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Ally disputes charges that another GMAC employee 'fabricated and changed title' in foreclosure cases

A South Carolina attorney is alleging more wrongdoing against homeowners facing foreclosure by Ally Financial's GMAC mortgage unit.

In a letter to a state trial court, Robert Rikard accused Judy Faber, a woman who identified herself as a GMAC vice president, of having "fabricated and changed the title in thousands of foreclosure cases."

Ally spokesman James Olecki responded that Faber "holds a completely different role than those in the foreclosure team and has no involvement in the foreclosure process."

He reiterated that the company is "confident" that the processing errors the company previously described (which have nothing to do with Faber) "did not result in any inappropriate foreclosures and that the substantive contents of the affidavits in question were factually accurate."

Faber, who is not named as a defendant in the South Carolina case, was the owner of a stamp that was used to authenticate the transfer of titles. In a deposition in Alabama, she said she was a vice president and director of a residential funding corporation in addition to being a GMAC vice president.

Whether these stamps were used legally is critical in foreclosure cases. To foreclose on a house, a lender needs to not only prove that the homeowner is in default but that the company owns the mortgage.

In case after case, "these stamps are all undated and not notarized, and they magically appear when a foreclosure plaintiff needs to prove chain of title in a case," Rikard said in a phone interview.

Lawsuits recently uncovered that a single employee of the GMAC mortgage unit, Jeffrey Stephan, signed off on 10,000 foreclosure papers a month without checking whether the information justified an eviction.

"What we're finding over and over," Rikard said, "is when a foreclosure gets challenged, the plaintiff doesn't actually own the note. If you can't comply with the law, you can't take people's houses."

Yves Smith on Naked Capitalism explains why this is important.

Complete coverage in The Washington Post:

Sept. 20: Ally suspends evictions on foreclosed homes in 23 states

Sept. 21: A single Ally employee, Jeffrey Stephan, signed over 10,000 documents a month without reading them

Sept. 22: Fake documents, forged signatures plague foreclosure system

Graphic: 'Robo-signer' Linda Green's changing signature

Who is Jeffrey Stephan anyway?

Sept. 23: Mortgage documentation problems could affect other states not included in Ally's 23-state moratorium

Sept. 24: Lawmakers question Fannie on 'foreclosure mills'

Document: Letter from Congressmen to Fannie Mae CEO

User poll: What should happen to foreclosure documents approved by 'robo-signers?'

By Ariana Eunjung Cha  | September 27, 2010; 5:01 PM ET
Categories:  Housing  
Save & Share:  Send E-mail   Facebook   Twitter   Digg   Yahoo Buzz   Del.icio.us   StumbleUpon   Technorati   Google Buzz   Previous: Connecticut orders Ally Financial to freeze foreclosures
Next: Economic agenda: Tuesday, Sept. 28, 2010

Comments

I think you're not getting the full story on these documents, and what is going on with housing. These affidavits were part of an attempt to hide the amount of bad mortgages on bank books. It was simply another step in an attempt not to modify mortgages. Thus, you're going to get lawsuits for fraud, conspiracy and a lot of other charges.

What is more, you will soon see a nationwide ban on home foreclosures as these issues come out. Finally, it is becoming clearer that the United States has changed its policy, and that in fact it has forgiven home mortgage debt. That is what this is all about, no matter what the protestations of the United States are. Many facts are coming to light which make it more and more likely that homeowners will sue to quiet title on the theory that the United States has in fact forgiven their debt. Here are the facts which will be used:

Through its

1. ownership stake in banks (creating Fifth Amendment Due Process rights to what is in FACT--not the arbitrary 31%--minimization of the risk of housing loss: see Huxtable v. Geithner Order on this (not the Order to Dismiss, sounds like a settlement was reached since Huxtable filed no opposition);

2. contracts with servicers (creating the same rights as above, but on a third party beneficiary theory--see Marques v. Wells Fargo);

3. mortgage principal reduction through HAMP;
4. adjustments to gross income for principal reduction through HAMP; and
5. loss of economic incentive to foreclose (this is Reggie Middleton's analysis on his blog),

the United States has in fact forgiven home mortgage indebtedness.

So I think you are wrong with your notion that they just have to "get the papers right." There's much MUCH more going on here.

Posted by: philneo2001 | September 27, 2010 5:23 PM | Report abuse

This is awful! We were supposed to close on our home this Friday and now they say it could be months before this all gets straightened out. We were pushed back to the 20th of October after already putting in our notice to be out on the 1st. We now have nowhere to go. Does anyone see anything happening any time soon?

Posted by: Anonymous | September 27, 2010 8:43 PM | Report abuse

Get information on how to reduce your debt by filing for bankruptcy http://bit.ly/avB0jI

Posted by: kerisable28 | September 28, 2010 3:20 AM | Report abuse

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