Bagels at a Bar Mitzvah

arrgy

LoanSafe Member
As far as old cases and filings, I believe there is a certain amount of estoppel where a party is preventing from contradicting itself, relitigating an old case, or altering facts. The fact that certain items were hidden and only discovered later (because someone made a material misrepresentation) are in your favor where Plaintiff has lied to the court. This tends to show intent. Transferring servicing (or the note) does tend to wash things for them.
Yes I have an affirmative defense for equitable estoppel, The elements of equitable estoppel as related to the party being estopped are: (1) conduct which amounts to a false representation, or conduct which is calculated to convey the impression that the facts are otherwise than, and inconsistent with, those which the party subsequently attempts to assert; (2) the intention that such conduct shall be acted upon by the other party; and (3) actual or constructive knowledge of the real facts. The party asserting estoppel must show: (1) lack of knowledge, and the means of knowledge, of the truth as to the facts in question; (2) reliance upon the conduct of the party estopped; and (3) a prejudicial change of position in reliance on the conduct of the party being estopped.
 

isisis

LoanSafe Member
Arrgy,

Remember that a foreclosure court is a court of equity and equity follows the law but isn't necessarily bound by it. The court has the discretion to "balance the equities", in other words determine who would be more harmed by their decision. Many judges have taken the point of view - without saying as much - that a defaulting borrower owes somebody the money and consequently errors in procedure don't overcome non payment, clouded title notwithstanding.

Because we're perceived as having enjoyed an unearned benefit at the expense of the servicer to diffuse the prejudicial subtext it's wise to empathize the damage caused by servicer misconduct. As agent for the (alleged) lender they have a legal obligation to cooperate with your performance under the loan contract. The fact the the previous servicer dropped the ball doesn't let them off the hook or allow them to take advantage. While they were not liable in a personal capacity when they accepted servicing duties it became their obligation to correct the errors. The previous servicer's actions frustrated your efforts to perform under the contract. The fact that the actors have changed doesn't affect anything.

The current servicer has no tort liability for the prior servicer's actions but the current servicer while not directly party to the contract can't enforce - by foreclosing - without curing the prior servicer's failure to perform. In fact trying to foreclose under the circumstances is a breach of the loan contract. That they've acknowledged you were harmed should be very helpful to you.
 

arrgy

LoanSafe Member
Arrgy,

Remember that a foreclosure court is a court of equity and equity follows the law but isn't necessarily bound by it. The court has the discretion to "balance the equities", in other words determine who would be more harmed by their decision. Many judges have taken the point of view - without saying as much - that a defaulting borrower owes somebody the money and consequently errors in procedure don't overcome non payment, clouded title notwithstanding.

Because we're perceived as having enjoyed an unearned benefit at the expense of the servicer to diffuse the prejudicial subtext it's wise to empathize the damage caused by servicer misconduct. As agent for the (alleged) lender they have a legal obligation to cooperate with your performance under the loan contract. The fact the the previous servicer dropped the ball doesn't let them off the hook or allow them to take advantage. While they were not liable in a personal capacity when they accepted servicing duties it became their obligation to correct the errors. The previous servicer's actions frustrated your efforts to perform under the contract. The fact that the actors have changed doesn't affect anything.

The current servicer has no tort liability for the prior servicer's actions but the current servicer while not directly party to the contract can't enforce - by foreclosing - without curing the prior servicer's failure to perform. In fact trying to foreclose under the circumstances is a breach of the loan contract. That they've acknowledged you were harmed should be very helpful to you.
I have been arguing from day one that there has been a breach in the contract, and I have stated over and over that I do not mind paying the party that is legally entitled to the money, but I will not pay someone who isn't entitled to it, I am not one of these free house people.
It is obvious that the old servicer tried to cure the failure to perform the mortgage by lying to the court and judge, and selling the note to HUD while I was still in loss mitigation. I looked and looked and I could only find equitable estoppel and breach of contract as a defense that addresses the situation. You can't cure a defect in a loan by selling off the loan to another party and misrepresenting to the seller the conditions of the sale. Then to hide it from everyone in hopes that no one would catch it, makes it even worse.
I filed a memorandum to the summary judgment hearing that was left open, restating the obvious and answering the questions raised by plaintiff's lawyer, while also asking the judge to dismiss their affidavit that the loan is not an FHA loan simply because someone stamped redacted on it, with no date and no explination.
The second part of the MSJ is Monday, hopefully I will prevail.
 

