Adversary proceeding by second trust deed lender
Posted: Sun Oct 24, 2010 11:42 am
I am assuming that the devil will be in the details of the mortgage broker agreement.
>
> No reliance and unclean hands.
> Peter M. Lively, JD/MBA
> Law Office of Peter M. Lively * Personal Financial Law Center I
> 11268 Washington Blvd, Suite 203, Culver City, CA 90230-4647
> Telephone: (310)391-2400 * (800)307-3328 * Fax: (310)391-2462
> A-Bankruptcy-Attorney.com
> Personal Financial Law Center II - Costa Mesa, CA
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> ________________________________
> To: cdcbaa@yahoogroups.com
> Sent: Thu, October 21, 2010 10:55:34 PM
> Subject: [cdcbaa] Re: Adversary proceeding by second trust deed lender
>
>
> Heads up on this issue.
>
> A mortgage broker client of mine is getting demand letters from a lender to
> cover loans that according to an internal audit were not substantiated or were
> false when made.
>
> So, there are two future issues: first, the mortgage broker who did not verify
> the information properly and represented that they did in the mortgage brokerage
> agreement; and second, the borrower who will be sued by the broker for indemnity
> or lender for possible nondischargeable claims.
>
> Of course, the lenders used the brokers as a shield against due diligence and
> underwriting requirements with the brokers agreement to buy back the paper upon
> demand.
>
> Any thoughts?
>
> Lou Esbin
>
> --- In cdcbaa@yahoogroups.com, Jim Selth wrote:
> >
> > This question reminds me of my former life when I exclusively represented
> >creditors. Back in 1998-2001, I filed over 50 nondischargeability cases for
> >mortgage lender Master Financial, Inc., which specialized in 125% loan-to-value
> >(!) second trust deeds. They had a good-sized bankruptcy department which
> >reviewed every debtors bankruptcy schedules, comparing them with the Loan
> >Applications. We would file Section 523 nondischargeability Complaints based on
> >false income in the Loan Application, failure to list child support obligations,
> >failure to list pending lawsuits, when loan proceeds were used to pay tax debts,
> >and the most common: falsely stating that the property would be owner-occupied
> >when it wasnt. This was a big deal for Master Financial, since they only made
> >owner-occupied loans and could persuasively argue that the loan wouldn> >been made but for the false representation about owner occupancy. Sleazy> >mortgage brokers (yes, there actually were such) would always tell the borrower
> >to just say the property is owner-occupied and youll get a better rate. We
> >settled 90% of these cases and took a few to trial with mixed results.
> >
> > Master Financial went under with all the other sub-prime Orange County lenders
> >such as Ameriquest in 2007, but now as a debtors attorney I always ask clients
> >with rental property if they told the lender the property would be
> >owner-occupied. However until seeing these e-mails from Sujin and Holly, I
> >didnt know any lenders were bringing these actions.
> >
> > Jim
> >
> > NOTE OUR NEW ADDRESS BELOW:
> >
> > James R. Selth
> > Certified Bankruptcy Specialist*
> > Weintraub & Selth, APC
> > 11766 Wilshire Boulevard, Suite 1170
> > Los Angeles, California 90025
> > Telephone: (310) 207-1494
> > Facsimile: (310) 442-0660
> > E-Mail: jim@
> >
> > *Certified by State Bar of California as Certified Legal Specialist in> >Bankruptcy Law
> >
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> >
Of Sujin
> >Kim
> > Sent: Sunday, October 17, 2010 10:41 AM
> > To: cdcbaa@yahoogroups.com
> > Subject: Re: [cdcbaa] Need Referral
> >
> >
> >
> > Yes, the AP regarding the 2nd TD is indeed with Pacific Heritage. What's going
> >on? This has never happened to any of my clients.
> >
> > --- On Sat, 10/16/10, Williams wrote:
> >
> > Subject: Re: [cdcbaa] Need Referral
> > To: cdcbaa@yahoogroups.com
> > Date: Saturday, October 16, 2010, 6:49 PM
> >
> > If it's by Pacific Heritage Financial, I would like to talk with you ASAP.
> >
> >
> > Holly N. Williams, JD/MBA
> > LAW OFFICE OF HOLLY N. WILLIAMS
> > 23151 Moulton Parkway
> > Laguna Hills, CA 92653
> > 949-305-5938, Fax: 949-716-8630
> > HNWilliams@
> >
> >
> >
> >
> >
> > ----- Original Message -----
> > To: cdcbaa@yahoogroups.com
> > Sent: Wednesday, October 13, 2010 11:21 AM
> > Subject: [cdcbaa] Need Referral
> >
> >
> > Listmates:
> >
> > I have a client who was hit with an adversarial proceeding. The plaintiff is
> >the client's 2nd TD holder and is alleging the client fraudulently overstated
> >his income on the loan application. Does anyone routinely handle this type of
> >matter? Referrals urgently requested!
> >
> > Thanks!
> >
> > Sujin Kim
> >
>
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