Local attorney argues mortgage fraud case

DAVISON TWP. — Attorney Rex Anderson and his clients, a family from Lapeer County, are awaiting word from the United States Court of Appeals for the 6th Circuit in Cincinnati over a mortgage fraud case.

Anderson, who has been practicing personal injury and consumer law in Davison for 20 years, took on the U.S. National Bank and Saxon Mortgage Services in the 6th Circuit Court, Oct. 12.

Anderson represents Lapeer homeowners who, six years ago, came to him after their bank attempted to foreclose on them. After filing Chapter 13 bankruptcy in order to stop the foreclosure, the bank submitted a proof of claim.

The homeowners immediately realized this was the first time they had ever seen their mortgage and their signatures had been forged and notarized and then filed with the Lapeer Register of Deeds office, said Anderson.

The mortgage was notarized in Oakland County at the same time the homeowners were attending the closing in Sacramento, Calif. The homeowners were never presented with a mortgage to review and sign.

Anderson addressed the three judge panel of the 6th Circuit Court to present oral arguments as to why the defendants in this case should not be allowed to receive an equitable mortgage.

This is after a court determination that the crime of forgery had been committed while the mortgage was in the possession of the lenders, said Anderson.

“The original mortgage document is void,” said Anderson. “Somebody forged the borrower’s signature.”

The six-year battle began when the bankruptcy court gave the defendants an equitable mortgage holding that the homeowners’ intent to give a mortgage outweighed the crime of forgery and the null and void mortgage.

Anderson said the homeowners do not contest they owe the loan; they only insist they should not be bound by a mortgage document, which they never had the opportunity to read, sign or agree to.

“Had the shoe been on the other foot, there’s no way the court would grant an equitable mortgage,” he said.

Although they would still owe the loan, the loan would not be secured by the home. This case and the forgery committed occurred about the time of the mortgage market meltdown in 2007.

There is no precedent in the United States Courts to give a bank an equitable mortgage where the homeowners’ signatures are forged while in the possession of the lender, said Anderson.

“The bank could have simply placed a call to the homeowners and requested them to sign the mortgage, which was missing from the closing documents,” he said. “Instead, somebody was directed to lie and commit a fraud on the homeowners. The bank is now asking the courts to reward its bad behavior and set a precedent that would encourage banks to disregard the law and the due process rights of its borrowers..”

The granting of an equitable mortgage in this case would set a precedent that would say to homeowners that they have no recourse against lending institutions that break the law, said Anderson.

Anderson said he hopes this case sets a precedent that will encourage lenders to obey the law.

He and his clients are awaiting a decision by the appeals court, due to come down at any time.

Calls to U.S. National Bank and Saxon Mortgage Services were not returned.