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"If the American people Ever allow private banks To control the issue of their currency, first by inflation, Then by deflation, The banks and corporations That will grow up around them Will deprive the people of all property Until their children wake up homeless On the continent their fathers conquered. The issuing power should be taken from the banks And restored to the people, To whom it properly belongs." Thomas Jefferson, Letter to Treasury Secretary Albert Gallatin (1802) WASHINGTON – March 2, 2009 – While the Obama administration battles to keep people from losing their homes, one Florida lawyer said she has a better answer to the toxic mortgage epidemic sweeping the country – fight back against the loan servicers and banks that are improperly pressing the foreclosure actions. “The loan servicers bringing most of the foreclosure actions in the country don’t own the mortgages and have no standing to take away a person’s home,” said the lawyer, April Charney, who has stopped scores of foreclosure actions in Jacksonville, Fla., where she works as a Legal Aid lawyer. In essence, Charney has forced scores of plaintiffs in foreclosure actions in Jacksonville to admit they don’t have legal ownership of the securitized mortgage they are trying to foreclose upon – stopping the home takeover battle in its tracks. The strategy has spread virally around the country and now thousands of foreclosure lawsuits are sitting idly – in legal limbo. “I have one case from 2004 where the bank has not returned to court and where my client now has deposited more money into a trust account than the house is worth,” Charney noted. Charney has held seminars in Ohio, Oregon, South Carolina and throughout Florida to educate lawyers on how to implement the courtroom defense. At least one Brooklyn judge, Arthur M. Schack, is already using the strategy himself in the courtroom. He told a reporter recently that he denies more foreclosures than he approves. Last summer, 13 of the 14 foreclosure actions that came before him were denied. “I want to see the servicing agent’s power of attorney, I want to see all the paperwork before I approve it,” he said. “If the paperwork is garbage, I deny it. If you’re going to take away someone’s home, it should be done properly.” The legal issue is that banks turn the mortgages into bonds, which are put into trusts, like collateralized debt obligations, or CDOs. The banks “sell” the CDOs the right to collect the revenue stream but, according to Charney, not the equity right to the property. Charney notes that under the current set-up, the mortgage default hurts everyone – like a neighbor who could be a state worker whose pension fund money is invested with a hedge fund that has invested in a mortgage CDO. “So far I’ve drafted about 1,500 lawyers into my army,” Charney said in a telephone interview last week. She is scheduled to hold her first New York seminar next month. “Of course, I’m looking to educate them and have them use the same technique here,” she said. That should be sweet music to homeowners here who are facing a foreclosure action. Charney said Washington has the resources to allow every mortgage holder the right to modify their mortgage – something that would definitely mute the criticism that the Obama plan rewards failure by allowing those who obtained mortgages they couldn’t afford to cut a deal for a lower monthly payment. “Look, the same problem that banks are having with securitized mortgages is going to spread to defaults with car loans, credit card accounts and student loans – they are all securitized and the banks and loan servicers starting legal actions to collect on those defaulting loans will face the same issue proving ownership,” said Charney. As for Obama’s $275 million mortgage plan, Charney said she has a better idea: “The U.S. government has to take over every one of these securitized loans and open up the mortgage modification plan to every American. That’s the only way we are going to get past this horrible thing,” said Charney, who has become, alongside a handful of other consumer advocate legal eagles, quite a cult personality for her pioneering courtroom foreclosure defense strategy. Rep: Foreclosed owners should squat in their own homes: David Edwards and Stephen C. Webster Published: Friday January 30, 2009 If you're poor and the bank is coming for your home, Congresswoman Marcy Kaptur has a plan for you. Just squat, she says. Yes, this Ohio Democrat is actually encouraging her financially distressed constituents whose homes have been foreclosed upon, to simply stay put. In a Friday report, CNN's Drew Griffin explored the case of Ohioan Andrea Geiss, whose home was foreclosed upon in April. "Behind in payments, out of work, a husband sick, she had nowhere to go," said Griffin. "So, she decided to follow the advice of her Congresswoman and go nowhere." In Lucas County, Ohio, over 4,000 properties were foreclosed upon in 2008, reports CNN. "So I say to the American people, you be squatters in your own homes," said Congresswoman Kaptur before the House of Representatives. "Don't you leave." She's called on all of her foreclosed-upon constituents to stay in their homes and refuse to leave without "an attorney and a fight," said CNN. "If they've had no legal representation of a high quality, I tell them stay in their homes," Kaptur told Griffin. Kaptur is a high-profile advocate of an increasingly popular mode of fighting foreclosures best known for it's key phrase: "Produce the note." By telling a bank to "produce the note," a homeowner can delay foreclosure by forcing the lender to prove the suing institution is actually the same which owns the debt. "During the lending boom, most mortgages were flipped and sold to another lender or servicer or sliced up and sold to investors as securitized packages on Wall Street," explains the Consumer Warning Network. "In the rush to turn these over as fast as possible to make the most money, many of the new lenders did not get the proper paperwork to show they own the note and mortgage. This is the key to the produce the note strategy." And Friday's segment on this growing foreclosure fighting "movement" was not the network's first. Earlier in January, CNN explored one person's strategy in demanding her bank "produce the note," only to find that the lender had "lost or destroyed" the evidence of debt ownership. Such a revelation can significantly strengthen a homeowner's position when asking to renegotiate a mortgage. That these banks, many of which received billions of dollars in government bailout funds, continue to boot defaulted owners from their homes, makes them "vultures" says Kaptur. "They prey on our property assets," she said. "I guess the reason I'm so adamant on this is because I know property law and its power to protect the individual homeowner. And I believe that 99.9 percent of our people have not had good legal representation in this." VIDEO >>> |
