A Foreclosure Primer from a Washington State Paralegal.
I. War Against America’s Middle Class.
While most Americans’ (and in fact the world’s) attention is on Syria, I would like to point out that there has been a war waging right here at home for several years, and it is far more likely to have a direct impact on you than anything overseas.
There is a financial war being waged that is arguably as damaging as any war in recent history. Warren Buffet said “In my view, derivatives are financial weapons of mass destruction, carrying dangers that, while now latent, are potentially lethal”. [Click HERE for PDF – Warren Buffet on Derivatives]
There has been a cyclical, premeditated, manufactured implosion of our economy that is guided particularly to our middle class, with the intent to keep it from acquiring and maintaining any true wealth and economic empowerment. Do you recall the Enron and S&L scandals of years gone by? The effect has been the extraction of over 40% of middle class wealth, the reclamation of well over 10 million homes, destabilization of the US dollar and a devastated middle class left reeling and struggling to survive. There have been casualties. The carnage that has been left behind is devastating and as palpable as any other war: Broken families, homeless children, destroyed lives and even suicides are all consequences of this horrific man-made disaster.
II. The Shame Game.
What seems to be the worst thing is that the victims are left to suffer in guilt and silence because they are made to carry the weight of the blame for the disaster as they are the “deadbeat homeowners” or the “Lazy American” who brought this upon themselves. This is anything BUT the truth. Anyone who has spend any time at all exploring this issue, will soon find that most Americans were well meaning, worked hard and were simply pursuing the American dream. [And deceived by the banks. DC Ed]
To date, I have not yet found the proverbial “deadbeat homeowner.” I suppose they may be out there but they do not come to my office. The stories I hear are of people who have often work their entire lives to support their families and build a future for themselves and their progeny only to have it taken from them in a few short years. Many of them never missed a payment in their lives until they lost all the value in their homes when the market went upside down, as the bankers and their accountants assuredly knew would happen. They most often have even reached out to their “bank” to try to get help.
They are told “We are here to help” but you have to STOP making your payments in order to qualify for modification programs: In reality we have court cases and whistleblowers who have educated us to know that the plan was to always avoid any so-called loan modification because you – the homeowner – was being dual-tracked right into fraudclosure and straight out of your home so that the banks could reach a pay point with insurance.
III. Evictions on Main Street
What are the chances that over 10 million homes could be over taken by such a disaster and there not be a response of compassion and support from the American People and our government? There has been very little of either so homeowners have been left to struggle and fight on their own, In fact, until recently they have had very few options. However thanks to the hard work of pro se’ litigants, foreclosure defense advocates and well-meaning attorneys who have learned what it actually takes to prosecute these cases, we are starting to experience victories and that bring me to the purpose of this piece today:
IV. Hope for the Future:
I am pleased to say that Washington State is one of the most progressive states in the union relative to this issue. For example, our legislatures responded to the concerns they heard by enacting the Washington Foreclosure Fairness Act, which provides for mediation via the Washington Department of Commerce. See: Foreclosure Fairness Act Takes Effect July 22, Washington Is Third Non-Judicial Foreclosure State To Offer Mediation
We, in the state of Washington, have had case law established in favor of the homeowner in cases such as:
OVERVIEW: When a company that maintained an electronic system for tracking mortgage debt initiated foreclosure proceedings, the court held that only the actual holder of the promissory note was a beneficiary for purposes of Wash. Rev. Code § 61.24.005(2) with the power to appoint a trustee to proceed with a nonjudicial foreclosure on real property.
OVERVIEW: Practice of a trustee in a nonjudicial foreclosure deferring to the lender on whether to postpone a foreclosure sale and thereby failing to exercise its independent discretion as an impartial third party with duties to both parties was an unfair or deceptive act or practice and satisfied the first element of the Washington Consumer Protection Act.
OVERVIEW: The borrower had obtained a loan from the lender secured by a deed of trust and an agreement that the property was not agricultural. The supreme court held that the trial court erred in permitting the trustee to proceed with a nonjudicial sale without first determining whether the land was agricultural because agricultural land had to be foreclosed judicially under Wash. Rev. Code §§ 61.24.020,.030(2) and the borrower could not waive the statute.
…………and other cases at the appellate level such as Beaton v. JP Morgan & NWTS, 2013 U.S. Dist. LEXIS 42806 (Western Dist. WA 2013). [Click here for LINK]
See also: DEBORAH H. BEATON, Plaintiff, v. JPMORGAN CHASE BANK N.A., et al., Defendants.
