I should have given the Bevilacqua case a bit more attention yesterday rather than sticking it in the Roundup. It represents the nightmare scenario we all expected to come to pass.
The highest court in Massachusetts ruled that a homeowner who bought a foreclosure that hadn’t been properly conducted by the foreclosing bank in 2006 didn’t have legal ownership of the property.
The decision by the Supreme Judicial Court casts a cloud over the legal ownership of any properties in Massachusetts where banks didn’t properly convey title when foreclosing. The problem has gained attention nationwide because of banks’ use of “robo-signing” and other dubious practices that may have broken chains of title on foreclosures.
Think about that. Banks that failed to convey title during foreclosure have clouded the title of any property for the foreseeable future, meaning that whoever buys up the foreclosed property may not be the legal owner. And extrapolating that out, all the homes across the country where the banks failed to convey title properly through securitization have clouded the titles there. That means tens of millions of homes pretty much have no legal ownership chain.
This is the securitization fail we’ve all been dreading. The banks have broken the housing market utterly.
So, as Charlie Pierce puts it, Mitt Romney’s quick fix for the housing market, to foreclose everywhere and let investors buy up the homes and rent them back out to the dispossessed, couldn’t possibly work. The investors or really anyone who buys a foreclosed property cannot be certain that they have a legitimate right to them. It also has implications for the plodding foreclosure fraud settlement; Massachusetts Attorney General Martha Coakley, among others, has distanced herself from that.
And now, the Supreme Judicial Court in Massachusetts has given Coakley, at least, some real ammunition. The decision says that, despite what “turmoil” may result in the housing market, the Court is demanding an explanation for the various gorilla accounting practices and whimsical record-keeping that resulted in the banks’ essentially stealing homes and selling them off, as though they were guys peddling Rolexes that “fell off the truck” on card tables along Fifth Avenue in New York. Coakley’s pretty fed up, too. “This is yet another clear demonstration that the only way we are going to restore a healthy economy is to address the foreclosure crisis and hold the banks accountable for their actions,” she said in a statement released yesterday. The Court’s decision clears the field for her to do that.
This also gives ammunition to the various community groups who are challenging foreclosures all across the country, fighting evictions with a “Sword and the Shield” strategy.
“The Sword”. Encouraging residents to stay in their homes, and to make their stories public, we organize blockades, vigils and other public actions to exert public pressure on the banks. The sword works together with:
“The Shield”: We inform bank tenants of their rights and work with legal services & progressive lawyers, to use aggressive post-foreclosure eviction defense to get eviction cases dismissed, win large move-out settlements (if it makes sense for that family/person), and force the banks to reconsider foreclosure evictions.
If the ownership cannot be proven on the home, it bolsters this strategy significantly.
The government can keep moving along with inadequate settlements that will “get the market moving again” (they won’t, and Adam Levitin has the definitive piece telling you why). GOP candidates can speak a lot of gobbledygook signifying almost nothing. But the truth that precious few want to admit is that the banks stole a bunch of homes. And they’re trying to pass them off to other people with phony documents. “This is a guy selling you a lemon of a used car, or inadequate aluminum siding,” as Pierce says. It’s pure fraud of the largest market in the world, the US residential housing market. And the Massachusetts Supreme Court is blowing the whistle.




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The stark naked truth of the matter, dovetailing with the prevailing (and growing) sentiment of the people sez:
The banks are going to end up eating this.
I just can’t see anything else.
So we’ve likely got some properties out there that represent fraud in the original mortgage, fraud in the creation of a MBS based on that mortgage, fraud in the following foreclosure of property, and fraud in the bank resale or auction.
That’s a lot of fraud that both parties are trying to ignore.
As a good object lesson, anyone buying any real estate should purchase the title insurance offered by the title company handling the transaction.
When all this really hits the fan, Graybeard, what entity actually has the money to pay off a million or more claims?
The title insurers will go bankrupt and the poor schlubs will still wind up without a house of the money they paid for it.
The sound you hear is the US economy screeching to a halt.
I would normally agree with you, but the politics as they are now will prevent that outcome. Witness the B of A move to place the derivatives under FDIC bailout protection [www.emptywheel.net], the at least tacit approval of the Fed [but not the FDIC], and the craven attempts by the WH to continue these discussions after NY, DE, CA, and NV all pulled plugs on deals. The pols ought to know that no amount of money in the OWS environment will provide enough advertising to obscure the conclusion that they SOLD OUT THE VOTERS by approving this without ANY investigation, and at pennies on the dollar compared to the FHFA lawsuit already in progress, much less the ones to come as this case’s effects progress along.
