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Editor’s Comment:
Crowd mentality is a double edged sword. On the way up in the boom, the myth was that the inflated prices were somehow explainable or justified and that the “real estate market never goes down.” history shows that housing prices always even off at housing VALUE and that deviation from value is what we call “prices.”
On the way down, the fall of housing prices could be and was easily predicted by reference tothe Case Schiller Index tying median income (the ability to pay for housing) with housing prices. The value of homes had remained the same while prices skyrocketed because Wall street had flooded the market with money and hired anyone willing to lie in order to close another loan deal.
Remember that 50% of the loan deals were refinancing. That had nothing to do with new purchases bigger than the pocket books of the buyers. These were people solicited by the banks with tag lines “I can reduce your payments” and I can get you money you can use for investing.
Many deals were new financing on older homes that were fully paid for on the promise of securities scames (see Merendon Mining) where the lenders posing as banks (but at the bank’s behest, holding trillions that investment banks collected from pension funds and other “qualified” investors) not only validated the illegal investment Ponzi scheme, but actually used PROJECTED INCOME from the Ponzi scheme to justify the loan making it appear that the inčome from the PROJECTED INVESTMENT PROCEEDS OF THE UNNEEDED LOANS was in fact to be counted as current income and therefore demonstrating the ability of a borrower to pay when the actual current income was a small fraction of the total income of the borrower reported by lying loan originators and mortgage brokers on the loan “applications” where the loan was both pre-approved and pre-funded.
There was no rush of buyers to flatten out the curve of declining prices because everyone knew the market was črashing. The masses were headed for the doors. Under the spectre of inventories of foreclosure properties (illegally obtained through false “credit bids” and robo-signed deeds on forclosure) and shadow foreclosure inventories (not yet put up for sale) only those with inescapable “reasons” were buying homes. The demographic explanations of demand for new housing demand that fueled the construction of new homes was all based upon lies. Migrations of large numbers of people into an area simply never happened and could therefore neither explain the housing boom nor stop the crash because it was all a myth.
In the article below, the further point is made that when the market actually shows signs of recovery — a long way off — many private sellers will be eyeing numbers they think are closer to their perception of value of their homes. Thus any upward movement is going to be met with a torrent of new inventory from both the banks and private ownership. For every blip that makes it appear that the market is improving, there will be a correction.
Housing Recovery a Long Way Off
Housing starts were surprisingly strong this week, while there was improving sentiment from home builders. So should we start to breathe a sigh of relief that the housing market is returning to health? The short answer is no. The headlines say that housing is stabilizing and there are signs of life in the real estate sector. This is true but is only part of the story. Signs of life is far different than a return to healthier times.
While KB Homes and Toll Brothers are reporting sales increases, this does not erase the fundamental problem with the real estate market today; there are too many people wanting to sell and not enough buyers. In some neighborhoods in the United States, every other house is for sale and sitting stagnant with no takers. But this is the obvious sign that the real estate market is troubled; there are deeper problems below the surface.
What is more troubling is in every block in neighborhoods across the United States, there are huge numbers of potential sellers that would sell their house if they could get the price they believe their house is worth. This huge reserve of sellers creates a supply waiting to flood the market when any sign of recovery in real estate capital values returns.
Additionally, banks continue to hold huge inventories of foreclosed properties waiting for a rebound in the market before placing these properties into the real estate market. …
In addition to supply issues, the U.S. economy is far from healthy. While we are in the midst of an uneven recovery, unemployment remains stubbornly high and the prospects of a more normalized employment rate are far off in the distance.
18 thoughts on “Housing Recovery Barred by Foreclosure Inventory PLUS New Sellers”
…and the crime hits just keep on coming:
http://www.huffingtonpost.com/2012/05/24/facebook-ipo-retail-investors_n_1542861.html?ref=business
Facebook IPO: Retail Investors Lose Out While Wall Street Clients Make Profits
http://www.randomhouse.com/book/213722/predator-nation-by-charles-h-ferguson/9780307952554/
Charles H. Ferguson, who electrified the world with his Oscar-winning documentary Inside Job, now explains how a predator elite took over the country, step by step, and he exposes the networks of academic, financial, and political influence, in all recent administrations, that prepared the predators’ path to conquest.
