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Foreclosure Summit

Page history last edited by spencer.graves@prodsyse.com 8 years, 1 month ago

Foreclosure Summit


     Roughly 50 people attended Occupy San José first Foreclosure Summit, Saturday, 15 September 2012 at the New Community of Faith (www.newcommunityoffaith.org).  


       CJ Holmes (hofj.org) gave a brief overview of how this crisis has developed over the past few years, her work to combat it and suggestions for future action.  David Merritt discussed the predatory loan they were suckered into and his efforts to fight back preemptively before they had taken his life savings and issued a notice of default.  Part of his work involved visiting courts over much of California reading the records of lawsuits against the banksters, all of which had been settled in at most 9 months, usually in favor of the banks.  


       Attorney Thomas Spielbauer gave a brief overview of foreclosure law in California.  Most foreclosures here used a non-judicial procedure, largely because the burden of proof is in the homeowner;  with a judicial foreclosure, the burden of proof is on the bank.  This gives the banks substantial advantages, because any allegations of fraud and other violations of law must be proven by the homeowner in a non-judicial procedure;  in a judicial procedure, the foreclosure agent would have to prove that they have the authority to foreclose.  Spielbauer said that foreclosure can be portrayed as a five-step process with many substeps:  


              1.  A Notice of Default (NOD) is filed with the Recorder in the county containing the real property at stake. This NOD must be served to the homeowner within 10 days. It is extremely important that the homeowner start taking action to protect themselves upon receipt of an NOD, because they have 60 days from the NOD during which they have a right to demand a copy "of the promissory note and all modifications."  The promissory note and especially the modifications may contain evidence of fraud or other irregularities.  After 60 days, it is much harder to get this information.   


              2.  A Notice of Trustee Sale can be filed as early as 90 days after the NOD.  The foreclosure agent is required to notify the homeowner and post a notice on the property.  


              3.  When Trustee Sale sale is completed, that typically ends the opportunities for legal recourse for the homeowner.  


              4.  If a resident of the property (homeowner or renter) decides not to voluntarily leave the property, the new owner may then file a Notice of Eviction.  


              5.  If the resident does not leave voluntarily, law enforcement officers may then forcibly evict them, possibly confiscating any property they have in the premises.  


Of course, there are many details and opportunities for challenge during this process.  However, distressed homeowners generally have fewer options the longer they delay.  David Merritt filed suit before he received a notice of default.  


       Spencer Graves provided a broad overview of the past and present of financial issues such as foreclosure.  He began by quoting Anacharsis from ancient Athens in the sixth century BC that, "Laws are spider webs, which catch the little flies, but cannot hold the big ones."  David Graeber noted that for the past 5000 years, as far back as archeologists can find records, the rich have written the rules to benefit them and impoverish everyone else.  This trend has been interrupted only by peasant rebellions.  He also discussed how people in the US have learned how to do more with less on average every year since the founding of the republic.  This rate of productivity improvement averaged 2.2% per year from the end of World War II to 1970 and 1.8% since.  The result of compounding 1.8% over 40 years means that the average annual income in the US has doubled since 1970.  From World War II to 1970, the benefits of these productivity improvements were shared by rich and poor alike.  Since 1970 only the to 0.1% have  gotten their fair share.  Even the 99th percentile has fallen behind, and the 20th percentile has seen only very slight improvements in their income, adjusted for inflation.  The cumulative lost income amounts to $39,000 per year, $100 per day, for the median American family.  Graves also mentioned William K. Black, who has compared today with the Savings and Loan crisis of 20-25 years ago:  After that crises became too big to cover up, regulators were allowed to file criminal referrals, which led to over 1,000 felony convictions of key S&L insiders.  The current crisis is roughly 70 times larger, but regulators have not yet started seriously investigating and filing criminal referrals.  This was tied to our current system for private funding of political campaigns.  Under this system, to get the money required to get reelected, incumbent politicians extort money from big businesses.  The big businesses contribute, because they typically get between $6 and $220 for each $1 invested in lobbying and political campaigns.  Graves ended with suggestions for how people might defend themselves and fight back against this corrupt system.  


       Brief presentations by the four panelists were followed by small group discussions, report backs and plans for future actions.  The event was moderated by award-winning journalist Henrietta Burroughs.  




From October 2007 through 2011, an average of 500 California families (13 per million population) lost their homes every day.  Joseph Stiglitz, Nobel Prize Economist, said the banks were "putting someone in a home for a few months and then tossing him out after having stripped him of is life savings."1


The Center for Responsible Lending says the crisis may only be about half over.2 If so, we can expect excessive foreclosures to continue through 2015.


Santa Clara County has been fairly typical: In July 2011 a total of 330 local families lost their homes (15 per day). These numbers have fallen dramatically recently to 137 for July 2012 (6.2 per day).3 We don't know if this is a temporary decline or an indication that the crisis may be over sooner than previous forecasted.


The San Francisco Foreclosure Audit "identified what appear to be one or more clear violations of law" in 84 percent of the 382 foreclosures on residential mortgage loans reviewed.4  This suggests massive criminality.


