Just like the last VICTIM OF WELLS FARGO I wrote about, Wells Fargo claimed that Norman and Oriane Rousseau had missed a mortgage payment.  But the payment HAD been made in person at a Wells Fargo branch by Cashier’s Check, and Mrs. Rousseau has the receipt for the transaction.

The Rousseaus file a dispute with Wells Fargo over the supposed missing payment.  Wells Fargo “investigates” and comes back saying that the Rousseaus had stopped payment on the check.  They stopped payment on a Cashier’s Check?  Seriously?

I don’t want to spend too much time on this ridiculous point, so here’s how Rousseau’s lawyer explains this technical yet wholly insipid issue, and then we’ll move on…

The teller’s receipt establishes that the cashier’s check was in the custody and control of Wachovia on April 1, 2009, and the research by the Cashiering Department should have concluded that Wachovia screwed up by not applying the cash-equivalent funds to the Rousseau’s account. After delivery and acceptance to the branch office, it was Wachovia’s responsibility to safeguard the instrument; Wachovia itself effectively stopped payment on the cashier’s check.

Okay, so let’s get back to the meat of the story…

Concerned that they could not resolve the payment dispute but told they should apply for a loan modification, the Rousseaus hired a law firm and submitted a loan modification application.  After that it was standard operating procedure at Wells Fargo… we lost this, and we lost that, resend this, and resend that… for almost a year.

Good Lord, Wells Fargo, could you please do something differently just once?  This article is almost becoming a form letter.

Wells Fargo then of course told the Rousseau family not to make their payments, that they were being considered for a loan modification and that making their payments would immediately disqualify them.

So, they saved their payments just in case Wells decided to deny them a modification.  Saved every single one just in case the bank decided to act like… well, Wells Fargo Bank.

Then Wells sent them a Notice of Default, but when they called to say they wanted to reinstate their loan, Wells said what they always say… IGNORE IT… don’t worry about it, everything’s fine, it’s just an automated sort of thing… why, you’re being considered for a loan modification.

Then Wells filed a Notice of Sale on October 28, 2010.  Their home would be sold on November 22, 2010.  And still Wells said… IGNORE IT… it’s just another automated sort of thing… your loan modification is still pending… and please re-submit some documents.

It was November 10, 2010… just 12 days before their home was to be sold… when the Wells Fargo representative told the Rousseau’s that their loan modification had been denied.  The reason: Insufficient income.

Yeah, but you know the funny thing about that is that their income hadn’t changed a nickel since they applied for the loan modification.  So, what’s the deal?  Did it take Wells Fargo a year to figure out the Rousseau’s income was insufficient?  Is that the story I’m supposed to be buying into?

You’re a liar, Wells Fargo.  Either you knew you weren’t going to approve their loan modification, or you’re the most incompetent financial institution in the history of the world.  And you don’t just do this sometimes, you do this all the time… and especially to people in their 60s or older.  Why is that do you suppose? 

In case you’re wondering what I’ve been up to, I’m actually collecting Wells Fargo stories at this point.  I figure it’ll be a hoot to put them all together into a book.  What do you think?  Should I autograph a copy for you when it’s done?

That same day the Rousseaus found a lawyer and discovered they had a RIGHT TO REINSTATE their loan.  (Nice of Wells not to tell them that, by the way.)  They contacted Wells and requested a reinstatement quote… TWO DAYS LATER Wells finally gave them the phone number for RCS, the trustee.

Read more here

Teri Buhl, Teribuhl.com

Fallout from JP Morgan trading losses, which led to rater Fitch downgrading their debt yesterday, aren’t the only financial worries the banking behemoth is facing. Nestled in that shocking 10-Q filed Thursday is an admission that their regulator, the Securities and Exchange Commission, thinks some of the details that lead to the explosive Ambacmortgage security fraud suit against the naughty stepchild of JPM, Bear Stearns/EMC, are worthy of an enforcement action. Yep- the SEC is giving or finally gave them a Wells Notice, which means according to their 10-Q (and their 10-K) in January 2012 the SEC’s investigation into the sins of Bear’s Mortgage team run by Tom Morano, Jeff Verschleiser, Mike Nierenberg and the subsequent cover up by JPM was worthy of a civil suit along with some penalties.

JPM’s 10-Q states “In January 2012, the Firm was advised by SEC staff that they are considering recommending to the Commission that civil or administrative actions be pursued arising out of two separate investigations they have been conducting… In both investigations, the Firm has submitted responses to the proposed actions.”

We see JP Morgan admit one of the Wells notices relates to the fraud actions first brought forward in the Ambac suit with this line from the 10-Q, “The second involves potential claims against Bear Stearns entities, JPMorgan Chase & Co. and J.P. Morgan Securities LLC relating to settlements of claims against originators involving loans included in a number of Bear Stearns securitizations.”

Read more here

In a decision that possibly opens the door for renewed foreclosure delays, the U.S. Court of Appeals for the Fourth Circuit has held that a lawsuit seeking rescission is timely where the consumer provided notice of rescission to the subservicer within three years of closing but did not file suit until after the three-year deadline had passed.

The May 3, 2012, decision in Gilbert v. Residential Funding LLC is the first by a federal appellate court to hold that a borrower need only send notice of rescission within the three-year period to validly exercise a right to rescind.

The decision puts the Fourth Circuit in the minority. The majority of courts to consider the question—including the Third and Ninth Circuits—have held that the requirement for the borrower to file suit within the three-year period is consistent with the language of Section 1635 of the Truth in Lending Act and prior precedent, including the U.S. Supreme Court’s decision in Beach v. Ocwen Federal Bank. In its opinion, the Fourth Circuit rejected the subservicer’s reliance on Beach, observing that Beach “did not address the proper method of exercising a right to rescind or the timely exercise of that right” but only addressed whether Section 1635 was a statute of limitation that operated to extinguish the right after three years.

