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Ohio Appeals Court Reverses Another Lower Court Error In F’closure Action; Nixes Bankster Affidavit Based On Computer ‘Screenshot’ Of Account Details

Thanks to an obscure ruling from the Cuyahoga County Court of Common Pleas, mortgage lenders in the Cleveland, Ohio area trying to substitute new documents for ones found to be faulty will have 30 days to explain why the cases should not be summarily dismissed. In additions, the signer of any affidavits or documents seeking foreclosure will need the original promissory note in order to prove foreclosure.

Mortgage lenders have sought to merely replace “robo-signed” documents with new substitute documents, in order to keep the foreclosure train rolling. This ruling in Cuyahoga County would disallow that. Here’s what it says:

In prejudgment cases where a lender has requested a delay in the proceedings to examine evidence it has submitted or otherwise calls into question the validity of the evidence its has submitted, the Committee recommends the entry of an order requiring plaintiff within thirty days to show cause why the case should not be dismissed without prejudice.

In post judgment cases where the lender has requested a delay in the proceedings to examine evidence it has submitted in support of its judgment or otherwise calls into question the validity of the evidence its has submitted, the Committee recommends the entry of an order requiring plaintiff within thirty days to show cause why the case should not be dismissed and the judgment vacated.

In any case where the lender seeks to remove the case from the active docket to examine evidence it has submitted, the Committee recommends that the motion be denied as improper under the rules of Civil Procedure and Superintendence. Following denial of the motion, an order as described above should be entered.

In other words, a party seeking foreclosure would basically have to start the process all over again in Cuyahoga County, as opposed to the substitute process. This stretches out the time before a foreclosure becomes legal and imposes significant costs on the banks. It’s a win for outgoing Attorney General Richard Cordray, who will soon join the Consumer Financial Protection Bureau. He basically wants this to become the standard for all courts in Ohio.

In addition to this ruling, the guidance in Cuyahoga County follows some other rulings by state Supreme Courts in New York and New Jersey. It forces counsel for the foreclosing party to attest personally to reviewing the foreclosure file, and that the signer of the affidavit has as well. Failure to provide proper documentation and affidavits to this effect would result in the signer or an officer of the party seeking foreclosure having to come to court to testify about his or her personal knowledge. Sanctions for perjury or contempt of court could spring from that.

What’s more, if no affidavit is signed attesting to the validity of the documents, and a affiant or officer of the party foreclosing has to come to court, they have to walk in with the original note in their possession. The key piece:

The affiant or officer of the party seeking foreclosure who appears in court in lieu of the filing of a foreclosure counsel affidavit must appear with the original promissory note, including all endorsements and allonges and a current payment history for the mortgage loan at issue. The affiant or officer of the party seeking foreclosure must be prepared to testify that he or she has personally reviewed the documents, records or other data related to the case, has reviewed the pleadings and other court filings in the case and has confirmed both the factual accuracy of the filings and the accuracy of the notarizations contained in affidavits filed in the case, if any. The affiant or officer of the party seeking foreclosure must be prepared to respond to the questioning of the magistrate or judge presiding over the hearing and the questioning of any other party attending the hearing.

That’s pretty hardcore. Basically it makes it nearly impossible to do anything but use verifiable documents and signatures, without risking sanctions and the dismissal of the foreclosure case.

As 4closure fraud, which first noticed the affidavit policy of the court, said, “This is all we ever asked for, the rule of law, that is already in place, be followed.”

Courts are slowly but gradually codifying policies that put much greater burden on mortgage lenders and their counsels to actually follow the law. We’ve seen in recent years that the banks cannot be expected to do that. So something’s gotta give.

FireDogLake

Yes, Mr. Cordray, they are.  Thank you for stating it for the world.  Welcome to our reality.  A reality that Matt Stone and Trey Parker figured out over a year ago.

Where are the rest of the State Attorneys General?  Every single one of them should be saying the exact same thing as AG Cordray!  Every single one of them should be prosecuting these bankers to the full-extent of the law and there should be a long queue to the prisons!

