Sunday, September 29, 2013

Rescission Returns in 3rd Circuit Opinion

Forbes has taken notice. There is a shift toward borrowers in mortgage litigation. The decision points back to the origination of the loan. This decision follows a similar decision in the 4th circuit. It all comes down to what actually happened at closing? And we don't actually know if the decision to allow rescission indefinitely on second mortgages will extend to the first mortgage if it is all part of the same transaction.
This is a point that needs to be driven home to each and every judge until he yells "Uncle!": "The answer is that Wall Street Banks wanted to use those loans as “assets” they could trade, insure, hedge and even sell contrary to the prospectus and PSA shown to pension Funds and other investors who advanced funds to investment banks as “payment” for mortgage bonds underwritten by those banks."

Wednesday, September 25, 2013

Why Many Marijuana Industry Investors Were Thwarted in Colorado, Despite Legalization

From:  AlterNet 

by  April M. Short

Red tape abounds for outside investors in Colorado.
Photo Credit: Oleksandr
September 24, 2013 - 
When U.S. Attorney General Eric Holder announced the Justice Department’s decision to allow legal marijuana markets to move forward without a fight on August 29, it was not just news for pot shops, pot users and pot growers. In the last month the legalization of cannabis in Colorado and Washington has attracted attention from investors from around the world looking to cash in on the new and expanding indu
The ArcView Angel Investor Network, a cannabis industry investing organization, gathered a group of more than 60 accredited investors and 20 companies in Denver, 
 Colorado on September 24 in a daylong event to discuss investing options. 

The ArcView Investor Network’s investors include billionaires, tech entrepreneurs, venture capital firms and real estate moguls, who attended the conference to hear companies present their cannabis startup business pitches. Those companies included “licensed dispensaries and cultivations, a Hollywood film from a well-known director about the industry, a handheld vaporizer company,  a company with a machine that creates hash oil and other cannabis concentrates, a security company for licensed  cannabis businesses, a company with new advancements in lighting technology,  and a popular online social network for cannabis consumers,” according to the press release. 

Steve DeAngelo, cofounder of the ArcView Group and ArcView Investor Network, told the Atlantic that while 60 investors attended, all looking to buy into the “burgeoning industry,” 90 percent of those investors “won’t be able to invest.” 

In addition to heading ArcView, DeAngelo is the executive director of the medical marijuana dispensary Harborside Health center in Oakland Calif., which has been called the world’s largest medical marijuana dispensary. He has been an activist in the cannabis legalization movement for more than three decades. MORE

Sunday, September 22, 2013

Finally an answer to that *vexing* question. Is There Life After HAMP?

From:  Deadly Clear

Published by THE RECORDER, Essential California Legal Content
modification-fraudChavez v. Indymac Mortgage Services [C.A. 4thD061997] Click here for the full decision
"We conclude the homeowner sufficiently alleged equitable estoppel to preclude the lender's reliance on the statute of frauds defense.
We also conclude that the homeowner sufficiently alleged a cause of action for wrongful foreclosure." Read more of this post

The Armageddon Looting Machine: The Looming Mass Destruction from Derivatives

From:  Deadly Clear

TruthDig posted the latest Ellen Brown, Web of Debt examination of the financial market.
highrisk-435x235The Armageddon Looting Machine: The Looming Mass Destruction from Derivatives
Five years after the financial collapse precipitated by the Lehman Brothers bankruptcy on September 15, 2008, the risk of another full-blown financial panic is still looming large, despite the Dodd Frank legislation designed to contain it. As noted in a recent Reuters article, the risk has just moved into the shadows:
[B]anks are pulling back their balance sheets from the fringes of the credit markets, with more and more risk being driven to unregulated lenders that comprise the $60 trillion “shadow-banking” sector.
Increased regulation and low interest rates have made lending to homeowners and small businesses less attractive than before 2008. The easy subprime scams of yesteryear are no more.  MORE

Saturday, September 14, 2013

REAL NEWS - OneWest Bank pays 7 figures in mortgage fraud case

From: Cal Coast News

September 11, 2013

A San Luis Obispo County couple has received a million-dollar-plus settlement and title to two houses in a case that is likely to result in more lawsuits by people who lost property to mortgage lenders after the bursting of the housing bubble.
Greg and Irene Rigali of Shell Beach sued OneWest Bank, IndyMac Mortgage Services, U.S. Bank and GSR Loan Mortgage Trust after their home and a rental property in Grover Beach were foreclosed. At the time, the Rigalis were negotiating with OneWest Bank to modify their mortgages, sources familiar with the case said.

