The site was deeply involved in the fight to stop abusive and unjust foreclosures after the financial crisis. As we’ll discuss in a moment, one of the leaders in this fight, Maine attorney Tom Cox, said he was part of a successful campaign to roll back banks’ hard-won protections for borrowers. That’s evidenced by a new Maine Supreme Court decision that overturns precedent and allows banks to re-litigate lost claims against mortgage borrowers…while barring other types of legal action.
The number of foreclosures significantly peaked in 2009 and 2010 due to value destruction through securitization. In the Stone Age, when banks held the mortgages they made, if the loan was late on payments, the bank would modify the mortgage if the homeowner was still alive (ideally We were able to either recover the repayments (in terms of) or pay a significant percentage. It expires over time. Banks were generally better off receiving half a loaf of bread than no bread at all. Additionally, regulators look down on REOs (real estate holdings such as foreclosed homes) on banks’ books, and foreclosures reduce the value of nearby homes and harm local communities. And banks had the skills to modify mortgages because they had made new mortgages.
In contrast, under the brave new world of mortgage repayments, debt collection agencies were established to force delinquent mortgages into foreclosure. They were paid for foreclosure, not to modify the mortgage. Even if they wanted to, they didn’t have the skills or local knowledge. As a result, renters who would have been able to recover in the past ended up losing their homes instead. And because recoveries from these foreclosures were much lower than the model had assumed, investors also suffered losses. This was at least partly due to an unnecessarily high number of foreclosures.
A small cadre of lawyers worked to challenge foreclosure abuses (and tried to foreclose on unforeseen homes and homes where the home had burned down but the bank refused to accept the insurance company) The servicer’s incompetence also made things worse, such as payment). One of the leaders was Tom Cox of Maine. Description from 2017 post:
Those who remember the bitter battles of the predatory foreclosure era will remember the name of Maine attorney Tom Cox. More than 9 million households lost their homes, many of whom could have been saved through loan modifications, which would have been better for investors.
Mr. Cox exposed the fact that debt collectors, as a whole, are not taking the necessary steps to foreclose. And it soon became clear that what had been portrayed as a simple documentation flaw actually reflected a much more serious legal problem. That is, the mortgage notes (which the borrower promised to pay) were frequently, if not routinely, not properly transferred to the securitization trust. A related issue is that liens against real estate are not recorded in local courts but in a mortgage registry called MERS, and there is a set legal procedure for changing MERS records when the ownership of a note and a mortgage lien changes. It was a lie. The reason for this is too much space to explain in detail here…
In 2012, Cox was one of five recipients of the Public Purpose Award, which the Portland Press Herald described as “a $100,000 award recognizing people 60 and older who work in the public interest.” “I will.”
Mr. Cox has won many precedent-setting foreclosure defense cases in Maine. I’ve embedded his latest win, which makes a case unlike anything I’ve seen before. In other words, the foreclosing debt collector violated evidentiary requirements by including records from a former debt collector that the current debt collector’s personnel who appeared in court could not prove. Their effectiveness.
Unfortunately, things have changed since 2017. New email from Cox:
After I won a series of foreclosure judgments that protected homeowners, new judges have been appointed since vacancies opened on the Maine Supreme Judicial Court in 2020, removing these protections. There is. I have attached the latest evidence.
For the past 15 years, I have dedicated the remainder of my law career to defending low-income homeowners facing foreclosure. I believe the value of the free services I provided during this time was well over $2 million. the result, finch Pursuant to the decisions discussed in this report, I stopped taking new foreclosure cases because I felt I could not assure my clients that Maine’s judicial system would treat them fairly. It’s sad and painful to see the banks always win.
My job from 2008 to 2020 was to thwart banks’ attempts to overturn favorable judgments won in the Maine Supreme Judicial Court, and to advocate for low-income homeowners in the Maine Legislature as well as in court. The focus was on protecting. They couldn’t beat us in the courts, they couldn’t beat us in the legislature. But they ultimately defeated us by persuading the governor of Maine (DINO, a Democrat in name only) to appoint new bank-friendly judges to the court starting in 2020. Attached report and news article A former bank lawyer appointed to the Maine Supreme Judicial Court in 2020 casts a 4-3 deciding vote to overturn two unanimous 2017 rulings. This explains how they made important decisions in favor of the bank. That means that if a bank loses a foreclosure action, like litigants who lose in all other categories of cases, it cannot later file a new action to prosecute the lost claim.
