JPMorgan Foreclosure Disputed, Casting Wider Doubts

The integrity of thousands of foreclosure notices issued by JPMorgan Chase could be cast in doubt, as a court battle over one Florida homeowner's foreclosure might implicate numerous similar filings, reports Bloomberg News. It's the latest example of a situation that could stall foreclosures across the nation.

Last week, the Washington Post reported that Jeffrey Stephan, a document processor for Ally Financial, who lives in a "modest" two-story house in a small Pennsylvania town, had approved up to 10,000 foreclosure documents a month without actually reading them. The news came to light after Ally said it was putting the brakes on foreclosures in 23 states, citing "corrective action" it needed to take. And when, at the end of the week, Ally began to withdraw foreclosure documents reviewed by another employee, Kristine Wilson, it appeared there might be yet another "robo signer."

Now, lawyers for a Florida homeowner are using a May statement by JPMorgan executive Beth Ann Cottrell to claim that the homeowner's foreclosure isn't valid. In her statement, Cottrell said she was part of an eight-person team that approved about 18,000 documents a month without seriously reviewing them.

"My review is more or less signing the document unless it's questionable," she said, according to Bloomberg, where "questionable" is meant literally: "somebody has a question and brings it to me and says, 'Beth, can you take a look at this?'"

These increased doubts about foreclosure filings come as the nation's total volume of foreclosures is itself increasing. More Americans lost their homes to foreclosure in August than in any other month on record, according to data from RealtyTrac.

While the document-processing scandals may seem like good news for homeowners dealing with foreclosure, Bloomberg notes that the doubts could delay the housing market's recovery. Home prices continue to fall, and foreclosure controversies, which create uncertainty in the market, may delay their hitting bottom.

Comments

[Taninthesummer]

10:09 PM on 10/07/2010

President Obama,

You MUST NOT abandon the American middle class! This is your moment to raise your reasoned, yet passionate voice, in our favor. Please, do not allow the banks to take control of this situation. They are not worthy. We are.

[rocky41]

04:00 AM on 10/07/2010

I had never heard of a "no doc loan"--meaning that Chase did not request any application info dor a mortgage I was more-or-less coaxed/invited to obtain. I suppose that this is because they charged $8,000 in closing costs that were included in the loan without my knowledge. They also said that I could "recast" the loan, but they have refused this since closing. Is there anyone/attorney accepting cases such as this???

[lawgrace]

03:40 PM on 09/30/2010

QUESTIONABLE commercial and residential real estate foreclosures via deceptive and fraudulent proceedings enable lenders to repeatedly, illegally flip properties, and enables falsified IRS form 1099-A’s. Foreclosure fraud is the best means by which unscrupulous foreclosure mill lawyers deceptively auction and bid (or insiders bid) and acquire those properties; and some neighborhoods blighted.

Foreclosure fraud deliberately utilizes defunct mortgage lenders companies or companies which no longer own promissory notes; huge ransom “fees makes it even harder for property owners to regain properties. Two particular companies “which benefit from fraudulent foreclosures are Wells Fargo and Freddie Mac.

Representations about Freddie Mac billion dollar losses should be weighed against the needless money that Freddie –as well as other lenders– PAY foreclosure mills and debt collectors who utilize courtrooms to outmaneuver and persecute property owners who oppose fraudulent foreclosures. Further, when justified lawsuits for fraud –as well as for OUTRAGEOUS “Unfair Debt Collection Practices,” become filed against lenders and mills, those same lawyers make additional $$$$ from litigating and concealing their own wrongdoing!

Further, THE SHOCKING fabricated pleadings filed in Bankruptcy courts for FRAUDULENT REPOSSESSION of commercial and residential real estate res ipsa loquitur is demonstration of intentional foreclosure fraud. Foreclosure fraud has many far reaching effects; for example, people UNJUSTIFIABLY EVICTED, UNFAIRLY answerable for IRS tax bills and undue “deficiency judgments.” *MORE @ http://open.salon.com/blog/wwwlawgraceorg/2010/08/18/case_in_point_foreclosure_mills_judicial_fraud_consumer

[msjimmied]

07:05 PM on 09/29/2010

From another perspective, read the comments...thought provoking.

http://www.zerohedge.com/article/its-really-jpm-tells-cnbc-it-systematically-reviewing-foreclosures

[msjimmied]

06:11 PM on 09/29/2010

There is more! Check this other angle out, counterfeit court summons!

http://www.zerohedge.com/article/mortgage-gate-just-got-wierder-counterfeit-court-summons

[Suzanne O'Keeffe]

02:55 AM on 09/29/2010

In a related important story from Ellen Brown, she details that a recent California bankruptcy court recently held that banks do NOT own clear title to the properties held in the name of MERS -- the Mortgage Electronic Registration System devised as a convenient property shuffler to serve the needs of the mortgage-backed-securities speculators.

The court held in the California case that MERS could NOT foreclose and that Citibank could not collect on its claim.

This, to me, is huge news -- why it's not on the front page of every newspaper is curious to say the least. So I'm doing what I can to spread the word.

MERS currently holds 62 million mortgages. As Ellen Brown writes: "The logical result could be 62 million homes that are foreclosure-proof. ... The defaulting homeowners could wind up with free and clear title. ... That means hordes of victims of predatory lending could end up owning their homes free and clear while the financial industry could end up skewered on its own sword."

Here's the article: http://www.webofdebt.com/articles/homeowners.php

[Scoppertop]

07:54 PM on 09/29/2010

Great article, thanks! F&F.

[Suzanne O'Keeffe]

08:39 PM on 09/30/2010

Happy to spread the word, Scoppertop!

