Commentary George W. Mantor

RISMEDIA, June 15, 2010—“Judge W. H. Mantor Commits Act of Shooting Self in Fit of Insanity at His Home.” So read the headline from an article in the February 7, 1919 issue of the Brainerd Dispatch Newspaper reporting the circumstances of my grandfather’s merge with the infinite.

It went on to say, “The tragedy shocked Brainerd as the kindly judge had lived in the city over thirty years.”

A “kindly” judge. Doesn’t that have a nice ring to it? Imagine the implications. He arbitrated disputes so fairly that he had a reputation for it. Thus, if you had the facts on your side and the law on your side, in my grandfather’s courtroom, you could win your case against the richest most powerful entities.

Today, at a time when judges have nicknames like “Maximum Bob” and “Hangin’ Henry” it is comforting to know that there was a time when judges understood that justice needed to be tempered with wisdom and compassion. Otherwise, the little guy always loses.

The court system and certainly it’s most esteemed officer should recognize that, for the little guy, justice is often hard to come by. For one thing, it’s very expensive. If the opposition sees you have limited resources, they will bury you in motions. That isn’t due process, it’s a railroading. Send in the Kangaroos! No, wait, they’re already here.

The courts are the last line of defense for an individual who has been targeted by the willful violation of laws, rules, and procedures by institutions that answer to no one.

Entities such as financial intermediaries, energy giants, chemical companies, munitions makers, government agencies, and politicians routinely engage in abuse of power, and can only be reined in and sanctioned by the courts.

The current state of the unlawful foreclosure industry shows the unintended consequences of labeling a company “too big to fail”; they become too big to hold accountable. The results have been no less than the total destruction of the world economy. In my opinion, that would not have happened had we let them fail.

Now, the evil little spawn of that compromise is a foreclosure epidemic that will result in the loss of what some experts predict will be 15 million homes, eight million jobs, millions of small businesses, and decimated retirement funds. Who could argue, in hind site, that it would not have been far better for the average American had the financial intermediaries been allowed to fail?

And, when you view this eve of destruction through the period since 9/11, it makes you wonder if we’ve won or lost the war on terror. Look into the eyes of a recently homeless nine-year-old and you’ll see the kind of terror we would all fight to defend against. But, it isn’t foreign terrorists who did this; it was cheap and shameless grifters under the watchful eye of our courts.

Somewhere between 1919 and the present, the very notion of justice from the courts has given way to judicial advocacy for those with the deepest pockets.

In 30 states, there is no review of the foreclosure process, and in those states wrongful foreclosure is a lucrative business. With no one policing the process, foreclosure fraud is rampant.

In the rare instance when a homeowner fights back, most judges aren’t even allowing them to present their cases before ruling against them. It is the ultimate in rocket-docket justice. Speed over accuracy.

Judicial advocacy for the bankstas. Never mind the law, never mind the facts, never mind who these foreclosers are, or whether they are even the true creditor, or whether the obligation was satisfied through a combination of borrowers payments and fees, credit default insurance and public money in TARP funds.

It’s public money, and the pool has been paid off with tax payer funds. Why the heck should the bankstas get tax payer’s homes to boot?

You don’t need to be an economist to know that putting people out of their homes destroys the local job base. Without jobs there are no tax-payers to pay back the borrowed TARP funds.

I am aware of an oft-made argument that homeowners had it coming, they signed the note and they need to make the payments or get out. That only shows how ill-informed the speaker is and how effective the promotional campaign has been. The bankstas, despite their defiance and obscene bonuses, are still able to illicit sympathy.

I don’t think we should ever lose sight of the fact that Wall Street and politicians cooked up this financial dross heap with failure in mind. We are simply seeing the waste and by products of what Wall Street actually produces. It neither looks like or smells like “God’s work.”

They manufactured debt that could never be paid back. This isn’t just about mortgage loans; they created debt out of all manner of schemes to sell the revenue stream to pension funds and then bet on impossibly leveraged loan pools to default.

They created credit score systems, bought politicians and favorable legislation, did away with every counties’ chain of title, eliminated transparency in real estate transactions, designed loan products with features that would enable income-restricted buyers to buy more house or borrow more money, thereby inflating appraisals and guaranteeing widespread defaults and massive default insurance payouts.

There are several categories of victims who need to be heard.

Certainly the investors have been defrauded as to the quality of these investments. They include pension funds and global governments who are now suing the financial intermediaries. But, the truth is that they were sophisticated investors betting other people’s money that was insured against loss. And, they have the resources to get a fair fight.

Then there are the victims of predatory lending, bait and switch, Truth in Lending Act violations, RESPA violations, HOEPA violations, and a host of other unfair lending practices. They deserve to be heard.

There are prime borrowers who were steered into sub-prime loans to their detriment. They deserve to be heard.