Bottom line, the erstwhile new homeowner has a tort against the seller, and the title company. Since fraud is involved there are additional damages that can be claimed by the ENHO because they were told that the home was indeed available to be sold when it wasn’t. This would be in addition to the DA deciding to prosecute for grand theft or wire fraud or RICO, or any number of other state and federal laws. “St” Ronnie sent the S&Lers to jail for destroying that market, by the hundreds. Time for more of the same.
The bank manipulated housing boom that was built on legal quicksand just had that quicksand turn into quickshit.
What makes you think this won’t bankrupt the title ins corps?
Ownership society!
It’s all the fault of the poor black people!
It’s all Fannie & Freddie fault!
Add to my scapegoat list. I’m sure I missed some faves.
I don’t suppose that the vultures will get caught in this. Oh no no no no no. They flipped the houses too quickly. They, as usual, get off scott free.
Couldn’t agree more. The lovely irony here is that the resident actually can prove title. They get to stay until somebody else can prove title to the mortgage and then follow the LEGAL foreclosure process. Talk about just desserts!!!
That’s good for the resident, but it sure does F Up the housing market. For years, until every one of these properties gets sorted out. Not to mention puts a lot of liability right back where it belongs, on the crooks who bundled all these mortgages together and never did what their prospectuses said they would (actually transfer the mortgage).
it will be a good lesson in the true corruption of the American system – how this all gets made OK so nobody who made money off this scam has to take any losses. It will make a Cirque d Soleil contortionist look like an iron beam.
I anticipate a quickly enacted law holding all banks not responsible, but all 99% purchasers fully liable.
Considering We the People have already “eaten” much, much more than our fair share, I’d say the bankers are lucky if we don’t claw-back all ‘income’ derivative of TARP funds, and all income derived from speculating with money they borrowed from us, and all bonuses going back to at least 2003.
For starters.
LOL but so true. it will be a triple satan sandwich but the only way. LOL
Wow. Why does part of me think this just might work out to be a good thing? And the rest of me is scared to death by it.
Saw this on the guardian would have laughed but I am convinced that is the game plan to reduce us all to same living conditions as china
The solution to the eurozone crisis is for Europeans to work harder and for longer, rather than being cushioned by the welfare system, said Jin Liqun, chairman of China Investment Corp, China’s sovereign wealth fund. He warned on Wednesday that Europe’s fundamental problem was that its workers were simply not productive enough.
“The root cause is the overburdened welfare system built up since the second world war in Europe: sloth-inducing, indolence-inducing labour laws,” Jin told Channel 4 News. The average Chinese working week is nearly 48 hours, the maximum allowed under European law. “We work like crazy,” said Jin. Graeme Wearden
Yes, if by `banks` you mean `middle-class taxpayers`.
I have said from the outset that had the Democrats followed the spirit and intent of the Great Society, much of this could have been avoided. Thus, had Congress given Legal Aid the wealth of funding necessary, the attorneys within Legal Aid would have been leading the charge, both in state and federal courts, and where the courts could not maintain their traditional fiction that chain of custody of titles. Conversely, a ‘clean’ title is the ‘bonus’ that would have occurred and where “government works” and quite effectively, would become the national storyline that refutes Ronald Reagan. Unfortunately, the Democrats in Congress “failed” in their efforts to represent their respective constituencies, writ large. And just as Congress doesn’t do “declarations of war” and consequently, we, the voters, have no expectation that our vote counts.
Jaango
Not surprising to me. Before I moved up here to Cleveland my brother commented that I could probably get a nice house here for very little. But, he added, good luck trying to get clear title to.
Yeah, I’m sure Jin’s kids are busy making basketball shoes 12 hours a day as I’m writing this.
What about the transfer fees owed to the counties? They’ve been forced to cut back because MERS hijacked a healthy chunk of their revenue streams.
Yeah, and just add a new chant:
“Title Companies got bailed out!
We got sold out!”
I doubt it will be homeowners — previous or current — that will receive any sort of help.
And, as soon as Title Co’s start to feel the heat, that will depress the housing market even more, because who wants to buy insurance from a company that might go belly up any second? Thank god for the state AG’s who didn’t go along with the settlement ideas, so there’s still a prayer that a few banks will pay up a very small fraction of what they need to.
If you commit fraud really really fast then people can’t see it and then it’s O. K.
“The banks are going to end up eating this.”
Guess you weren’t paying attention 3 years ago.
