The Miami Herald

The backing is blamed on homeowners allegedly dragging their feet. In reality, banks have been the cause because of federal directives to pursue loss-mitigation alternatives or by voluntarily slowing down the process to explore settlement options in the interests of both parties and the market.

However long it takes to conclude a foreclosure in Florida, given the unprecedented magnitude of the fraud, forgery and abuses to which banks have admitted, we should exempt this category of civil court cases from “time to complete” requirements.

We should not make public policy decisions based on unverified, incorrect and misleading information, particularly when the data are provided by the same industry that admitted wrongdoing.

The next problem behind any push for foreclosure reform is that the real-estate market is improving. Prices have rebounded in Florida because, in part, inventories of foreclosed homes are being managed by the banks and homeowners.

Short sales and negotiated resolutions of foreclosure cases yield higher returns than faster foreclosures, but these settlements would disappear under the proposed legislation.

The big winners would be institutional buyers. When they buy properties in bulk, they exclude Realtors who profit from short sales and from other end user transactions. Instead of supporting the legislation, Florida’s Realtors should be following California’s lead and opposing all actions to speed foreclosures.

Foreclosure-legislation proponents have also convinced homeowner associations to support their bills by arguing that this legislation will help them. It’s true that the so-called, “show cause” provisions of both bills would allow any lien holder to show cause as to why a final judgment of foreclosure should not be entered. But if the plaintiff chose not to file any of the evidence needed to obtain a foreclosure judgment, a court could not enter a judgment.

Associations already can demand status conferences and existing law allows judges to force a plaintiff to move a case forward. Also, associations already can move their own cases to judgment, and pending legislation will allow them to move their cases much more quickly.

Since 2012, the market for third-party investors to purchase association liens at foreclosure auctions has been robust. Investors pay the $4,000 to $20,000 in HOA liens, take title to the property and rent it out before a bank forecloses. This market will be eliminated, and associations will be stuck with large inventories of unpaid lien cases, making things even worse.

It is undisputed that those responsible for the foreclosure crisis are the financial institutions that filed these cases, as admitted in two recently signed federal settlements. These settlements should lead to more protections, not lowered standards. The full magnitude of bank wrongdoing has not been fully revealed, and even more will be swept under the rug.

Roy Oppenheim, defense attorney, legal blogger and creator of the South Florida Law Blog.

Experienced defense foreclosure and real estate attorney, Roy Oppenheim left Wall Street for Main Street, founding Oppeneim Law along with his wife in 1989 in Fort Lauderdale, Florida, and is vice president of Weston Title and creator of the South Florida Law Blog, named the best business and technology blog by the South Florida Sun-Sentinel. Follow Roy on Twitter at @OpLaw or like Oppenheim Law on Facebook.

Read more here: http://www.miamiherald.com/2013/03/22/3299899/foreclosure-legislation-invites.html#storylink=cpy

By Julie Schmit

U.S. foreclosure filings saw their biggest drop last month in at least five years after revelations that thousands of foreclosure documents may have been improperly prepared.

November filings dropped 21% from October and 14% from November 2009, RealtyTrac reports today. November bank repossessions totaled 67,428, down 12% from a year earlier.

Part of the decline was seasonal. Foreclosure activity slows around Thanksgiving. But some of it stemmed from delays that lenders and mortgage servicers imposed after reports surfaced in September that their employees or contractors signed, and in some cases backdated, documents claiming knowledge of facts about mortgages that they did not know.

HOUSING MARKET: Track the rise, fall and … rebound?

The Department of Justice and the state attorneys general are investigating.

The controversy “forced lenders and servicers to hit the pause button” as they checked records and changed processes, says RealtyTrac CEO James Saccacio.

Mortgage servicers and lenders, meanwhile, are pressing ahead to resume stalled foreclosures. November’s lull will be followed by a bulge of cases later, says Lawrence Yun, chief economist with the National Association of Realtors. The pace of foreclosures will return to more normal levels in the second quarter of 2011, says Rick Sharga, RealtyTrac senior vice president.

Well Fargo says it has prepared new documents for 94% of the 46,000 cases in which it deemed that necessary. Wells found no case in which a foreclosure was occurring where it wasn’t appropriate, says spokeswoman Vickee Adams. Bank of America  is “moving very slowly” to resume cases to make sure procedural changes it has made are working, says spokesman Dan Frahm.

