“Chain of Title” How Three Ordinary Americans Uncovered Wall Street’s Great Foreclosure Fraud – By David Dayen (Book Review)


When I am not helping consumers get a fresh start and live debt free in my law practice, I enjoy reading as a pastime.  IMG_3041To combine both, I recently had the pleasure of reading this book, published by first-time author David Dayen.

This book is a terrific look inside the implosion of the American housing market beginning around 2008, and the wave of foreclosures which followed. It is told from the perspective mainly of Lisa Epstein, a Florida wife, mother, health care professional and new homeowner.  Although practicing abundant caution in her personal finances, her home fell into foreclosure.  She had the audacity to actually examine the court documents filed against her – and eventually opened the door on a massive fraud perpetrated on the American public and our legal system.  It did not take a seasoned attorney to see that the arguments presented were as flimsy as a reed.  Eventually, she became a full-time consumer advocate and nearly won election to the prestigious of clerk of courts of Palm Beach County, a foreclosure quagmire.


I had numerous clients during my office in those years with identical nightmare stories of mortgage companies who refused to accept payments, who demanded the production of documents which they promptly lost, and who generally turned a deaf ear to homeowners.  This book explains why- the mortgage loan servicers made more money by foreclosing on the home, than they ever would have working with the homeowner to stay in the home.


Joining Lisa Epstein was Michael Redman, another Florida homeowner abused by his mortgage company.  Michael Redman was a car salesman of substantial earning capacity.  But when his mortgage company unilaterally added $600 per month to the $1,600 mortgage due to “miscalculating” his property taxes, at the same the Florida economy collapsed and car sales slowed to a trickle, he was also served with foreclosure papers. The two joined forces and began using the power of the Internet to publicize what are now notorious facts – mortgage companies were flooding the courts with forged and robo-signed affidavits, dummied up transfer documents, and more, all brought in the names of companies which no legal interest in the mortgage whatsoever.


These consumers were instrumental in exposing the fraud of famous robo-signer “Linda Green.”  Linda Green was eventually found to have signed as the “vice-president” of more than twenty mortgage servicing companies in just one month in 2009.  Her prior professional experience?  She was a shipping clerk for an auto parts facility.


In another memorable passage, Dayen documents how the foreclosure mills (law firms whose practice was devoted to representing banks against consumers in foreclosure litigation) were dealing with such a staggering amount of lawsuits that they actually left in the following boilerplate in their lawsuits:




That is not a typo.  Foreclosure lawsuits like this were filed with the clerks of courthouses, and would eventually go into a court of law as evidence.  It was obviously a placeholder which was never changed by filling in the name of the actual company involved in the transfer.  The foreclosure mills did not even bother to look for this link in their chain of title, and the “Great Foreclosure Machine” churned on.


I highly recommend this book.  You may or may not be shocked to learn that the banks and their lawyers were caught red-handed, but essentially were never brought to task for their behavior.  True, some sub-prime mortgage companies and foreclosure law firms went out of business, and some paid fines and settlements to state attorneys general. But the compensation they paid paled in comparison to the millions in fees they generated, leaving entire communities in shambles.


I do not “defend” foreclosure lawsuits in the way described in the book.  My practice does, however, involve Chapter 13 representation.  In Chapter 13 bankruptcy, homeowners in foreclosure can form a plan to cure the past due mortgage amount and save the home. The bankruptcy courts have become much more aggressive in their protection of homeowners, including the use of “conduit” plans to stop servicers from dumping unauthorized fees on homeowners.  Call me at 216-642-8234 if you are facing foreclosure and we can set up an appointment to see what options exist.

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