Title companies will be OK here. Bet on it. They always attach CYA riders and the fact that you haven’t heard a peep from them, or their lobbyist mouthpieces, indicates that they caveated themselves out of this just fine. Besides, there doesn’t even have to be a title company involved in a foreclosure sale.
Hhmm, an institution with real clout is flaunting “Look Forward, Not Back”.
I wonder what the “savvy businessmen” are going to say about that.
Not if Obama & Geithner get another bite at the apple.
Think how many scoundrels in congress will have to go for the banks
to be held accountable.
Not if the title companies stop offering coverage when the title is not clear-cut.
Massachusetts a record title state. Why have a registry of deeds?
There is a much bigger issue here, too… In states where people pay property or real estate taxes, until title is totally settled, the counties will not know who to bill. If a supposed property owner (who bought one of those bargain foreclosures, for instance) decides not to pay his tax bill because of ownership doubts, then the county can sell the property at a tax sale — or can it? In other words, the title is so clouded that, absent an expensive and detailed search to quiet title, no one can do anything.
A few years down the road, if a true owner is identified, the taxes due will be enormous! And, what about inheritance laws and succession? What the banks did just totally gums up the works!!
If there isn’t a movement to nationalize these banks, arrest the fraudsters, disgorge their profits, liquidate the institutions, open state banks in each state, well then we are all slaves to the bankers. It should be clear to anyone with a brain that the financial industry has destroyed the American economy, single-handed. What is the prison time for destroying an economy ? Ask a jury of middle class homeowners for the answer to that question.
LOL. You break me up!!!
About 522
Regrettably, Obama said the banksters “did nothing illegal”. I guess that depends on how you define “fraud”.
You beat me to it with both of your comments. As soon as I saw the headline, my first thought was: It’s All & Solely the fault of the dreadful home-buyers! If there’s any “problems” with foreclosure sales, the banks are blameless innocent lambs. Somehow the home-buyer is surely to blame, and my lordy, if they’re a minority… well: say no more!
I’m surprised our resident trolls haven’t swanned to this post to adjure us on how it’s always & only the fault of the lousy lazy 99%. Banks are blameless… yadda yadda…
Rightio! Banks, by Obama’s definition, can never engage in fraud or illegal activities. Only the 99% can and do.
It seems that nationalizing the banks is becoming part of the OWS movement.
Apparently, Germany has done extremely well with national banks.
http://www.alternet.org/economy/152736/what_we_can_learn_from_germany%3A_how_countries_with_publicly_owned_banks_do_better_than_america/?page=4
“The example of Germany shows that even success is no guarantee in the face of a relentless onslaught of propaganda by large privately owned banks interested only in making money for their CEOs, wealthiest clients and shareholders. But peering behind the propaganda, the public banking model that helped underwrite Germany’s economic success might be the fast track to a US banking system that serves Main Street rather than Wall Street.”
Can anybody please tell me the name and/or legal cite for the case?
Thanks.
Would love to agree that having the banks finally eat their own losses is the only possible conclusion, but I note that here, it was, apparently, an innocent purchaser for value that got the consequences, not the banks. I have seen enough that it is hard for me to believe that anything but a successful revolution will be able to hold the banks accountable. “They own the place.”
nevermind, found the name by googling “Bevilacqua” and “foreclosure”.
I have a question for the lawyers: is there still a writ of novel diseisin? Would something like that clear the air (if not the books)?
you put a monkey in front of a calculator, and sooner or later it’ll go Enron on ya.
Bevilacqua means “drinks water”, or in this case Bevisottolacqua: drinks underwater.
Old real estate saying … “Never steal in slow motion”
If only the fed could intervene, but alas, the property in question is NOT federal land, hence no federal jurisdiction.
Slice it, dice it, mince it, chop it, these are in rem issues and the problems arise out of the banksters’ failure to abide by the individual state of situs’ rules on transfers of ownership and recordation thereof. This failure of course was a deliberate end run by the banksters around the state recordation process and fees.
Yes Virginia, the banksters will take it up the ass on this. And they deserve to.
Don’t worry about the US economy. It’s already dead. It just hasn’t been buried.
BUT take heart. This system fails for 90% of the world population and therefore must and more importantly, WILL change. OWS is just the start of a long awaited awakening.
Wait and see. Take heart and fill your hearts with light and love.
Blessings of love to all.
I am re-posting my comment from an earlier thread and encourage all of you to pass this information along to your county recording official.
