If car dealers can keep track of titles, banks can track promissory notes, Joseph Lents says.
Somebody has been trying to foreclose on Joseph Lents’ Boca Raton home for five years. So far, they have been unsuccessful because he has legally fought them every step of the way.
The original lender, or the assignee, seems unable to produce the promissory note and prove it has the right to foreclose. In an era when Wall Street has sliced and diced mortgages to package them as securities, that could turn into a broader issue.
“I probably have been to the Palm Beach County courthouse 100 times or more over the last five years, just to observe,” Lents said. “In 99 percent of the residential foreclosure cases, plaintiffs are asking the court to accept a promissory note copy as the original because it is presumed lost.”
Resistance doesn’t come cheap. Lents has paid more than $120,000 in legal fees and costs so far to save his 5-acre, $2.5 million home.
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Way to go Mr. Lents. An inspiration for us all.
I wonder if could have just refinanced the house with a totally different bank before this got out of hand?
So I want to here what others think of this issue:
Edward Jordan, a 79 year old retiree, put into an exploding ARM, qualified at a teaser rate of 1%, with his income inflated to $8,900 a month. He bought his home in the 1970s — he doesn’t DESERVE homeowner ship?
I don’t think so.
There were insentives, trips to Hawaii and Palms Springs, a former Countrywide employee said, if you closed the most loans, or the most options ARMs, but never a contest for the employee that closed the most FIXED home loan or loan best for the customers!
You don’t say?
Mozillo said he sold his stock in August because he has a lot of grandkids, education to pay for and obligations.
How ironic. You sell a product that you know people can’t survive on and then sell the stock at high prices so you can survive. Nice work, Godzilla — I mean, Mozillo.
In October of 2005 I went to Hawaii w/ my friend that worked for New Century. The company took 100’s of employees and their spouses or friends. We stayed 4 days at the Grand Wailea… too ostentacious for me but amazingly fun. They took the whole crew on an evening boat cruise and to dinner in limos to Lahaina. There were luaus, breakfast, dinners provided by New Century. All I could think was “OMG the mortgage business is doing amazingly well”. I remeber the speaker saying during one of the many toasts that there were clouds on the horizon in the industry. Looking back it makes me sick that New Century paid for this on the backs of “hard working” homeowners that most probably no longer own their homes. I only hope Countrywide gets their due. And all the other lenders/servicers/banks and the people that deride us homeowners struggling to hang on to our homes, credit, sanity and self worth.
Richard-
He probably should have refinanced with another company. I’m assuming he didn’t because the terms he got from his current mortgage was what he wanted. He probably didn’t want to incur another set of closing cost fee associated with a new transaction.
The very first time I heard about Fairbanks was involving this very same thing. The payment seems to never get posted. The payment vanishes. When the borrower gets a notice it’s months later. Since I’ve known about them (97′) they have been caught up in mess like this. As funny as this sounds, they are worse than CW.
JacMac-
For a L.O. to put a 79 yr old in an a.r.m. simply doesn’t make sense. I’m sure it was a no doc deal. To most lenders defense, they will catch the age and get more stringent with the L.O. If its a full doc loan. Most lenders will default the borrower’s income with retirement income, unless they can really, really prove they are still working and drawing a large income. With a note of 8k, assuming no other bills, his income would need to be in the area of 17k a month. If he’s making that amount of money each month, why does he need to refi. The loan never made sense from the begining.
Chris-
An underwriter/lender is not allowed to discrimate re: age, race, gender, sexual orientation, etc. If a borrower wants an ARM and he/she qualifies, the underwriter/lender has no choice but to approve it. It would be solely up to the LO to determine which product makes sense for the borrower and place him/her in the proper loan program that he/she qualifies for.
Also, I am curious……please clarify why you think putting an elderly client in an interim ARM does not make sense. I think putting an elderly borrower in a 10-1 ARM for a lower rate and improved cash flow makes more sense than putting him/her in a 30-year fixed for a higher rate when his/her lifespan statistically won’t be more that 10-15 years, at the most.
