Fannie Mae Pulls the Plug on Castle Law Group, Aronowitz Mecklenburg

FANNIE
The Federal National Mortgage Association (FNMA), more commonly known as FANNIE MAE announced today they will no longer be using well-known Denver foreclosure law firms; Castle Law Group and Aronowitz & Mecklenburg.

Fannie Mae had suddenly terminated its relationship and has ceased doing business with both Castle and Aronowitz. Fannie Mae is known for having strict guidelines and low tolerance for violations of any kind.

Fannie Mae has already turned referrals of new foreclosure cases, and transferred existing cases to other law firms.

There has not been any formal comments from the Government-Sponsored Enterprise (GSE) who oversee Fannie Mae although it has been commonly reported the two law firms have been under the Colorado Attorney General’s (AG) investigation for allegedly overcharging fees in serving foreclosure notices to homeowners.

The Denver Post wrote recently, the AG’s office claimed one of the law firms “misrepresented its costs and charged more than twice what it paid for posting services”.

The investigation of these billing discrepancies from Castle Law Group and Aronowitz & Mecklenburg led to the finding of overcharging their foreclosure costs. Those costs were then passed on to the banks and then to homeowners. There were also claims of collusion and price fixing among foreclosure law firms in the state as well as reported by the Denver Post and as alleged in several Attorney General pleadings.

The Attorney General’s investigations helped push Colorado state legislature to create new bills to help homeowners in foreclosure.

Real Estate and Foreclosure Defense Attorney Keith Gantenbein helped draft Representative Beth McCann’s bills, HB 14-1130 called “Foreclosure Cure Remit Unpaid Fees to Borrower Act” and HB 14-1295 requiring a single point of contact for a borrower when negotiating a loan modification and prohibits Dual Tracking. Gantenbein also testified for both bills.

HB 14-1130 passed almost unanimously by the state Senate committee last Tuesday, April 8th. There were 64 votes in favor, 0 votes against and 1 vote defined as ‘other’.

HB 14-1295 passed the Senate Second Reading yesterday, April 10th.

Gantenbein has been working extensively with Rep. Beth McCann, who, along with Senator Jessie Ulibarri have all been concerned with numerous foreclosure issues and homeowner complaints that have been plaguing Colorado.

It is unclear at this time, whether the Federal Home Loan Mortgage Corporation (FHLMC) known as FREDDIE MAC, the brother of FANNIE MAE, will also be terminating all their business with Castle Law Group and Aronowitz & Mecklenburg as well.

Keith A. Gantenbein, Jr. is a licensed, Colorado foreclosure defense attorney and real estate attorney located in Denver and servicing all of Colorado. His foreclosure defense practice includes foreclosure prevention, foreclosure assistance, loan modifications, short sales, and all other foreclosure defense legal assistance. He also handles real estate closings, title issues, lien issues, quiet title, real estate contracts, bankruptcies, mortgage negotiations, lender liability, real estate, civil litigation, contracts and landlord/tenant.

If you think you will be facing foreclosure, or are in the foreclosure process, or have had a wrongful foreclosure, contact Keith Gantenbein at (303) 618-2122 for a one-hour consultation where he will discuss your situation and go over all your options with you.

Visit: http//www.gglawllc.com

Is Wells Fargo’s Manual a Blueprint for Foreclosure Fraud?

wells

A lawsuit filed by a New York homeowner facing foreclosure has brought to light a 150-page manual created by Wells Fargo instructing Wells Fargo attorneys how to process foreclosures when there are missing documents and specifically when an endorsement is missing. The endorsement is a key document that the lender must have to prove they own the mortgage before they can foreclose on a homeowner.

The manual, titled “Foreclosure Attorney Procedures” (for internal use only) was introduced as evidence in the lawsuit filed in U.S. District Court in White Plains, N.Y. last week.