In 23 states, foreclosures go through the courts. Because court cases require more paperwork, it may take longer in those states for foreclosures to resume at a more normal pace, Sharga says. He doesn’t expect the difference among states to be great. Some judges have also begun processing foreclosure cases more slowly, says Florida foreclosure defense attorney Roy Oppenheim. Foreclosure activity in Florida fell 38% in November from a year earlier.

by Paul Owers

Long before the furor over foreclosures exploded nationwide, Gerta Kachko figured something was amiss.

The computer programmer from New Jersey lost her job in 2008, nearly three years after she had taken out a $350,400 mortgage on a second home, a waterfront condominium in Hollywood.

When Kachko missed several months of payments, Deautsche Bank filed for foreclosure, but she didn’t understand why Deutsche was involved. The lender that gave her the note was American Home Mortgage Servicing Inc.

“We never heard of them before,” said Kachko’s son, Eugene, 33.

With that, the Kachkos launched a legal battle to fight the foreclosure, an odyssey that would include a quick judgment for the bank and alleged wrongdoing by so-called robo-signers.

After employees of mortgage-servicing companies nationwide admitted to signing thousands of foreclosure affidavits without reviewing them, several big lenders this fall suspended foreclosures while they investigated possible paperwork errors in the filing process.

Homeowners and their lawyers say overwhelmed lenders and judges are rubber-stamping foreclosures, overlooking major problems and compromising the defendants’ rights to due process.

“This case is a symbol of the crisis,” said Roy Oppenheim, whose Weston, Florida law firm is representing the Kachkos. “It’s a system that’s run amok. All the rules of civil procedure are being flushed down the toilet.”

Oppenheim and Geoff Sherman, a lawyer in his firm, crafted a basic defense for the Kachkos. They argued that Deutsche’s foreclosure filing should not be allowed because it did not follow Florida law by showing how the bank had acquired the note from American Home Mortgage.

It remains unclear how Deutsche Bank became involved with the Kachko mortgage. A spokesman declined to comment on the case.

Eugene Kachko said he was “99 percent certain” the bank’s motion to foreclose would be denied.

But Sherman said the Aug. 10 hearing lasted only a few minutes, with a Broward County Circuit Court judge ruling in favor of Deutsche Bank and setting a date of Dec. 8 for the condo to be repossessed.

Sherman said he later read about issues in other cases involving an accused robo-signer, Linda Green, who had signed documents in the Kachko foreclosure.

Intrigued, Sherman investigated further while Eugene Kachko hired an expert on mortgages and foreclosures to review his mother’s case.

The expert, West Palm Beach attorney Lynn Szymoniak, wrote in an affidavit that “it is clear” that Deutsche had not acquired the Kachko mortgage at the time it moved to foreclose.

Szymoniak testified that Deutsche filed a document proving that it owned the Kachko mortgage only after filing the initial foreclosure, and it attempted to make the document effective retroactively.

The document was signed by Green and Linda Thoresen, who were identified as representatives of America Home Mortgage.

But Szymoniak said Green and Thoresen actually were employees of Lender Processing Services Inc., a Jacksonville-based company whose services include drafting missing documents to facilitate foreclosures.

Green and Thoresen “signed thousands of documents each week as needed in foreclosure cases, without any personal knowledge of the documents, often without any authority from the entities they claimed to be their employers and, in most cases, without ever reading such documents,” Szymoniak wrote.

She also noted that LPS told federal regulators in August that its document production operations were the subject of state and federal investigations. A spokewoman for LPS did not respond to an interview request.

On Aug. 20, Sherman filed a motion for a rehearing, asking that the judge’s ruling for Deutsche be vacated on the grounds that the bank allegedly committed fraud.

Judge Eli Breger granted the order on Sept. 24, canceling the Kachko foreclosure. Four days earlier, GMAC Mortgage had become the first lender to suspend foreclosures.

Tracy Starasoler, a Boca Rato lawyer for Deutsche, could not be reached for comment.

Sherman is gathering more facts in the case and expects another hearing sometime next year. Meanwhile, Gerta Kachko hasn’t made payments since 2008 but still owns the Hollywood condo, now appraised by Broward County at about $155,000 — less than half the amount of her mortgage.

Homeowners who are delinquent on their mortgages won’t magically get their homes back, even if banks were found to have foreclosed improperly, legal experts say. The lenders may face fines and sanctions and have to pay attorneys fees, but they ultimately will refile the foreclosures once the paperwork issues have been resolved.

The homeowners “do owe the money and they owe it to someone, it’s just a question of who,” said Jerron Kelley, a defense attorney.

