Connecticut Renter Facing Foreclosure Eviction Invokes New Bailout Law In Attempt To Fight Off Fannie

In Hartford, Connecticut, The Hartford Courant reports:

• Four days after Evelyn Colon paid the September rent for her Hartford apartment, a U.S. marshal knocked on the door. He handed her a notice that she had to be out in a month. Fannie Mae, the huge mortgage financier, had foreclosed on her building and was evicting Colon and two other tenants.

• Colon is now fighting her eviction in what her attorneys believe is the first court challenge in the country to use a provision(1) deep within the government's $700 billion bailout legislation to seek protection for renters facing eviction after foreclosure. She will be able to stay in her apartment while the case is litigated.

***

• Colon's attorneys at Greater Hartford Legal Aid Inc., an agency that helps low-income clients, are arguing that Fannie Mae became a federal agency when it came under the control of the Federal Housing Finance Agency Sept. 7 and is therefore bound by the financial services bailout legislation.

For the rest of the story, see Hartford Tenant Fights To Stay In Home After Foreclosure (if link expires, try here or try here).

See also, WTNH-TV Channel 8: Renter fights back against foreclosure:

• "Basically we've asked the court to throw this case out, the eviction, out of court, or, if the court doesn't feel comfortable doing that, to kind of put things on pause until the Treasury or another federal agency, perhaps the F.H.F.A. (Federal Housing Finance Agency), issues a policy statement saying what does the language in the Bailout Bill mean," said Stephanie D'Ambrose from Greater Hartford Legal Aid.

(1) Section 109(b) of the Federal bailout bill may require the U.S. Secretary of the Treasury to work with the F.H.F.A. and other government entities to permit tenants like Evelyn to remain in their apartments after foreclosure. BetaTenantRentSkimming

L.A. Official Calls For Stop To Illegal Foreclosure Evictions; Lender Accused Of Stiffing Booted Tenants Out Of $7K "Relo Fee" Required By City Law

In Los Angeles, California, CBS 2 reports:

• Los Angeles City Council President Eric Garcetti called Friday on Countrywide Home Loans to stop the practice of evicting tenants from apartment buildings that have gone into foreclosure. The councilman pointed to the case of Johnny Lee, who lives in a triplex in Echo Park. Following foreclosure, Countrywide allegedly pressured Lee to leave the apartment and offered him a $2,000 relocation fee. City law requires a $7,000 fee in such cases, according to Garcetti.

• A representative for Countrywide was not immediately available for comment. "It's really frustrating, and I feel like I was duped," Lee said. "I had no idea that this was illegal and that I had a right to stay or to a minimum amount of money. In fact, I was told I would have to be out within 30 days and didn't have the right to any money, even my security deposit," he said. "I encourage others in this situation to learn more about their rights as tenants."

• In a letter to Countrywide, Garcetti said the Calabasas-based company attempted a similar eviction earlier this year in South Los Angeles. "Months later, it appears that Countrywide and its agents continue to violate city law by illegally pressuring tenants to vacate foreclosed properties and offering relocation fees below what is required by law," Garcetti wrote. "I am writing to ask that your company cease and desist illegal foreclosure-related eviction practices immediately. In addition, Countrywide must bring its eviction practices and guidelines into compliance with the city's Rent Stabilization Ordinance."

Source: Councilman To Countrywide: Stop Illegal Evictions.

See also: Countrywide to EP tenants: get moving. BetaTenantRentSkimming

Forensic Loan Review Firms Begin To Pop Up Offering To Find Errors In Loan Docs For Homeowners Fighting Foreclosure

A syndicated column in the Los Angeles Times reports:

• Homeowners who are having difficulty getting the attention of their lenders to discuss their troubled mortgages might want to obtain a forensic loan review to determine if their lenders made any mistakes when the mortgage was issued.

***

• In a forensic loan review, a legal pathologist scours your loan documents looking for errors in, among other things, the truth-in-lending statement the lender provided shortly after you applied for your mortgage and the lender's annual percentage rate calculation so you could compare loan costs. If the truth-in-lending statement doesn't match the HUD-1 closing-cost sheet you received at closing, if the APR is off by just a hair, you might have cause for legal action against the lender.

