ML-Implode Exclusive: Foreclosure Expert Mildred Wilkins Blasts Industry in “Fraudclosure” Report
“External” Title Issues
Almost all title issues used to be of the external variety and included such things as:
- a mechanic’s lien against the former owner which was not released
- a contractor’s lien, against the former owner which was not released
- homeowners’ association dues
- Liens related to a divorce settlement
- Heirs of former owner who have exerted a claim
- A failure to transfer all interest in the real estate (such as mineral rights)
- A previous deed was improperly written or signed
- The property address misspelled in the deed conveying the title
- A deed which has been signed but not properly recorded
- Liens from a local taxing entity, IRS or other entity
- Numerous other, similar claims which create a ‘cloud’ on the title you hold
A title company search would typically reveal the issue and the title company would take the appropriate actions to correct it. The fact that the public records would allow anyone to research any existing claims greatly minimized the possibility of unresolved title issues remaining on the deed once you bought it. Since you also purchased an expanded title policy as ‘insurance’ against anything which had not been revealed during the search, you could be assured that there were not likely to ever be any challenges which could not be easily rectified.
Transactions between individuals required the transfer of:
- Clear title, backed by a title search of the public aforementioned ‘public’ records
- Presentation of a general warranty deed (as evidence that clear title had been passed)
- An owner’s title policy which warranted that in the event there had been an event in the past which created a challenge upon the validity of the title, then the title company would do whatever was necessary to clear up such dispute, at no cost to the purchaser
- Utilized the services of a title company closer who handled the transaction details of the formal closing as a disinterested 3rd party, who had no contractual relationship with any of the parties to the transaction.
“Internal” Title Issues
Our current challenge is the chaos which has been created by internal title issues. Real estate is continually evolving which, of course, means there will be lots of changes. Changes are necessary in the world and we embrace those which are positive and move our industries forward and make our lives better. But every now and then some segment or industry will take a GIANT step into the abyss with some well-crafted but totally cockamamie idea which throws us into a tailspin.
The creation of MERS (Mortgage Electronic Registry Services) was just such a GIANT step. Internal title issues which have undermined the entire backbone of property rights in this country are a massive, destructive, unintended consequence of MERS. While MERS was created to make the tasks for MERS club members:
- Easier
- Faster
- More self contained
- profitable
MERS allowed the partners to:
- Push mortgages into trusts at break neck speed
- Create and sell securities in previously unimaginable volumes
- Avoid billions of dollars in recording fees, which by law, should have been paid to YOUR local municipality ( for frivolous things like schools, police and fire trucks)
- Make money so fast they couldn’t keep count
- Make mortgage transfers so fast sometimes they forgot who they thought had it
Unfortunately, moving mortgages at breakneck speed, via a computer program no less, without ever taking the time to move the physical note (remember that little document which says you have the right to the collateral (the HOUSE) in the event payments are not made). A little piece of paper with serious power (if you have it). You have no legal standing to foreclose or otherwise force payment of the obligation if you don’t possess the orginal note TOGETHER with the mortgage. The harsh reality is that without the note travelling with the mortgage (as in attached to it, by staple, bubble gum, we don’t care what, just as long as they remain travelling partners) the holder of the mortgage essentially has 50% of 0. You can pass the mortgage around as much as you want but it is totally unenforceable without the accompanying note. Yes, an obligation is owed, but to whom? Worse yet, the enforcement power is, by law, within the note, which somebody left at home. And worst of all, law says you can’t remarry them later and it will be okay. Once divorced, they are divorced, permanently. None of this,” let us give it one more chance stuff “ that we Americans are famous for.
It appears that the members of the MERS club were so busy counting their dollar bills that they overlooked the need for a serious assessment of the downside of their actions. We may discover as the months continue that in fact they were warned by one of their rank (I can’t believe that NOBODY thought of possible problems) and they chose to ignore the warning under the illusion that they owned Washington and Wall Street and would therefore be able to talk/posture/bs their way out of any eventual problems. Besides, investors would be holding all the stuff and they were protected since they sold loans as soon as they found a warm body willing to sign on the dotted line. This was a monumental miscalculation on the part of banks but we and they are only discovering this fact now.