[pjdj34]

10:03 PM on 09/28/2010

So I gotta wonder... Do you think bank management knew they had/have an enormous problem with "lost" mortgage notes leaving them with unsecured loans, at risk of losing billions of dollars and being sued by investors right and left. And because they knew, they purposefully horded government money (remember tarp) to build reserves instead of loaning it to small businesses to get the economy going again. When the internal emails at the banks start showing up and some honest whistle blowers step up, the Sarbanes-Oxley crowd is going to have a field day with lots members of Board of Trustees. Come on state AG's, get going.

[Tiggerchick]

10:10 AM on 09/28/2010

My neighbor just told me that he went through the mod. process. "Successfully" They paid the trial modification payments for the prescribed three months and then received their successful modification paperwork with their new payment. Too bad the new payment wasn't the same as the trial payments - it was approximately $25.00 less than the original payment. My neighbor (unemployed) is now back to being 4 months behind. This makes me wonder about the stats of the HAMP program...the blah, blah of "X% of approved homeowners fall back into default." Well, gee, I guess you would want them to fall back into default if you give them a permanent payment that's closer to the original rather than the one they paid during the trial. I truly believe mods are simply the banks way of squeezing a few more dollars out of the desperate homeowner before they foreclose.

[Tiggerchick]

10:06 AM on 09/28/2010

There is only one true solution to stabilize the housing "free fall" Cram down. It will effectively slow down foreclosures, stop strategic defaults and reset the housing market. Banks say that they don't want homes; however, all of their behavior is to the contrary. They either do want the homes or they're simply so large that they now have become inept.

My example - job loss/burned through savings after about seven months. 1st mortgage current/never late. 2nd mortgage (same bank) - 60 days, NOD issued. Asked the bank to extend the 15 yr. term to 30 yr. and decrease the interest. It didn't matter that they would have earned more $ over the life of the loan. It didn't matter that the first was current. Their rules are "we don't modify seconds". End of story. They now have their house. My rent is approximately equal to my first and a % of my second - I could have stayed in the house, they could have made more $ - win, win. Now it sits vacant and rotting - great for my neighbors, isn't it? Turns out they had insurance on both mortgages so they get the $ AND the house. So in that scenario, yes, it makes more sense for the bank to foreclose. Wonder how many other mortgages are insured without the homeowners knowledge. This is the pyramid Wall St. has built - placing bets for America to fail and they gain.

[truthfinderddw]

07:21 AM on 09/28/2010

Thats why banks and their servicer's have been so successful at Foreclosing. America's due process is for the few and powerful. What happens when the Inventory get so large. Well!

[frank day]

01:25 AM on 09/28/2010

Its home owners and Investors vs Wall Street. Guess which side Congress is on?

[Sundialsvc4]

10:15 PM on 09/27/2010

I quite firmly believe that ...

(a) There is a MASSIVE securities fraud going on here, and every single one of the "too big to fail (sic...)" institutions are hip-waders deep in it.

(b) ... and so are plenty of Civil Officers in our Government, who never saw a single "million dollars a day" that they did not covet.

(c) "Whatsoever ye sow, that also shall ye reap."

Right now, there are lots of high-flying people who know that the Day of Reckoning is upon them. And they are wasting no time telling Congressmen, Senators, and Justices, and Commissioners (and Presidents??) that "if I go down, so do you."

But... this thing is SO huge, and SO outrageous, and SO blatant, that there is no other possible outcome. 310 million people in this country, and billions(!) more outside of it, are not going to "take the fall" here. They are not going to give up their lives, their futures, or their children's children's children's futures, to prop up or to perpetuate the insanity of less than one thousand hardened criminals.

"No."

[frank day]

01:13 AM on 09/28/2010

Its a gigantic miserable mess.

[grouseless54]

08:02 PM on 09/27/2010

Let's be very generous and credit Mr. Stephan with 240 hours per month. Doubt it, but that's 42 statements per minute and we all know that even bankers have to take time out to pee. So, Mr. Stephan's superiors (I use the term loosely) were aware, the entire time, that his work could not be accurate or adequate. That the bosses thought they'd never be caught is interesting. As an ex-banker, it means - to me - that they're up to something else that they need to spend real time and money on and that thought gives me heartburn.

[frank day]

01:14 AM on 09/28/2010

Well said.

[IncredulousInNorthDakota]

07:40 PM on 09/27/2010

1. Put your money in the smaller local banks that are community driven rather than shareholder profits driven.
2. Sit back and watch the Wells Fargos, Bank of Americas, Chases, and other too big to fails come tumbling down.
3. Applaud the forward looking statesmen who vote to return to the successfully tested banking regulations that Reagan tossed away 30 years ago and started this mess afresh.
4. Don't get fooled again.

[tapeatsbill]

07:49 PM on 09/27/2010

Fanned - You are so right on! Move your money to local bank. Local means in your state!

North Dakota's state bank is the envy of every other state.

[prock]

08:36 PM on 09/27/2010

You're forgetting
5) Prosecute for fraud
6) Insure that the sentence matches the crime.

The days of the SEC slapping Goldman Sachs with a 550 million dollar fine for running a multi-billion dollar scam have to end if we are ever going to see the financial system mended.

[GloriaY]

07:33 PM on 09/27/2010

This reminds me of the saying " oh what a tangled web we weave when first we practice to deceive." Corrupt Wall Street bankers were so bent on cheating by any means necessary, that better judgement was replaced by greed, and all they could see were millions in their pockets. Can't wait for the lawsuits that should follow and to see the guilty handcuffed and carted down to jail. Hope that they are not allowed to get away with this one too. Wall Street bankers are heartless, merciless, dishonest scumbags.