During the Savings and Loan crisis of 20 years ago, the Office of the Comptroller of the Currency (OCC) and the Office of Thrift Supervision (OTS) filed thousands of criminal complaints. These led to over a thousand criminal convictions against senior finance industry executives.5  By contrast, as of April 16, 2012, there had been NO convictions of controlling officers of the large nonprime lenders.6


Two factors might explain the difference between today and 20 years ago:


(1) The mainstream commercial media conglomerates (ABC, CBS, NBC, CNN, Fox) would lose advertising if they reported too many details. Twenty years ago, more local broadcasting and print media organizations were independently owned, presenting greater competition for audience than today.


(2) The majority of incumbent politicians at the national level have been elected with substantial contributions from the finance industry, especially the major banks.7 This was true 20 years ago. However, the amounts of money today are greater.


This major national crisis will be discussed at a Foreclosure Summit outlined below.




The program will be moderated by Henrietta Burroughs, founder of the East Palo Alto Center for Community Media and Editor-in-chief of East Palo Alto Today (www.epatoday.org).


1 - 2 PM: Presentations by leaders in the fight against foreclosures. These will include attorney Thomas Spielbauer, realtor and anti-foreclosure organizer CJ Holmes, foreclosure victim David Merritt, who has been suing Bank of America, Wells Fargo, Chase and others with some success since 2009, and Foreclosure Summit organizer and researcher Spencer Graves.  


2 - 2:10 PM: break


2:10 - 2:40 PM: Small group discussions with attendees brainstorming the following: (a) Concerns about foreclosures. (b) Questions for the presenters. (c) Ideas for action to change the current trends.


2:40 - 3:10 PM: Report backs from the groups.


3:10 - 3:40 PM: Responses from panelists to the concerns, questions, and suggestions for follow-on action.


3:40 - 4 PM: Open discussion of follow-on activities moderated by Henrietta Burroughs.


Brief Bios of the Presenters


Henrietta J. Burroughs is the founder of the East Palo Alto Center for Community Media and editor-in-chief of East Palo Alto Today (www.epatoday.org). She is an award-winning journalist with substantial experience with major broadcast and print media. She currently produces and hosts the bi-weekly television show, 'Talking with Henrietta." (www.epatoday.org/news/who's_who.html)


Thomas Spielbauer is an attorney in San José specializing in foreclosures. His web site (http://spielbauer.com) includes a discussion of "How to Do Your Own Loan Modification" (http://spielbauer.com/LoanMod.htm).


CJ Holmes is a realtor in Santa Rosa and the founder of Home Owners for Justice (hofj.org). In the latter capacity, she has been interviewed many times on KPFA radio. Her work in this area helped secure approval of the California Homeowner Bill of Rights, signed July 11, 2012 by Gov. Brown (http://oag.ca.gov/news/press-releases/california-homeowner-bill-rights-signed-law).


David Merritt is the owner and president of a small manufacturing company and the victim of a predatory loan.  Since 2009, he has been suing Bank of AmericaWells Fargo, Countrywide Home Loans and others in Santa Clara County Superior Court. His complaint alleges that senior banking executives conspired to defraud millions of Americans with predatory loans that are allegedly designed to strip borrowers income, savings, equity and property from them and transfer it over to defendants.  He is also the principle author of a book entitled 20th Century American Struggle, 21st Century Hope.  


Spencer Graves is an activist with Occupy San José and the Green Party of Santa Clara County. He is the primary organizer of this Foreclosure Summit. He is a licensed professional engineer with a PhD in Statistics and Executive Director of "effectivedefense.org". 


Sponsoring Organizations :


Green Party of Santa Clara County

Homeowners for Justice

Attorney Thomas Spielbauer

Occupy San José




1"Fighting Foreclosures 3 Ways", occupy.pbworks.com (http://occupy.pbworks.com/w/page/54013671/Fighting%20Foreclosures%203%20Ways, accessed 12 August 2012)


"Fighting Foreclosures 3 Ways", occupy.pbworks.com (http://occupy.pbworks.com/w/page/54013671/Fighting%20Foreclosures%203%20Ways, accessed 12 August 2012)



3Pete Carey, "Bay Area foreclosures Jump in July", San José Mercury News, 14 Aug. 2012 (www.mercurynews.com/real-estate/ci_21312142/bay-area-foreclosures-jump-july)



4Aequitas, "Foreclosure in California: A Crisis of Compliance", Feb. 2012 (http://www.sfassessor.org/Modules/ShowDocument.aspx?documentid=1018)



5William K. Black (2005) The Best Way to Rob a Bank Is to Own One (U. of Texas Pr.)



6John T. Burke, Jr. (Apr. 16, 2012) "Another Slap On the Wrists", TheCenterLane.Com

(http://www.thecenterlane.com/?tag=savings-and-loan-crisis )



7Wikipedia, "Conflict of Interest"(http://en.wikipedia.org/wiki/Conflict_of_interest)



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