Watching A House of Cards, Part 1
Nye Lavalle is best known for his sports predictions. With his family, he founded Sports Marketing Group and stunned many sportswriters with his accurate calls on the popularity of figure skating and NASCAR in the 1990s, among many others. Sixteen years ago, he began investigating mortgage fraud when a bank attempted to wrongfully foreclose on a family property. Many of the issues he uncovered more than a decade ago, like robosigning, are just being recognized today. He continues to try educate others about problems in the banking industry and the US economy.
Jennifer Barry: Could you tell me a little bit about how you got interested in the whole mortgage fraud and predatory lending?
Nye Lavalle: Sure. Just to give you an idea, my email, mortgagefrauds@aol.com, has been in existence, since about 1995.
JB: That’s a very long time.
NL: It all started the night my mom and dad Anthony and Matilde Pew owned a home in Dallas, Texas, that we used for our family business called Sports Marketing Group. And I had a place in New York and LA, and we were eventually going to retire to that home at first blush. But we purchased the home, and my family had money, and I had money, we were a business, and basically, soon after we closed on the loan, the bank SOA just started doing all sorts of stupid things. Nobody resided full-time in the home, and they were instructed to send the payment statements to Michigan so that they could get paid on time, and they never sent them there. They sent them to the property address and somebody wasn’t on the property for sometimes two to three months. And they wouldn’t change the address. They wouldn’t take off the late fees, then when I would pay bills on time at the bank, it turned out that they would send the payments from the bank to California to the posting center, and they wouldn’t get posted for 10 more days, even though you paid it on time at the bank. And then they would put another late fee onto the account.
Then, when we had insurance and we paid on a quarterly basis, they would send cancellation notices 30 days ahead. The bank would force place another insurance policy on the property even though we had our own insurance on it. And the long and short of it’s all in a report I created called “Predatory Grizzly ‘Bear’ Attacks Innocent, Elderly, Poor, Minorities, Disabled & Disadvantaged!” They were just churning the account, just trying to make fees and money all over the place.
What we learned years later in litigation is that our account was red-flagged for fraud. The loan officer who approved the loan and did all the documentations had taken blank applications that my folks signed, and put as monthly income from my family, US$100,000 a month, when that was their annual trust income.
So they were trying to do what we call manufacture a default. A lot of servicers do that because they want to foreclose on the house. They want to get rid of the liability because that mortgage has been tainted or it becomes instead of A paper, B, C, or D paper.
It’s called a scratch and dent mortgage.* It’s kind of like a refrigerator, it gets that name kind of like from a refrigerator or stove at the store that somehow gets dented and damaged during transit, and it’s not as valuable as the perfect condition new appliance.
JB: Right.
NL: So after that we went to pay off the note. We go look, this is crazy, we don’t want to do business with you, we just want to pay you off. They wouldn’t meet with us. We asked for servicing records. They sent us records that made no sense. We offered to pay them in cash in 14 days on two conditions: that they could come up with records of what we actually owed them, it was about a $100,000 note, and that they could provide us the original note, stamped, cancelled and paid in full. I knew how banking worked because I had represented some banks. Well the servicing records they gave us, the year end balances were like $5,000 off, I mean literally. And they showed and proved our point that when we had insurance on the property, not only did they put one forced place policy on top of our insurance that we had, but they put two more on top of the one that they had, so they actually had three policies on top of each other.
JB: Incredible.
NL: And that was just a mess. And it was really, they were cooking the books is what I learned. And when I got all the information and gave it to them and said look, we want to get rid of you, they assigned it to a company called EMC Mortgage, which was a unit of Bear Stearns. EMC initiated foreclosure, and we initiated a defense to that, and over the years they spent $2.5 million and 7 years in litigation on a $100,000 loan.
You can catch the rest of the interview here…
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As I have said before, I am not in foreclosure and never had a mortgage on my home, but looking from the ‘outside’ and following this whole issue of foreclosures, one can see the fraud reeking throughout the complete financial industry and the government. What really is the killer is how all this fraud is being handled by the exact ones who participated in the fraud from the very beginning, years back..either working in the government or working Wall Street banks. The fraudsters or let’s say racketeers, who are guilty of fraud are the same ones who are trying to ‘ fix ‘ the fraud. It can’t be fixed..it’s done. Prison’s are filled with less crimes than this…NO ONE is above going to prison. This fraud started when a borrower signed on the promissory note..changing it into a Security Instrument with a fraud payee/lender listed on the note and mortgage.. A payee/lender who never paid one cent for the mortgage and recorded the mortgage in county records is void. But the greed and fraud continued from there. Why stop when the getting is so good. Now the massive fraud is out in the open..they want to fix it.?? Sorry, but the crime has been done… a deliberate crime. Can someone explain the difference of this criminal act done to this country and the act of terrorism, the use of force or threats to intimidate..such as a political policy ? Wake up America……it is our country they are stealing…just follow the money and you will find who has gained with fraud.
Go get’em Nye!!