CONSUMERS NEED  !!

Hoh hoh hoh….

This is big news. I just got off a conference call with Richard Cordray, the Attorney General for the state of Ohio. He has filed a lawsuit in Lucas County (Toledo) Common Pleas Court against GMAC Mortgage and their parent company Ally Financial, in a suit which names Jeffrey Stephan, the infamous robo-signer who signed off on up to 10,000 foreclosures a month across the country with affidavits, without verifying the information in the foreclosure documents. The lawsuit alleges fraud on the part of GMAC, along with violations of the Ohio Consumer Sales Practices Act, in filing false affidavits to mislead the courts in what they describe as hundreds of Ohio foreclosure cases. And, the Attorney General is treating every single false affidavit filed in an Ohio court as a separate violation, with a fine of up to $25,000, plus additional restitution for the homeowner of an unspecified amount.

That’s because it is a separate violation.

That’s north of $10 billion dollars, potentially, for GMAC/Ally alone.  In one state.

And by the way, he’s also calling it what it is: fraud upon the court.  That is, a crime.

There is a hidden bomb in here as well:

Now that has potential.  If MERS didn’t (and couldn’t) actually have the note….. who did?

Here comes the REMIC question!

One of the best parts of this suit’s filing is that it will make possible discovery, during which we’re likely to find out a whole lot about the origination practices of these firms, and exactly how, and if, they conveyed what was supposed to be conveyed – or if the entire securitization structure is a house of cards.

Go get ‘em.

Those of you counting on getting your old assembly line job back in Detroit can forget it.

The recent eight year forecast published by the Bureau of Labor Statistics shows that 4.19 million jobs will be gained in the US in professional and business services, followed by 4 million health care and social assistance jobs, while 1.2 million will be lost in manufacturing. This is great news for website designers, Internet entrepreneurs,  registered nurses, and masseuses in California, but grim tidings for traditional metal bashers in the rust belt manufacturing states like Michigan, Indiana, and Ohio.

I’m so old now that I am no longer asked for a driver’s license to get into a night club. Instead, they ask for a carbon dating. The real challenge for we aged career advisors is that probably half of these new service jobs haven’t even been invented yet, and if they can be described, it is only in a cheesy science fiction paperback with a half dressed blond on the front cover. After all, who heard of a webmaster, a cell phone contract sales person, or a blogger 40 years ago? Where are all these jobs going to? You guessed it, China, and other lower waged, upstream manufacturing countries like Vietnam, where the Middle Kingdom is increasingly subcontracting its own offshoring.

These forecasts may be optimistic, because they assume that Americans can continue to claw their way up the value chain in the global economy, and not get stuck along the way, as the Japanese did in the nineties. The US desperately needs no less than 27 million new jobs to soak up natural population and immigration growth and get us back to a traditional 5% unemployment rate. The only way that is going to happen is for America to invent something new and big, and fast. Personal computers achieved this during the eighties, and the Internet did the trick in the nineties. The fact that we’ve done diddly squat since 2000 but create a giant paper chase explains why job growth since then has been zero, real wage growth has been negative, and American standards of living are falling.

Alternative energy and biotechnology are two possible drivers for a new economy. Unfortunately, the last administration did everything it could to stymie progress in both these fields, coddling big oil so China could steal a lead in several alternative technologies, and starving stem cell researchers of Federal cash, ceding the lead there to others. While the current crop of politicians extol the virtues of education, the reality is that we are dumbing down our public education system. How do we invent the next “new” thing, while shrinking the University of California’s budget by 20% two years in a row? If my local high school can’t afford new computers, how is it going to feed Silicon Valley with computer literate work force? The US has a “Michael Jackson” economy. It’s still living like a rock star, but hasn’t had a hit in 20 years.

China can have all the $20 a day jobs it wants. But if it accelerates its move up the value chain, as it clearly aspires to do, then America is in for even harder times. I’ll be hoping for the best, but preparing for the worst. How do you say “unemployment check” in Mandarin?