Virginia,
Underwriters have the lattitude to make common sense decisions that sometimes don’t appear on the product guidelines. The loans I have done for customers 65+ get scrutinize more because of their age, especially when the product is a stated one. It falls dangerously close to predicatory lending. I know you can’t discriminate. I’m not saying that at all. You can give a person 200 years old a loan. My point is realistically, underwriters are or at least the ones I deal with are harder on the information because of it. Will you get an underwriter to admit that. No. But that’s what happens.
And yes you are right, it falls back on the L.O. if the deal is approved. That’s the problem. Why would you do that to someone that is on a fixed income?
As far as the sense of an A.R.M. for someone that old. I don’t know if its a 2/28 or a 10/1. You might do it but I wouldn’t. If he lives to be 89 then what? Another 10/1 arm and some more closing costs? Do it right the first time. How about buying the rate down on a thirty year fix and explaining the benefits versus the quick fix. He lives to be 89 and he still has his house and a piece of mind. Sometimes what a customer wants isn’t always the best option.
If he was 29 that’s a different story. The room for error and correction is limited for someone who is 79. If you are doing right by him, you have to consider that.
You cannot discrimate due to age period. I underwrote for 18 years and was an mortgage banking operations manager which included managing the underwriting, quality control and compliance departments. If you use more stringent underwriting guidelines for elderly borrowers, you are breaking the law period. Of course, you would not want to see a retired elderly person on a fixed income going stated and I wouldn’t typically allow exceptions to ratios, asset or LTV requirements on this type of borrower. Maybe that is what you meant.
According to the National Vital Statistic Reports, the average life expectancy in the US is 77.3 years, then it varies from there depending on whether the borrower is male or female and of course there is the borrowers health history
etc.http://www.cdc.gov/nchs/data/nvsr/nvsr53/nvsr53_06.pdf
As a loan officer, I deal in A Paper but would never recommend an elderly borrower take a 2/28 or Option ARM or some such nonsensical ARM Program. Good points above for a loan officer to consider when placing an elderly borrower in a loan program. It all depends on the individual and their credit, income, asset and loan-to-value profile. No two borrowers have the same profile or financial requirements so one financing scenario (30-year fixed-rate) is not always the answer for every elderly borrower. But I do like the option of buying down the rate on a 30-year fixed-rate, although it can get expensive, escpecially in CA where the median price of a home is in the mid $500,000’s. The loan officer must definitely go deep into the borrower(s) profile and determine exactly what loan program would work best for him/her.
Here is an excerpt from
http://www.ftc.gov/bcp/conline/pubs/credit/ecoa.shtm
Equal Credit Opportunity
Credit is used by millions of consumers to finance an education or a house, remodel a home, or get a small business loan.
The Equal Credit Opportunity Act (ECOA) ensures that all consumers are given an equal chance to obtain credit. This doesn\’e2\’80\’99t mean all consumers who apply for credit get it: Factors such as income, expenses, debt, and credit history are considerations for creditworthiness.
The law protects you when you deal with any creditor who regularly extends credit, including banks, small loan and finance companies, retail and department stores, credit card companies, and credit unions. Anyone involved in granting credit, such as real estate brokers who arrange financing, is covered by the law. Businesses applying for credit also are protected by the law.
When You Apply For Credit, A Creditor May Not…
Discourage you from applying because of your sex, marital status, age, race, national origin, or because you receive public assistance income.
Ask you to reveal your sex, race, national origin, or religion. A creditor may ask you to voluntarily disclose this information (except for religion) if you\’e2\’80\’99re applying for a real estate loan. This information helps federal agencies enforce anti-discrimination laws. You may be asked about your residence or immigration status.
Ask if you\’e2\’80\’99re widowed or divorced. When permitted to ask marital status, a creditor may only use the terms: married, unmarried, or separated.