arrgy

LoanSafe Member
Also, I am finding in doing my research, that appellate courts want Defendants to be specific and plead how they were damaged by the conduct of the Plaintiff. Its not even enough to say, "hey I was harmed, my note and mortgage really don't belong to you". You have to explain how you were harmed, like having a in house mod vs. an FHA mod (you don't have to state actual figures I found in one NY case, you simply need to state that a FHA mod would have had better terms then an in house one.)
So as you stated isisis, emphasizing how the conduct damaged me is important.
Failing to follow FHA guidelines before foreclosing and addressing that affirmative defense in my answer by stating the loan isn't an FHA loan without stating an actual date and reason is important.
As a result of estoppel, I was denied the ability to be heard in court, since the loan was sold and the case simply disappeared. In my state, that could also lead to extrinsic fraud.
Clouding my title and making it more difficult to sell my property.
there are others probably that I can't think of right now.
 

isisis

LoanSafe Member
In deposition a couple years ago Bofa's attorney asked how I'd been injured. It seemed inexplicable to him that a borrower who hadn't made payments in years could conceivably have suffered an injury. I said because I'd been prevented from paying down the loan balance which is the gist of it but since then I've given injury considerable thought. Technically non payment doesn't result in any actual benefit and certainly not one received from the servicer though it might in the case of someone underwater without equity in which the mortgage has become a losing contract and living without payments makes rent unnecessary thus somewhat offsetting the loss but anyone with an investment in their home suffers from non payment. If the servicer was the cause in whole or in part there was injury. Here are some of the ways homeowners may have been injured.

- If loss mitigation was offered with misrepresentation, deceit or concealment or handled negligently and was relied on to your detriment it prevented you from finding other means of foreclosure avoidance like renting a room, leasing the property or refinancing into affordable terms. In the latter case you've been injured by the accrual of higher interest arrears

- If default was induced or performance prevented or refused then your performance was excused.

- If foreclosure charges and fees were imposed these were then added to the loan balance and are earning interest at the note rate.

- Credit damage.

- Legal fees and court costs. Contract law doesn't include these but the mortgage allows the lender to be reimbursed for them and expenses resulting from the borrower's default.

- Lost earnings from the time spent fighting a wrongful foreclosure.

- Emotional distress. Again not available under contract law but a remedy under the FDCPA for unfair debt collection.

As for clouded title that's an injury to a legal right - according to Yvanova, a case decided by the California Supreme Court and worth reading. https://scholar.google.com/scholar?...vanova+v+new+century+mortgage+corp&oq=Yvanova

When you signed papers and entered into the mortgage loan contract you did so with the reasonable expectation that they would act within the standards of good faith and fair dealing and cooperate with your performance. You agreed that the loan would be serviced by a third party but with the reasonable expectation that it would not provide a impediment to negotiating with the real party in interest. The fact that a conflict of interest would exist between the servicer and lender in which the servicer stood to gain more by your default was concealed from you. Georgetown law professor Adam Levitin discusses this in Mortgage Servicing. https://www.google.com/url?sa=t&sou...FjAAegQIDhAC&usg=AOvVaw1UPFr4dk-JzAEA0qaKOqRE

Because you have been unable to negotiate with the actual creditor who would benefit more from the ongoing contract than the servicer you have been injured.
 

moretrouble

LoanSafe Member
In addition to what Isisis stated, One of my arguments was I had to spend thousands of hours to study finance, economics, laws to discover their scheme. That prevented me from properly doing my job robbing me of advancement opportunities. You can ask the purported servicer and lender how they are injured being already bailed out by the taxpayers (us) their ceos and executives collecting billions of dollars in bonuses, bond holders made whole. But all of these still won’t make you win because the judges are either corrupted or cowardice.
anyway, I was reading New residential financial documents on SEC site. They are boasting about their “hard to duplicate” bond portfolio. Yes, it’s hard to duplicate because the fraud is going to be exposed to the SEC! DOJ, FTC now that the foreclosure king head of the treasury department and the ex-director of Ocwen head of the Commerce department are gone.
 