Over the last several decades, the United States has undergone one of the most radical social and economic transformations in its history.
· Finance has become America’s dominant industry, while manufacturing, even for high technology industries, has nearly disappeared.
· The financial sector has become increasingly criminalized, with the widespread fraud that caused the housing bubble going completely unpunished.
· Federal tax collections as a share of GDP are at their lowest level in sixty years, with the wealthy and highly profitable corporations enjoying the greatest tax reductions.
· Most shockingly, the United States, so long the beacon of opportunity for the ambitious poor, has become one of the world’s most unequal and unfair societies.
If you’re smart and a hard worker, but your parents aren’t rich, you’re now better off being born in Munich, Germany or in Singapore than in Cleveland, Ohio or New York.
This radical shift did not happen by accident.
Ferguson shows how, since the Reagan administration in the 1980s, both major political parties have become captives of the moneyed elite. It was the Clinton administration that dismantled the regulatory controls that protected the average citizen from avaricious financiers. It was the Bush team that destroyed the federal revenue base with its grotesquely skewed tax cuts for the rich. And it is the Obama White House that has allowed financial criminals to continue to operate unchecked, even after supposed “reforms” installed after the collapse of 2008.
Predator Nation reveals how once-revered figures like Alan Greenspan and Larry Summers became mere courtiers to the elite. Based on many newly released court filings, it details the extent of the crimes—there is no other word—committed in the frenzied chase for wealth that caused the financial crisis. And, finally, it lays out a plan of action for how we might take back our country and the American dream.
I’m not trying to scare anyone. This is not on Honshu Island but two more have erupted. We need to look at the big picture. 4 earthquakes over the weekend, volcanic eruptions and Fukushima. it has to be put together.
Sakurajima volcano (Kyushu, Japan): powerful vulcanian explosions
Thursday May 24, 2012 11:28 AM | Age: 3 min
BY: T
Timing means everything. That resignation was a tad too sudden for my taste.
http://theenergycollective.com/masoninman/85834/top-us-nuclear-regulator-s-parting-message-fukushima-was-wake-call
Gregory Jaczko’s Parting Message: Fukushima Was “A Wake-Up Call”
Gregory Jaczko, chairman of the U.S. Nuclear Regulatory Commission, announced his resignation this week, but he is still making pointed comments about the need to strengthen regulations to ensure nuclear power plants are safer.
“I think the Fukushima event was a wake-up call, hopefully for everyone,” Jaczko said in a news conference today, referring to the earthquake- and tsunami-triggered nuclear plant accident in Japan on March 11, 2011,
“I think there were people throughout this industry who had come to the belief that an accident of that magnitude simply was never going to happen, that we had really come to the point at which we’d eliminated that,” Jaczko said. “I’ve always tried to do my job without making that assumption.”
Fukushima radiation higher than first estimated
Kevin Krolicki, Reuters
May 24, 2012, 11:31 pm
…”Because radiation sensors closest to the plant were knocked out by the March 11, 2011 quake and the tsunami, the utility based its estimate on other monitoring posts and data collected by Japanese government agencies.
Tepco, set to be nationalised in July in exchange for a Japanese government bailout, estimated meltdowns at three Fukushima reactors released about 900,000 terabecquerels of radioactive substances into the air during March.
That was 2-1/2 times the amount of the first estimate by Japan’s Nuclear and Industrial Safety Agency in April last year and about 17 percent more than the highest estimate provided by the government safety agency…”
Don’t bother with WHO’s report: it is geared to preven massive, worldwide hysteria. The Japanese government is making plans to have 40 millions people evacuated to mainland China. Europe and Australia are spelling it like it is. Don’t expect the same respect from the US.
Sorry guys but foreclosures might be the least of our problems.
Matt Weidner just added one element to the above article posted by Neil.
http://mattweidnerlaw.com/blog/
PERMANENTLY DAMAGED HOMES….The Banks, Property Inspections, Property Preservation, Winterization—A Massive Scheme of Unlicensed Contracting
May 24th, 2012 | Author: Matthew D. Weidner, Esq.