Mr. Cox highlighted and pointed out important passages from the dissenting judge. finch, Two other judges also joined.
(¶53) As recently as just seven years ago, the Court issued unanimous judgments in two separate but analytically related cases, ruling against a mortgagee in a foreclosure action. held that continued litigation seeking the same relief was barred. See Pushard v. Bank of Am., NA, 2017 ME 230, ¶¶ 4, 35-36, 175 A.3d 103 (judgment in first proceeding based in part on defective notice of default) . FRB. National Morgue. Ass’n v. Deschaine, 2017 ME 190, ¶¶ 7, 37, 170 A.3d 230 (prior judgment issued as sanction for plaintiff’s failure to comply with pretrial order). This conclusion is not noteworthy because it treats mortgagees like other claimants who have already sought relief but have failed. That is, if a party loses in a final judgment resulting from a failure of evidence or other dispositive reason, that party is barred from trying again to sue. See U.S. Bank, NA v. Tannenbaum, 2015 ME 141, ¶¶ 6, 10, 126 A.3d 734. Today, courts have retreated from that principle. They do not do so because the laws enacted based on such lawsuits are outdated. That won’t happen because the law has changed. Rather, courts do so simply because they disagree with the outcome of a case that we decided a while ago.
*15 (¶54) In my view, Pouchard and Deschenes remain good and settled law. And the impact of today’s court decisions goes far beyond overturning most or all of these two 2017 cases. It calls into question other important areas of established foreclosure law. Beyond that, the court’s willingness to abruptly change the direction of the law in these circumstances rightly raises questions about the extent to which the court intends to follow established precedent generally. It is.
factors that have a negative impact finch That means the newly appointed pro-bank judge, Catherine Connors, has a long history of representing banks, including in foreclosure matters, and should have resigned herself. The incident was so blatant that the Judicial Conduct Commission recommended disciplinary action against her (see first embedded document below). The second document includes an article about possible sanctions, a first for a Maine Supreme Court justice.
Cox also pointed out that Finch’s decision was punitive in nature because the bank had other ways to recoup these losses.
I would like to add here that there is a fundamental truth that the four justices of the Maine Supreme Court majority refused to consider in their 4-3 vote in Finch. When a loan owner with a valid claim for foreclosure loses a foreclosure action in court, the loss is invariably due to the negligence of the loan owner’s mortgage servicer and/or the foreclosure mill attorney hired by the servicer. This means that in all lawful foreclosure cases, the loan owner’s attorney has a duty to ensure that the loan owner’s evidence meets all of the proof requirements of the elements of the foreclosure claim, and in fact does so. Because they have the ability.
Finch’s problem was a flawed default letter. A competent mortgage holder’s attorney should and can determine, pre-litigation and pre-trial, whether a letter of default meets legal requirements. If the loan owner loses in court because of a letter of default (which is written by the foreclosure agent’s attorney about 50% of the time), the loan owner can sue the foreclosure agent’s attorney for negligence. Loanholders lose foreclosure cases only because their attorneys are negligent and lazy in handling the foreclosure case. Loanholders have full remedies to sue their attorneys if they lose their foreclosure case. There is no need for a court to instead allow a loan holder to file a second lawsuit against a homeowner who has had enough trouble finding an attorney for the first lawsuit.
Courts in Maine and in many other states sometimes offer mortgagors a “free house” in exchange for keeping loan owners, their servicers, and foreclosure agents honest and prudent in their judiciary. I can’t bear the thought that it might. foreclosure process.
But going back to the argument at the beginning of the article, renters fighting foreclosure aren’t looking for a free home. They wanted a mortgage modification. But since the servicer could neither grant the debt nor receive compensation for granting it, it would instead fight against the borrower.
00 Commission Report to Maine SJC Filed October 11, 2024
00 2024-11-03 Me. The Monitor — Ethics probe puts Maine Supreme Court into uncharted territory
00 Finch vs. US Bank NA, 2024 ME 2 (Westlaw Edition)
