Forbes has taken notice. There is a shift toward borrowers in mortgage litigation. The decision points back to the origination of the loan. This decision follows a similar decision in the 4th circuit. It all comes down to what actually happened at closing? And we don’t actually know if the decision to allow rescission indefinitely on second mortgages will extend to the first mortgage if it is all part of the same transaction. The result of rescission is that all payments of every kind must be returned to the borrower plus interest and attorney fees and potentially treble damages. All payments mean closing costs, fees, costs, expenses, principal interest, escrow and anything else. If the “lender” doesn’t do that the mortgage lien is expressly invalidated by operation of law, which is the same as being subject to a recorded satisfaction of mortgage. TILA is back!! — at least until the…

THE fifth anniversary of Lehman Brothers’ bankruptcy has occasioned one legacy-spinning defense after another. We’ve heard from Ben S. Bernanke, chairman of the Federal Reserve; Henry M. Paulson Jr., the Treasury secretary at the time; and Timothy F. Geithner, then the New York Fed president and later Mr. Paulson’s successor at Treasury, about their historic decisions to use trillions of dollars of taxpayers’ money to bail out the banking system.

But will we ever know what really happened behind all those closed doors? The seemingly appalling treatment afforded Richard M. Bowen III, a former Citigroup executive who blew the whistle on years of malfeasance there, shows that we may not. Thanks to political pressure and the revolving door between Washington and Wall Street, the events leading up to the financial crisis remain obscured and may never be fully revealed.

Read on.

Widow faces foreclosure on reverse mortgage she says she didn’t understand

Barbara Freeman will never forget what it was like the day a slick banker sat down at the kitchen table in the only house she’s ever owned.

Mike Sullivan, a man whose business card identified him as a Wells Fargo reverse mortgage consultant who worked out of Greensboro, and a partner explained the workings of a deal that he said could provide much needed cash to Freeman and her husband, Roy.

“I didn’t understand really anything about it,” she said. “But they made it sound good, and they told us I could stay in the house even if something happened to Roy.”

The bankers thought they might be interested in what they were selling — a high-interest reverse mortgage that would provide them with nearly $25,000.

Despite misgivings, the Freemans took the deal. But instead of a worry-free retirement…

Writing with the flu. Despite symptoms and medication that makes me dizzy, I feel compelled to write about something that is getting traction out there. The more you look at the false claims of securitization the more it stinks. We are dealing with a system that is based on really big lies. I’m sure our leaders of government have a very appealing rationalization why we must pretend the mortgage bonds are real, why we must pretend the mortgages are real, why we must pretend the notes are real, and why we must pretend the debts and defaults are real. But those are lies based on sham transactions. And those lies are based in public policy. And public policy is contrary to law.

My focus is on cases pending in the judicial branch of government. Our system of government was designed to insert the judicial branch into disputes so that fractures…