We all understand that the banks are holding back on homes and not selling them, but why is that? Well there are many, many reasons, but one thing they all need to be thinking about (and I don’t believe many are right now) is the fact that many of the homes they are maintaining are being maintained in violation of serious consumer protection and public interest laws.
The State of Florida has one of the most serious and severe statutes that address a major problem of unlicensed contracting. Florida has an all-expansive definition of contracting and provides serious civil and even criminal penalties for parties engaging in unlicensed contracting. And keep in mind, you don’t have to touch a hammer to be engaged in unlicensed contracting….the mere offering to bid for the work is unlicensed contracting.
Have a read at how this is defined in statute:
“Contracting” means, except as exempted in this part, engaging in business as a contractor and includes, but is not limited to, performance of any of the acts as set forth in subsection (3) which define types of contractors. The attempted sale of contracting services and the negotiation or bid for a contract on these services also constitutes contracting. If the services offered require licensure or agent qualification, the offering, negotiation for a bid, or attempted sale of these services requires the corresponding licensure.
Florida Contracting Statute
And read here for the full description of penalties for unlicensed contracting.
And so here in this extraordinarily ethically challenged state, I wonder how it is that the banks and all their agents are engaging in a statewide property preservation scheme and are performing work that clearly violates these important laws with impunity? Oh right, circling back to that statement, extraordinarily ethically challenged state.….(That means the corporations that own our elected officials get away with what
But if the State will not step up and enforce these laws, if Florida’s Attorney General will not fulfill her obligation to protect consumers, perhaps we must rely upon private attorneys general to do the important work of protecting the public from the harm done by out of control banks and the thugs working under them. (Incidentally, I first got turned onto this whole issue after I was contacted by the several licensed contractors who used to do this work for the banks but who got cut out of the work when the banks decided to start using cheaper, unlicensed contractors, cutting them out of hundreds of millions of dollars worth of work.)
I’m fighting not just to protect consumers, but to protect the interests of the good and responsible licensed professionals who are following the law and supporting good workers in their communities.
But here’s the real kick about this whole deal…what happens when the banks finally conclude their tens of thousands of foreclosure cases and are ready to now sell those properties to unwitting third party purchasers? What about the months and months and years of unlicensed, unregulated, improper and illegal contracting work that has been done on those hundreds of thousands of properties?
What about all the mold they just covered up with
Hummm?
I’ve seen a few listing and sale agreements between the banks and, unfortunately, the paper isn’t long enough to list all the undisclosed defects.
SELLING PROPERTY WITH KNOWN DEFECTS MAKES THE PROPERTY WITH THOSE KNOWN DEFECTS UNMARKETABLE AND UNSELLABLE AT ANY PRICE
Oh, and here’s another very disturbing part of this whole widespread, blatant, wasteful and dangerous part of this whole ongoing scheme being perpetrated against the citizens of this state…..
EVEN THE INSPECTIONS OF THE PROPERTIES ARE VIOLATIONS OF STATE LAW!
That’s right folks, all these banks that are out sending thugs onto property to “inspect” are likewise violating additional consumer protection statutes……that ratchets up the claims for damages under a whole series of consumer protection statutes……here it goes:
(4) ”Home inspection services” means a limited visual examination of one or more of the following readily accessible installed systems and components of a home: the structure, electrical system, HVAC system, roof covering, plumbing system, interior components, exterior components, and site conditions that affect the structure, for the purposes of providing a written professional opinion of the condition of the home.
Chapter 468
and the penalties here
(2) Any person who is found to be in violation of any provision of this section commits a misdemeanor of the first degree, punishable as provided in s. 775.082 or s. 775.083.
THERE IS JUST NO END TO THE DAMAGE THE BANKS AND THEIR WILLFUL VIOLATION OF EVERY LAW EVER IN EXISTENCE HAVE CAUSED TO THIS NATIO
This site, Veterans Today, contains extremely important information about the step-by-step procedures to eliminate populations and create one uniform world.