Ask about your marital status if you\’e2\’80\’99re applying for a separate, unsecured account. A creditor may ask you to provide this information if you live in “community property” states: Arizona, California, Idaho, Louisiana, Nevada, New Mexico, Texas, and Washington. A creditor in any state may ask for this information if you apply for a joint account or one secured by property.
Request information about your spouse, except when your spouse is applying with you; your spouse will be allowed to use the account; you are relying on your spouse\’e2\’80\’99s income or on alimony or child support income from a former spouse; or if you reside in a community property state.
Inquire about your plans for having or raising children.
Ask if you receive alimony, child support, or separate maintenance payments, unless you\’e2\’80\’99re first told that you don\’e2\’80\’99t have to provide this information if you won\’e2\’80\’99t rely on these payments to get credit. A creditor may ask if you have to pay alimony, child support, or separate maintenance payments.
When Deciding To Give You Credit, A Creditor May Not…
Consider your sex, marital status, race, national origin, or religion.
Consider whether you have a telephone listing in your name. A creditor may consider whether you have a phone.
Consider the race of people in the neighborhood where you want to buy, refinance or improve a house with borrowed money.
Consider your age, unless:
you\’e2\’80\’99re too young to sign contracts, generally younger than 18 years of age;
you\’e2\’80\’99re 62 or older, and the creditor will favor you because of your age;
it\’e2\’80\’99s used to determine the meaning of other factors important to creditworthiness. For example, a creditor could use your age to determine if your income might drop because you\’e2\’80\’99re about to retire;
it\’e2\’80\’99s used in a valid scoring system that favors applicants age 62 and older. A credit-scoring system assigns points to answers you provide to credit application questions. For example, your length of employment might be scored differently depending on your age.
Virginia,
I’m with you on most of this. The exception power underwriters have is what I’m talking about. It can go either way. Officially, you can’t discriminate but it happens. Off the subject but something to defend what I’m saying. Five years ago, I worked for Aegis Retail. I submitted a loan(refi) that qualified for approval. What was being paid was 30k worth of back child support. The actual number was 60k but they were in negotiations to settle.
The underwriter called me directly to confirm this. Then she told me a story about how her ex-husband never paid his child support to her and then went on to tell me she was going to try her best to deny this loan because the title work showed that he was remarried and that the original judgment was for the ex-husband to sell the home and split the proceeds. She told me that she didn’t think him only paying 30k and keeping the house was right. What she thought had nothing to do with the loan “officialy”, but that’s what I was “unofficially” up against. The file was eventually denied.
As far as life expectency stats are concerned, the man should be dead. And so, if using those stats, then my question to you again is now what, since he beat those odds…….Put him in another adjustable and hope he dies before the new loan adjust? The L.O. should have done it right the first time.
I know its expensive in CA and buying down the rate can cost. But consider he is going to pay additional fees on his new loan as well.
The underwriters I’ve dealt with have always brought up “benefit to borrower” on deals like this. Because of age they will counter offer with a 30 fix or something more stable than what I submitted. It’s their legal way of saying we don’t want to do that loan but here is an alternative. We didn’t turn you down and if you don’t accept our counter then it’s not a denial but a customer withdrawl. No discrimination.
I’m sure if we had the entire story we would both agree on how the deal should have been structured. But from what is given, the age is a major factor on the direction the loan should have taken and I don’t see where that consideration was used.
Virginia,
The excerpt says great things but I know you don’t believe that discrimination is not happening on the underwriting level. Please don’t tell me that.
Virginia,
You’re kind of disagreeing with yourself here.
“If you use more stringent underwriting guidelines for elderly borrowers, you are breaking the law period. Of course, you would not want to see a retired elderly person on a fixed income going stated and I wouldn\’e2\’80\’99t typically allow exceptions to ratios, asset or LTV requirements on this type of borrower.”
Al:
Investor guidelines for stated income borrowers typically (not in all cases) exclude retirees from elibible borrowers. These limitations are already placed on the loans by the investors and are not subject to the decision making of the underwriter…
I don’t know where your loans are being underwritten but in my arena, loans have been underwritten and approved based on the qualifying of the borrowers. If you have seen and/or experienced discrimination, I would suggest reporting it to the authorities.