For more, see Errors in loan documents can save strapped homeowners (Even small mistakes in the paperwork may give borrowers the legal leverage to persuade lenders to rework their mortgages).

----------------

For a recent story of a foreclosure mitigation company which offers to audit and find errors in loan documents and promises homeowners help in fighting foreclosures, and which is now being sued by the Florida attorney general for alleged deceptive practices and the unauthorized practice of law, see:

• Lauderdale firm didn't deliver mortgage relief, state suit alleges (Lauderdale company denies wrongdoing and says it was let down by law firms it trusted to help individuals),
• Broward Foreclosure Debt Mitigation Company Sued for Deceptive Practices. UndoMortgageLoans TILAdelta

Texas Man Sues To Void Deed In Alleged Land Swindle

In Beaumont, Texas, The Southeast Texas Record reports:

• A Jefferson County man has filed suit against a Beaumont couple and the woman's mother, claiming their conspiracy against him has forced him to lose property that belongs to him. Glen Ray Waldrop claims he is the owner of 3.27 acres located [...] in Beaumont.

• He entered into what he believed to be a contract for deed with Jeff Allen and Theresa Ann Theal in May 2001, according to the complaint filed Oct. 21 in Jefferson County District Court. In the contract for deed, Waldrop believed the Theals would purchase the property through monthly installments, the suit states.

***

• In fact, the document Waldrop signed was a general warranty deed, transferring ownership of the property to the Theals, he claims. [...] Waldrop knew nothing about the general warranty deed or [the mother's] role until the Theals ceased their monthly payments in April 2007, the suit states.

For more, see Disabled man claims he was swindled out of property by local couple.

Go here, go here, go here, and go here for other posts related to deed theft by forgery, swindle, etc. DeedTheftAlpha

Iowa Widow Seeks To Stop Foreclosure, Void Deed & Mortgage; Claims Now-Deceased Husband Forged Her Signature On Legal Documents

In Polk County, Iowa, the Des Moines Register reports:

• Ed Boesen's widow says she has rights to two commercial properties because her husband forged her signature on a loan document and a property transfer document. Maureen Boesen is asking a judge to clear the titles on two properties despite more than $5 million worth of defaulted loans on them.

• Lawyers for Maureen Boesen, as well as James Monroe, attorney for the Boesen estate, made the claim in Polk County District Court in response to two lawsuits filed by lenders against Boesen's estate. The lawyers contend Ed Boesen forged his wife's signature on a mortgage document on one of the properties and on a deed transfer on the other.

• "Maureen Boesen asserts she owns the property and that the signatures on documents are without her authority," a motion filed last week by her lawyers says. As a result, neither loan is valid, the lawyers claim.

For more, see Boesen widow alleges forgery.

Go here to compare Mrs. Boesen's actual signature with those that were allegedly forged.

Go here, go here, go here, and go here for other posts related to deed theft by forgery, swindle, etc. DeedTheftAlpha

Feds, 23 States Join In "Operation Clean Sweep" In Attempt To Nail Credit Repair, Loan Modification, Debt Relief Operators

From the Florida Attorney General's Office:

• Attorney General Bill McCollum [last week] announced Florida’s participation in a collaborative effort targeting credit repair operators, many of which deceptively claim they can remove any and all negative information from consumers’ credit reports.

• The Federal Trade Commission (FTC) and 23 states joined forces in Operation Clean Sweep, a nationwide initiative to address this consumer protection issue. “Whether through credit repair, debt management, debt settlement, or interest rate reduction schemes, it is unacceptable to deceptively convince consumers facing financial distress to part with their money,” said Attorney General McCollum. Collectively, the FTC and the states took actions against 36 companies engaged in potentially deceptive or misleading conduct.

For more, see Florida Joins FTC, States Targeting Credit Repair Operations in "Operation Clean Sweep."

See also: Palm Beach Post: Claims of debt fraud soaring (Until he can persuade lawmakers to impose rules, Florida Attorney General Bill McCollum hopes lawsuits his office has filed and its investigations "send a message to this industry that preying on consumers in financial distress will not be tolerated.").

For the Florida AG's recent press release on a recent civil suit filed in this regard, see Broward Foreclosure Debt Mitigation Company Sued for Deceptive Practices.