Kelley said it’s unlikely that many lenders will agree to cancel foreclosures in favor of loan modifications, although other defense attorneys say improper foreclosures may give homeowners more leverage.

In some instances, “the banks want the cases to go away so they’re more likely to settle,” said Gary M. Singer, a real estate lawyer in Sunrise.

That’s what the Kachkos are counting on.

“We’re hoping they’ll offer us something that would work for us,” Eugene Kachko said. “Her ultimate goal is to keep the home.”

Oppenheim Law Foreclosure Defense Workshop: Transcript

The third group of people to consider is those who have recently purchased a home through a foreclosure, which may have been done illegally. What should we call these people, any ideas? I refer to these people with dirty titles, however this is ironic because they are the ones who have been helping bail out the economy. These are the investors. These people have been taking their hard cash that they still have left, looking for good deals, and helping propel the economy back to life. Without such people, the prices would continue to drop. Back in 2008, everything had stopped. There was no buying or selling, the market was literally at a standstill. It is because of these investors, however, that we still have a real estate market, albeit not a great one. What will happen to these people? They may in fact be thrown out of their homes, by the people who lost them in the first place. I would like to add that these are not bad people, and I will represent both those people who have lost their homes to foreclosure and those who may lose their homes due to bad foreclosures.

Transcript: Oppenheim Law’s Foreclosure Defense Workshop  

For those of you who read my blog, I wrote an article the weekend after I had the good fortune of going to a homecoming football game with my family, where my daughter was one of the nominees for homecoming queen. The most important part for me, professionally, was where one of the players caught the ball in the end zone. It was great play and he seemed to come out of nowhere. All of a sudden his hands were coming up for the ball, and he was coming down in the end zone. This goal would have changed the course of the game for the homecoming team, however the referees called it ‘offensive pass interference,’ and it did not count. This was because, as he propelled himself into the air to catch the ball, he actually did so by pushing himself up off the other players. Therefore the reason he was higher than them in order to catch the ball, was that as he was pushing them down so he could pull himself up, like an old physics equation. The touchdown therefore did not count, and the team was pushed back an additional thirty yards because the penalty was offensive pass interference and two personal fouls.

At that moment, it occurred to me, that the judges in our current situation should have been making the same calls as those referees. They should have been acknowledging the fact that the banks were improperly using their size, force, and mass against individual homeowners, to gain an advantage. There were hundreds of attorneys like myself begging and pleading for this process to be stopped, but the courts would not listen, instead choosing to focus on the mantra of ‘we must get these foreclosures through.’ So for anybody who has lost their homes during this time, we are prepared to work with you. We believe you have valid claims and that you are entitled to receive serious compensation for the loss you have encountered. On top of this, the banks need to be punished for their bad conduct.

Foreclosure Defense Workshop Transcript by Roy Oppenheim

Fannie Mae and Freddie Mac sent a really funny letter this past week, to 1200 to 1500 servicers of loans, which I must share with you. They said, to the servicers, “We expect you to follow the law as you complete your foreclosure, the laws of the United States and the laws of all 50 states.” This was published in the Sun-Sentinel. I almost fell off my chair when I read it! To think that a government agency would need to tell the servicers and their lawyers that they are expected to follow the law is unbelievable. Surely they were always supposed to be following the law, before and now. Are they crazy? This is just a society that has run amuck and allowed our institutions to get too big; too big to fail, and too big to be challenged by the media, by our own government officials, and even more of a problem, one that is clearly too big for the judiciary. Robert Jarvis, a professor at Nova Southeastern University, and an old friend of mine from high school, feels that this is a crisis that is way beyond judges, because they just aren’t prepared to handle it.

Foreclosure Defense Workshop Transcript by Roy Oppenheim

The next group is people who have already lost their home to foreclosure. Those people have the right to bring an action of fraud upon the court, have their foreclosure voided, and get their property back. This does not mean, however, that you will permanently get it back. It means that you will then be subject possibly to another foreclosure, unless of course the judges decide that they don’t like being defrauded and want to teach the banks a lesson. If they want to ensure that this never happens again in this nation, it is conceivable that some of these banks, or mortgages, will be seen as unenforceable as a matter of equity. When you go to court you have equity and you have law. Equity is different from law, and is where a judge literally values the equities of the different parties and determines if one party has what’s referred to as ‘unclean hands.’ It’s very biblical actually, the judges therefore have the right to say that this foreclosure is illegal and unenforceable, and because you did it with knowledge that you committed fraud, then we’re not going to give you a second shot. This is a very powerful tool and I am curious to see the judge who has the wherewithal to administer it. This will also give you the power to extract some sort of tax payment from the banks for having illegally kicked you out of your home.