Al:
Exceptions are granted, based on the overall strength of the file. Typically, the underwriter fills out an exception request outlining why he/she thinks that the exception should be granted. If you have a retiree with with fixed income and high ratios, low assets and high ltv, the exception would not make sense and would most likely not be granted. But if you had a retiree with fixed income and three million dollars in liquid assets, it may be considered. Please read the last paragraph of my post. You cannot make general statements and conclusions based on generalities because you will always find an exception.
Hi Virginia,
So if I understand correct, there is some discrimination written into the rules such as the case of stated income and retirees. I guess it could be argued that retirees are not absolutely limited to a certain age, but that’s a stretch.
Who is Aegis? Were they A paper or sub prime or Alt A or what? The name sounds familiar….they sound like they were subprime…..After reviewing the posts on this website, it is glaringly evident that the A paper world is totally different than the sub prime world, so what I may have experienced may not be the same as you. I have never in my life experienced an unethical underwriter, pompous and egotistical yes, but no one who would take a bribe or break the law. Our reputations are all we have and most of us would never put it in jeapordy….not even for a million dollars. But I agree, that we are pretty much on the same page…..
Al
my area of expertise was not with the investors writing the guidelines. It was with underwriting and compliance as a lender adhering to the investor guidelines and rules applied to our are of the business. If you wish to discuss how investor underwriting guidelines were written and what rules those guidelines were subject to, I would suggest finding someone with experience in that area of our industry (I am not referring to portfolio loans from banks, but to the loans securitized on Wall Street). I am only speaking to the area that I have experience in…..
From your 1:12 post
“You cannot discrimate due to age period. I underwrote for 18 years and was an mortgage banking operations manager which included managing the underwriting, quality control and compliance departments. If you use more stringent underwriting guidelines for elderly borrowers, you are breaking the law period.”
Doesn’t sound like much room for exceptions.
Virginia,
Sorry if I’m being difficult, just interested in some clarification. You made a very firm statement about discrimination, and you are clearly against it which is as things should be. However you then identify that retirees should not be in stated income loans which seems like a contradiction. It also seems to me that age is a factor in ability to repay. It’s hard to repay a loan if you expire before it does. Since insurance companies can legally discriminate based upon age for insuring drivers, then it seems not that much of a stretch that lenders would have some leeway as well.
Al:
As an mortgage loan underwriter, you cannot discriminate (See the ECOA verbiage I posted above).
“Doesn\’e2\’80\’99t sound like much room for exceptions.”
Your statement doesn’t even make sense. What does “If you use more stringent underwriting guidelines for elderly borrowers, you are breaking the law period” have to do with exceptions?
I enjoy participating in intelligent, educational, informative discussions but it sounds like you are just trying to be contrary.
I posted before I read your clarification. Thank you. Underwriting for a mortgage lender is not the same as underwriting for an insurance company. Insurance companies use actuaries to come up with their guidelines and tables. In the mortgage arena, guidelines are provided by the investors who buy the loans. The investors develope the parameters of the loans they will agree to buy. They provide underwriting guidelines for the underwriter to follow when analyzing the borrower(s). In the guidelines is the section: Eligible Borrowers. Most investor guidelines exclude retirees from stated income products. That is not an underwriter’s decision but already pre-determined by the guidelines. The underwriter is not discriminating, the retiree is just not eligible for that particular loan product
Regarding the borrower dying before the loan is repayed: heck, any borrower could die before the loan is paid off. That is not a factor the underwriter considers when approving a loan.
Virginia,
Aegis Mortgage. It was an A-paper lender. Actually, it was set up to mirror CW in its operation except for the bank part.
And yes, anyone can die at anytime so that life expectency snippet doesn’t mean anything either, but a 29 year old has a better chance in paying back a 2/28 than a 79 year old. My arguement wasn’t about the discriminaton. It was about the bone head decision of setting the borrower up for a higher chance to fail.