Attorney Linda Tirelli, who filed the lawsuit calls the Wells Fargo manual “a blueprint for fraud”. She, other attorneys, forensic auditors and consumers have long suspected banks were systemically creating improper documents to prove ownership of loans by producing “manufactured documents”. A number of Tirelli’s cases involved mortgage notes that weren’t endorsed by anyone. After the bank was made aware of the blank mortgage note, the bank would “magically” produce the document. Tirelli and other attorneys began calling the paperwork “ta-da” documents.

We all remember “manufactured” documents were introduced several years ago and called “robo-signing”. In 2010, it was revealed the banks were routinely using affidavits signed by employees who signed thousands each month without reviewing and ascertaining the facts to be true (employees averaged 30 seconds per affidavit). Those charges led to a $25 billion National Mortgage Settlement (NMS) that was supposed to have put a stop to the abusive practices of the five largest banks; Wells Fargo, JPMorgan Chase, Ally/GMAC, CITI and Bank of America.

This Wells Fargo manual outlines steps to obtain missing documents after the bank has initiated foreclosure proceedings. There are explicit instructions what their lawyers must do when there is a lost or missing affidavit or if there is no documentation showing who owned the loan. (The bank should have that paperwork already in their files.)

On page 17, Step 3 of the “Foreclosure Attorney Procedures” Manual (for internal use only), there are step-by-step instructions for the Wells Fargo “Default Docs Team” if a blank endorsement is in a file, and the attorney wants that note executed. The manual outlines steps for the attorneys and Default Docs Team to CREATE endorsements to a note on a separate sheet of paper called an Allonge. (An Allonge is an attached, separate paper(s) documenting endorsements, normally arising from a lack of space on a form.)

State Attorneys have been regularly receiving complaints from homeowners that Wells Fargo and Bank of America refused to allow the homeowner to submit missing documentation, and failed to respond to requests to have their mortgage balance or interest rates reduced within the 30 days allotted in the settlement.

Wells Fargo spokeswoman Vickee Adams said the pages (from the manual) provided to Wells Fargo appear legitimate, but the bank has not “reviewed the complete document or every line of the section provided to confirm its authenticity entirely.”

The Wells Fargo manual may just be the smoking gun that the systematic document fabrication is still going on.

Keith A. Gantenbein, Jr. is a licensed, Colorado foreclosure defense and real estate attorney located in Denver and servicing all of Colorado. His practice includes foreclosure defense, foreclosure prevention, foreclosure assistance, loan modifications, short sales, and all other foreclosure defense legal assistance. He also handles real estate closings, title issues, lien issues, quiet title, real estate contracts, bankruptcies, mortgage negotiations, lender liability, real estate, civil litigation, contracts and landlord/tenant.

If you think you will be facing foreclosure, or are in the foreclosure process, or have had a wrongful foreclosure, contact Keith Gantenbein at (303) 618-2122 for a one-hour consultation where he will discuss your situation and go over all your options with you.

Visit: http//www.gglawllc.com

Foreclosed Home Delivered to Bank- On a Truck

m man

Foreclosures don’t just happen in the U.S., they happen all over the world. Homeowners can lose their homes to foreclosure no matter where they are.
Take the story of a homeowner in the little town of Lovech, Bulgaria. Lovech is a pretty little town, located in north-central area of the country and known as the Town of the Lilacs. There are approximately 36,000 people living here. On the highest point in the town sits Hisarya Fortress, built in 1018 and where the lilacs spread as far as you can see. The Danube River meets the mountains here, in this town that was first settled in the 3rd century. In the center of town is a restored covered bridge, a tribute to Bulgarian architecture. There are equally beautiful churches, a museum, a monastery, schools, banks and shops. There are more than 100 buildings and homes dating back so far that they’ve been deemed cultural landmarks.

Today, there is now, one less house in the town of Lovech.

One homeowner fell behind in his mortgage payments to one of those banks. The homeowner and his entire family went to the bank. They cried, they begged the bank for mercy, please give them more time, don’t take our home away. But the director of the bank told them the bank could not make any exceptions. The family had exactly one week to pack their belongings and vacate the home.

