Banks Face Mortgage Scrutiny as $49 Billion Vanishes

[Joanne98]

Source: Bloomberg

Oct. 18 (Bloomberg) -- Citigroup Inc., Bank of America Corp. and Wells Fargo & Co., set to report earnings this week, face investors groping for answers after evidence of flawed foreclosure documents triggered a selloff of U.S. bank stocks.

The banks plus JPMorgan Chase & Co. saw $49.3 billion in market value shaved off in the three days ended Oct. 15 amid concern that rising costs of faulty foreclosures will eat into profits. JPMorgan set aside $2.3 billion of reserves to cover mortgage repurchases or litigation expenses, including some for “mortgage-related matters,” the lender said Oct. 13.

“We’ve had two banks report good earnings in terms of credit-quality costs coming down,” said Erik Oja, an equity analyst at Standard & Poor’s in New York, referring to JPMorgan and First Horizon National Corp. “But people don’t care. They say ‘Well, how many foreclosures do you have in the pipeline? And what are you seeing?’ And they answer that we’re looking at each one. And people say ‘All right, sell.’”

An investigation by attorneys general in all 50 states into foreclosure practices has fueled speculation that banks will have to purchase billions of dollars in loans from mortgage-bond investors who will challenge the paperwork. Lenders have suspended foreclosures in some states and started reviews after court documents surfaced showing employees at several large mortgage firms signed papers without ensuring their accuracy.



Read more: http://noir.bloomberg.com/apps/news?pid=newsarchive&sid=ay0fBSlWVptM

[Newsjock]

1. See this? It's the world's smallest violin

... playing My Heart Bleeds for You, Citibank.

[Tansy_Gold]

2. The $49B didn't vanish -- IT WAS NEVER THERE IN THE FIRST PLACE

Pumped up stock values, based on lies and fraud, but there was no there there, no "value," no nothing.

The stock market is not a reflection of anything real any more, except maybe the greed of the greedy and the blind faith of the foolish/stupid. It sure as hell ain't "the economy."



TG, NTY

[bemildred]

3. Yep, it's like the collpase of a Ponzi scheme, is what it is like. nt

[tridim]

5. Yep, I just found out yesterday that JPM Chase "bought" my mortgage from WAMU For $605.

A supposedly $100k+ asset purchased for $.005 on the dollar when WAMU collapsed.

But that's actually not the whole story, Chase bought my mortgage with TARP funds, so they actually got it for free. Problem is, WAMU didn't transfer the asset legally (or at all), because their securitization process ate it up and turned it toxic. Oops.

My home is unsellable now, so even if they did hold the mortgage it is still worth nothing.

Multiply that clusterfuck by a million and you begin to see the big picture.

[Autumn Colors]

6. How did you find this out (the price Chase paid WAMU)?

I'm curious because I got my mortgage (30-year fixed) through a regional bank. After one payment to them, they sold it to Countrywide and then it of course ended up at Bank of America. When I checked the MERS database awhile back, it listed Fannie Mae as having partial interest in the mortgage (??? - news to me). I checked the same database a few days ago and no result comes up for my street address at all now.

What I'm wondering is if my mortgage is part of this whole mess, what happens if I do pay off my entire mortgage? Will there be a clean title or will the property not be able to be sold because no title company will issue insurance?

[tridim]

7. http://www.wamustory.com/

I spent about 12 hours researching everything yesterday and was blown away by what I found out. It's basically an external audit by myself. I still need much more information though.

Here's what I found out (from an email to my parents):

It’s like solving a puzzle!

When WAMU (the second bank that held my loan) collapsed in 2008, Chase purchased their assets (my mortgage) for one-half-cent on the dollar. Which means my entire mortgage was purchased for $605. Quite a deal huh!?

But the deal was even better than that.. Chase bought WAMU with TARP money. Which means they purchased my mortgage with my tax dollars, for $0.00. They also got a ton of free banks out of the deal, it strategic areas around the country where they wanted to expand anyway.

Chase purchased WAMU AFTER the FDIC took control of WAMU, so Chase actually purchased the bank from the FDIC, not WAMU. WAMU’s assets were never legally transferred to the FDIC, or Chase. If they were, they would have proof, and they would also have to record each transfer with the county clerk in the case of mortgages. They didn’t do that. I’ve looked at the actual legal documents (on the SEC website) for the sale of WAMU to Chase, and the section referencing mortgage servicing agreements is missing. It’s the only addendum in the entire document that is missing!

While WAMU held my mortgage (from 2003-2008) they securitized it (bundled and sold with all the other toxic assets) and transferred no paperwork to Chase or the FDIC. If Chase doesn’t hold my promissory note, they can’t legally foreclose on my property (or legally collect mortgage payments). That’s where I’m at now.