In addition to those who actually have defaulted on the terms of their loans, we have a whole other wave of foreclosures that are the result of mistakes, fraud, predatory lending and predatory servicing. And yet, even where it is apparent that this is the case, there is no real access to justice. American homeowners are being deprived of property without due process in direct violation of the fourteenth amendment.

Nowhere has this behavior been more egregious than in the actions of attorneys who represent foreclosure mills. I believe there is a predatory conspiracy at work by several entities to wrongfully foreclose on as many homes as possible.

Bear in mind that they are not the creditor, have no interest whatsoever in the property, are not operating under anyone’s authority, and lose nothing in the event of a default. They are rogue collection agencies and servicers owned by the companies that have the most to gain from defaults; the owners of the credit default swaps.

The Florida Attorney General’s Office is investigating the foreclosure law firm, Florida Default Law Group, for fraud. Under review, are what appear to be the fabricating and/or presenting of false and misleading documents in foreclosure cases.

These documents have been presented in court before judges as actual assignments of mortgages, and have later been shown to be legally inadequate and/or insufficient.

Of particular interest, is the case in which the firm presented to the court not one but two “Original” notes.

On September 9, 2008, the bank’s lawyer submitted a notice of filing the original note with the court, with a promissory note attached.

On June 20, 2009, in the same case, another lawyer for the same bank submitted another notice of filing the original note with the court, with a promissory note attached.

I’ve seen them both and they don’t look anything alike. The signatures look different. The handwritten dates on the signature page look different. The loan number is typed on different parts of the signature page. Only one version of this original has an endorsement.

So, the question becomes, is one the “original” original and the other photo shopped, or are they both phony?

One thing for sure is that there is no way they can both be a true original. And, if one was manufactured, why not both? Why stop there?

Take the case of Joanne Fredenburg, a widowed homeowner in Florida. Last month Ms. Fredenburg was served with not one but two foreclosure lawsuits from two different plaintiffs that both claimed to own her promissory note and mortgage, and said she owed them each more than $276,000.

In January of 2009, a jury awarded Sgt. Gerald Thitchener and his wife, Katrina, $2.3 million against Countrywide Home Loans for repossessing and selling the wrong Las Vegas condo back in 2003. One juror commented, “[Countrywide] never even said they were sorry.”

H. Vincent and Theresa Price have lived in their home in Alameda for 32 years and had never been late paying their mortgage. But last September, their mortgage servicer made a mistake in their accounting department.

They didn’t credit the Prices for having made their August and September mortgage payments, even though they most certainly did, just like they always had, and on time too. Incredibly, less than five months later they had lost their home to foreclosure.

Now, regular readers of my columns understand that this was no mistake but is part of a pattern of unlawful foreclosures.

Then there is Angela Iannelli, of Pittsburgh. Her mortgage payments were on time when a contractor for the bank showed up to take her home. The contractor damaged furniture, took her pet parrot, shut down utilities and pad-locked the door.

According to the Pittsburgh Post Gazette, Bank of America representatives were of no help, asking her to stop calling, saying they were “tired of hearing from her,” putting her on hold and then hanging up on her. Later, Bank of America called to say it had “made a mistake.” But, they forced her to travel to another town to get her parrot back.

No one is exempt from these fraudulent attempts to steal people’s homes. Not even the brave men and women who unquestioningly carry out our nation’s foreign policy.

The Service member’s Civil Relief Act (SCRA) should have protected active duty Army Reserve Captain Michael Clauer, who commanded over 100 soldiers in Iraq.

Last September, Michael returned to Texas to find that his homeowners’ association had foreclosed on his free and clear $300,000 house—and sold it for $3,500, because is HOA dues were $800 in arrears. That ought to teach him.

The homeowners’ association’s lawyer filed an affidavit wrongly claiming that neither of the Clauers was on active duty. Lawyers commit fraud on the courts because the courts allow them to.

These cases are not anomalies but are merely a representative sampling of thousands of such cases. It appears that justice is so blind it cannot see that its scale is drastically twisted and out of balance. Maybe justice isn’t dead, but it sure appears to be on life support.

George W. Mantor is known as “The Real Estate Professor” for his consumer education efforts including a long-running radio program, monthly workshop series, public appearances, and frequent articles.

During a career dating back to 1978, he has amassed experience in new home and resale residential real estate, resort marketing and commercial and investment property.

Prior to starting his own real estate and mortgage brokerage in 1992, he had been Director of Training and Customer Service for Great Western Real Estate. In addition, he has served on virtually every real estate committee, including a term as a Director of the California Association of REALTORS.

George is a nationally respected authority on all areas of real estate and is frequently quoted in a wide range of publications. He is an oft invited guest of Fox Business Network and for many years, he was the host of “Keepin’ It Real…Real talk about the real thing, real estate” on KCEO radio.

The Real Estate Professional includes him in “a directory of the Nation’s outstanding authors, columnists, and speakers. His articles have also recently appeared in Real Estate Finance, The Real Estate Professional, National Real Estate Investor, Broker Agent News, and Realty Times. His blog is