Our banks created an internal issue for which they must assume total responsibility. This title issue, or the need to cover up the lack of clear title, is the true cause of robo-signing affidavits, and the subsequent revelations since mid –September.
Further to my comment of 9 August 2016, unlike the old Bank Rate system with its high interest rates,…
Comment by Jean E. Allan on 20 December 2010:
My family’s saga is being told on nhjustice.net. It is a very ugly story about how a small state has been captured by big financial interests, and has used the ‘color of law’ to take private property from the average citizen and turn it over to the large financial/business interest. In our case, the State overtly took $100,000, but there may have been more trading that we are not aware of.
Today, I am schedule to have a competency hearing. The State’s Office of Forensic Examiners found me not competent because I essentially reported exactly what you are reporting in this paper. The only difference was that I used the specifics of my case. And, the names are very well know. And, on is about to get the medal of freedom award for his assistance in the 2008 bailout of the banksters.
Thank you for continuing to write on this issue. Individual citizen families cannot fight the foreclosure fight alone. We continue to pray that some authority will intervene on our behalf. Perhaps I will know more after 1Pm today. That is the time of the competency hearing.
Sincerely,
Jean E. Allan aka Jean E. Allan Sovik
Pingback by Fraudclosure Report | “The Title Crisis: Clouded at the Core” « Foreclosure Fraud – Fighting Foreclosure Fraud by Sharing the Knowledge on 27 December 2010:
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Comment by marilyn lane on 27 December 2010:
For anyone who has had their property fraudulently sold, they have another battle to fight – that of the Title companies that insured the forged deeds.
After having Astoria Federal S & l ,Successor in Interest to Fidelity NY FSB state in New York Supreme Court in front of Judge Alice Schlesinger, Its Indemnify, Indemnify Indemnify , we are stepping aside and the title coompanies are stepping in.(Astoria Federal with corrupt debt collector attorneys Mullooly, Jeffrey Rooney & Flynn auctioned off my two NYC condos to straw buyers without even owning my two properties.
Fast forward – The Bank got rid of these corrupt attorneys MJRF and has new attorneys. At that point when the banks new attorneys said it’s Indemnify , I should have been given back possession of my two condos.
Instead corrupt attorney Thomas Malone for Fidelity National Title and corrupt attorney David K Fiveson of Coronet Title did not want to indemnify the forged deeds they insured but wanted to be Intervenors instead and be heard and what they told the court is time makes forged deeds good.
FORGED DEEDS CONVEY NO TITLE AND HAVE NO LATCHES.
The Title Companys , Judge Alice Schlesinger of NY Supreme Court, and I all know there is no “equity” in a forgery.
With the fraud being discovered at William P Foley’s (CEO) Fidelity National Title ,Fidelity National Financial and Lenders Processing Service (DOCX) the title attorneys statement to Judge Schlesinger “we have equity”,
only meant there was money under the table for the judge and Judge Schlesinger said to me, “it doesn’t look good for you” and she ruled against the law.
Judge Alice Schlesinger perpetrated Title fraud with Fidelty National Title and Coronet Title.
I am the true owner of apts xx and xx at xxxxxxxxx and I will continue to pursue to get possession of my two condos.
Comment by Michael Haltman on 27 December 2010:
Hi Mildred:
Great article on the title crisis. I am giving a CLE class on foreclosures and title and in my research have found what you are saying regarding MERS, securitization and standing to foreclose.
My read is that the new owners of the homes who bought foreclosures or REO’s probably won’t be thrown out avoiding a claim to the title company. The original homeowner, although delinquent and subject to a legally done foreclosure, may have a claim against the lender who foreclosed illegally and took their house.
It is somewhat confusing unless I do a flow chart, but in your opinion who is going to be held culpable including the referee. Thanks.
Mike Haltman
Comment by mike on 27 December 2010:
Great article but you miss real valid arguments. 99% of the notes are unenforceble if transfered correctly into the trust. Why?
)1 Because once the notes enter into the REMIC they are no longer notes but have been converted into bonds. Once done, they can not be undone.