Therefore, if you have lost your home to GMAC, JP Morgan Chase, Bank of America, and we are even suggesting Wells Fargo, then you may still have rights. Soon there will be other banks to add to this list.  If this is the case, then we suggest you contact us, either go to our website, or call us, and we will be glad to evaluate your foreclosure. We can determine if you were unfortunately dispossessed of your property through illegal, unconstitutional, and fraudulent means. If I had said this two years ago, you would have all thought I was criminally insane. It is insane, that I could stand here, and accuse some of the largest banks in this nation of this kind of pervasive fraud. However, I am not doing this alone. Most of the Attorneys General in the United States are on top of this, along with the US Senators, certain members of the House of Representatives and the Office of the Controller of Currency.

Transcript: November Foreclosure Defense Workshop

At a glance, the law is very short and innocuous, but when you consider its implications, it becomes very clear that the reason this went to the Senate about a week ago, is as a result of the GMAC crisis, and that of Chase and Bank of America, the timing of which was identical. You can actually call the White House and state your views as to the bill and they do in fact tally these comments up. You’ll get some college kid whose father paid a lot of money to get him a great internship, whose job it is to take down the details of what you say. So you can in fact call and say that you are opposed to HR 3808, stating that it is once again a trap, and something that the banks are pushing which will hurt homeowners. It’s not going to improve the economy, and all it will do is once again, result in a loss of confidence in America, a country that isn’t protecting property rights, due process rights, or procedures that have been in place for hundreds of years. The idea that this bill is sitting on the president’s desk waiting to be signed, is remarkably problematic. And the fact that this bill went through like stealth with both Democrats and Republicans signing it, is even more shocking. They are trying to get this through as quick as possible, with the implications being that the kind of fraud we have just experienced will now be institutionalized. Therefore, I strongly recommend that you all consider making that phone call!

Florida Foreclosure Defense Workshop by Roy Oppenheim

Another questionable issue is why retired judges were brought in on a permanent basis, to take over an entire division of the court and to do foreclosure. In doing so, other judges have been ostracized and prevented from rotating into that division. In general, there is supposed to be a natural order of rotation of judges from criminal to civil, to probate, to juvenile, and to domestic, on a regular basis. I would argue that the other judges have had their constitutional rights impeded on, as they are being denied the opportunity to rule on foreclosure cases. It seems, however, to be deemed perfectly acceptable in Florida at least, to bring back retired judges, who are of course thrilled to be paid on a per diem basis, in order to enhance the expediency of the courts. Many of such judges have said on record, that they work on a quota basis and that they must dispose of a certain number of cases within twelve months; I believe it’s around sixty five percent. It’s as if they are traffic cops who have to issue enough speeding tickets by the end of the month.

Transcript: Foreclosure Defense Workshop by Roy Oppenheim

The best analogy to use for this crisis is that of Humpty Dumpty. Let us consider Humpty Dumpty to be the Mortgage. If we consider this in the historical and traditional sense, then we can view the egg to be the lender providing a mortgage to a borrower. But what happens if the lender decides to split the mortgage in half, with the mortgage and promissory note going to different places? We then have two eggs. If the note is then chopped up into little pieces with different interests, the egg is now broken and falls off the wall. This is what we read about when lenders securitize. What the banks have then tried to do is put Humpty together again so that they could foreclose. However, it is very difficult to foreclose on a mortgage, or put an egg back together again, once it has cracked. The egg cracked because of the intentional and deliberate desire to securitize the mortgages and to sell them off to different places, with mortgages going to a trust and notes going to investors, and then subsequently sold to different bond holders.

The most important point to make here is that you cannot foreclose on a mortgage unless you put the egg back together again, which is what the banks have tried to do. The only way to do so is by signing and notarizing a bunch of bogus documents and by having people sign on behalf of others. We have been saying this to the courts for two years now, and have been completely ignored. There are in fact judges on record who have said; “I do not want to hear it, I do not want to see it…. You have thirty seconds to make your argument…. I’m not going to listen to your pleadings, and whatever you say I’m not going to listen to you!”  Is this not a violation of a judge’s oath of office? As I said before, his duty is to ‘maintain the integrity and independence of the judiciary.’ How can you be independent if you are not willing to even consider evidence from a lawyer, who has done his research and presented an articulated argument?