is a plan that is current in its evolution but by no means complete or
the last word. The assumption here is that even without taking mortgage
foreclosure cases into consideration, the percentage of cases that
actually go to trial is between 5%-15% depending upon how you
categorize “cases.” On the other hand, if you are not prepared for
trial and counting on settlement, your opposition will generally know
it and have the upper hand in negotiating a settlement.
WORD OF CAUTION: IF YOU
ARE ALREADY IN PROCESS, YOU ARE REQUIRED TO ACT WITHIN THE TIMES SET
FORTH BY STATE LAW, FEDERAL LAW, OR THE LAWS OF CIVIL PROCEDURE.
FAILURE TO DO SO LEAVES YOU IN AN UPHILL BATTLE TO REVERSE ACTIONS
CONSIDER BANKRUPTCY, ESPECIALLY CHAPTER 13, WHERE THERE ARE MORE REMEDIES THAN YOU MIGHT THINK IF YOU FILL OUT YOUR SCHEDULES PROPERLY. WE ARE SEEING BETTER RESULTS IN BANKRUPTCY COURTS THAN FEDERAL OR STATE CIVIL COURT PROCEEDINGS.
- Get your act together, stop fighting amongst the members of your
household and make a decision as to what you want to do — fight or
- If you choose flight, then by all means try the short-sale or
jingle mail strategies that have been discussed on this post. Do not
try to make money on the short-sale, since nobody is going to give it
to you. You can make a few dollars by riding out the time in
foreclosure without making payments (and hopefully saving the money you
would have paid) and by negotiating as high a price (a few thousand
dollars) as you can in a deal known as “cash for keys.” Even for this,
you should employ the services of a local licensed attorney — at least
- If the decision is fight — then the second decision to make is to
answer the question “fight for what?” If you want to buy time, there
are many strategies that can be employed, which basically are the same
strategies as those used if you are fighting for real. And you might be
surprised by the result. Some people get a year or two or even more
without payments. You are going to take a FICO hit anyway so why not
put some cash in your pocket while you hold back payments.
- AVOID crazy deals where you give your property or share your
property with a stranger. If you persist in engaging such people at
least call references and make sure the references are real. Ask
questions about their situation and how they feel it worked out to
them. Get as much detail as possible.
- AVOID mortgage modification firms. If you persist in engaging such
people at least call references and make sure the references are real.
Ask questions about their situation and how they feel it worked out to
them. Get as much detail as possible.
- In all cases, if at all possible:
(a) Get all your information together along with a short executive
summary of your “journal” (even if you create the journal now). That
means all closing documents, any information you have on title,
recording in the county recorder’s office, the names of all parties who
were “at” closing (that means not just the actual people who were
there, but he names of companies that were represented or mentioned at
closing). Also, include in the file any notices of default(NOD) or
notice of Trustee sale(NOTS) or summons from a court.
(b) Get a TILA Audit of the loan transaction itself.
(c) Get a Forensic Mortgage Analysis of your mortgage to determine
whether the loan was securitized and who the real parties are in the
transaction. Who is your creditor? The TILA Audit alone does nothing
without taking further steps. The Trustee’s “Take-down” report should
be demanded in non-judicial states and if the house is in foreclosure,
your written objection should be sent to the Trustee.
(d) If someone tells you they are “pretty sure” or can
“definitely” stop your foreclosure or promises a favorable outcome,
and asks for money up front, then run like hell. This is a scam.
(e) Only a Court order stops foreclosure or a Trustee Sale. No
letter of any form or substance will stop it unless the other side is
intimidated into stopping the action, which sometimes happens when they
know their paperwork is “out of order.”
(f) Get a Forensic Mortgage Analysis Report that summarizes in a few pages the potential issues that you should be investigating.
(g) Get an Expert Declaration that uses the forensic report and the
expert opinions of specific experts (like appraisers, title analysts)
and which identifies the probable chain of securitization and the money
trail. You’ll be surprised when you find out there were two yield
spread premiums not disclosed to you and that they can total as much or
more than the “loan” itself. GET EXPERT OPINION ON PROBABLE DAMAGES
INCLUDING RETURN OF UNDISCLOSED FEES, INTEREST, ETC. (SEE LAWYER’S
WORKBOOK FROM GARFIELD CONTINUUM).
(h) Send the Forensic Report and expert declaration to the known
parties, with an instruction to forward it to all other parties known
to them in the securitization chain. Include a Qualified Written Request(QWR) AND a Debt Validation Letter(DVL) (which is really a debt verification
letter). Don’t be surprised if your pretender lenders will come back
and tell you your QWR is defective or improper in some way, but that’s
OK, you have followed statutory procedure and they didn’t. With the
help of an attorney and with consultation with your experts decide on
what resolution you will demand — damages, rescission, etc.
(i) Don’t believe a word about modification.
Practically none of them go through. They are leading you into default
so they can collect more service fees, and get money out of you that
you think is stopping the foreclosure.
(j) Don’t believe a word that any pretender lender or representative
says or represents, even if they are a lawyer, particularly verbal
communications that they refuse to confirm in writing. Challenge
(k) Don’t accept any document as authentic. Many documents are being
fabricated or forged, including affidavits. This is why you need a
lawyer and an expert and a Forensic mortgage analysis — to determine
what documents and parties are suspect and what you should be asking
for in discovery and in the QWR and DVL.
(l) YOUR FIRST STRATEGY IS TO RAISE NOT PROVE
ISSUES OF FACT. BY PRODUCING A FORENSIC REPORT AND EXPERT DECLARATION,
NEITHER YOU NOR YOUR LAWYER NEEDS TO ACQUIRE EXPERTISE IN SECURITIZED
LOANS. YOU ONLY NEED TO RAISE THE ISSUE OF FACT BY SHOWING THE COURT
THAT YOU HAVE EXPERTS WHO SAY THE PRETENDER LENDERS/TRUSTEES ETC. ARE
NOT CREDITORS AND NOT AUTHORIZED AGENTS WORKING FOR THE CREDITORS. THEY
SAY THEY ARE IN FACT THE CREDITORS OR HAVE SOME AUTHORITY GRANTED BY AN
ALLEGED CREDITOR. IT IS NOT FOR THE COURT TO ACCEPT ONE VIEW OR THE
OTHER, BUT RATHER TO ALLOW DISCOVERY AND AN EVIDENTIARY HEARING ON THE
ISSUE OF STANDING (SEE RECENT FLORIDA CASE).
(m) Be very aggressive on discovery. They will argue that even if
they are not the creditor and even if they refuse to disclose the
identity of the creditor, they are still entitled to disclose because
they are the holder of the note and/or mortgage. Your argument will
probably be that they still have a duty to disclose the identity of the
creditor and the source of the their authority to represent the
creditor, along with proof that the creditor has received notice of