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May 2016 Article Archive

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Older people with reverse mortgages charged unnecessary fees, suit claims
washingtonpost.com | May 30, 2016
To Retha Floyd, 95, taking out a reverse mortgage on her home seemed like a sensible way to pay for needed repairs and preserve the house for her descendants. But a $5 million class-action lawsuit filed this month alleges that two mortgage companies conspired to defraud Floyd and thousands of other elderly clients — including hundreds in the D.C. area — by charging them for home inspections that were both illegal and unnecessary. The charges were added to their loan amounts, resulting in less equity in the house.
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Big bank plans $420 million lawsuit over soured Countrywide loans
mpamag.com | May 30, 2016
HSBC plans to file a $420 million lawsuit against Bank of America and Merrill Lynch over soured Countrywide mortgage loans. HSBC notified the state of New York of its intention to file the lawsuit this week, claiming that Merrill Lynch and Bank of America allowed Countrywide loans to be securitized despite knowing they were toxic, according to a HousingWire report.
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Wells Fargo pays $70M for failures in foreclosure accord
charlotteobserver.com | May 28, 2016
Wells Fargo & Co. agreed to pay a $70 million penalty in ending the bank’s five-year fight to settle legal claims over foreclosure missteps after the 2008 credit crisis. U.S. regulators announced the fine for the San Francisco- based bank on Wednesday as part of an agreement that also frees the nation’s biggest mortgage lender from loan-servicing restrictions imposed last year.
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Sciaratta v. US Bank as Trustee
May 24, 2016
APPEAL from a judgment of the Superior Court of Riverside County, John Vineyard, Judge. Reversed and remanded. Stephen F. Lopez Esq. and Stephen F. Lopez for Plaintiff and Appellant. Keesal, Young & Logan, David D. Piper, Michael T. West and Joshua B. Norton for Defendants and Respondents.
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How one woman beat the big banks: The amazing, true story about how Wall Street’s mortgage fraud unraveled
salon.com | May 22, 2016
None of Lisa Epstein’s options for dealing with her foreclosure seemed very attractive. She could try the Home Affordable Modification Program, or HAMP, which President Obama announced from Mesa, Arizona, on February 18, 2009, the day after Lisa was served. She pulled the speech up at the White House website. The idea was that the Treasury Department would give mortgage servicers incentive payments to modify delinquent loans. In the speech, Obama kept stressing borrower responsibilities more than the responsibilities of fraudulent lenders or securitizing banks. Did he not understand how this crisis happened?
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The ins and outs of credit scores
latimes.com | May 22, 2016
Dear Liz: I've been using a free credit site to learn more about credit reports and credit scores. Recently I looked around and found reviews about how "horribly inaccurate" these free scores are. Where can I go to find my real FICO credit scores? I need the ones that matter, the ones that lenders use.
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Guild Mortgage becomes DOJ's latest target over alleged FHA-lending violations
housingwire.com | May 22, 2016
Over the last several years, lenders like Wells Fargo, Franklin American Mortgage, Walter Investment, First Tennessee Bank, Freedom Mortgage and M&T Bank chose to settle with the Department of Justice after being accused of originating and underwriting mortgage loans that did not meet Federal Housing Administration standards.
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407,000 More Victims of Government taking FNMA
investorshub.advfn.com | May 22, 2016
The government would like us to belive the only victims are ultra rich hedge funds. This is simply not true. Another Pension fund is in trouble, in no small part due to government confiscation of FNMA dividends, which many pension funds invest in.
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The Great Foreclosure Fraud
prospect.org | May 17, 2015
When millions of families lost their homes to foreclosure in the Great Recession, a nurse, a car dealership worker and a forensic expert blew the whistle on mortgage industry abuses. There is a rot at the heart of our democracy, rooted in a nagging mystery that has yet to be unraveled. It gnaws at people, occupies their thoughts, leaves them searching for answers in the chill of the night. Americans want to know why no high-ranking Wall Street executive has gone to jail for the conduct that precipitated the financial crisis.