The family left the bank in – wait a minute – not in total defeat. The land that the house was built on, was not included in the mortgage! The bank did not own the land, just the house! The family decided if the bank wanted their home, the bank could have it. They would give the house back to its new owner – the bank.
They packed their belongings. With the help of family members and friends, the house was taken apart – piece-by-piece and totally destroyed.
With the last bit of their money, the family hired a truck and loaded the remains of the house on the truck.

The large truck, its flatbed pilled high with timber, block, tile and wire drove to the nearby city of Teteven. The truck pulled up in front of the main entrance of the central district office of the bank where the contract for the mortgage had originally been signed.

The truck was quickly unloaded on the sidewalk in front of the bank. Can you imagine the look on that bank director’s face?

Keith A. Gantenbein, Jr. is a licensed, Colorado foreclosure defense and real estate attorney located in Denver and servicing all of Colorado. His foreclosure defense practice includes foreclosure prevention, foreclosure assistance, loan modifications, short sales, and all other foreclosure defense legal assistance. He also handles real estate closings, title issues, lien issues, quiet title, real estate contracts, bankruptcies, mortgage negotiations, lender liability, real estate, civil litigation, contracts and landlord/tenant.

If you think you will be facing foreclosure, or are in the foreclosure process, or have had a wrongful foreclosure, contact Keith Gantenbein at (303) 618-2122 for a one-hour consultation where he will discuss your situation and go over all your options with you.

Visit: http//www.gglawllc.com

4 Killed, 2 Wounded at Eviction Hearing

eviction order

At the American Indian Headquarters in Alturas, California, former tribal leader, Cherie Lash Rhoades – in what spectators are saying – went berserk Thursday evening, February 20th.

Rhoades, the former chairwoman of Cedarville Rancheria, allegedly shot four people in the tribal office and a fifth person who was trying to escape. When she ran out of bullets, she allegedly picked up a butcher knife and stabled a sixth victim.

The first four victims killed were a 19-year-old woman, a 30-year-old man, a 45-year-old woman and a 50-year-old man. One of these victims was reported as the tribe’s leader.

Two other women were wounded, one severely. One had been shot four or five times and possibly also stabbed. She is recovering in an intensive care unit after a lengthy surgery. The other woman was shot once and is recovering after surgery. Both are in critical condition.

One person escaped the massacre. Covered in blood from the other victims, she ran to City Hall where police were alerted of the slaughter.

When police arrived on the scene, Rhoades was running outside the building with the knife still in her hands. An employee at Rancheria helped tackle her. Rhoades was taken into custody and faces murder and attempted murder charges.

Alturas is a remote town located in the northeast area of California, near the Oregon border. The Bureau of Land Management (who oversee public lands with American Indian tribes), have Rhoades listed as recently being replaced as chairwoman of Cedarville Rancheria.

Cedarville Rancheria is a recognized tribe of the Northern Paiute nation. Statistics show 26 people as living in the tribe and governed by an elected council to serve a 3-year term.

Members of the tribe were holding a meeting on evicting Rhoades and her son from the Rancheria when Rhoades allegedly attacked the council.

Last year, in Modesto, California, two people were killed when serving an Eviction Notice. Deputy Robert Paris was serving the eviction notice. Paris was accompanied by Glendon Engert, a locksmith who had been hired to get access to the condominium as part of the eviction process. The tenant open fired, killing Paris and Engert and a stand-off began. Ten hours later, a fire erupted from the apartment after authorities threw flash grenades and tear gas into the unit to try to flush the shooter out.

The burned, charred body of the suspect, James Ferrario, was found after the fire was extinguished. Ferrario had fallen behind on payments on a $15,000 Bank of America mortgage. He also appeared to have defaulted on $13,406 owed to the Whispering Woods Community Association. The Association foreclosed on the condominium, followed by the bank foreclosure in December.