The only verifiable “note” is the deed that has been recorded paid since origination in most cases. If a “mortgage or note” is not assigned to a deed, the “mortgage or note” is nothing more than an unsecured debt such as a credit card debt. The banksters_ can not_ use_ our _paid off deeds as “insurance” to collect on a debt that they say we owe, Only the deed holder with the paid off deed, with no recorded debts attached, can sell, live in or do what ever they want with the property. I would say the banksters screwed up badly. I think that NOW is the time for a Nationwide Moratorium on all fraudclosures. The charades need to stop. They and the foreign interest made enormous amounts of money off of all of us and all of the phony threats and fraudclosures need to stop. They cannot have our homes too, Thank God.
It is unfair and outrageous that some families are homeless through real estate racketeering! Whether or not some people never should have been given mortgage loans it is urgent to look white collar fraudulent foreclosure activities. –http://chn.ge/eU2zAm
Certain PREDATORY mortgage loans were issued for the very purpose of loan default so that properties can become flipped, repeatedly (hence blight); lenders gain tax credits, mortgage-default insurance, and more. Additionally, too often, not only has the lender NOT filed foreclosure, certain homes wound up being flipped by the foreclosure mill lawyers who execute simulated auctions whereby “straw buyers” fraudulently “credit bid”! Also, illegal, fraudulent foreclosure causes useless deeds for property sales; title insurance denials, etc.
It is outrageously unfair when families become homeless because of fraudulent foreclosure proceedings filed by lawyers in civil and in bankruptcy courts!!! Scores of homeowners do not contest foreclosures because they have no legal knowledge to recognize challengeable foreclosures or fraud; no means to pay for attorney representation; they are told to come to foreclosure auctions with money they do not have, so they stay away from foreclosure auctions.
White collar foreclosure fraud entails intentionally fraudulent foreclosures naming defunct mortgage companies, or having no ownership of notes; unfair fees beyond “Acceleration Clauses” that impairs borrowers’ ability to repay arrears; falsified Bankruptcy Court motions to “Lift Stay” for accomplishing”simulated” foreclosure auctions via “straw buyers.”And lawsuits against foreclosure lawyers for fraud and “Unfair Debt Collection Practices,” generates more lawyer fees.
Foreclosure lawyers are court officers, and required to know laws and civil procedure –lenders and servicers AREN’T. Lawyers are the ones who file lawsuits to seize and sell property; and they file and record property deeds after auctions. *Request for Congressional Foreclosure Panel to Examine Foreclosure Lawyers @ http://www.change.org/petitions/view/request_for_congressional_foreclosure_panel_to_examine_foreclosure_lawyers#
“Not the securities, I’m talking about the mortgages themselves. A lot of times the banks need to borrow money for operations or whatever, and so they have to give collateral as well. That’s why a lot of the notes endorsed are blank, they actually transferred the collateral files to the Fed, and the Fed actually holds the actual mortgage notes.”
I’ve been saying this for awhile. It explicitly says the FED can use residential mortgages as collateral to PRINT NEW NOTES. Why would the law say that it is allowed and they wouldn’t do it? I don’t think Congress is up there passing moot laws.
The FED can do what? LEGALLY COMMIT FRAUD YOU SAY? How can RESIDENTIAL MORTGAGES be used as COLLATERAL WHEN THEY ARE NEVER SECURITIZED? Did they not know the debt was NEVER SECURITIZED, THE DEAL WAS NEVER SEALED? What collateral files do you mean? Do you mean the FED never,ever checked to see if the banks ever did their due dilligence and secured the debt properly?You are saying the FED assumed the banks were dotting all of the i’s and crossing all of the t’s in securing the debt pool? Do you mean the banksters needed to use our paid off properties as collateral to commit fraud via the FED? A mortgage note is a collaterized pile of nothing unless it is tied to a deed. A mortgage note just states a debt is owed, the securitization process (assigning the mortgage to a deed) would have made their fraud quasi-legal (they still over-speculated the market knowing full well the bubble would burst, ponzi scheme=fiancial disaster of epic proportions) but they never securitized the debt (assigned a mortgage to a deed) so we do not owe this debt and no one can prove it except the holder of the paid off deed which is us. Did they gamble on the country as a whole or use us as individuals suckers? None the less, ‘THEY’ made gagillions of dollars off of our paid off properties via phony “MBS” and Credit Default Swaps and any other way they could slice it and dice it and make money off of it, and so did all of the foreign investors, now they want our houses too? They are ALL A BUNCH OF GREEDY PIGS. Our Government sold out all of OUR LAND to the foreign interest if we default and get foreclosed on the foreigners get our houses and our land. Well I guess this explains why and how Timothy Geithner has the balls to say fraudclosures need to happen or the housing market will “collapse fueher, I mean further”. So you say the FED helped the banksters to perpetuate all of the fraud or this is only considered fraud if WE DO IT? Our homes were the” vehicles” they used to commit fraud with, not the “collateral”. Now that begins to explain WHY THERE STILL IS NOT A NATIONWIDE MORATORIUM ON FRAUDCLOSURES. The whole cabal will be implicating themselves. Too bad that they can not hide it because the people know the truth about all of ‘THEIR’ fraud. FKA many banks by many other names now AKA FRAUDCLOSUREGATE. A criminal enterprise of unimaginable proportions.