Mortgage Loan Modification Companies Beginning To Draw Attention From Feds, Lawmakers

In Modesto, California, The Modesto Bee reports:

• The Justice Department is gearing up to probe potential scams targeting distressed homeowners in the San Joaquin Valley. On Friday, Rep. Dennis Cardoza, D-Merced, urged Attorney General Michael Mukasey to investigate mortgage-reduction schemes marketed in the region.(1)

• For an upfront fee, homeowners are being told their monthly mortgage payments can be renegotiated. At best, the homeowners may end up paying for work that's available for free. At worst, they'll pay for work that isn't done at all.

***

• The questionable solicitations come in different ways. Phone calls offering mortgage negotiation services have been ringing through the San Joaquin Valley for several months. [...] Official-looking letters are arriving in valley mailboxes, some citing congressional bill numbers or phone numbers for a "loss mitigation department."

• And Thursday in Modesto, some homeowners attended a workshop in which they were asked to pay $3,500 to get their mortgage woes resolved. Typically, the companies offer to renegotiate a mortgage in exchange for an upfront fee amounting to one month's mortgage payment, or more.

For more, see Loan-help schemes scrutinized (Claims to fix mortgages for fee set off red flags for the feds and Cardoza) (may require free registration).

(1) It may be that, in California, the services marketed by these operators may already be regulated under the state law regulating the conduct of foreclosure rescue operators who provide mortgage consulting services to financially distressed homeowners. The law, among other things, specifically prohibits the collection of an upfront fee. For the law, see California Mortgage Foreclosure Consultants Act - Section 2945 through Sction 2945.11 of the California Civil Code, as recently amended this year by AB 180, Mortgages: foreclosure consultants.

Arizona BBB Warns Of Possible Loan Modification Scams

The Better Business Bureau of Greater Arizona reports:

• In today’s economy, most homeowners would welcome a lower interest rate on their mortgage, which could result in a lower monthly payment. This has opened the door for loan modification companies to take advantage of consumers more than ever.

• Better Business Bureau is receiving reports from concerned Arizona consumers who are being solicited by unknown companies offering to help them reduce the interest rate on their mortgage loan.

• “The majority of the consumers being targeted by phone tell us they have never been late on their payments and are not even close to facing foreclosure,” said Matthew Fehling, President/CEO of BBB. “Consumers are being advised by these companies to stop making their mortgage payments and negotiate a lower interest rate. This is a definite red flag,” added Fehling.

For more, see BBB Warns Consumers about Loan Modification Phone Calls.

Reports Of Hedge Fund Threats Against Loan Servicers Making Loan Modifications Outrage Lawmakers

In Washington, D.C., Politico reports:

• Barney Frank is not happy with hedge funds. Specifically, he and other top House Democrats are “outraged” that some hedge funds are telling mortgage service companies not to modify distressed mortgages with the help of the government program Frank helped craft.

• The New York Times reports that at least two hedge funds told servicers they might take action against them if the servicers participated in the government program to help homeowners avoid foreclosure. The program, which became law in July, just took effect at the beginning of October.

• Frank (D-Mass.) and four other Democratic members of his Financial Services Committee wrote an angry letter to the CEOs of the hedge fund companies named in the article, Braddock Financial Corporation and Greenwich Financial Services. The lawmakers wrote that they “strongly urge” the companies to reverse their position on the modification issue and informed each CEO that they’re scheduling a Nov. 12 hearing at which both will be asked to testify.

For more, see Frank threatens financial industry, calls hearing.

See also:

• House Financial Services Committee press release: Lawmakers Demand Hedge Funds Drop Opposition to Foreclosure Prevention,
• Letter to Braddock Financial Corporation,
• Letter to Greenwich Financial Services,
• Letter to Managed Funds Association.

Disbarred Florida Attorney Gets 10 Years For His Part In Alleged Sale Leaseback, Foreclosure Rescue Scam That Defrauded 50+ Homeowners

In Tampa, Florida, WTSP-TV Channel 10 reports:

• A federal judge has sentenced a disbarred lawyer to ten years in prison on his guilty plea to a mortgage scheme that stole the equity from more than 50 homeowners. Graham Daniel Kligerman, 34, of Clearwater, was also ordered to pay $6.5 million in restitution. The U.S. Attorney's office said Kligerman was part of a mortgage foreclosure rescue scheme that defrauded more than 50 homeowners.