2) Likewise the mortgages/DOT also need to transferred, assigned and recorded at the local level in order to get into the trust. The problem is the trust can’t hold assets or they lose there IRS tax free status and their ability to be bankruptcy remote.
What you have here realy is the sale of unregistered securities to unknowing investors (homeowners). The banks and securities underwriters knew this all along and that’s why nothing was ever transferred and they used MERS to hide it all.
Let’s follow the rabbit further down the hole. When a homeowner makes a payment that payment was never truly credited on the books of his loan. Why? Because the money was paid into a pool(trust) where the bonholders were paid in their tranches. This why they will not and cannot produce the loan level files.
On top of that you need to also factor in the over$ 7 trillion dollars in bailout money the FED(foreign owned) gave out and the billions of dollars the FDIC bought back of MBS from all the players. Also, the CDOS, CDS, insurance money that has already been paid off.
There is no money owed and their is no clear title! How do you fix that mess?
Iit is FRAUD from the creation at every juncture of the game and all the players are complicit including thegovernment for the coverup.
Comment by John R. on 27 December 2010:
This is directed to Michael Haltman’s question. As I’ve read it,if fraud was used in a lawsuit, and then, post judgment proved, then the original lawsuit is deemed VOID ab initio…. (or “at initiation”)that means it’s as if the judgment was never rendered! Ergo, the “new owners” own nothing! How could they? They were, after all, only a part of a fraudulent scheme. And the correct procedure for the “victims” who originally lost their homes would be to submit a motion to vacate a void judgment and once ruled on, to file an eviction notice. Woe befalls those who participated in the fraud, the buyers & the sellers of the illegally foreclosed on property.
Comment by Blanche Dubois on 16 January 2011:
I read the article with great interest although I am already familiar with this mess. However, great as the information may be, it still doesn’t answer any questions. For example, here’s my predicament:
1. I refinanced my mortgage in Nov. 09 with BofA. At the time of the closing, I was provided with blank copies of all my docs. Shortly thereafter, I received a notice telling me that they had already shuffled the mortgage around to someone else. When this mess hit the public eye, I started to track my papers but to no avail. My payments are going to (what seems) is BofA and I’m receiving statements from what seems to be BofA. I requested a copy of my Deed and Note and, instead, received a copy of my appraisal report which tells me that they don’t have the original documents. I hold a recorded Deed, Note and Title from Chase (my prior mortgagor) but have not received the discharged papers from them either. So what does that mean? What am I supposed to do? Where do I start looking? What are my options? Coincidentally, my mortgage is in good standing and I’m in no danger of losing the home that I know of.
Comment by clark on 24 September 2012:
Lots of fraud folks. Many of the crooked attorneys who foreclose very homes are financed by the mortgage companies they foreclose for. Many of the judges are taking bribes thru their homes also being financed multiple times and then paid off by robo signers. Basically check the records they’ll get loans totaling $200,000 up to millions on the same home some show 2-3 loans a year. The loan is quickly paid off, a few months later they’re given another loan. No one can do this, but they can. The government doesn’t inquire about a fat check like this. They walk away with big bribes to go against borrowers no matter even though they know it’s a fraudulent loan. Many of these attorneys and judges allegedly make no house payments.
Their income would not sustain this but they have been also trustees for predatory lenders also and trustees for home improvement companies that defrauded borrowers which turned into predatory loans. This is how they proved themselves worthy to be judges and hold a license to defraud the borrowers. This has been going on for years. They are being paid by the title companies and banks to do this folks. This is a big network all the attorney bar associations want to keep the crooks on the bench. This the very reason when folks have been defrauded by mortgage and title companies most attorneys refuse to take the case or if they do take the case won’t fight and just take clients money. They know what will happen if they challenge the crooks, they won’t ever win another case in court. This thing is sinister folks, but true
Comment by Mike Libera on 27 December 2013:
I am involved in several loans with Ocwen as servicer. They have unbelievably sent me copies of bills they have submitted in my case (one for a property already sold at auction to them; one which they refuse to sell despite my many requests to do so)which total over $30,000 for two BPO letters, which normally run around $100 apiece. Clearly they’re milking somebody – I guess the taxpayer. Isn’t anyone watching these thieves?