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William K Black reveals Banker Control Fraud: epidemic of mortgage fraud is so large it hyper-inflated the housing bubble
bfcsa.com.au | May 15, 2016
The U.S. Treasury’s Office of Thrift Supervision noted last year (page 7): The FBI estimates that 80 percent of all mortgage fraud involves collaboration or collusion by industry insiders. This confirms what one of the country’s top fraud experts has said for years: that it was fraud by the big banks – more than anything done by the little guy – which caused the financial crisis.
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UBS urges judge not to hold it liable for mortgage bond losses
finance.yahoo.com | May 15, 2016
NEW YORK (Reuters) - UBS AG (UBSG.S) urged a U.S. judge on Friday to reject claims that it should be held liable for $2 billion (£1.4 billion) in losses that investors incurred on mortgage-backed securities issued before the collapse of the U.S. housing market. Lawyers for UBS made their closing arguments in the non-jury trial in Manhattan federal court in a lawsuit being pursued by U.S. Bancorp (USB.N) on behalf of three trusts established for mortgage-backed securities.
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M&T Bank settles federal fraud case for $64 million
democratandchronicle.com | May 15, 2016
M&T Bank will pay the federal government $64 million to settle a lawsuit that centered on how the company issued housing loans. In 2013, a former M&T underwriter Keisha Kelschenbach filed a whistleblower lawsuit against her former employer saying that she saw fraud in the bank's Federal Housing Administration underwriting. Her lawsuit prompted a U.S. Department of Justice investigation. From that investigation, the department found M&T had awarded loans that did not meet federal requirements.
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Wells Fargo admits deception in $1.2 bln U.S. mortgage accord
cnbc.com | May 12, 2016
Wells Fargo & Co admitted to deceiving the U.S. government into insuring thousands of risky mortgages, as it formally reached a record $1.2 billion settlement of a U.S. Department of Justice lawsuit. The settlement with Wells Fargo, the largest U.S. mortgage lender and third-largest U.S. bank by assets, was filed on Friday in Manhattan federal court. It also resolves claims against Kurt Lofrano, a former Wells Fargo vice president.
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SEC takes Wells Fargo to court to enforce subpoenas
reuters.com | May 12, 2016
U.S. securities regulators accused Wells Fargo & Co on Friday of repeatedly ignoring its subpoenas for documents in connection with a probe into the bank's $60 billion sale of mortgage-backed securities. The Securities and Exchange Commission's filing in a San Francisco federal court seeks to compel the fourth largest U.S. bank to hand over documents. The SEC said it has issued several subpoenas since September.
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Are We Heading for Another Housing Crisis?
money.usnews.com | May 12, 2016
Ten years ago, a storm was brewing in the housing market. Lenders were handing out mortgages seemingly to anyone who applied, and in many cases, borrowers weren't asked for documentation to prove income. Some institutions rolled out adjustable-rate mortgages that featured teaser rates and were marketed to consumers as loans that could be easily refinanced before the interest rate was scheduled to reset and send payments into the stratosphere.
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Scalia, Jesinoski, and the Process of TILA Rescission
May 11, 2016
Assignee liability is an important issue in rescission. The general rule for assignee liability, set forth in section 131 of TILA, 15 U.S.C. § 1641,8 is that the assignee of a credit transaction covered by TILA and Regulation Z is only liable for violations that are apparent on the face of the disclosure statement. However, section 131 specifically exempts rescission from this rule so a borrower could compel the assignee of a loan with violations triggering the right of rescission to rescind the loan, even though the violations are not apparent on the face of the disclosure statement.9 Thus, banks must be careful in purchasing loans subject to rescission.
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Is There a Deadline to Foreclose in California?
mccarthylawyer.com | May 10, 2016
From the desk of San Francisco lead attorney Alison Cordova: There are deadlines for foreclosure. Which deadline depends on what type of foreclosure and whether there is a maturity date in the note. In 1933, CA adopted Section 725(a) of the Code of Civil Procedure, essentially creating judicial foreclosure. That section provides: “The beneficiary or the trustee named in a deed of trust upon real property or any interest therein to secure a debt or other obligation, shall have the right to bring suit to foreclose the same in the manner and subject to the provisions, rights and remedies relating to the foreclosure of a mortgage upon such property.”
