Hi everyone. Alan has had computer issues. (There was the little matter of the coffee spillage drowning the logic board) In addition, some work thingies have kept him tied up. He promises to post soon.
In the meantime, here’s piece that’s worth reading. (And I’ll likely emerge again from my literary bubble to post something else late tonight.)
******************************************************************************************************************
As you likely know, Barney Frank announced on Friday that he wants to take $50 billion of the remaining TARP money in order to try to slow the still ongoing torrent of foreclosures.
In that same vein, here’s an intriging article from the LA Daily Journal written by my pal Marty Berg about what some attorneys are doing to challenge some of those same foreclosures.
The Daily Journal, just to remind you, is the paper that lawyers and judges read—but that you and I do not, mainly because a subscription to the DJ costs nearly as much as a downpayment on a two-bedroom, recently repo’d house.
Since, for the abovementioned reason, there is no way you can access the article online, rather than the usual snippets, you’ll find the whole thing below:
(PS: The above photo is of Bennington College, taken yesterday when it was a gorgeous and very chilly 14 degrees. And, just to be clear, no, no one is foreclosing on Bennington.)
(PPS: Go Slumdog!!!)
FORECLOSURE WAR: LAWYERS V. BANKS
by Martin Berg
For the vast number of distressed homeowners, the massive federal bailout has provided no help. Neither has the federal program designed specifically to help homeowners. About the only thing the Bush administration and Congress agree on is that it’s a total flop.
Meanwhile, the number of foreclosures across the country continues to soar. But so does the number of lawyers stepping in to fight them in court.
And the lawyers are having some success – while uncovering even more troubling aspects of the nation’s mortgage meltdown.
One way these lawyers have been able to halt or stall foreclosures is by asking what would seem to be a very basic question: Before a financial entity takes away someone’s home, shouldn’t it have to prove it owns the loan it wants to foreclose on?
Remember, the original lenders passed on the risk associated with the loan, by slicing it up into pieces and selling it to many different financial institutions, who have no relationship to the borrower at all.In California, many of the cases are at an early stage.
But a federal judge in Ohio blocked 14 foreclosures in a November 2007 ruling, finding Deutsche Bank National Trust Co. hadn’t proved it owned the loans.
“Challenging ownership [of the loans] is a coming wave in our state,” said Maeve Elise Brown, executive director of Oakland-based Housing and Economic Rights Advocates, which conducts training for lawyers fighting foreclosure.
In Southern California, Pasadena sole practitioner Philip Koebel recently sued on behalf of a retired Bank of America teller facing foreclosure, questioning whether the bank seeking to oust her from her home, Wells Fargo, actually owned her home loan.
Koebel acknowledged he knew little about real estate law when he tackled the case, so he tried what he knew. “It’s basic contract law,” he said.
When the woman took out the loan, she fretted about whether she would be able to make the payments. “But the broker told her not to worry, she would be able to refinance in a year,” Koebel said. “What we alleged was that the broker never cared because they knew they were going to sell the loan to somebody else.”
Facing foreclosure was stressful for her mother and the entire family, said her daughter, Deirdra Duncan, who lives in the home with her four young foster children. “I tried to keep the kids out of the loop, until a man in a silver truck stopped in front of the house, basically terrorizing the kids, telling them they’re going to be homeless.”
She could never find out exactly for whom the man worked. But he came back several times, in an effort to scare the family into moving out in advance of the impending foreclosure, she added.
Rather than fight the lawsuit, Wells Fargo eventually backed off, agreeing to renegotiate the loan.
Since he first took the case, Koebel has been getting a crash course in real estate law and the mechanics of the mortgage meltdown. He’s part of an e-mail chat group overseen by Walnut-based solo Walter Hackett, a banker for 27 years before he started his legal career.
Hackett said he left the mortgage lending business because he was uncomfortable with increasingly unsavory practices. “I got to know how it should be done and how it shouldn’t be done,” Hackett said. “As it got more egregious I didn’t want to be a part of it.”
Now he is providing an online forum to help a group of nearly 60 attorneys share knowledge and ideas on how to help homeowners keep their homes.
In addition to challenging the entity that’s foreclosing, Hackett said attorneys are also challenging the original loan documents. “We attack the foreclosure at the front end and the back end.”
