Register of Deeds Curtis Hertel: “If you or I committed this kind of fraud, we’d go to jail.”

In Lansing today, Ingham County (Lansing Area) Register of Deeds, Curtis Hertel and State Rep Jim Ananich presented a bill to introduce judicial foreclosure in MI.

As part of the press conference, homeowner Bill Donahue described how he almost lost the home he has lived in for 25 years because Fannie Mae, which had not claim to his loan, foreclosed on him as he was being processed for a HAMP modification (which he ultimately got).

Last May, he applied for a HAMP modification. After submitting a second round of paperwork in June, he was told in July he was in underwriting, which might take six months. During that period, Bank of America’s collection people kept harassing Donahue and his wife. By late summer, they received a foreclosure notice from Fannie Mae, which explained it was just a formality since he hadn’t made a payment in so long. BoA told him to ignore it, but it turned out his house was sold in a sheriff’s sale. In December, he got the HAMP modification, which cut their payment in half. Nevertheless, this April, a process server came to his house with a foreclosure notice. When Donahue showed him the document proving he had a mod, the process server congratulated him for being of the 5% or so who actually got mods. The server took copies. But in May, Fannie Mae sent a packet giving him 3 days to contest a foreclosure. Finally, by early June, Fannie dismissed the foreclosure. (I hope to have video from Donahue later.)

In his presentation explaining the importance of replacing MI’s current foreclosure by advertisement with judicial review, Hertel explained,

You can literally walk into my office and tell me you’re committing a crime and there is nothing I can do to stop you except report it. I still have to submit the documents.

Hertel later elaborated on this, revealing among other details that he recently received an FBI subpoena relating to foreclosures.

There were a few people at the press conference (including my own county clerk) who complained about the cost of instituting a judicial foreclosure system. Representative Ananich had the best response to those questions:

Due process isn’t a system that only works when it’s affordable or it’s convenient.

It’s nice to hear that sentiment from a few public figures.

Update: Sorry for the crappy video quality: when I get rich, I’m going to buy a real camera. In any case, this is Donahue explaining how he almost lost his house even though he had successfully modified his mortgage.

Update: Register corrected, per retirinfive.

17 replies
  1. emptywheel says:

    @Matt Browner Hamlin: Let’s hope so–though have we yet seen anything to believe the FBI is serious?

    Or let’s hope, by letting that known, AG Schuette decides he’ll do something about the referrals from at least 23 Registrars on robo-signers.

  2. harpie says:

    o/t [from Glenn Greenwald‘s Twitter feed]:

    Does Obama camp see upside in pissing off the left?; Greg Sargent; 8/17/11

    The story exploding on the left right now is that the Obama campaign’s state director in New Mexico sent out an email containing a blog post mocking Paul Krugman and the “firebagger liberal blogosphere”for criticizing the debt ceiling deal negotiated by the White House. Liberal bloggers are asking whether this is the latest sign that the Obama team sees percentage in dumping on the left — or “hippie punching,” as the blogospheric parlance has it.

    The Obama official, Ray Sandoval, circulated the email just after the debt ceiling deal passed Congress, hammering lefty critics for deriding the deal as a surrender. Sandoval’s email included a blog post that derided Krugman as a “political rookie” and decried critics for “pure, fanatic, indomitable hysteria.”

    The term “firebagger” appears to be a reference to Firedoglake, whose bloggers frequently hammer the White House for giving too much ground to Republicans. […]

  3. thatvisionthing says:

    transcript freak:

    Curtis Hertel Talks about Banks Breaking the Law

    CH: …have seen is the banks systematically breaking the law in a lot of these foreclosures, actually using illegal documents in foreclosing people. Now if you or I committed forgery, if you or I committed this kind of fraud, we’d go to jail. And I think the banks should be treated the same as every citizen. The people who made these decisions should also go to jail.

    EW: So when you get – you now recognize some of the robosigners. When you get one of those documents that you think is forged, what do you do?

    CH: Unfortunately I can’t do anything except for report it to the attorney general’s office, and that’s what I do every time I get one.

    EW: How many of those do you think you’ve done?

    CH: Reported to the attorney general’s office? Hundreds.

    EW: Hundreds? In what time frame? Since– ?

    CH: Since April of this year.

    EW: And what about chain of title? With people buying new homes, what are you seeing now with people who have bought foreclosed homes – what’s their title like?

    CH: There have actually been some recent rulings that good faith buyers will not be affected by the MERS ruling. But those have all been on the local courts and not actually have gone to the court of appeals yet. So, I don’t know the answer to that question. I hope that it will mean that those people aren’t wrongfully affected, because they did nothing wrong.

    EW: What about when the note was not securitized properly on a previously owned home?

    CH: So far the courts have ruled that a good faith buyer is going to be fine. Now, I can’t tell you what the courts are going to do tomorrow, so right now that seems to be law.

    EW: So, Curtis, what’s going to solve all of this?

    CH: What’s going to solve all of this is a couple of things. One, we need to change Michigan’s laws to make sure that foreclosures like this never happen again, and that there’s a fair due process for citizens. But we also need to hold those people accountable, and the Michigan attorney general, attorneys general through all the 50 states, and the federal government needs to do that. And I think we are seeing some headway. I actually got, I can’t talk about the details of it, but an FBI subpoena last week in my office. We are seeing an increase in interest from law enforcement and prosecutors in looking at these cases. We want the people that did this to be held to justice, and we hope they will be held.

    EW: Thank you.

  4. CTuttle says:

    Oh Snap…! SEC may have destroyed documents, senator says

    Grassley: Agency may have got rid of Goldman, Madoff documents

    “From what I’ve seen, it looks as if the SEC might have sanctioned some level of case-related document destruction,” said Sen. Chuck Grassley, Republican of Iowa, in a letter to the agency’s chairman, Mary Schapiro.

    Buh-bye, Geitner…! ;-)

  5. prostratedragon says:

    @CTuttle: Matt Taibbi’s latest concerns this. According to the whistleblower, it seems to go back to 1993, and involves destruction of records from “Matters Under Inquiry,” or preliminary investigations, which in this case were never referred for further action.

    The records were supposed to be kept for 25 years on behalf of the National Archive, with NARA being in charge of their destruction thereafter if such be done.

    Instead, what we got sounds like a collapse toward the NCAA’s self-investigating, self-punishing member model, with SEC deciding on its own when suspects had done enough to get their records cleared (shortly before the presiding officer taking a job with the suspect, in too many cases).

  6. Bob Schacht says:

    “EW: What about when the note was not securitized properly on a previously owned home?”

    They’re good to go– unless maybe the previous homeowner gets wise to what has happened to him/her, and then sues to get his/her house back. What happens then?

    Thanks for this diary, EW!

    Bob in AZ

  7. retirininfive says:

    One minor point, Marcy. In many states, it’s Registrar of Deeds. In Michigan, it’s Register of Deeds.

  8. thatvisionthing says:

    @Bob Schacht: Doesn’t CH’s answer, that so far at local court law, the results so far have been that the title is effectively laundered, but that could change at the court of appeals — doesn’t that imply that there ARE such cases where the previous, wrongly foreclosed homeowner is challenging new owner’s title? EW, if you could clarify that point — ? Mighty interesting.

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