For more, see Disbarred lawyer sentenced in mortgage fraud.

See also:

• U.S. Attorney (Tampa, Florida) Press Release: Clearwater Man Sentenced To Ten Years For Mortgage Fraud,
• The Tampa Tribune: Clearwater Lawyer Gets 10 Years For Real Estate Scam,
• St. Petersburg Times: Disbarred Clearwater lawyer gets 10 years in Florida mortgage scheme,
• Original Criminal Complaint - U.S. v. Kligerman,
• Go here for more on Graham Kligerman.

Go here for criminal prosecutions of foreclosure rescue operators and home equity scammers.

For more on equity stripping scams, generally, see DREAMS FORECLOSED: The Rampant Theft of Americans' Homes Through Equity-stripping Foreclosure 'Rescue' Scams (4.61 MB approx.).

DC AG Settles Civil Suit With Title Closing Agent In "Money Store" Equity Stripping, Sale Leaseback Foreclosure Rescue Scam

In Washington, D.C., the Office of the District of Columbia Attorney General announced:

• Acting Attorney General Peter Nickles announced [yesterday] that the District has entered into a consent order with a title settlement company and its principal which participated in the Metropolitan Money Store mortgage rescue scam. The companies, Regional Title & Escrow, LLC and RTE Title LLC, and their principal, Valeria Tomlin, are permanently prohibited from performing settlement services in the District and will pay $575,000 to homeowners in the District of Columbia and Maryland who were stripped of title and substantial equity in their homes. The settlement is subject to approval by the DC Superior Court.

• The District’s complaint alleged that Tomlin and her title companies performed settlement services and otherwise participated in mortgage loans they knew were not bona fide. In entering into the consent judgment, Tomlin and her title companies denied that they engaged in wrongful conduct.

[...]

• The complaint also alleges that Metropolitan Money Store conducted a major mortgage rescue scam in which it targeted 25 homeowners in the District of Columbia. As part of a “Foreclosure Reversal” scheme, Metropolitan Money Store and others falsely promised to help the homeowners avoid foreclosure, keep their homes, and repair their damaged credit. Metropolitan Money Store then diverted proceeds from purported sales of these homes to itself and related companies.

• The District continues to seek relief for victimized homeowners from other defendants in its lawsuit filed in Superior Court, District of Columbia vs. Metropolitan Money Store, et al., Civil Action No. 6023-07 B.

For the D.C. AG's press release, see District Announces Agreement With Title Settlement Company in Mortgage Rescue Scam.

Go here and go here for other posts on the alleged Metropolitan Money Store foreclosure rescue scam. joyjackson

NJ AG Targets 39 In Suits Alleging Equity Stripping, Sale Leaseback Scams; Involved $13.5M In Bogus Loans & 48 Homeowners Screwed Out Of $3M+, Says AG

In Bergen County, New Jersey, The Star Ledger reports:

• Forty-eight New Jersey property owners have lost more than $3 million in home equity through "foreclosure rescue" schemes operated by Vest Financial and JP Global Property Management Inc., according to civil lawsuits filed by the state Attorney General's office.

• The lawsuits accuse the two companies, as well as 37 mortgage loan providers, mortgage industry employees, lawyers and others of violating the state's Consumer Fraud Act and the Racketeer Influenced and Corrupt Organizations Act. The state is seeking restitution for the property owners, penalties and permanent bans to keep them offering similar schemes to others.

***

• [New Jersey Attorney General Anne] Milgram said the companies preyed on desperate homeowners behind on their mortgages by persuading them to sell their properties to third-party investors as part of complex "sale and lease-back" schemes. [...] Vest Financial and JP Global never followed through on their promises. Instead, Milgram said, the companies stripped the homes of their equity value through the scheme and left the homeowners with no means to pay rent and with ruined credit histories.

For more, see State accuses firms of running predatory 'foreclosure rescue' schemes.

See also: Legal Newsline: Milgram: Foreclosure rescue schemes nothing but fraud ("Milgram says the defendants used predatory foreclosure rescue schemes to convince homeowners to sign over their homes, obtained at least $13.5 million in fraudulent loans and stole at least $3 million in homeowner equity.").