I’ve looked at all the legal documents relating to the sale of my mortgage, on file at the <snip> County Clerk’s office. You can see them too if you want. http://<snip>

There are no official and legal records of my mortgage being transferred to the FDIC or JP Morgan Chase. Banks and government entities can’t just assume mortgages, they have to have them transferred legally. This was never done.

This all might mean nothing, but it sure is interesting figuring it all out. I bet I know more about it than the people I talk to at the bank.

---

And this morning I found out that JPM Chase apparently didn't purchase WAMU's securitized assets! They are owned either by a bankrupt bank or mystery investors associated with the same bankrupt bank.

Chase is foreclosing on a property they don't own, and have never owned. I'm starting to think about suing Chase for the 2 years I was sending them monthly payments, and keeping my house free-and-clear.

[apnu]

10. sounds to me that nobody owns your mortgage.

Does that mean, technically, your own the house now?

[tridim]

14. That's what I'm trying to find out now.

I know they can't foreclose. Only the holder of the note and title can do that.

Problem is, I live in a courtless foreclosure state. There is no lawsuit from either side. Yet.

[apnu]

23. Here's a long but interesting article

That I found interesting and related to your situation.

http://www.freedom24.org/rationalpost/2010/10/16/the-foreclosure-mess/

In brief, check the chain-of-ownership on your mortgage. If its broken (and it sounds like it likely is) they're screwed and you probably have a good case to walk away scott-free.

[dixiegrrrrl]

19. Drats....I just found this..

About the idea of a quiet title:

One has to be careful about talking about quiet title actions in the context of registration systems. Quiet title actions really have no applicability where a registration system is in place, having been wholly replaced by the registration statutes. Quiet title actions derive in common law jurisdictions from a common law equitable cause of action by the same name. In many jurisdictions they have been supplemented or replaced by a statutory cause of action, which may or may not have the same legal elements of the common law action. Where dealing with statutory quiet title it is more appropriate to talk about actions in the nature of quiet title.

http://en.wikipedia.org/wiki/Quiet_title

However, since Chase has fled from MERS, ??????

This is probably something I would want to mention to a lawyer:

"Where dealing with statutory quiet title it is more appropriate to talk about actions in the nature of quiet title."

[tridim]

9. My mortgage isn't in MERS either.

Or Fannie/Freddie.

My guess is that data is being illegally dumped as we type. Add another massive scandal to the list.

I have NO IDEA who owns my mortgage, and I don't believe Chase knows either. It is an unbelievable clusterfuck.

[ms.smiler]

11. Naughty tridim, you weren’t supposed to figure out that Chase

didn’t own your loan and had no standing to bring a foreclosure action against you.

Didn’t Chase at least file a bogus Assignment of Mortgage at the Recorder of Deeds office?

Like most mortgages, there is likely fraud in your mortgage subject to Treble damages, fraud, wrongful foreclosure and Slander of Title.

It looks like Chase wants to pay for your retirement. Nice. Go get ‘em.

The government has nearly all mortgages but yours sounds truly lost. Usually foreclosing parties know darn well who really owns the loan but they aren't about to share that information. I suspect your paper is more problematic than Chase may have realized.

Keep everything Chase mails to you and take careful notes of any contact you have with them. DO NOT sign anything unless it was prepared by your own attorney.

[tridim]

13. Nothing was recorded after WAMU. Nothing.

According to public records, WAMU owns the title. They no longer exist. Chase never purchased the asset from them.

This morning Chase told me (after about 3 hours on the phone) that Fannie Mae is the investor. When I said, I'd like to see those records, they clammed up and transferred me to forclosure mitigation. The agent said, "We're not supposed to tell you who the investor is". I said, "Your rep already told me, so I already know." She then said, that's all the information I can give you. Have a nice day. Click.

Called their lawyer and told them this, and they're going to call Chase and get back to me.

I got em. And I'm going to fuck them.

Edit: Fannie Mae's mortgage tool on their site doesn't have my info, so they are probably lying about Fannie too.

[dixiegrrrrl]

15. I am in same mess.

Countrywide to BOA to MERS to Fannie Mae, but no records at the county level beyond MERS.

However, from everything I have found out, the thing to do is get a good real estate lawyer, have them send a letter to the servicer
( in your case, Chase) requesting a copy of the note.
They won't have it, most likely, or if they do produce it, compare it to your mortgage and the county records to see if it is a forgery or facsimile ( it is supposed to be the original).
See if the lawyer thinks there is a Circuit court judge who will support you filing a quiet title claim.
http://en.wikipedia.org/wiki/Quiet_title

( All of this lawyer discussion can be done during a free consultation).

IF there is a possibility you can prove there is no note, and your state has a law which supports your claim no legal owner of the note exists, you might be able to get the quiet title, thus the house.
( you will still legally owe a promissary note to....uhh...god knows who, but no house is attached to that)

THEN sue Chase for every penny you paid in the past!