On average, there are approximately 10,000 evictions processed each week in the U.S. That number is no wonder, with almost 900,000 foreclosures each year.

Keith A. Gantenbein, Jr. is a licensed, Colorado foreclosure defense attorney and real estate attorney located in Denver and servicing all of Colorado. His foreclosure defense practice includes foreclosure prevention, foreclosure assistance, loan modifications, short sales, and all other foreclosure defense legal assistance. He also handles real estate closings, title issues, lien issues, quiet title, real estate contracts, bankruptcies, mortgage negotiations, lender liability, real estate, civil litigation, contracts and landlord/tenant.

If you think you will be facing foreclosure, or are in the foreclosure process, or have had a wrongful foreclosure, contact Keith Gantenbein at (303) 618-2122 for a one-hour consultation where he will discuss your situation and go over all your options with you.

Visit: http//www.gglawllc.com

Zombie Neighborhoods in the West

zombie house

Colorado has spectacular land with wide, open spaces and gorgeous views. Five years ago there was a high demand for new homes. Everyone wanted ‘a piece of the west’. Investors saw Colorado as a land of opportunity and bought huge parcels of land for development. Unfortunately, the investors bought the land right before the economy went sour and the demand for housing went down the tubes.

When the recession hit, investors halted development, some in the midst of paving roads, others after building one or two homes. Today, the developments sit idle – becoming “Zombie Neighborhoods” or “Zombie Subdivisions”. Idaho, Wyoming, Utah, Arizona and Montana are experiencing the same problem as Colorado. Investors had seen these states ripe for development too, before the housing bubble burst and economy took a dive.

I’ve written about “Zombie Homes” that were auctioned or sold. The homeowners thought they were free from further debt. Months, or years later, lawsuits are filed against the homeowner for the old, resurrected “Zombie Loan”. Now we have “Zombie Neighborhoods”.

Today, there are hundreds of thousands of undeveloped lots in our state, blighting the land and draining the tax revenues. Take a subdivision with only one house built and the other 199 lots are vacant. Public services are required to supply water to the entire subdivision and keep the streetlights lit even though there is only one home there.

In Dry Creek, Colorado one developer bought an old mobile home park. The 100 mobile homes were moved out but the housing boom was over before any homes were built. Today the development is full of cracked and decaying mobile home pads and scattered with derelict debris and weeds.

A recent study showed Douglas County has 8,646 vacant (undeveloped) lots, Mesa – 6,393, Eagle – 6,067, Montrose – 4,232 and Garfield 2,883. That’s a lot of “Zombie” land.

One of the hardest hit areas in the west is the land west of Jackson Hole, Wyoming where 68% of 10,225 parcels of land are undeveloped. The area had an unprecedented 70% population growth between 2000 and 2010. Development was booming, but the bad economy kicked in and sales stopped. The county tried working with the developers, and new ordinances allowed developers to replat the troubled areas reducing the number of lots. But the area is still left with the same acreage of “Zombie Land”.

Montrose, Colorado has most of its undeveloped lots within the city limits. These “Zombie Neighborhoods” have only one or two homes built in large subdivisions. The upkeep of these areas are draining the city’s revenues.

When the oil industry collapsed, Mesa County, Colorado was hit hard. Unfinished subdivisions went into default. Thousands of lots didn’t have the infrastructure (roads, drainage, water and sewer) required when they were approved. Buyers bought expecting these would be in place. Eventually the properties went into default. Who wants land without water or some kind of road to get to the property?

Phoenix, Arizona experienced the same thing. There was a frenzied demand for homes. Builders were clearing land, when the recession hit. Phoenix became a city of unfinished construction and development. Today, about 350 subdivisions are actively selling compared to the normal market of 600. It’s been a slow recovery.

County governments are struggling to cope with this onslaught of “Zombie” properties trying to figure out if they should reshape or kill them.