County Recorders are beginning to take proactive action. Most prominent among them are John O’Brien, Registrar of Deeds, Essex Cty. (Salem) MA and Jeff Thigpen, Registrar for Guilford Cty. (Greensboro) NC. A recent audit in Essex Cty. revealed 75% of all Assignments of Mortgage were invalid and an additional 9% were questionable.
http://www.salemdeeds.com/pdf/PressRelease7-29-11.pdf
O’Brien is refusing to accept for recordation any document without signature authentication of both the Affiant and the Notary.
http://www.salemdeeds.com/pdf/RobosignerRejectionLetterTemplate.pdf
http://www.salemdeeds.com/pdf/AffidavitofAuthenticity.pdf
Press Release by Jeff Thigpen:
http://4closurefraud.org/2011/03/02/nc-register-of-deeds-jeff-thigpen-takes-on-mers-questions-if-county-is-owed-millions-titles-compromised/
Here is a link to determine whether or not your mortgage in a part of the MERS fraud:
http://www.salemdeeds.com/robosite/
This database is extensive, however; if you get a “no matches found” as I did, it does not guarantee you are not affected.
I don’t think there will be clawbacks, but there might be a need to complete the repayment of monies loaned by the gov’t via transaction taxes on derivatives. That might also have the benefit of inhibiting the use of exotics and riskier instruments.
It was always said that there would be a loan, payback and in the end a cleaning-up of gov’t losses with this kind of tax. The 99% should not be out a penny for having loaned emergency funds to keep things going. We are, after all, in this together.
That is the obvious solution – and is the process in most states, albeit quite slow, and I suspect will be the process in Mass – so a speed up of the process is likely via a new law.
Indeed the cases my daughter has won have all just been delays as the bank must put together proper documents – about an extra one year of rent free living as the folks look for jobs and the bank goes back to court a few times (my daughter does these pro-bono as part of “religious”/just doing the right thing outreach).
This is a huge victory for our hero – Register O’Brien who has been fighting the robosigning, MERS and the banks before it was “sexy” to do so :) And yes, he was also fighting the MA Real Estate Bar Association’s President Bloom – they were ready to side with the banks! America – listen and watch – we, the people are winning!
Please read the correspondence between Reg. O’Brien and Edward Bloom: http://boston67.blog.com/peoples-hero/
Bloom says it all:”“Ibanez created a lot of problems,’’ said Bloom, the Real Estate Bar Association president. “The hope was that the court might solve the title problems created by Ibanez for people who bought at foreclosure sales,’’ he sa…id, but “the Bevilacqua case leaves all those people in limbo.’’
While Ibanez case was a light at the end of the tunnel for us, for him it created a lot of problems! What a moron!
Insurance companies make money by denying claims. Their rates are not based on the assumption that fraud on the part of banksters will go unchecked and is allowed to continue.
Why do people think that somehow insurance is a magic-money bucket.
When the companies see their rates are not generating enough profits, reserves, and cash to pay claims, they will find ways to deny claims.
And they may just do that anyways.
“a good object lesson, anyone buying any real estate should”
hier an attorney
Here is the real effect.
A new home loan is going to be TOUGH to get. Meaning, not very many buyers. Meaning, lower and lower demand. Meaning, lower and lower house prices. Meaning, many seniors who depend on the equity in their homes are going to be up shit’s creek.
It is already tough to get a home loan. After this all happens, it will be near impossible for all but a few.
That is the catch 22 we are all caught in. To recover the housing market, you need to have home loans readily available. But, with values going down, the loans are much more risky–they become like big credit card loans. When the banks also cannot depend on recovering the asset they loaned against, then, the loans become ever more risky and the qualifications needed get even higher.
And, here is the biggest fact. There is not enough income or assets in the Federal government to cover the housing market–it is too massive for even the government to handle. And, there is not enough money in the banks to cover it–unless you talk about using depositors money.
And, there isn’t enough FDIC money to cover all the depositors.
“The 99% should not be out a penny for having loaned emergency funds to keep things going. We are, after all, in this together.”
MarkH,
Then where is the money going to come from. We ARE the gov’t
Thank God Obama did not find any corruption or fraud in the banks!
At this point I start to ask myself if Obama could find his way back to the White House if he had to walk around the block. Or maybe he thinks we’re all that dumb.
How much longer does he try to pretend that the banks did nothing illegal without starting to look like a total idiot?
please tell me you are kidding. Obama doesn’t look stupid to you? Actually, you are correct. He is the all=time best shyster the repubs have ever had. This pompous ass prostituted himself to the banks faster than a nickel whore in a parking lot. And now, wants the people to believe he was held hostage and none of the things he has done were his fault.