by Brian Mahany
Halloween is still a few weeks away but in New York, the zombies apparently come out early. Justice Arthur Schack is still pondering how failed mortgage lender IndyMac bank filed a foreclosure action three weeks after it legally ceased to exist. While some courts continue to rubber stamp the garbage that is often filed by foreclosure mills – law firms that specialize in representing lenders, more and more judges are drawing the line.
Luckily, Justice Schack appears to be one of those judges. We are not sure if he or the homeowner dusted off the calendar but someone figured out that IndyMac had closed their doors some 3 weeks before the foreclosure paperwork was signed.
When a bank goes under, the FDIC either takes over the failed bank or finds another bank to assume its operations. The new entity can certainly foreclose but not the failed bank. Once it ceases to exist it has no legal authority.
So how did this happen? There is but one logical explanation – robosigning. The “who” remains the mystery. In our experience, it is often the law firm representing the bank.
The court raised the same issues. Said Justice Schack, IndyMac was the “legal equivalent of a vampire — the living dead.”
According to published reports, the court is considering sanctioning the law firm for bringing a frivolous complaint; frivolous because a defunct bank has no standing to foreclose. He also criticized the handling of the paperwork by MERS, the Mortgage Electronic Registrations Systems.
The case against the homeowner has been dismissed for now. That does not prevent the correct noteholder from refiling the case – if they can locate the paperwork.
The fraud lawyers at Mahany & Ertl represent homeowners throughout the United States in suits against banks, mortgage companies and their lawyers. We are not a traditional foreclosure defense firm. If you are facing the immediate loss of your home, contact a local lawyer or your state bar association’s lawyer referral service. If, however, you feel that you have claims against your bank for fraud, abuse, improper denial of a HAMP modification, forged documents or the like then give us a call. We want to hear from you.
All inquiries are protected by the attorney client privilege and kept in confidence. In most instances, cases can be handled on a contingent fee basis meaning no legal fees unless we win and collect for you.
Mahany & Ertl – America’s Fraud Lawyers. Offices in Milwaukee, Wisconsin; Detroit, Michigan; Portland, Maine and Minneapolis, Minnesota. Services available in many jurisdictions.