What Loose change 911 stated as early as 2003 is now common knowledge confirmed by Dan Rather (not the most daring journalist in the world. For him to come out, it is serious and can’t be contained). Banks were involved, AIG was involved and today’s big players were involved. It’s been non-stop since.
http://www.veteranstoday.com/2012/05/23/uncle-gordys-mid-week-reality-check-may-23-2012/
@Toile,
I know you’re going through a tough time. I’m posting this one for you… Hoping it will take away some of your heartaches.
http://www.huffingtonpost.com/alexandre-montagu/dewey-leboeuf_b_1540329.html?ref=business
What the Future Looks Like for Lawyers
Posted: 05/23/2012 3:50 pm React Inspiring
The demise of Dewey & LeBoeuf only a few years after the merger of Dewey Balantine and LeBoeuf Lamb is a shot across the bow of the legal establishment, for the failure of the firm is not the result of an isolated incident of mismanagement. To be sure, the guaranteed payouts to star partners and the unusually large debt amassed by the firm did precipitate the fall; however, the payouts and the debt were only symptoms of a much deeper structural malaise affecting the entire legal industry.
The economy in which legal services are supplied is in the midst of a profound transformation. Rapidly advancing technology has caused an increasing globalization and privatization. The legal establishment has endeavored to respond to these forces by creating increasingly larger law firms with high fixed overhead costs in multiple jurisdictions. The merger of Dewey Ballantine and LeBoeuf Lamb is a classic example. However, as explained fully below, this does not appear to have been the right response. Like a house of cards, large law firms like Dewey can collapse at the slightest downturn in the economy.
Let’s consider why. First, changing technology has created whole new lines of business that require legal services, while it has destroyed other businesses, eliminating or shifting their demand for legal services. The contrast between Instagram and Kodak illustrates the point. Instagram, a photographic services company that is only two years old, was acquired by Facebook for one billion dollars; a few months before, Kodak, another photographic services company but one that has existed since the nineteenth century, filed for bankruptcy. Law firms providing legal services to clients in the photographic services industry must adapt to the changing landscape in that industry; otherwise the demand for their services will inevitably shrink. In this context, smaller, more specialized firms, the so-called “boutiques” will have a clear advantage over the larger, generalist firms. Boutiques employing experienced, tech savvy lawyers can respond to specific client requests quickly and cost efficiently.
Yet, any law firms have reacted to this change by growing in size, bringing different practice groups under one umbrella, hiring many untrained associates, setting up multiple offices and increasing their overhead. This is unsustainable. Clients are unwilling to pay ever higher hourly rates, especially for junior lawyers who are being trained on the client’s dime. Yet because of their high, fixed overhead, large law firms are not able to reduce their rates. Therefore, the large firms are increasingly competing for a shrinking pool of business where cost is not a factor. On the other hand, firms that have the specialized expertise to provide solutions to their clients’ problems at the right price are likely to thrive.
The technological forces have also created a globalized economy. Clients are increasingly providing their products and services in many different countries. This means that clients require advice and legal services across multiple jurisdictions. Again the legal establishment has responded, or rather reacted, by growing in size, taking on more overhead in many different countries. The classic example is Coudert Brothers, a once venerable French and American law firm, whose rapid expansion in the face of globalization led to its demise. In this context boutique firms with the necessary expertise that can provide advice and services in association with other value based firms in different countries, provide a more competitive solution to globalized legal issues.
A bubble economy will mask these issues, but when the tide recedes, the heaviest ships will sink. We have experienced two major bubbles in the last decade alone — the dot.com bubble at the turn of the millennium and the housing bubble that collapsed in 2008. The wreckage left behind by each of these bubbles includes names such as Brobeck, Phleger & Harrison, Morgan & Finnegan, Heller Ehrman, Dewey & LeBoeuf, Thielen Priest & Reid.
The large law firm model is stressed by the technological forces that have spawned a global world where money and power are increasingly in private hands. The fate of the remaining firms will be dictated by their clients’ choices. And clients have been examining alternative solutions. Glimpsing the future of the law firm therefore entails understanding the choices available to clients. Here are some:
1.Consolidate all of your legal work with one firm and ask for discounts. While it may be more convenient for the client or its in-house legal counsel to have one firm to communicate with, consolidation of legal work with one firm will not result in cost efficiencies for the client. In addition, a single law firm may not have the expertise to handle a client’s multifaceted legal needs. Incidentally, it is this mentality that has allowed, and even encouraged the large firms to exist and grow in size. However, as clients are pressured to reduce cost, this solution will be discarded.
2.Outsourcing of legal services to low cost jurisdictions such as India: this does not provide a satisfying or satisfactory solution to clients’ problems. Complex problems that require specialized advice, often involving multiple legal systems, are not susceptible to resolution by low paid lawyers in a very different time zone who do not have the communications skills or necessary expertise to resolve the client’s.
3.Bring the work in-house: This is also not a sustainable solution for clients. Legal is not a core functionality for the vast majority of companies. Businesses need different legal services at different times. For example, they may need mergers and acquisitions advice in one year; in another year they may have more than their usual share of litigation; in another year they may need intellectual property advice in connection with the launch of new products. The company cannot afford the lawyers and attendant non-legal support staff required for all of these tasks. The role of in-house lawyers is to allocate legal work effectively and efficiently, to supervise the work and to act as liaison with the outside firm and the company’s staff.
4.Use a variety of smaller specialized tech savvy law firms. This would appear to offer the client the best value. Nimble specialized firms are able to respond efficiently to client’s concerns and are able to bring a creative mixture of technical and legal solutions to the table and most importantly, they can do so at the right price. While large, non-specialist law firms may also be just as effective in providing these services because of their large overhead they simply cannot do so at competitive prices.
Any business that is able to provide what its clients want at the right price will thrive. The future may well bring smaller, more specialized, more tech savvy law firms, with connections to each other across multiple jurisdictions. This does not mean that large law firms will disappear overnight; only that the trend is likely to be more towards boutique, more specialized firms, rather than the mega firms created through mergers such as the one that gave us Dewey LeBoeuf. Meanwhile, there is a great deal of pain in store as the legal establishment is forced to adapt to the shifting economic landscape.
Dee, Pie and everyone else,
“The plaintiffs have brought sufficient evidence to allow the case to go forward,” U.S. District Judge Reed O’Connor in Dallas said. O’Connor threw out several claims in the lawsuit at the end of a court hearing yesterday.
O’Connor allowed the counties to seek damages and an injunction limiting future filings by MERS. He rejected county allegations that MERS was filing false liens, which would have allowed the counties to seek $10,000 for each contested filing.
Tie it with what Pie has put up about Stanley Morgan forthcoming demise.
Things to ponder:
1) What will happen to Stanley Morgan’s assets? Does our government put its hands on them? (That would be the normal thing considering how much bailout money was never recovered from anyone of those banks)
2) Yet, The Dallas judge refuses to grant the $10,000 per defrective/missing assignment. So, no money is trickling from the banks to the counties (or very little anyway) AND penalties run only from this day forward.
3) Tie in the infamous “settlement” where people victimized by banks and MERS will get a whooping $1,800 to $2,000 per wrongly foreclosed house.
What deduction can we make? Centralize government intends to take the money from the banks, step by step. It will NOT be redistributed where it was stolen from. What purpose will it serve then? Why do the feds want all of it and FOR WHAT DESIGN?
I’m having a very unpleasant taste in my mouth. There appear to be plans of shuffling money around but none of us is in the loop and it is not to our advantage or benefit. What the hell is going on?
Subject: RePOST: Open Letter to all attorneys who aren’t PSA literate by April Charney.
April Charney Esq. discuss the use of PSA in foreclosure defense.
http://stopforeclosurefraud.com/2012/05/23/repost-open-letter-to-all-attorneys-who-arent-psa-literate-by-april-charney/?utm_source=feedburner&utm_medium=feed&utm_campaign=Feed%3A+ForeclosureFraudByDinsfla+%28FORECLOSURE+FRAUD+%7C+by+DinSFLA%29
Bank of America Corp. (BAC) and Mortgage Electronic Registration Systems Inc. failed to persuade a judge to dismiss a lawsuit claiming they shortchanged Texas counties out of uncollected mortgage filing fees.
“The plaintiffs have brought sufficient evidence to allow the case to go forward,” U.S. District Judge Reed O’Connor in Dallas said. O’Connor threw out several claims in the lawsuit at the end of a court hearing yesterday.
O’Connor allowed the counties to seek damages and an injunction limiting future filings by MERS. He rejected county allegations that MERS was filing false liens, which would have allowed the counties to seek $10,000 for each contested filing.
“The $10,000 per is out,” Thomas Hefferon, attorney for Bank of America, said in an interview after the hearing.
Dallas County filed the initial complaint in September, alleging that Merscorp Inc.’s MERS was established by banks including Charlotte, North Carolina-based Bank of America to avoid paying filing fees, as well as to ease transfers of mortgages. Dallas revised the lawsuit in October, seeking to represent all other Texas counties in which a deed of trust has been filed identifying MERS as a beneficiary.
MERS, which runs an electronic registry of mortgages, said it followed Texas law and didn’t shortchange counties on fees.
‘Perfectly Legal’
“What MERS does and how it does it is perfectly appropriate, perfectly legal,” MERS lawyer Robert Brochin said at yesterday’s hearing. “The designation of MERS as a false lienholder should be categorically denied.”
Most of the case remains following Judge O’Connor’s decision, Stephen Malouf, an attorney for Dallas County, said in an interview after the hearing. The counties will be seeking to enjoin MERS from continuing to operate as it has in the state, he said. “We’d like to see it stopped.”
MERS tracks servicing rights and ownership interests in mortgage loans on its registry, allowing banks to buy and sell loans without recording transfers with counties. MERS acts as the lender’s nominee and remains the mortgagee of record as long as the note promising repayment is owned by a MERS member.
Dallas County claims this allows banks that own stakes in MERS to buy and sell loans without properly recording transfers with counties and paying the fee. Dallas County District Attorney Craig Watkins said last year his county may be owed as much as $100 million.
Other Counties
Counties in other states including Kentucky, Michigan, Ohio and Oklahoma also filed suits claiming the MERS system has cheated them out of filing fees. The Kentucky suit was dismissed in February. Delaware’s attorney general last year filed an unrelated suit, alleging MERS used deceptive practices that hide information from borrowers.
“The MERS system has created massive confusion as to the true owners of the beneficial interests in mortgage loans and mortgages throughout the United States, and the loss of revenues has harmed U.S. counties,” Dallas County lawyers said in court papers last year.
“As of today, the system they are so proud of is a complete and total failure,” Malouf said at the hearing before O’Connor. “It has made the property recording system in the U.S. spaghetti.”
Every County
The Dallas County class-action lawsuit would cover every county in Texas where MERS is identified as beneficiary or where “any record has been filed” that would cause MERS to be identified in deed files as a grantor of interest in a property, unless “MERS itself actually holds in the property the interest that MERS purports to be granting,” county lawyers said in court filings.
Under Texas law, “there is no duty to record assignments, or other documents,” lawyers for MERS and Bank of America said in court papers March 9.
“The Texas Property Code, which contains various statutes concerning recording interests in land, allows parties to record interests in land to protect their interests but does not require that any recording occur,” the defendants said in the filing. “The counties have suffered no injury — and thus lack standing — from nonpayment of recording fees for documents that were never recorded.”
MERS doesn’t create new documents when a deed of trust is assigned to a new lender, Hefferon, the Bank of America lawyer, said at yesterday’s hearing. “There is no obligation to send a document that doesn’t exist,” he said. “There is no injury if you haven’t collected a fee or don’t do the work.”
Jason Lobo, a MERS spokesman, didn’t immediately return a call for comment.
The lawsuit is Dallas County v. Merscorp Inc., 11-cv-02733, U.S. District Court, Northern District of Texas (Dallas).
@Enraged
I believe you asked about this lawsuit status.
.http://stopforeclosurefraud.com/2012/05/23/bank-of-america-mers-lose-bid-to-dismiss-texas-fee-suit/
What the decision is saying is: Even if all the parties involved believe the assignment is valid, it is fatally flawed prior, and thus cannot withstand the threshold in court.
Morgan gone by the end of the year! Can’t hide the losses any longer going into BASEL III requirements and the Facebook deal was a great way to get all the venture folks and $3.00 shareholders out of their holdings. Don’t believe the hype! This is a win – win. The really rich venture guys get to dump all their cheap shares, Facebook can blame Morgan Satnley going out of business when the stock trades down to $15.00, and the government can take some of the money in fines for non-disclosure, or limited dissemination.
Once again, the fall guy is the average American Schmo who will be forced to absord 90 billion in derivative losses neatly tucked behind 2009 mark requirements in the MS off balance sheet SPE’s / SPV’s.
July 02, 2012!
@Nab,
Just read the whole decision. It comes down to this (and we have the same decision in OH concerning the assignment of a note): Sand Canyon not being the holder (and therefore the payee), it COULDN’T assign it to Wells Fargo.
Judge’s head is in good order between the ears. Right decision to make.
@Nab,
Where I get stuck, though, is that they still decide that Drouins’ case satisfies the standing requirement. SWomehow, something happened between the judge’s ears and I don’t know that it is.
@Nabdulla,
Try it under this light: the assignment was TECHNICALLY valid, meaning that it did not contain any flaws or defects that would render it inherently invalid or voidable on its form (no hanky-panky with robot-signing, fake notary or any such thing). HOWEVER, Sand Canyon not being the payee in the first place, it does not have any authority/capacity/legal right to assign the note to Wells Fargo.
Think about the note as a check. You get a check from Paul for $100. It is signed by Paul, the date is proper, the order is proper, the spelled-out amount jives with the numbers, it is technically valid. You owed Peter $100. So, instead of giving him $100, you simply give him the check, not endorsed to your name first. Peter can run to the bank until he’s blue and collapses, he won’t be able to cash it without your endrosment on the back.
Makes sense?
@ All….
Does this makes sense to anybody ??
“….Whatever the merits of Wells Fargo’s argument as to the standing of a mortgagor to challenge the validity of an assignment, the gravamen of the Drouins’ complaint is not that the assignment from Sand Canyon to Wells was invalid (though there are overtones to that as well). Rather, the Drouins’ principal grievance is that, even if the assignment was technically “valid,” it cannot have served to assign their mortgage to Wells Fargo because Sand Canyon did not hold the mortgage, and could not assign what it did not have. Because the Drouins satisfy the requirements of standing as to that claim, and because New Hampshire law clearly establishes the right of mortgagors to file an action seeking to enjoin a foreclosure sale, the case may proceed.”
http://ia601207.us.archive.org/15/items/gov.uscourts.nhd.37486/gov.uscourts.nhd.37486.33.0.pdf
The part that says: “….even if the assignment was technically “valid”, it cannot have served to assign their mortgage….”
This makes absolutely no sense to me. I’ve tried “geeking it out” for the last 2 hours. Realized some time ago what Neil and chinkinthe armour mean when they say that if you follow the document trial you’re lead down the rabbit hole – been walking around the rabbit hole for over 2 years now – can’t bite into the logic of this decision.
What I find remarkable is that, the few times I click on the remote, I regularly fall on some real estate channel showing young couples with no savings, a kid or two on tow, what I would call “iffy” insecure jobs (some middle-management gig in some soon-to-croak bank or investment firm), buying houses worth upwards of 500K and in which they invest another 75K of remodeling, with the minimum deposit required (20% nowadays), in an economy that is going nowhere but downwards. Some of those houses were repo’d. We all know that the titles are so clouded, we’re talking Kansas-style tornado watch!
In these days and ages, who, in his right mind, would want to tie himself up to a bank for over 450K? Are we witnessing the creation of yet another bubble ready to burst at the first significant downturn while the body of the first one isn’t even cold yet?
Oops! What am I thinking… no one has had a right mind for years, in this f…’d up country.