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How Old Can A Mortgage or Deed of Trust be and still be Enforced in California? The MRTA Provides An Answer.
calrealestatelawyersblog.com | May 10, 2016
The Marketable Record Title Act (MRTA, Civil Code section 882.02+) was enacted so that ‘ancient mortgages’ would not last forever. Prior to the act, lost or forgotten mortgages and deeds of trust would continue to be a cloud on title. The MRTA became law in 1982 to put an outside limit on the number of years that the power of sale in a deed of trust may be executed. The MRTA provides that if the “evidence of indebtedness” recorded with the county recorder contains a reference to the maturity date of the secured debt, the right to foreclose by private trustee’s sale will expire 10 years after maturity.
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The Marketable Record Title Act Made Easy
floridabar.org | May 10, 2016
Until passage of the Marketable Record Title Act (MRTA) in 1963, (1) an examination of title involved a review of all documents relating to the property recorded in the county in which the property in question was located from the earliest public records to the present. That lengthy process usually involved the purchase of an abstract of title from a reliable source and a review and analysis of every document and title transaction shown in the abstract.
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Wells Fargo told staff to keep quiet about missing papers
reuters.com | May 9, 2016
A former employee accused Wells Fargo & Co of instructing workers at a call center to refrain from telling customers about lost deeds or other missing documents, and of firing the worker who called the policy unethical, according to a lawsuit made public this week. Duke Tran, who was a customer service specialist at the bank, says that his supervisor berated him for telling a husband and wife that their loan contract was missing from an internal system.
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BIG FL Decision: Hurray for Judge Beatrice Butchko in Florida
May 6, 2016
THIS CAUSE having come before the Court for Trial on March 17 and 18, 2016, and the Court having reviewed Defendant’s Motion for Sanctions Under the Court’s Inherent Contempt Powers for Fraud Upon the Court, and being otherwise advised in the premises, it is hereupon: ORDERED AND ADJUDGED that Defendant’s Motion for Involuntary Dismissal after Trial is GRANTED for the following reasons.
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Another win for the homeowner in the Appellate Court
May 6, 2016
Oscar Bustamante appeals from a judgment dismissing his lawsuit against respondents U.S. Bank, N.A., and Wells Fargo Bank, N.A., after the trial court sustained their demurrer to his second amended complaint without leave to amend. Bustamante’s complaint followed a well-worn path trodden by many former homeowners who lost their homes in the wave of foreclosures during the recession.
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Millennials are moving, but mortgages don’t follow
cnbc.com | May 5, 2016
It is the No. 1 barrier to entry for young, would-be homebuyers: credit. Millennials are the first generation to come of age in a post-almost-apocalyptic housing market, where lenders, eight years later, are still paying billions in reparations for mortgage misconduct and outright fraud. Millennial homebuyers are also paying a price.
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Bank of America Corp Settles Fraudulent Mortgage-Backed Securities Lending Charges
bidnessetc.com | May 5, 2016
Bank of America Corp. (NYSE:BAC) has agreed to settle the charges over the sale of mortgage-backed securities prior to the financial crisis of 2008. The Federal Home Loan Bank of Seattle filed the lawsuit in 2009. The lender reached a settlement worth $190 million, according to the filing cited by Bloomberg.
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Judge approves Goldman Sachs $272 million toxic mortgage settlement
housingwire.com | May 5, 2016
In August, Goldman Sachs agreed to pay $272 million to settle a lawsuit brought by an Illinois electrical workers’ pension fund over losses suffered due to alleged misrepresentations of the quality of mortgage loans that backed crisis-era mortgage-backed securities. On Monday, a federal judge approved the proposed settlement between Goldman Sachs and NECA-IBEW Health & Welfare Fund, an electrical workers' pension fund in Decatur, Illinois, finding it to be “fair, adequate and reasonable,” according to a Bloomberg report.
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Presumptions, Pleading, Procedure and Proof Really Matter in Foreclosure Actions
livinglies.wordpress.com | May 5, 2016
In the final analysis nearly all foreclosures have been rubber-stamped based upon facts that are presumed to be true but which are untrue. In my opinion every case lost by homeowners has been the result of the court using legal presumptions and shifting the burden of persuasion onto the homeowner who has been stonewalled, with the court’s help, during discovery and stonewalled before there was any foreclosure when the homeowner submitted qualified written requests and debt validation letters. Hence the court shifts the burden to the homeowner and then helps the bank by not allowing access to information that would prove that the presumed fact is rebutted by competent evidence.
