Note: I wrote this before stumbling across this post which provides pretty good evidence that President Obama’s recent sale of his house was also signed by a robosigner. Brazen doesn’t even begin to describe the situation….
It’s beyond trite to state that the foreclosure crisis has had a huge effect on the economy. But I don’t think most people realize how much of the crisis–and the response by banks to the crisis–involves flat-out law-breaking. A small anecdote related to if banks will refile foreclosure applications in Florida from Yves Smith (boldface mine):
To be blunt, whether these cases resurface will in large measure depend on the servicer or foreclosure mill’s willingness to create bogus documents. I’ve seen this happen even in my limited direct contact with foreclosure cases. The bank’s law firm presented an allonge an attachment to the borrower’s note to allow space for additional signatures which magically showed that the note had indeed gone through all the parties as stipulated in the pooling & servicing agreement for that deal. Per the Uniform Commercial Code, an allonge is supposed to be so firmly attached to the original note as to be inseparable, yet the bank’s team claimed to have miraculously found it. In addition, it bore signs of being a forgery (pixtillated signatures on a “wet ink” document; signatures reproportioned to fit signature lines).
But the use of this sort of forgery raises the bar to consumer challenges. They are fairly easy to creates, and to challenge them, a homeowner would need to hire a document expert to challenge its validity. And despite the growing skepticism among judges of documentation submitted by banks, to side with a borrower on the grounds of document forgery might be a bridge some judges are not willing to cross.
I don’t think those in the mortgage industry, along with those in their orbit (i.e., judges who try foreclosure cases) realize how corrosive this is. A long time reader told me, “You would be crazy to buy a house right now”, to which I responded, “You would be crazy to set foot in a court right now.”
When the rich and the powerful are allowed to perjure themselves, none of us is free.