The case turned on a mortgage practice known as “dual tracking.” Under the practice, lenders work with borrowers who are in default but, at the same time, pursue foreclosure.
At the short end of the seven-figure settlement agreement were two nationally known individuals, billionaire Steve Mnuchin, principal owner of OneWest Bank; and Rik Tozzi, a prominent Alabama attorney specializing in banking litigation and “complex cases in difficult or dangerous jurisdictions,” according to his website.  MORE

Tuesday, September 3, 2013


             What is “the law?”
         Usually we ask a slightly more specific question, such as “what is the law about under age drinking?” or “What is or are the legal definition(s) of “murder”, “manslaughter”, “mayhem”, “malice”, “maritime”, “marriage”, “materiality” or “mortgage”?  (In the Law as in the list of states in the Union, labels, names and words that begin with “M” seem to be disproportionately numerous and very important).
         The most disconcerting thing for any one to learn, I guess, is that there are no fixed answers to any of these questions.
         Every answer in law is a dialogue, which is to say that every answer is a process, not a classification.   Worse yet, every dialogue in the law concerns the process of classifying something.  Every “Final Judgment” in the law is basically a classification: “guilty” or “not guilty”, “liable” or “not liable.” 
So whether you negotiate in court or out of court, you are doing the same thing in law: you are talking and/or exchanging ideas in writing, whether you do so in the courtroom, the corporate boardroom, the billiard lounge, or the bedroom. 
So what is law?
Twenty-six years after I matriculated in the University of Chicago Law School, I still struggle with this question and all I can tell you for sure is that ALL answers are horribly, frustratingly unsatisfactory---but I think the following is at least "true": Law is a Process, Not a Fact.  
I think that the best answer is that “Laws” are basically mental pictures, symbols which we use in our heads to convince others that we are correct.  “Laws” are symbolic expressions of what we want, and how we use these symbols in our dialogues is open ended.
All the “M” words above are “Hot Topics”, likely to inspire passionate discussion between any two people old enough to pronounce the words and not yet so senile as to forget what they were talking about.
Let’s just take the hot topic that is most particularly relevant: what is a “mortgage”?
A “mortgage” is a special kind of contract, the purpose of which is to transfer ownership, usually of real estate, incompletely and over time.  A “mortgage” is a particularly complex “legal” contract because it has lots of conditions and special terms which might shift “equitable” ownership back and forth between buyer and seller (or creditor and “accredited” borrower). Suddenly we see a classification we weren’t expecting: what is “law” and what is “legal” on the one hand, compared with what is “equitable” or “fair” on the other?  How does “legal” ownership and right differ from “equitable” ownership and right?  This question opens up a brand new dialogue INSIDE our initial dialogue about “what is a mortgage?”
And this is a typical example of how legal dialogues go: the raise questions in the process of answering them. 
The art of dealing with these multiple layers of questions and answers and subordinate questions and sur-replies, or “surreal replies” in some cases, is the art of law---the art of rhetorical manipulation of concepts and symbolic expressions to achieve symbolic, and sometimes practical, “victory” in an argument or negotiation.
There are other aspects of the “what is a mortgage” question even without further elaborating the answer: Who is a buyer and who is a seller?  What exactly is being bought and sold in a mortgage?  Is it the dirt underlying a home together with the bricks and cement in the home?  Or is it a legal document called “title” to the dirt and bricks and cement?
Why does every mortgage have a “note” attached to it and what is that note all about?  The law answers in all its magisterial mystery: “A promissory note when accepted and approved by a Federally approved bank is the equivalent of money.”  That’s just the answer you were looking for, right?  Another word to be defined and argued about: “money”.  And a weird phrase “the equivalent of money”---say what you say?
Well, you see, the NOTE is the consideration for the TITLE, and it what makes the buyer’s ownership of the Title (and the land represented by the title) but it is also the SECURITY for payment of the consideration in real money (since the note is only “the equivalent of money?”  Aren’t you glad you asked?  So what is a SECURITY?
Well, SECURITY obviously means a guarantee of some sort, right?  A promise that you will keep your promise or else something bad will happen maybe?  “Cross my heart and hope to die, stick a needle in my eye”?  That sort of thing?  Well, maybe, but the law is not so crass.
Under the Laws of the United States, a “SECURITY” is defined as “ANY NOTE.”  You can see we’re really making progress here, can’t you?
All I can say, folks, is this: if you can’t stand the heat, stay out of the kitchen.  If you’re going to argue, be prepared to ARGUE and know the language of the law---it is ONLY a language, it is not a set of clear answers.  Law is the process of argumentation, only this and nothing more, quoth the raven, nevermore....
CEL III, writing from New Orleans 70130, "way down upon the Swampy River..."