From the New Jersey Attorney General's office:

• NJ AG's lawsuit #1: Milgram v. Vest Financial LLC, et al.,(1)
• NJ AG's lawsuit #2: Milgram v. JP Global Property Management, Inc., et al.,(2)
• NJ AG's press release: Attorney General Sues Foreclosure Rescue Operations for Fraud and Racketeering (Defendants Allegedly Preyed on Homeowners Desperate to Avoid Foreclosure).

Go here for criminal prosecutions of foreclosure rescue operators.

For more on equity stripping scams, generally, see DREAMS FORECLOSED: The Rampant Theft of Americans' Homes Through Equity-stripping Foreclosure 'Rescue' Scams (4.61 MB approx.).

(1) The Defendants in this lawsuit are: Vest Financial, formerly of Paramus; Metropolitan Mortgage Services, Inc., of Cliffside Park; Alex Armani of Cliffside Park; Sohrab Moussavian of Englewood; Anthony Scordo III of West Orange; Felix Nihamin, an attorney who resides in Franklin Lakes and practices in New York City; Francis A. Ciambrone, an attorney with law offices in Paramus; Rhys A. Herrmann, of Belleville; JP Global Property Management LLC of Bloomfield; Peter H. Eckhardt, Jr. of Livingston; Philip Altieri of Flemington; Kristopher Pilone of Manalapan; DBK Realty Investments LLC of Edison; Tom A. Andriopoulos of Washington Township (Bergen County); Settlement Source, LLC of Edison; Vivian M. Ruiz of Hillsdale; and Glen B. Thompson, New York City.

(2) The Defendants in this lawsuit are: JP Global Property Management; Jeremy P. Sorvino of Waldwick; Jeffrey M. Malen of Ringwood; Peter Eckhardt, Jr.; Christopher William Eckhardt of Washington Township, (Bergen County); Anthony Scordo III of West Orange; Nihamin; Michael J. Andalaft, an attorney with law offices in Cedar Grove; Capital Hill Mortgage, Inc.; Stanley Capital Mortgage Company, Inc. of Englewood Cliffs; Rhys A. Herrmann of Belleville; Brendan Joseph Flynn of Fort Lee; Maryann E. Sorvino of Ridgewood; Frances B. Benna of Elmwood Park; Vincent F. Latorre of Kenilworth; Jennifer R. Kortman of Livingston; Rebecca A. Kortman of Chatham; William McVeigh of Wharton; Mauricio V. Almeida of Colonia; and Thompson.

California Woman Wins Race To Prosecutor's Office; Cops Plea In Upfront Fee Foreclosure Rescue Scam; Agrees To Testify Against Two Alleged Co-Scammers

In Monterey County, California, the Salinas Californian reports:

• One of three defendants in a Gonzales foreclosure scam made a plea deal Friday to charges including felony conspiracy to defraud, the Monterey County District Attorney’s Office said. All three defendants were accused of scamming more than 55 people in Monterey County of at least $100,000.

• Maria de Lourdes Ponce of Gonzales and Santa Cruz residents Fabian Olivares Casillas and Melissa Garcia were arrested in August, said John Hubank, a deputy district attorney with the consumer and environmental protection unit, on suspicion of taking thousands of dollars from homeowners after promising to save their homes from foreclosure.

Source: Plea deal in foreclosure scams against 55 Monterey County residents.

See also, The Monterey County Herald: Guilty plea in fraud case.

For the Monterey County DA's press release announcing the original charges, see District Attorney files felony charges filed against foreclosure scam artists.

Go here for earlier posts and available updates on this story.

Four Month Foreclosure Moratorium, Mediation Program Looming In Miami?

In North Miami, Florida, WFOR-TV Channel 4 reports:

• Miami-Dade County is dubbed the foreclosure capital of the state, and now the county could be taking on the most drastic housing relief effort to date. If Miami-Dade's chief judge approves this moratorium, it could stop all foreclosures for four months, starting as soon as November 1st. It's a measure that could eventually be adopted in all counties across the state.