Survivor_IN

LoanSafe Member
Also, I am finding in doing my research, that appellate courts want Defendants to be specific and plead how they were damaged by the conduct of the Plaintiff. Its not even enough to say, "hey I was harmed, my note and mortgage really don't belong to you". You have to explain how you were harmed, like having a in house mod vs. an FHA mod (you don't have to state actual figures I found in one NY case, you simply need to state that a FHA mod would have had better terms then an in house one.)
So as you stated isisis, emphasizing how the conduct damaged me is important.
Failing to follow FHA guidelines before foreclosing and addressing that affirmative defense in my answer by stating the loan isn't an FHA loan without stating an actual date and reason is important.
As a result of estoppel, I was denied the ability to be heard in court, since the loan was sold and the case simply disappeared. In my state, that could also lead to extrinsic fraud.
Clouding my title and making it more difficult to sell my property.
there are others probably that I can't think of right now.
Yes, certain acts needs to be described with specificity, such as fraud. However. Fraud is dirty word in foreclosure courts. I prefer kinder phrases such as deceptive acts, duplicitous accounting, even theft of funds is more palpable that "the F Word." lol. Courts don't like to entertain those things in foreclosure even though evidence is right in front of them. I totally agree with cause and effect to show you were harmed. Being prevented from paying down the balance is skimming if you ask me and seizing or converting property of others. (the money has been reallocated to where, the general fund account?) Servicers damaged people's credit to keep them from refinancing where foreclosure is more profitable for their balance sheet. The protracted time taken to "get a mod approved" increases their balance sheets where the "past due" is capitalized. Yo, request numbs on those. lol. Credit damage affects ability to earn income and causes reduced employment or under-employment, also affecting ability to pay. (interference with performance) By the time you get any mod approval, the paymemnt hasn't budged because of the increases in principal due to servicer's (intentional) delay and increase debt accounting. Servicers gain more with higher UPB as that is how they get paid. It's a percentage.

Pandemic exempted cause I have no clue how good or bad people are being treated on resolutions and modification activity, but moratoriums will eventually end and lead to balance calcs on the debt. Government is saying up to 18 months (FHA standard for mod eligible claim) because we don't have full effect those lost jobs or how quickly people recover after that. I remember promises of past due payments being tacked on the end during the Great Recession as a means to cure. I'm not sure I've seen anyone actually achieve that one. It's still coin toss on who gets profit and who get loss column right now. Some people are just bored at home without income loss while others have lost substantial earnings from closures and others, like Jeff Bezo, have substantial profits from the crisis.

Also remember there various versions of estoppel. Judicial estoppel refers to the filings can not change facts. Judicial notice involves pointing out evidence from reliable sources such as agreements entered into by the CFPB or another court that may be relevant to your argument. Promissory estoppel relates to the offer of the mod with certain terms or interests rates, the claiming that it was not offered, or was denied, or even finalized. It was expected from the conduct. Lenders just can't toss or deny HAMP loans because of a servicing change. This evidences an expectation interest and a denied opportunity. And results in damages in various forms. Mainly financial and foreclosure processing. It's not free rent. Not at all. It's oppressive and a lack of good faith and fair dealing to rescind a deal designed to cure past due, report positive credit events and allow the borrower to resume payments and obtain peace and not be further penalized by the default status. I do know there is a bit of difference in a court of equity as opposed to court of law. My understanding is that equitable relief involves such acts as demanding an action or refraining from an action and where it is important to be fair so that one party does not obtain a windfall. There are situations where foreclosure is wholly inappropriate to begin with. I don't think taking the house is an equitable thing where servicers foreclosed over minor breaches (you didn't pay FPL and they want 80 dollars and a late fee) and ultimately these servicers are using the process to generate 1000s of dollars in fees. But that's just me.
 

arrgy

LoanSafe Member
Of all the "estoppels", equitable one is the way to go in my case. In my state, Judicial estoppel only applies to changing facts later on, that would never apply in my position, since the legal fact that the loan was assigned during loss mitigation will never change. Promissory estoppel doesn't apply either and is optional if used in matters of equity.
However, equitable estoppel is used in matters of equity and deals with the deception of a plaintiff to change the behavior of the defendant. Here the plaintiff kept hidden and then lies were made to the court about the FHA status and the representation that the modification I was receiving was an FHA type one not a in house mod. This goes back to the damages that I personally incurred since the in house MOD had worse conditions then an FHA would have. Had I known the facts of the case, the transfer of the mortgage and sale of note, etc. I would have never signed a mod and but insisted that the SMJ be decided and the case heard.
Which goes to fraud. My state doesn't have a general fraud, we have intrinsic and extrinsic fraud. Extrinsic fraud is worse and applies to this case, in extrinsic fraud the conduct of the plaintiff makes it so that the Defense is never heard in court. By inducing me to sign a mod and at the same time selling off the debt when you couldn't during loss mitigation they made the case go away, my defenses on the FHA face to face (which by the way I first argued in 2010 before it became fashionable to do so) were never heard in court. The plaintiff even stated this by saying that the first foreclosure case was dismissed after the trial period of the mod ended.
But all of that is mute since the assignment to HUD made it a void assignment. Anything done after that, is null and void including the mods, etc. The estoppel and intrinsic fraud only applies as a defense IF the assignment to HUD is found to be ok (which if it is, my God I will be screaming to the appellate court.)
As I was laying out my strategy, I found myself in front of a white board doing a yes/no flow chart, which helped tremendously to all of the possible situations. As a defendant in this, you really do have to expect and plug up any holes before they occur so you can't give the crooked judges any outs.
 