Keith A. Gantenbein, Jr. is a licensed, Colorado foreclosure defense attorney and real estate attorney located in Denver and servicing all of Colorado. His foreclosure defense practice includes foreclosure prevention, foreclosure assistance, loan modifications, short sales, and all other foreclosure defense legal assistance. He also handles real estate closings, title issues, lien issues, quiet title, real estate contracts, bankruptcies, mortgage negotiations, lender liability, real estate, civil litigation, contracts and landlord/tenant.

If you think you will be facing foreclosure, or are in the foreclosure process, or have had a wrongful foreclosure, contact Keith Gantenbein at (303) 618-2122 for a one-hour consultation where he will discuss your situation and go over all your options with you.

Visit: http//www.gglawllc.com

Mortgage Relief Scams

thief

We’ve always had and continue to get calls from homeowners who are stunned they found a foreclosure notice posted somewhere on their home. Often, the notice was posted in an obsolete area – a side door or an obvious seldom-used area. Consequently, the homeowner finds the notice after a hearing has been held and an eviction notice filed.

These homeowners are shocked when they realize they’re IN foreclosure or have been foreclosed on. Too many times the homeowners say they were working with or paying a company to stop any foreclosure from happening. Some were caught in a whirlwind with lenders selling off their loans so fast, the paperwork never caught up and mortgage payments weren’t credited. Then we have the homeowners who say they were in the middle of a modification and the lender sold the loan before the modification was completed.

These homeowners are all victims. We hear too often “they promised me I could stay in my home if I paid them”, “my modification was being approved when they sold the loan”, “I’ve been making payments to the wrong lender” and “I was never notified until now”.

Homeowners facing foreclosure are in such vulnerable positions they’re likely to grasp at the inevitable scam artists who crawl out of the woodwork. These scammers tell the homeowner what they want to hear like “we guarantee we will save your home”, “we will have your mortgage payment lowered”. Scammers make promises they can’t keep, while (illegally) collecting a fee from the homeowner each month. Unfortunately, homeowners find out later the scammer never contacted their lender (even though they told the homeowner they talk to the lender every week).

As I’ve written before there’s a rule in place by the Federal Trade Commission (FTC) called the Mortgage Assistance Relief Services (MARS) that makes it illegal for companies to collect any fees until a homeowner has actually received an offer of relief from their lender and accepted it. It is illegal for these companies to take any kind of upfront money from you. Only an attorney licensed to practice law in the state where your home is located can require an upfront fee. The attorney places the money in a client trust account, withdrawing fees only when they complete actual legal services.

As a licensed, established and practicing attorney by the State of Colorado, I have sworn and taken an oath to follow all the rules, regulations and laws of Colorado and of the United States. Companies scamming homeowners are here today and gone tomorrow – after they’ve collected and debited your account for months. They know you don’t have the money to go after them, and most aren’t even located in Colorado.

The bottom line is, you paid a lot of money to a scammer for nothing. Lenders will only work with licensed attorneys, not phony counseling or foreclosure rescue companies (also called ‘foreclosure consultants’, ‘mortgage consultants’, ‘forensic loan auditor’, ‘loan modification consultant’, ‘foreclosure prevention specialist’, ‘short sales negotiator’).
If you think you’ve been the victim of a mortgage relief scam or are paying one of these ‘rescue companies’ contact a licensed foreclosure defense attorney as soon as possible – before you find an Eviction Notice posted on your home.

Keith A. Gantenbein, Jr. is a licensed, Colorado foreclosure defense attorney and real estate attorney located in Denver and servicing all of Colorado. His foreclosure defense practice includes foreclosure prevention, foreclosure assistance, loan modifications, short sales, and all other foreclosure defense legal assistance. He also handles real estate closings, title issues, lien issues, quiet title, real estate contracts, bankruptcies, mortgage negotiations, lender liability, real estate, civil litigation, contracts and landlord/tenant.

If you think you will be facing foreclosure, or are in the foreclosure process, or have had a wrongful foreclosure, contact Keith Gantenbein at (303) 618-2122 for a one-hour consultation where he will discuss your situation and go over all your options with you.