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Seven big banks settle U.S. rate-rigging lawsuit for $324 million
finance.yahoo.com | May 4, 2016
NEW YORK (Reuters) - Seven of the world's biggest banks have agreed to pay $324 million to settle a private U.S. lawsuit accusing them of rigging an interest rate benchmark used in the $553 trillion derivatives market. The settlement made public on Tuesday, which requires court approval, resolves antitrust claims against Bank of America Corp <BAC.N>, Barclays Plc <BARC.L>, Citigroup Inc <C.N>, Credit Suisse Group AG <CSGN.S>, Deutsche Bank AG <DBKGn.DE>, JPMorgan Chase & Co <JPM.N> and Royal Bank of Scotland Group Plc <RBS.L>.
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BANK OF AMERICA: We've never seen investors rush to sell stocks like this before
businessinsider.com | May 5, 2016
Bank of America Merrill Lynch's big-money equity investors are rushing for the exits. In a note Tuesday, equity and quant strategist Jill Carey Hall said the firm's institutional clients were net sellers of stocks for a 14th straight week. That's the longest such streak the firm has seen since it started keeping track in 2008.
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Big bank VP and family members headed to prison for mortgage fraud
usnewsnow.org | May 5, 2016
A former SunTrust executive, his wife and her brothers are headed to federal prison for mortgage fraud. Moshin Raza, his wife, Humaira Iqbal, and her brothers Farukh Iqbal and Mohammad Ali Haider will all serve time after being convicted for their part in faking loan documents and committing mortgage fraud. All four were employed by SunTrust Bank when they committed the fraud, according to the U.S. Attorney’s Office.
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Seven big banks settle U.S. rate-rigging lawsuit for $324 million
finance.yahoo.com | May 4, 2016
NEW YORK (Reuters) - Seven of the world's biggest banks have agreed to pay $324 million to settle a private U.S. lawsuit accusing them of rigging an interest rate benchmark used in the $553 trillion derivatives market. The settlement made public on Tuesday, which requires court approval, resolves antitrust claims against Bank of America Corp <BAC.N>, Barclays Plc <BARC.L>, Citigroup Inc <C.N>, Credit Suisse Group AG <CSGN.S>, Deutsche Bank AG <DBKGn.DE>, JPMorgan Chase & Co <JPM.N> and Royal Bank of Scotland Group Plc <RBS.L>.
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Total Annihilation of a Bank Lawyer and Their Witness!
May 2, 2016
We recently finished up a trial in Broward County, Florida. The Plaintiff’s witness was very qualified, at something, as an employee for 8 years with Seterus, only I’m not sure at what. After a lengthy cross on her general background and “qualifications” in which relevance objections started to be sustained, Plaintiff goes to move the note into evidence. I offer to stipulate to the note coming in, if Plaintiff agrees to stipulate that the original was first filed in this case on 2/26/14. Suit was filed on 12/27/11. Opposing counsel agrees. The Plaintiff then asked background questions on the note. I object relevance, cumulative, we can let the evidence speak for itself. Sustained.
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It’s Harder to Own a Home Now Than Anytime in Nearly Half a Century
time.com | May 1, 2016
Gen Xers and Millennials are still locked out of the housing market. The stock market is chugging along. Employers are adding jobs at healthy clip. But, a decade after the housing crisis, Americans are still finding it harder to become homeowners than at any time since the late 1960s. The national home-ownership rate fell to 63.5% in the first quarter of 2016, down from 63.8% in late 2014, according to a recent report by The Wall Street Journal. That’s only a hair above the 48-year low of 63.4% hit in 1967. Yes, when The Doors released ‘Light My Fire’ and Carl Yastrzemski led the Red Sox to a surprise pennant.
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Freddie Mac may need another taxpayer bailout next week
marketwatch.com | May 1, 2016
Freddie Mac FMCC, -1.21% is expected to report a loss when it announces first-quarter earnings before the bell on Tuesday. That’s bad news for any public company, but especially critical for the mortgage provider because of its tangled history with the federal government.
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