The lawyer can have his cut from the suit.

I am not a lawyer and this is not legal advice.
However, I have been following this mess since day one and I know all of the above is being done by others.
see 4closurefraud.com and other sites for the processes, information.

The trick is to do this NOW before a zillion others do it.

[tridim]

16. Awesome advice! I have been assuming I can't afford a lawyer.

Which I most certainly can't, but maybe it wont hurt to talk to one anyway.

The only piece of the puzzle still missing in my case is MERS. I know WAMU used them, but there is NO record of it on MERS or at Chase.

My guess is that Chase simply assumed they purchased my mortgage without verification, probably with fake documents from both sides. That aint legal folks.

I caught Chase in 4 big lies just this morning, and called them on it each time. I should probably stop that. Anger does weird things to me. I've never been this angry.

[ms.smiler]

17. Tridim, Dixiegrrrrl offers sound advice

That’s pretty much what I was about to offer.

A Quiet Title action can address not only your Deed but any fraud in your mortgage. Competent counsel can be had sometimes for about 30% of the value of your home if they are successful. That is probably much less than the amount of your mortgage. Any damages won in the action can likely cover the expense of counsel.

Tridim & Dixiegrrrrl, I asked my own attorney if I could also sue for the mortgage payments I made and she said it hadn’t been done yet in our state. She nodded though so it appears she considered it reasonable. It made me smile to see that you both understood that a company collected payments when they were not legally entitled to collect them. I suppose that’s the Unjust Enrichment aspect in all of this.

If you like Tridim, I’d be happy to check with my attorney for a referral in your state. She networks with attorneys across the country that are trained and experienced with modern day mortgages.

[dixiegrrrrl]

18. Ms. Smiler....I would love to have a referral in Ala. if you have one.

Our circuit court is here, in town, but we live in a small county seat, the lawyers/judges all grew up together, and I not sure they have much experience outside of the county.
MY county recorder ( a bit dim, she is) seemed totally unable to grasp beyond the black and white on the records.
I need a very experienced real estate attorney who understands what we need to do.
And because I live 2 hours from Montgomery or Mobile, I out of touch with who is who in those areas ( which are closest to me).

Ala is a non-judicial state, and in this county, MERS is foreclosing every week, by the dozens.

Interestingly, I just noticed last week that foreclosure auctions have been re-scheduled and then re-scheduled again.
So SOMEBODY is wising up and not buying.

Meanwhile, I can locate and post the links, or pm the links ( some of them I have in pdf form) to the process of all this.

[ms.smiler]

20. I thought Fannie Mae issued a directive that no more foreclosure

actions were to be brought in the name of MERS. Is MERS still used in some locations? All those foreclosures should be invalid. Boy, attorneys are going to be busy in your neck of the woods.

I think the banks will have problems moving foreclosed properties, unless they have their own internal arrangements. Investors and home buyers should know better by now to avoid foreclosed properties unless they're willing to risk Title problems.

I'm waiting to hear back from my attorney and I will let you know. A friend of ours lost an investment property out in Arizona and she offered 8 attorneys in that state so I'm hoping she can come up with someone in your state. I just don't think I would trust someone new to this field. I prefer the attorney who understood these issues years ago and stood up to the big banks on behalf of homeowners, before most people even realized there were problems.

[dixiegrrrrl]

21. thank you.

MERS foreclosure auction notices were in the paper ( weekly paper)still, as of last week.
In our state, no court involvement unless you fight the foreclosure, and most people do not fight.
So 90% of the notices are in MERS name. No challenge, really.
( I have also identified the Birmingham law firm that is used to file the foreclosures....what do you want to bet the names signed are not actually employees?)

Since we are paying our mortgage, I want to be sure I will have clear title if we sell, and want to be sure we are not
participating in fraudulent payments.

I definitely agree an experienced attorney is the way to go.

[EFerrari]

12. Chase pulled out of MERS -- article here:

http://www.democraticunderground.com/discuss/duboard.php?az=view_all&address=389x9308935

I speculated it was to make information more difficult for their screwed borrowers to find.

[Samantha]

22. In theory, you should have obtained title insurance at closing

Most lenders insist buyers have this. I say this cautiously because it does seem none of the classic rules apply now, but are you absolutely sure you didn't purchase this at closing?

Sam

[KansDem]

24. "...JPM Chase "bought" my mortgage from WAMU For $605."

So you could have offered $606 and now own your own home straight out? :wow:

[Joanne98]

8. Good point

[lunatica]

4. Vanished? You mean like a magician's puff of smoke and the rabbit is gone?

Did it all vanish to Switzerland or the Bahamas? Will we see the CEOs moving to Paraguay?

[KansDem]

25. Paraguay...

"Bushland"

Hope they drop in and say "hi" to the Bushes...maybe even Ken Delay, too!