Visit: http//www.gglawllc.com

House Bill 1130

bill

HB1130 passed in subcommittee unanimously. GoldmanGantenbein has worked hard with Rep. Beth McCann and CPC in supporting this Bill. Click HERE to read more in the Denver Post.

Keith A. Gantenbein, Jr. is a Colorado consumer advocate attorney, foreclosure defense and real
 estate attorney located in Denver and servicing all of Colorado. His foreclosure defense practice includes: foreclosure prevention, foreclosure assistance, loan modifications, short sales, and all other foreclosure
 defense legal assistance. He also handles bankruptcies, wrongful credit reporting, mortgage negotiations, lender liability, real estate, civil litigation, debt defense, debt harassment, contracts and landlord/tenant.
 If you think you will be
facing debt collection, foreclosure, or are in the foreclosure process, or have had a wrongful foreclosure, contact Keith Gantenbein at (303) 618-2122 for a one-hour consultation where he will discuss your
 situation and go over all your options with you.

Visit http://www.gglawllc.com

New Mortgage Rules Took Effect This Month

new mortgage

On January 10th, 2014, new mortgage rules took effect throughout the U.S. Although the rules are intended to protect mortgage borrowers from predatory lenders, they will most likely make it harder to obtain a mortgage or refinance a current loan.

Under the new rules, lenders must provide a monthly billing statement that clearly indicates how much money the homeowner paid went to escrow, principal and the balance owed. The monthly billing statement must also state any service or transaction fees paid.

When making a payment, or an additional payment, the lender must credit that amount the day they receive the funds. If you write or call asking the total amount to pay off the loan, the lender must respond to you within 7 days of receiving your inquiry.

If you write your lender with any question or concern in regards to your account, they must let you know within 5 days they have received your inquiry. Then, the lender has 45 days to respond to the issue and let you know the outcome.

When a homeowner is paying more than 30% of their income on their house payment, analysts say the home is unaffordable or “cost-burdened”. In the U.S., more than 21 million people are paying more than 30% on their house payments, and of that, more than 11 million people are paying more than 50% their income (“severe burden”) on their house payment.

Additionally, there are over 11 million homeowners who are seriously underwater in the U.S. Unfortunately there is a severe shortage of affordable housing bringing the question once a homeowner is foreclosed on, where do they live?

Previously, a lender had no obligation to respond to a homeowner’s request for lower monthly payments. With these new rules, lenders are required to attempt contact with homeowners within 36 days of a missed payment and give the homeowner any workout options within 45 days. The lender must give the homeowner a single point of contact within their customer service department. Customer Service must respond with a decision within 30 days. However, the lender does NOT have to give the homeowner a workout agreement and can start foreclosure proceedings once the payment has been late 120 days. Again, it’s stressed the lender must “attempt” contact, it’s not required.

If the homeowner has an increasing ARM (adjustable rate mortgage), the lender must notify the homeowner by mail 210 to 240 days prior to the increase. A second notice from the lender must follow 60 to 120 days before the new payment.

Under these new mortgage rules, lenders are required to make sure the potential buyer (or homeowner refinancing) is financially able to make the mortgage payments. Under the new “Ability-to-Pay Rule” borrowers can’t exceed a 43% debt to income ratio (total monthly debt divided by total monthly gross before tax income). In other words, if you have an $80,000/year income, your monthly debt should not be more than $2,800. Your debt to income ratio is critical in securing a loan, or refinancing.

Under the “Qualified Mortgages” part of the new rules, lenders are required to document and verify an applicant’s income, assets, credit history and debt. Underwriters will also ensure any credit card debt interest rate will remain the same (no ‘teaser or short-term’ lower interest rates). Borrowers will have more paperwork to fill out. That, in turn will probably mean longer loan processing times.

Banks, housing groups and lenders are bracing for “paperwork headaches” and delays. The lenders fear a wave of foreclosures in which the homeowner can claim the lender should have known they couldn’t afford the loan.

