2010  CaseClarity dot com  

Florida Judges, Others: Hoodwinked

Florida’s judiciary seems to
have been persuaded by the mortgage industry that economic recovery
cannot begin until all these nonperforming mortgage loans are off the
bank’s books and the properties are made available back into the
market.  I reach this conclusion because of comments that I have
personally heard made by judges, including one at a foreclosure defense
seminar last year.  Unfortunately, this is a shallow argument advanced
by an industry having little else to offer.  The judiciary, like others
victimized by the mortgage industry, has been hoodwinked.

– 1.  To deceive; trick; take in.  2. To blindfold.  3.  To Conceal – The American Heritage Dictionary

To deflect attention away from
the main legal problems each plaintiff has in bringing defective
mortgage foreclosure actions, the industry continues to push these cases
through just as if there had been no requirement to comply with rules
of civil procedure and long-standing law for a plaintiff to prove its
right of action.  This is a game of musical chairs taking place right in
our courts.  Let’s examine the layers of real people being victimized
by the mortgage industry.

The Sub-Prime

The first group victimized by the
mortgage industry and their buddies at Wall Street were the sub-prime
borrowers – some who should have never obtained a mortgage loan but
rather should have been protected by the safeguards our financial system
uses to keep the economy in balance.  The mortgage industry cast a
spell that was framed out in hope and entitlement to home ownership
which ultimately led good people buy into a false expectation.  Sub-prime borrowers:

Investors of MBS Certificates

Next up are the investors or
purchasers of certificates of mortgage-backed securities who bought the
hogwash being peddled by Wall Street.  Now that their investment value
has evaporated these are the same people often holding out for more
bailout money so they recoup some of their money.  Investors of MBS securities

Consumers with Good Credit

A huge group falling victim to the
financial carnage is comprised of lots of good people with good
financial net worth and excellent credit.  For all kinds of reasons
these consumers bought into the roller coaster ride, absent the safety
catches, and fell off.  Consumers
with excellent credit and capital hoodwinked

When the
I-can’t-make-these-payments wake-up call finally came for borrowers it
was a straight shot by the mortgage company to the courthouse for a
judgment to sell the property.  The next target in the game:  judges. 
The mortgage industry already knew there existed an institutionalized
bias favoring banks that it would not take much work to obtain judgments
and sell the property.  So the industry and their attorneys put in
whatever they could get away with in front of judges and got judgments. 
Truth be told that is still going on.  Now that so much has been
revealed by consumer advocates across the US, and by judges actually
paying closer attention, it’s hard not to think that many judges in this state
are now feeling –
well, hoodwinked

Title Companies

Now that so many foreclosure
judgments have been entered on weak and often improper or fraudulent
grounds the next wave of cases the courts will likely see is a barrage
of disputes between title companies and parties claiming to have been
improperly dispossessed of their real property.  There can be no doubt
that these problems and related litigation will make the cost of real
property ownership to be higher and riskier in Florida.  Title companies
who have insured deeds to Florida real property are not immune from the
coming avalanche of litigation over property disputes.  But, they can
thank the mortgage industry for destabilizing Florida real property
titles with defectively/fraudulently obtained judgments .  Title companies,


Like those in the title industry
investors having purchased real property during this time of uncertainty
stand to also be drawn into disputes over the validity of the judgment
leading to their opportunity for purchasing houses at foreclosure sale.
For those investors active in buying Florida distressed real estate, and
who are not spooked by the prospect of being drawn into litigation over
the validity of judgments, the key would be to quickly sell what they
have purchased and make it someone else’s problem.  However, buyers of
real property at foreclosure sales have a huge risk where a foreclosure
sale has been set aside after proceeds have already been delivered to
the mortgage company.  Under Florida law the mortgage company does not
have to return these proceeds but rather the buyer of the property,
whose clerk-issued deed becomes void, assumes the rights of whatever the
mortgagee had at the time of judgment.  Buyers of these properties
better observe that the judgment was properly obtained, otherwise they
stand to suffer the same net result: Investors, hoodwinked.

Continuing Abuse Perplexing

With so much overreaching by the
mortgage industry – beginning with first offering loans all the way
through to getting over on judges and post-judgment investors – it
remains perplexing how they continue to get away with these practices. 
Perhaps they know something we don’t.  These companies and their counsel
keep advancing legal arguments not on solid ground and often bringing
forth documentary evidence fabricated solely for the purposes of
propping up the foreclosure judgment.  One view unavoidable to consider
is that Florida dockets may not have exploded with mortgage foreclosure
actions, as they have, if judges here had consistently and uniformly
rejected shoddy foreclosure pleading practices early upholding the
then-existing set of rules and case law that should have blocked these
tactics in the first place.

Last to Know – But Now They Know

Blaming the judges now is of
little help and they also have a point to consider.  Judges are not
ordinarily the first to learn about practices that are
deceptive, fraudulent or in some way in violation of the law.  These
come to the court after someone has examined the facts and advanced a
claim or a charge.  So, it is a natural consequence that the judges were
among the last to learn about the abuses by the mortgage industry – in
any real detail.  So until the judiciary got up to speed on what was
actually going on they too were victims of the mortgage industry’s
deception.  It’s no small wonder that foreclosure cases were moving
through the courts at breakneck speeds.  The mortgage companies had to
get these through before someone discovered all of the details and
brought these to the court’s attention.  Now that judges “know better”,
in no small part due to the consumer law defense attorneys, it remains
an open question as to what they will do about it.  One thing is for
sure, judges are no longer being hoodwinked – unless they let it
happen.  Judges now know it is time to put to a stop this madness
advanced by the mortgage industry and their attorneys.  Doing otherwise
would reward the long line of deception with approval of our good
state’s courts.  That
cannot possibly be the will of Floridians or of its trusted judiciary