It’s obvious, the A.R.M. didn’t work for him. So for the people listening, imagine what he is going through as he figures how he is going to get another loan to save his house. A bad deal is a bad deal wheter it’s A paper or B paper. It’s still a bad deal.
Great post! Thanks Chris, we are indeed on the same page….
Get out of the house you scum bag.You don’t own the house you loser
Joseph Lents is nothing but a squatter should be sent off to a lawless, corrupt, 3rd world country. Shame on him.
There is a differance between knowing what right and proving in a court of law.
Joes my hero and brokers are lame. I assume that is who leaves these lame comments. Shit, they have all the time in the world to comment and be asses since they cant pawn loans no more. I love that I can come here and see truly how you pigs really are. Hopefully there are some politicians that read this blog. One of the few blogs that keep it on the real.
wow….i am puzzled by what i am reading from some on this issue. you are actually applauding this guy? one quick question -he is unable to pay his mortgage but can afford 120k in legal fees? i really don’t care if he is pulling one on the lender, it is just out of balance for what i thought this blog is supposed to represent. your are that blinded by your disgust of brokers that you cling to this fat cat as your hero?
you better hope no dem politician reads this or they may just use this fat cat as a poster child for their claim that a bailout will benefit the exact opposite of who are most in need of help.
This is not the example that should be endorsed or coveted because it works against the cause for foreclosure help…..how about the mother of 4 who had a serious illness hit her family and is unable to pay her mortgage for several months on an average salary and does not have the ability to hire an attorney for 120k…. talk about being real and an ass
curious on your thoughts moe….
he must be a victim of the exploding “toxic” mortgage he was duped into taking….
i will put money on the table that he has a “toxic” option arm.
This is exactly the type of client who will typically choose the otion arm…clients who know the use and benefit of the program…he is a cpa so he should be familiar with finances.
i am still puzzled by the comments this guy is an inspiration….his company was slapped with pumping and dumping securities…and you are bashing brokers??
any other thoughts on this guy????
Thank God Joseph is here as an example for defending your rights. All our rights. 90% of us have a “consumer mentality” that has been created and reinforced by those who want us to consume. Joseph is no squatter, that’s HIS home. He is on the title. And he has the right, and the courage and determination to keep it, defend it, and enjoy it. Lenders have been amassing tremendous wealth at the expense of we “consumers”. If Joseph paid off that hous to within $30,000 of satisfying the mortgage, and then became ill, or lost his income, or any one of a dozen different scenarios, they would try and take it just as feverishly as they are trying to take it now. And make grotesque amounts of profit from the property again, and would not give a second thought to Josephs circumstances or all the money and love and time and work that he put into the property.
It’s time for us all to grow up! We’ve been trained and treated and spoken to as sheep. Joseph Lents is simply defying the wolves. I stand with him, and with Moe, and with the other brave men and single moms who will not apologize for keeping THEIR HOMES.
ROFL….man, this guy IS not really a HERO, but is he wrong? FUCK NO! He’s using the legal system in order to stave off eviction – period. If the system is wrong, change it. But do the rest of us a favor (David, Buck and “Mr. Bait”), if you’re too busy to buttonhole your Congressman to change the law, don’t get pissy with Joe here.
He is LEGALLY within his rights – ethics have NOTHING to do with it ! Who really gives a crap if he really (proof?) WAS involved with “pump-n-dump” operations, legally he is within his rights to ask lenders to produce paperwork THEY SHOULD LEGALLY HAVE IN THEIR POSESSION.
If I get pulled over by the police, and they demand my drivers license – I HAVE TO PRODUCE IT. It is a legal document which, as a citizen, I safeguard and have available for LEGAL scrutiny when asked. Conversely, LARGE CORPORATIONS (defined as a PERSON – under the same legal system I – and Joe – adhere to) MUST submit documentation when required. Period.
So, if you hate Joe – fine. BUT…he is WITHIN his legal rights to use our legal system with as much cleverness as Corporations do.