Breaking the Predatory Lender Matrix By Jim Krage of Foreclosure Sales are Avalanching from Predatory Lending: Since October, Hard Money Loans have gone into Foreclosure massively. Now, Option ARMs are predicted to start a new Cataclysm. KFWB – Market Wrap with Moe Ansari – Sat 12 Noon – Predicted new Downturn to DEPRESSION – Option ARM Probably DEPRESSION with Hi Inflation – Dollar Will Lose Value, eveything will be more expensive. Past Mistakes in FOREX: many bought EUROs – Canadian $ and some small currencies were Better Gold and Precious Metals skyrocketed – Real Estate is now cheaper, and may get cheaper still. Predatory Mortgage Loan elements = Variable Interest, Negative Amortization, Balloon Payments, Prepayment Penalties, Interest Only Periods, Lack of Disclosures YSP (Yield Spread Premiums) – Lender bribed Broker to get Borrower to accept Higher Interest Rate If you have a Predatory Mortgage, what can you do?: 1) Sell it (Lose Money or Bank agrees to take less) 2) Bankruptcy (Adversary Proceeding or Reformation) 3) Offer a Deed in Lieu of Foreclosure 4) Short Sale to a Friend 5) Sue the Lender 6) Short Refinance 7) Loan Modification (often turned down – won’t lower principal) Short Sales and Loan Modifications with TEETH are most popular. Good Lawyers doing Loan Mods get an Audit of Loan Docs and Sue to wake up Negotiations. TOOLS #1: File a Rescission, File a Lis Pendens (for your Complaint filed) TOOLS #2: Forensic Audit of Origination Loan Documents for Violations of TILA, RESPA, State Laws TOOLS #3: Audit Recorded Documents–Assignments, Substitutions, NOD, Notice of Sale, Trustee’s Deed

Breaking the Predatory Lender Matrix By Jim Krage of Short Sales and Loan Modifications with TEETH are most popular. Good Lawyers doing Loan Mods get an Audit of Loan Docs and Sue to wake up Negotiations. TOOLS #1: File a Rescission, File a Lis Pendens (for your Complaint filed) TOOLS #2: Forensic Audit of Origination Loan Documents for Violations of TILA, RESPA, State Laws TOOLS #3: Audit Recorded Documents–Assignments, Substitutions, NOD, Notice of Sale, Trustee’s Deed Check with a Lawyer to see what’s Best for You: 1)Rescinding the Contract (Note) and all documents based on it (like the Trust Deed) = can remove the Security of the Deed of Trust (The Rescission may need to be validated by a Judge for full effect) 2)If a Loan Audit finds Violations in Origination Loan Docs = Leverage (Some Lenders will ignore Audit Findings, unless they are in a Lawsuit) 3)If an Audit of Recorded Docs finds errors, the Sale may be reversible (Often Eviction by Unlawful Detainer can be stopped) (Results can be used for Quiet Title and Wrong Foreclosure Procedure Causes of Action in a Lawsuit)

Breaking the Predatory Lender Matrix By Jim Krage of Some Reasons to Rescind – then Examples: 1) TILA Violations of Notice of Right to Cancel (for Refi’s TILA offers 3 years to Rescind) 2) TILA Violations of APR (for Refi’s TILA offers 3 years to Rescind) 3) TILA Violations of undisclosed Finance Charges (for Refi’s TILA offers 3 years to Rescind) 4) Violations of Misrepresentation, Fraud, Consideration (Calif. Civil Code 1689 & 1691 allow Rescission) Rescission can Void the Security Interest of the Lender (Always check with a Lawyer for What’s Best for You)

Breaking the Predatory Lender Matrix By Jim Krage of Courts and Causes of Action: TILA and RESPA are Federal Laws. Misrepresentation and Fraud are most sued as State Laws You can only sue in Fed Court if you have a Fed issue. Rumors are that Borrowers are unlucky in L.A. Fed Court. I have seen better results in State Court for Fed & State issues L.A. Fed Judge Manual Real is an old judge trying to throw out Fed complaints that ask for the Original of the Note. From “Judge Manuel L. Real of the Central District of California. In December 2008, Real began holding hearings into the conduct of the law firm that filed at least nine produce-the-note cases pending before him. By the end of January 2009, Real declared the suits to be frivolous, ordered the attorney to repay plaintiffs all monies paid for his services, ordered the attorney and his law firm to pay in excess of $60,000 to five law firms forced to defend the cases he filed, declared the attorney to be a vexatious litigant and barred him from making any future filings in the Central District without the prior written permission of the chief judge.” In 2006,the House Judiciary Committee started an investigation of Real, but did nothing.

Breaking the Predatory Lender Matrix By Jim Krage of Many Judges decide issues by feelings, And don’t follow the law and precedent. In Pro Per’s are often shafted by judges. Appeals are difficult and costly, so judges usually get away with wrong rulings. I support to ask for legislation to make Judges accountable.