Whenever a homeowner is in fear of foreclosure, unsure of their home modification, gets a notice of any kind from the courts, they should immediately contact a reputable, foreclosure defense attorney. Colorado’s foreclosure laws are very complex and unique and should be handled by an experienced foreclosure defense attorney. Homeowners need to protected against lenders ‘coming after them’ and for any deficiency which happens months and even years after foreclosure. An experienced foreclosure defense attorney will cover all these topics for the distressed homeowner.

Keith A. Gantenbein, Jr. is a Colorado consumer advocate attorney, foreclosure defense and real
 estate attorney located in Denver and servicing all of Colorado. His foreclosure defense practice includes: foreclosure prevention, foreclosure assistance, loan modifications, short sales, and all other foreclosure
defense legal assistance. He also handles bankruptcies, wrongful credit reporting, mortgage negotiations, lender liability, real estate, civil litigation, debt defense, debt harassment, contracts and landlord/tenant.
 If you think you will be
facing debt collection, foreclosure, or are in the foreclosure process, or have had a wrongful foreclosure, contact Keith Gantenbein at (303) 618-2122 for a one-hour consultation where he will discuss your
 situation and go over all your options with you.

Judge has Ruled: Detroit to Shed Billions in Bankruptcy

Detroit

Judge Steven Rhodes made the long-awaited decision – Detroit is cleared for bankruptcy.

Last July 18th, 2013, Detroit filed for bankruptcy protection, making this city the largest in our nation’s history to make this huge step. The city is more than $18 billion in debt after years of decline and financial mismanagement. It no longer has the resources to provide residents with basic police, fire and emergency services.

Under federal bankruptcy for municipalities, known as a Chapter 9, Detroit had to first prove it was eligible for protection. Earlier today, Judge Rhodes ruled Detroit is eligible to proceed with its bankruptcy.

The ruling was a huge blow to city unions and other creditors. At risk are the pension funds and other benefits for retirees. Detroit has $3.5 billion in unfunded pension obligations. Retirees could find themselves taking pennies on the dollar. Judge Rhodes issued a statement, “It will not lightly or casually exercise the power to impair pensions.” But, the judge made it clear that public employee pensions are not protected in a federal Chapter 9 bankruptcy, even if Michigan’s constitution says otherwise.

Detroit, once the fifth largest city in the United States used to be thriving and prosperous. Known as “The Motor City”, Detroit had a population of nearly 2 million people. Today, the population is just over half a million. People are leaving in droves. Detroit has the highest violent crime rate in the nation adding to the many reasons not to live there. Named the poorest city in the nation, Detroit’s unemployment is close to 50% and has the unwanted distinction as the worst city in the U.S. to find a job.

Dogs are a huge problem as well. There are over 50,000 stray dogs roaming the city. Large dens of dogs have been found living in the many vacant homes. There is widespread dog fighting. Pet owners not only left their homes, they abandoned their pets. Packs of dogs have killed other pets, bitten people and clogged animal shelters. Recently, a woman had her scalp torn off by two dogs as she was sitting on her porch. The city’s falling revenue forced cuts in animal control.

There are more than 100,000 vacant homes decaying and blighted. There’s a tremendous backlog of foreclosures, squatters have stripped homes of anything they could sell, and some have taken up residency in the vacant homes. Half the streetlights aren’t working making the neighborhoods extremely unsafe. It will take more than a major plan to put this city back on its feet.

Detroit must determine what’s necessary to invest in attracting new business and people. If the city doesn’t solve this systemic problem, they’ll just repeat their mistakes.
Today’s ruling will most probably clear the way for the numerous other cities waiting to hear the outcome of this case. Expect Oakland and San Jose California, Pontiac, Michigan and about seven other large cities to be file for bankruptcy shortly.