***

• [North Miami Mayor Kevin] Burns wants a countywide moratorium on foreclosures, oddly enough one that even the banks could support. The program is mirrored of what Philadelphia started this summer that has remarkably saved 80% of their homes in foreclosure.

• "If they can do it in Philadelphia, the City of Brotherly Love, I think they can do it the City of North Miami but also in Miami-Dade County," said Burns. "And I assure you that if the Chief Judge approves it here in Miami-Dade County, they'll do it throughout the state of Florida."

• The plan is pretty simple: There would be a 120 day halt to all existing foreclosure filings, and new filings would be sent to mediators within 45 days of the filing. Essentially banks and homeowners would be forced to meet to work something out.

For the story, see North Miami Mayor Proposes Foreclosure Moratorium.

Bar Associations Ramp Up Nationwide Pro Bono Efforts In Fighting Foreclosures

The National Law Journal reports:

• [L]awyers across the country are doing their share to help homeowners facing foreclosures stemming from the subprime mortgage crisis. From Massachusetts to California, bar associations have formed task forces and organized pro bono projects offering services such as hotlines and free consultations regarding foreclosures, an issue many lawyers say could only get worse.

For more, see Bar Associations Nationwide Bulk Up Pro Bono Efforts in Foreclosure Cases.

Lenders Are Failing In Obligation To Identify All Occupants In Homes When Requesting Foreclosure Evictions, Says Chicago-Area Sheriff

According to a press release from Cook County, Illinois Sheriff Thomas J. Dart's office:

• [W]hile mortgage companies are supposed to conduct a basic due diligence investigation before requesting an eviction – identifying all occupants – sheriff’s deputies are regularly finding no work done by the mortgage company in advance, leaving the identifying work to deputies working at taxpayer expense.

• “These mortgage companies only see pieces of paper, not people, and don’t care who’s in the building,” Dart said. “They simply want their money and don’t care who gets hurt along the way. On top of it all, they want taxpayers to fund their investigative work for them. We’re not going to do their jobs for them anymore. We’re just not going to evict innocent tenants. It stops today.”

***

• [Dart] wants mortgage companies to be forced to provide sufficient information to the Sheriff’s Office in order to conduct an eviction. That will provide greater notification to tenants that their building is in foreclosure and will require mortgage companies and their attorneys to do more leg work in advance of an eviction.

For more, see Cook County Sheriff Suspends Foreclosure Evictions (Move comes in wake of growing mortgage crisis).

In related stories, see:

• Illinois Attorney General Backs Sheriff's Eviction Moratorium,
• Lawsuit Withdrawn Over Eviction Orders (A mortgage lender that filed a lawsuit to force the Cook County Sheriff to evict a suburban Chicago woman from her home has withdrawn the lawsuit. Accredited Home Lenders says it's also suspending its eviction action against Shirley McFarland of Dolton from her foreclosed bungalow.). BetaTenantRentSkimming

"No One Leaves Campaign" Takes To Boston Streets As Students Spread Word To Protect Tenants From Illegal Practices In Foreclosure Evictions

In Boston, Massachusetts, The Boston Globe reports:

• [106] Boston law and college students plan to join community activists to walk the streets of Dorchester, Hyde Park, and South Boston, to advise tenants to stand their ground and stay in their homes. Calling it the "No one leaves campaign," students aim to advise tenants of their legal rights to stay in their homes, even after foreclosure. That will help slow abandonment and blight in vulnerable neighborhoods. They are focusing on the 28 zones in Boston and Chelsea with the most foreclosures.

• "Tenants have an amazing amount of rights and a lot of ability to fight these evictions," said Harvard Law School student Nick Hartigan, 25, one of the main organizers. "Banks should do the responsible thing and allow people to stay."

***

• [Tracie Tyler, a 47-year-old administrative assistant fighting her eviction] is energized to have student involvement in what she sees as the important quest of getting the news out. "They are young, they are vibrant, they inspire us older folks," Tyler said. "There are people that are afraid who don't know where to go."

For more, see Students take to the streets to aid displaced tenants.

See also, Harvard Law Record: Harvard Law's foreclosure taskforce tackles housing crisis (Legal Aid Bureau leads effort to stop eviction of tenants in foreclosed properties). BetaTenantRentSkimming