arrgy

LoanSafe Member
I don't believe it. I lost and the judge ordered Summary Judgment. No reason, just I read the pleadings. He wants the plaintiff to draft the motion, he stated that I am well versed and I of course can file a motion to reconsider, and he is putting off the sale for the being, and he very very strongly suggested that we work something out (plaintiff and myself).

I am stunned but not too surprised. I now have to figure out my strategy, motion to reconsider, chapter 13, or simply walk away from the entire thing, and feel glad knowing I lived rent free for 11 years. I get the feeling that they don't want to deal with the DASP thing, assignments to FHA, etc. I believe it just might be too complicated for them to rule on.
 

moretrouble

LoanSafe Member
I don't believe it. I lost and the judge ordered Summary Judgment. No reason, just I read the pleadings. He wants the plaintiff to draft the motion, he stated that I am well versed and I of course can file a motion to reconsider, and he is putting off the sale for the being, and he very very strongly suggested that we work something out (plaintiff and myself).

I am stunned but not too surprised. I now have to figure out my strategy, motion to reconsider, chapter 13, or simply walk away from the entire thing, and feel glad knowing I lived rent free for 11 years. I get the feeling that they don't want to deal with the DASP thing, assignments to FHA, etc. I believe it just might be too complicated for them to rule on.
I know exactly how you feel. That's what I felt after the judge denied my motion for relief from judgment. I told you so, post #9149. The judge did not grant their SJ, we went to trial , general judgement of foreclosure granted, i filed motion for relief... Later I appealed, affirmed w/o opinion, motion for reconsideration to the affirmed, later petition to the stat supreme court... denied w/o . Judges seem to work for the banks while collecting salaries from the tax payers. I have a judgement of foreclosure but they have not attempt to enforce the judgment. When they do I will file suit in the Federal court and do other things.. don't just simply walk away, make them earn it. Stay till the sheriff kicks you out.
 

arrgy

LoanSafe Member
It was very strange, I got the feeling that he wanted to tell me something that I was missing in my defense, but couldn't. Why would a judge go out of his way to almost insist that I file a Motion to Reconsider or very very strongly suggest that I work with the Plaintiff? I would have expected "you lost, next case".
 

moretrouble

LoanSafe Member
My judge compelled me to go to a mediation session with the fake plaintiff even though i told her i did not a mod. Judges know about the frauds but don't want to touch them for one reason or another, even the appellate and sc judges. Just keep fighting if you have time keep filing court documents.
 

kraftykrab

LoanSafe Member
It was very strange, I got the feeling that he wanted to tell me something that I was missing in my defense, but couldn't. Why would a judge go out of his way to almost insist that I file a Motion to Reconsider or very very strongly suggest that I work with the Plaintiff? I would have expected "you lost, next case".
In most places you can make a request for written reasons for judgment. Check your RCP where you live. If you're going for motion to reconsider, you're basically arguing the same thing that's been argued but making sure you didn't miss anything. if you choose to appeal, you will be assigning error to the trial court's ruling and you will want to know in that case exactly why the judge ruled as he did. That written reasons for ruling would come in handy then.
 

arrgy

LoanSafe Member
I will definitely be doing all three, motion to reconsider, written reason for judgment and then an appeal. I honestly think the judge wants to pass this off to the SC in my state to decide if it met SJ or not.
 

moretrouble

LoanSafe Member
It was very strange, I got the feeling that he wanted to tell me something that I was missing in my defense, but couldn't. Why would a judge go out of his way to almost insist that I file a Motion to Reconsider or very very strongly suggest that I work with the Plaintiff? I would have expected "you lost, next case".
Maybe the judge wants to know what will be other side’s response to your motion to reconsider or relief. Be careful in my state, motion to consider is not appropriate, better to file a motion for relief of judgement. Maybe after you file the motion the other may give up.
 

arrgy

LoanSafe Member
The other side won't give up, and the judge specifically lead me down the reconsideration avenue. What is strange is that in my state: It is important to note that it’s imperative to file a motion to reconsider if the Judge missed an issue. If you do not, you forfeit the right to file an appeal on the issue. The appeals court will not consider an issue that was not considered at the trial level first.
I really can't do anything until I see the order that is written.
 
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