Keith A. Gantenbein, Jr. is a Colorado consumer advocate attorney, foreclosure defense and real
estate attorney located in Denver and servicing all of Colorado. His foreclosure defense practice includes: foreclosure prevention, foreclosure assistance, loan modifications, short sales, and all other foreclosure
defense legal assistance. He also handles bankruptcies, mortgage negotiations, lender liability, real estate, civil litigation, debt defense, debt harassment, contracts and landlord/tenant. If you think you will be
facing debt collection, foreclosure, or are in the foreclosure process, or have had a wrongful foreclosure,
contact Keith Gantenbein at (303) 618-2122 for a one-hour consultation where he will discuss your
situation and go over all your options with you.

JP Morgan Chase Agrees to $13 Billion Settlement

Chase

In the article published November 8, 2013, I wrote JPMorgan Chase had tentatively agreed to pay another fine. In that tentative settlement Chase was mulling over paying out $13 billion, with most of that going towards relief from many state and federal lawsuits and investigations. There was also a $4 billion amount that would be put aside for payment to consumers.

Yesterday, November 20th, Chase agreed to pay that $13 billion, along with a payment to investors of more than $6 billion and the previously agreed upon $4 billion payment for consumer relief.

The settlement does not absolve Chase or its employees from facing possible criminal charges in the future. United States officials can still pursue charges against some of the individual employees who were involved in mortgage fraud.

On the lighter side, $7 billion of the compensatory payments will be tax-deductible for the banking giant. The $2 billion penalty will not be deductible.

Part of the $4 billion set aside for consumers would go toward helping some homeowners whose mortgages are handled by JPMorgan Chase. In another uncommon move, another share of the $4 billion will be used to reduce blight in neighborhoods that have been run down due, mostly to abandoned homes. (It’s not clear whether these neighborhoods hold homes owned by Chase.)

In a separate statement late yesterday, HUD Secretary Shaun Donovan said “The $4 billion in relief for homeowners and borrowers could benefit more than 100,000 borrowers. The goal is to help American consumers and communities hardest hit by the housing crisis.”

This settlement also requires JPMorgan Chase to hire an independent auditor to make sure they follow all the guidelines set out for them. Chase announced they expect to fulfill all the obligations in the settlement by the end of the year, 2017, giving them a little over four years to do so.

This settlement began from alleged bad behavior relating to mortgages and mortgage-backed bonds. Chase, and the banks they bought, securitized billions of dollars of defective mortgages. Two investors – Fannie Mae and Freddie Mac suffered huge losses by buying the residential mortgage-backed securities from Chase, Washington Mutual and Bear Stearns.

Chase also remains in the bulls-eye for several additional legal actions. The Attorney General in Sacramento, California is currently investigating JPMorgan Chase, as well as several European banks.

Chase issued a statement saying they have reserves to cover the settlement requirements and said they are cooperating with an ongoing criminal investigation. JPMorgan Chief Financial Officer Marianne Lake added “While we appreciate that the amounts in these settlements are significant, the bank has set far more money than $13 billion aside to deal with the fallout from the crisis.” Lake also clarified the ongoing criminal investigation into both the bank and employees.

JPMorgan Chase Chairman, Jamie Dimon also issued a statement, “despite the bank agreeing to the settlement, we did not admit to a violation of law.”

Keith A. Gantenbein, Jr. is a Colorado consumer advocate attorney, foreclosure defense and real
 estate attorney located in Denver and servicing all of Colorado. His foreclosure defense practice includes: foreclosure prevention, foreclosure assistance, loan modifications, short sales, and all other foreclosure
defense legal assistance. He also handles bankruptcies, wrongful credit reporting, mortgage negotiations, lender liability, real estate, civil litigation, debt defense, debt harassment, contracts and landlord/tenant.
 If you think you will be
facing debt collection, foreclosure, or are in the foreclosure process, or have had a wrongful foreclosure, contact Keith Gantenbein at (303) 618-2122 for a one-hour consultation where he will discuss your
 situation and go over all your options with you.