FOX40’s Paul Robins, main anchor of FOX40 in the morning in Sacramento, interviews Managing Partner Stephen Foondos about what you need to know about wrongful foreclosures.
See the interview from the FOX40 website by clicking here
In dramatic fashion, a ruling by a five judge panel of the California Supreme Court on Wednesday denied the request of the five major banks to have the decision in Glaski v. Bank of America (5th Dist. Ct. App. No. F064556) depublished. Two of the seven judges recused themselves, for reasons unknown. While the banks could have attempted to appeal the controversial Glaski decision, they feared a ruling upholding Glaski by the Supreme Court, and instead chose to seek depublication, and lost.
The impact of the Supreme Court’s landmark decision is enormous, giving irrefutable authority to homeowners who are facing foreclosure or who’ve already been foreclosed on, to seek damages for wrongful foreclosure. Stephen Foondos, founder of United Law Center (ULC) in Roseville, Calif. and one of the attorneys who argued against depublication, has led his team to fight the banks for wrongful foreclosure since 2008. ULC has been leveraging this case to help thousands of Calif. homeowners fight back against their mortgage lender, and win because the banks don’t want to fight against Glaski in a jury trial. Since Glaski was published, ULC has seen the rate and value of case settlements increase dramatically. Cases wherein “Glaski” is alleged may include principal reductions between 30-70%, interest rates fixed at 2-3% for 30 years and a cash award upwards of six figures.
“The banks, fearing the appellate process, tried depublication and failed. While the banks argued that the Glaski decision could have a catastrophic impact on the banking industry, it’s a major victory and real step forward in the long legal fight to provide the real victims of the foreclosure crisis, the homeowner, true relief,” explained attorney Foondos. “We’re ecstatic about the Calif. Supreme Court’s decision. It’s yet another indication of the direction in which the law is turning in this banking brawl, directly in favor of California homeowners.”
The Glaski decision stands for the simple proposition that if an entity wants to collect on a debt in California (or foreclose on a mortgage), that entity must own the debt. Further, if such an entity is claiming ownership by way of an assignment, that assignment must be valid. A bank’s assignment of a promissory note to a Mortgage-Backed Security Trust (a “Securitized Trust”) is generally referred to as “securitization.” Pursuant to the New York law under which the Securitized Trust was created and Federal Securities Law, the transfer of Mr. Glaski’s note was required to occur within 90 days of the closing date of the Securitized Trust commonly referred to as the “90 day Rule.” If this securitization occurs beyond the 90-days, it is considered void at its inception.
Therefore, because the Securitized Trust did not own Mr. Glaski’s note, it could not legally foreclose, and hence, the foreclosure was wrongful. The California Court of Appeals agreed. And while Glaski is viewed as an outlier in Federal Courts, “The Court’s decision to deny the banks’ request for depublication of Glaski affirms that it is the law of the land in California, and we have been granted the right to sue in California Superior Court,” says Foondos.
It is estimated that 70-80% of all California homeowners who financed a home between 2003 and 2008 had their note securitized. “Accordingly, in light of the Glaski decision, approximately 1.3 million homes may have been wrongfully foreclosed upon and have grounds to sue their original lender for damages,” explained Foondos.
You can find the original release here.
KCRA Interviews Stephen Foondos:
ROSEVILLE, Calif. (KCRA) —With an estimated 1.3 million California homeowners in foreclosure, a Roseville attorney says the state Supreme Court has made a decision that could ultimately keep many from losing their homes.
“This is nothing less than a huge victory for homeowners because this provides them with the legal leverage that they have when they are trying to attempt to get some recourse from their bank,” attorney Stephen Foondos said.
Foondos said a Fresno homeowner fought foreclosure in court and won in the case known as Glask v. Bank of America. In the case, the homeowner claimed the financial institution trying to take his home didn’t have the right to because the loan was improperly transferred to a securities trust.
“This trust never owned anything and therefore didn’t have the right to foreclose on Mr. Glaski, which now means Mr. Glaski has the right to sue,” Foondos said.
Five major banks asked the California Supreme Court to keep the Glaski decision from being published so that it couldn’t be used it as precedent in other foreclosure cases around the state.
Lawyers for the financial institutions claimed the decision could be catastrophic for the banking industry.
But this week, five Supreme Court justices sided against the banks and the court is allowing the decision to be used as a legal basis in other future cases.
“These are no joke,” Foondos said. “That’s why the banks have been aggressively trying to suppress this information from the public.”
Foondos said it’s not necessarily a silver bullet that will cut short all foreclosure proceedings, but it could be a legal tool for people at risk of losing their homes.