The point is not to get the houses for free. It’s to force financial institutions to renegotiate shoddy or fraudulent loans at a rate that will allow homeowners to keep their homes. “It’s not in people’s interests to put the banks out of business, and the banks seem to be managing that on their own,” Hackett said.
One of the pioneers in fighting foreclosures is April Charney, a Jacksonville, Fla., Legal Aid attorney. When she started, she knew nothing about the intricacies of the mortgage mess.
That was before she spent days and nights poring over internal bank documents, transcripts, affidavits and depositions. Now she can reel off the industry jargon of credit swaps and MERS, for Mortgage Electronic Registration Systems, like an insider. “I’ve had to learn most of it on the fly. It’s very dense, heavy lifting. It makes your head hurt.”
But she learned more than just the lingo. “This is Enron, times 100,000,” she said. “There was no due diligence anywhere up and down the securitized loan waterfall.”
Now she travels the country training other lawyers when she’s not in court or on the phone.
She and Hackett say lawyers challenging foreclosures can make money from such cases. Wrongful foreclosure cases can generate fees, and some judges have awarded attorneys defending against foreclosure multiplier awards on their fees.
While acknowledging that people facing foreclosure don’t have many resources, Koebel stresses he’s not working pro bono. He said he also hopes to apply what he’s learning on this case to future matters. “These cases are going to be like dominoes.
Whatever we don’t make on a single case, we hope to make in volume.”
As they wade into the thicket, foreclosure-fighting lawyers around the country have taken encouragement from the ruling in Ohio’s Northern District by U.S. District Judge Christopher Boyko, an appointee of President George W. Bush.
In a footnote to his ruling, Boyko sharply criticized financial institutions and their lawyers for arguing that judges couldn’t understand how financial institutions operated because their practices were so complicated. “The institutions seem to adopt the attitude that since they have been doing this for so long, unchallenged, this practice equates with legal compliance. Finally put to the test, their weak legal arguments compel the court to stop them at the gate.”
Although I paid off my mortgage with no help, shouldn’t I be entitled to a retroactive bailout–just to be fair?
Okay – I’m going probably going to start a fight.
I think Slumdog deserved to win in it’s Golden Globe category, considering the competition nominated, and it was one hell of an enjoyable movie. But it’s also wildly over-rated – or perhaps I should say, not the kind of movie that effects me very deeply. Brilliantly produced, acted and directed as an engrossing series of anecdotes, but let’s face it – that script bordered on ridiculous. A total gimmick lacking any dramatic credibility. Audience pleasing, but essentially an exercise in sentimentality and little else that wasn’t erased emotionally over the course of the cutesy narrative. Also a bit too slick a production for it’s own good – except it wasn’t because that turned out to be most of the point. The film even managed to make being covered in shit seem something close to delicious.
The cinematography and cutting were extraordinary – which points to the minor problem I have with the show. Not so much a problem as disappointment that so much exciting material was dissolved in an absurdly gimmicky premise and a resolution that had the emotional weight of chomping on a Snickers bar. (I love Snickers, incidentally and I “loved” the movie. I’m recommending it – but I’m also recommending “Dark Knight.” Haven’t seen “Wrestler” and “Milk” yet, but I’m recommending “Doubt” and “Gran Torino” as the two best “serious” films I’ve seen so far.)
“Slumdog Millionaire”, however, has the best chance of any film this year to go the “Producers” route and end up on Broadway as a musical and then go back to the Big Screen in it’s “complete with songs” reincarnation. This thing is Golden, and perfect for the Globes.
Let me add that my criticisms of Slumdog are in the context of looking at a British film about India, not of being introduced to an Indian film that brings a fresh sensibility (which is what I thought I was going to see.)
Reg, I don’t entirely disagree with you. Yet, I thought it had more content embedded in it than meets the eye, although the structure was a bit glib.
In terms of my own reference, I’d just come off of reading the novel, White Tiger. That, and the fact that I’d recently read many, many blogposts from India during and after the Mumbai seige, may have caused me to fill in some blanks in Slumdog Millionaire, that the film itself didn’t fill, an inobjectivity of which I’m aware.
But I was happy it won anyway, for a list of not terribly artistically rational reasons.
As I said, I enjoyed it immensely. It’s just that the concept started feeling like Swiss Cheese before I had even exited the theater. My biggest disappointment was when I realized it had been directed by a Brit.