The borrowers in Gilbert had sent their rescission notice following the filing of a foreclosure action by the holder of their note. In doing so, they were employing a tactic that, since the mortgage foreclosure process began, borrowers have routinely used to delay a foreclosure even when the borrower has no real intention of rescinding (and perhaps even when the borrower does not know if he or she has any basis for rescinding or the ability to tender back the principal).

Read more here

If one wants to understand the full complicity of Wall Street in the Great Recession, look no further than the voluminous package of pre-collapseLehman Brothers documents that have been made available by the law firm Jenner & Block LLP, which has acted as the coroner in the Lehman post-mortem.

Most important, the cache dispels the myth that Dick Fuld, chief executive officer of Lehman Brothers Holdings Inc., and his close associates were unaware of the risks their business faced in 2007 and 2008. That would be bad enough, but the more devastating reality is that Fuld and his sycophants were warned repeatedly but were blinded by their hubris.

The records confirm, yet again, that the “forces-out-of- our-control” argument we hear from Wall Street leaders is bunk. It is the ill-advised behavior of one banker after another, day in and day out, that leads to the sort of devastating financial crisis we are only now emerging from.

For instance, at a Lehman board meeting in September 2007, according to a copy of the presentation in the data cache, Lehman executives presented a clear summary of the brewing crisis. “The initial tremors were felt at the end of 2006,” the board was told, “when the poor loan performance of sub- prime borrowers began to be a cause for concern in the marketplace. This was evidenced by a gradual spread widening in the asset backed index.” The presentation continued: “The market continued to widen as it became apparent that the performance problems in mortgage loans was not going to abate and was no longer limited to the sub-prime market but also affecting the Alt-A product.”

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Margaret Chadbourn, Reuters via Huffington Post

In considering how to fix the ailing U.S. housing market, Republicans and Democrats in Washington have found a rare point of agreement: they would prefer life without failed mortgage giants Fannie Mae and Freddie Mac.

But even with agreement that the system is broken, it is unlikely Congress will soon tackle the mammoth task of winding down two entities that have cost taxpayers more than $150 billion since their bailout in September 2008. Fannie and Freddie now support about 60 percent of all new U.S. home loans.

Already, lawmakers have taken tentative steps to scale back Fannie Mae and Freddie Mac’s involvement by reducing the size of loans that they can guarantee. Republicans and Democrats have unified behind preserving affordable homeownership.

But more dramatic actions could be politically treacherous in an election year. Home buyers still rely on the government backstop in nine of 10 new mortgages, and the fragile market must be weaned slowly from its dependence on federal programs providing financial backing.

Changing the present system might prove hard for lawmakers who are wary of risking harm to the housing recovery. Some would fear alienating the deep-pocketed housing lobby and various consumer groups rallying around the issue.

“There’s not a politician out there who is willing to take the risk of proposing something with a short transition period that would potentially be blamed for cratering the housing market,” said Douglas Elliott, a Brookings Institution fellow and former investment banker.

Read more here

Secretaries of State Elaine Marshall of North Carolina, Beth Chapman of Alabama, and Ken Bennett of Arizona are at the forefront of developments transforming the role of Notaries Public. Their insights will be a highlight of Conference 2012 — especially in light of mounting nationwide concerns over notarial compliance and risk management.

“We are pleased that these three influential Secretaries — all of whom are among the top minds in notarial issues — will join us to address the nation’s Notaries and their employers during this critical time,” said NNA President and Chief Executive Officer Thomas A. Heymann. “The foreclosure crisis put the spotlight squarely on the high value of legal and ethical notarizations. These Secretaries will provide their perspectives on what needs to be done to strengthen the notarial process and avoid these types of financial crises.”

Marshall, recipient of the NNA’s 2006 March Fong Eu Achievement Award, will discuss her state’s strides in Notary standards and technology. First elected Secretary of State in 1996, Marshall quickly emerged as a staunch advocate for the role and professionalism of the Notary office. She is a past president of the National Electronic Commerce Coordinating Council and has held several leadership positions within the National Association of Secretaries of State (NASS).

Chapman, in a second consecutive NNA Conference appearance, will address the reasons she championed the implementation of the highest Notary bond in the country. Since taking office in 2007, Chapman has become an expert in Notary compliance and risk management, twice hosting events in Alabama for Notaries on state law and best practices. She currently serves as president of NASS and has worked tirelessly to promote Notary education and professional standards.

Bennett, appointed in 2009 after serving four terms as a state senator, has overseen his state’s Notaries at a time when they are dealing with the fallout from the real estate and foreclosure crises. He currently is the Western Region Vice President for NASS. He will also offer his perspective on challenges Notaries face when dealing with immigration issues.

The NNA’s 2012 Conference will be held June 3-6 at the Sheraton San Diego Hotel and Marina.

About the National Notary Association

Established in 1957, the National Notary Association (NNA) is the nation’s foremost professional member organization serving the communities of Notaries in every state. The non-profit NNA is dedicated to educating, serving, and advocating for the 4.8 million Notaries in the U.S. by imparting knowledge and understanding, promoting a positive public perception of the office, and bolstering consumer protection through best practices. The Association’s professional programs, services, and model legislation help Notaries advance their careers and serve the American public with the highest level of professionalism and ethics. To learn more, visit us at NationalNotary.org.