"The United States Trustee Program is engaged in an enhanced review of mortgage servicer filings in bankruptcy cases to help ensure the accuracy of the claim to repayment." Jane Limprecht, identified as a spokesperson for the United States Trustee Program and quoted by Gretchen Morgenson, "Fair Game/Don't Just Tell Us. Show Us." p. 1, col. 1 (New York Times Nat'l ed., "SundayBusiness" Section, Sunday, November 28, 2010).
Proof of standing to Foreclose is the missing ingredient to stop the Insurance Crisis in Foreclosed Properties. Title Insurance Companies and Mortgage Insurance Companies can issue more Policies insuring against Title defects and against misplaced Mortgage defaults, respectively, if the successful Mortgage Foreclosure Plaintiffs have already proven that the Defendant Mortgagor legally defaulted on the Mortgage (and thus on their Note), and that the Plaintiffs have clear title to the Mortgaged Property before they try to sell it after they secure a Judgment of Foreclosure.
"Until now, what we had was homeowners complaining about a lack of due process. Now you have the federal government complaining about the abuse of the judicial process. That's really what was missing before." Howard D. Rothbloom, Esquire quoted in id.
The linked newspaper report concludes with commentary on a further observation attributed to Mr. Rothbloom, to the effect that individual cases do not resolve systemic changes. In the reporter's view, "systemic change is precisely what's needed." Id.
Change already came and nobody noticed. Mortgagees -- which are the parties with exclusive right to Foreclose on a Mortgage -- changed their business model. The advent of securitization intruded into their previously existing ways of doing business. Before securitization, Mortgagees were easily identifiable and Title to the Properties they Foreclosed on was clear; following securitization, Mortgagees were able to sell their rights to receive payments from Mortgagors and re-sell and re-sell those rights again. Now what once were identified Mortgagees became shadowy "lenders" and "investors". They invented "Mortgage Service Companies" to collect the Mortgage payments. They also invented a system in which mortgage servicers would attempt to continue to take advantage of existng court procedures: Lacking evidence both of who actually holds a Note and a Mortgage, and that the Foreclosure Plaintiffs have the right to Foreclose in the first place, they almost always allege that they both hold the Note and Mortgage, and that the Note and Mortgage cannot be found after diligent search, according to published newspaper reports.
They thought that the court system would change to accommodate them.
It is true that it is their changed system, the changed system involving securitized Mortgage Foreclosure Plaintiffs who are no longer Mortgagees but "lenders" represented by "servicers" that is precisely what needs to be changed, again, back to what worked.
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