To the extent that Chase acquired Beaton’s loan in 2008 before she defaulted, it falls within the 15 USC § 1692a(6)(F) exemption of “debt collector.” NWTS was appointed as successor trustee on November [*11] 29, 2010. Dkt. # 39-6 (Ex. 6 to RJN). However, Beaton had been in default since approximately July 1, 2010. Dkt. # 58-4 (Ex. 4, Not. of Default). Accordingly, NWTS does not fall within the same exemption. Beaton alleges that the identity of the “Note Bearer/Creditor remains unknown[,]” that it remains undetermined if Chase is the actual beneficiary pursuant to RCW 61.24.005(2), and that NWTS violated FDCPA and damaged the Plaintiff by foreclosing her property. Dkt. # 55 (SAC) at 6:4-8. Liberally construed, the court finds that Beaton has plausibly alleged that NWTS attempted to collect on a debt that may not have been owed to Chase, which may have violated the FDCPA. See: McDonald II, 2013 U.S. Dist. LEXIS 31730, 2013 WL 858178 at *12
Deed of Trust Act:
If Chase was not the holder of the note, it did not have the authority to appoint NWTS as a successor trustee, and NWTS did not have authority to initiate foreclosure proceedings without knowledge of the beneficiary as required by RCW 61.24.030(7). This would result in a material violation of the DTA. Accordingly, Beaton has plausibly alleged a violation of the DTA that survives dismissal.
This has been the result of years of diligent effort, sacrifice and passion for justice on behalf of attorneys here in our state. I have always believed that this war would be fought in the courtroom, case by case, argument by argument and by using multimedia to reach increasing numbers of consumers, and that is proving to be true. Most recently the StafneTrumbull Law conducted an extremely telling Deposition of Jeff Stedman of Northwest Trustee Services: Writes Stafne:
“In this deposition [name protected], who has been threatened with foreclosure, obtains evidence that Northwest Trustee Services is a biased trustee, i.e. judicial substitute, which considers the mortgage lenders as its clients. Further, when this biased substitute judge needs legal advice with regard to applying the law it goes to mortgage lender’s attorney for advice. Justice isn’t blind when it comes to nonjudicial foreclosures by Northwest Trustee Services and [name protected] requests in his case for the judiciary to stop this abuse.”
Within the deposition Stedman refers to internal procedures established to comply with the Washington Deed of Trust Act (DOTA). He states that,
“If there was a dispute, if there was a request that—or that the current noteholder was not the noteholder or didn’t have the ability to—didn’t have standing, then I think it would be up to me to go back and do some more research and look into it, and I would most definitely do that. But absent a dispute, I don’t think I need to.” (See Stedman Deposition click here for LINK)
I highly recommend reading this deposition if you are a foreclosure defense advocate, homeowner or work in any sort of enforcement capacity. In light of this recent evidence, we are encouraging people to contact their trustee if there is any confusion regarding who the noteholder or beneficiary of their loan and the Stafne Trumbull Law firm is pursuing post foreclosure lawsuits.
Another recent development in our area is that our company, Financial Revival Group Inc. is supporting the efforts of the Stafne Trumbull law firm by providing paralegal support, mediation services, and helping facilitate Awareness, Education, Unity and Action in our state regarding the issue of foreclosure defense. We do so with passion AND compassion. You no longer need to fight alone.
Going forward we will be expanding our multimedia campaign to hold those responsible for this debacle up to the light, and to pressure them curb their lawlessness while showing you how to protect your interests. We encourage you to come forward and tell your stories so that we can band together, because when we focus there is indeed strength in numbers. We must unite for in our pursuit of justice, liberty and the common good.
If you are experiencing any issue with your mortgage, we can help you. We provide information, help you identify your options and connect you with trusted, experienced professionals. For more information, you may call our office at 425-259-2600 or email me at firstname.lastname@example.org. We really DO want to help. Check our Facebook page for timely updates:
If you are in another state and are interested in our model please feel free to contact me as well. We believe that organization and efficiency increases access to quality support and that is our goal.
Edmund Burke said, “All that is required for evil to prevail is for good men (and woman) to do nothing.” I am thankful that the days of doing nothing – and supporting evil — are drawing to a close!
Thanks to Michelle Darnell for her excellent post.
And if all else fails: