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HOW TITLE IS BEING CORRUPTED BY CITI AND OTHER MAJOR BANKS
EDITOR’S COMMENT: It’s a game to them and life to the rest of us. They have power and they are using it regardless of law, ethics, morality or simple common sense. This homeowner made her payments on time, but as soon as Citi entered the picture, they were headed for foreclosure. Why? Because they want the property. Citi and others are looking to become the largest property owners in the nation without spending a dime on loans.
This is not a mistake where the right hand doesn’t know what the left hand is doing. The Banks are in the foreclosure business — regardless of their right to foreclose and regardless of who takes the loss. A close examination of the securitization chain here will show that Citi never bought the loan, never put a dime in the deal and has no loss from anything resembling a loan receivable account.
Citi is getting paid in every way conceivable —including from the borrower and still taking the house on December 2. They claimed huge losses for which the Federal Reserve window and TARP was opened up to them paying them 100 cents on the dollar. They downgraded the pools and received AIG or AMBAC money, proceeds from credit default swaps and other credit enhancements. Just how many times does this obligation need to be paid in full before we stop the foreclosures?
And here is the real bulletin. When the dust clears after litigation, this lady is going to be entitled to restoration of possession and title to her home. When she gets it, title will be cleared of all other transactions that were recorded and she will probably be awarded damages, maybe treble damages as well. And some investor buying cheap homes is going to have a total loss, with no home and a claim against Citi that will be contested because of disclaimers in the closing paperwork with the investor. When the investor turns to the title insurance carrier it will be the same story.
As investors realize the high risk they are taking, they will recede from the market or work out conditional deals where they don’t take title and get the right to rent the property. These conditional deals are springing up all over the country as savvy people, understanding the securitization and title mess, pick up easy money renting property that doesn’t belong to them based upon deals with the homeowner who gets a payment equivalent to cash for keys. Some deals allow the homeowner to get back the house if the investor wins in litigation against the bank.
Check with an attorney licensed in the jurisdiction in which your property is located before taking any action based upon information on this blog.
Whistleblower: Despite payments, a foreclosure threat
- Article by: RANDY FURST , Star Tribune
A banker says Nancy Gosselin made the mortgage payments on her St. Louis Park house, but CitiMortgage seems determined to foreclose.
CitiMortgage is planning to auction Nancy Gosselin’s house at a sheriff’s sale next month, based on its claim that she missed a payment in 2009. The Minnesota attorney general’s office has intervened, but says it can’t get a straight answer from the lender.
Nancy Gosselin cannot understand why CitiMortgage is about to foreclose on her St. Louis Park house. Neither can her local banker or the Minnesota attorney general.
At the heart of the dispute is a single monthly payment of $584 that CitiMorgage says she failed to make more than two years ago, according to the attorney general’s office. Gosselin says she made all her payments. A loan officer at Bremer Bank agrees. The attorney general’s office, which says it can’t get a straight answer from CitiMortgage, has urged the mortgage giant to stop the foreclosure and work out a deal.
But the fallout from the alleged missed payment has been a series of cascading late fees and penalties and refused payments that has culminated in CitiMortgage’s threat to auction Gosselin’s home at a sheriff’s sale Dec. 2
“I did nothing wrong. This is very frustrating,” said Gosselin, standing on the sidewalk last week in front of her house on Xenwood Avenue S.
Gosselin gave CitiMortgage permission to discuss her case with Whistleblower. But Mark Rodgers, director of Citi public affairs in New York, declined to do so “due to privacy considerations.”
“Generally, if an account is in the foreclosure process, we cannot accept less than the full amount needed to bring the account current, unless a work-out plan is developed,” he said. “We encourage customers in such situations to get in touch with us directly to see what options may be available to them.”
She tried. For nearly two years she repeatedly wrote CitiMortgage memos arguing that the company was mistaken in its late fees. CitiMortgage never budged.
Stephan O’Connor, a loan officer at Bremer Bank, reviewed Gosselin’s records and disputed CitiMortgage’s claims, writing that Gosselin “has provided all of the proof that her payments were made and made on time.”
Gosselin, a receptionist at Sela Roofing, spent her childhood in the house. It became hers, after her mother’s death, when she bought out her sister’s interest. She’s lived there for more than 20 years.
In 2005, she refinanced the house with an $84,100, 20-year mortgage from Bremer Bank, which then sold the mortgage to CitiMortgage. In 2009, she filed for bankruptcy, facing an assortment of debts, but continued making mortgage payments.
After the alleged missed payment in 2009, the company began piling on late fees, penalties and attorney fees that have swelled to more than $2,500. The firm has refused to accept Gosselin’s past six mortgage payments, so it says she now owes more than $6,000.
On Thursday, William Gosiger, who works in Attorney General Lori Swanson’s consumer services division, wrote a letter to CitiMortgage that “this office does not believe that Ms. Gosselin’s home should be foreclosed upon due to a problem that resulted from one allegedly missed mortgage payment.”
“We have dealt with nine different staffers at CitiMortgage and the right hand doesn’t seem to know what the left hand is doing,” said Ben Wogsland, an attorney general’s spokesman. “We have sent five or six letters to CitiMortgage. We have had only one substantive written response. This is consistent with a lot of consumers’ complaints about mortgage lenders being unresponsive.”
Whistleblower asked two local lawyers with expertise on foreclosure to review Gosselin’s records.
Nick Slade, a Minneapolis attorney, said it appears that after she filed for bankruptcy, CitiMortgage shifted her payments to a different department, which would explain why her checks were recorded by the company weeks after she sent them.
“Even though she thought she was making a full month’s payment, the late fees were paid first [by CitiMortgage] and she became further and further in arrears,” he said. “The whole thing just started snowballing. … It really shows how broken the mortgage system is.”
Jane Holzer, an attorney with the nonprofit Foreclosure Relief Law Project in St. Paul, said: “It looks like she made all her payments. She may have a dispute with CitiMortgage about whether she owes late fees. But late fees shouldn’t triple or quadruple what she owes. … It shouldn’t justify a foreclosure.”
Randy Furst • 612-673-4224
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