Homeowners are rightfully disgusted with the banksters' loan mod / foreclosure dual track system, whereby a bank will pretend to negotiate a modification, put the homeowner on a "trial period" of 3 months, then extend the trial period to about a year, and then suddenly announce that the homeowner does not qualify for a permanent modification. The bank will then re-start the process of negotiating for a mod, but at the same time will put the homeowner on the foreclosure track, and then foreclose behind the homeowner's back under this loan-mod/foreclosure "dual track" system.
It's time for the homeowners to fight back. Clearly, the banks have much more incentive to squeeze the borrowers out of another year of payments and then take the house by foreclosure on top of that. The government's $1000.00 "incentive" per permanent mod is laughable compared to all the incentives to foreclose.
So the way for the homeowners to fight back is to put the banks on a dual track system. It goes like this. Homeowner will pretend to negotiate a mod just like the bank is pretending to do so. At the same time, however, homeowner will file a Quiet Title action against the parties of record.
You see, most "bubble" loans, especially MERS loans, contain a latent defect. The defect is that the loan has been transferred away from the original pretender-lender, but the new party's interest is not recorded. At least not until default, when the new party will start preparing to foreclose.
As long as that interest remains unrecorded (and that is that party's choice and not your fault), the new party is not entitled to any notice as to any changes in the ownership of the property or adding/removing encumbrances, nullification of a prior deed of trust, etc.
So, if the homeowner successfully challenges the encumbrance (the deed of trust or mortgage) based on TILA/RESPA violations, table-funding, unrelatedness to the reality of the transaction (failure to name actual parties, etc.), and other defects, the pretender-lender will not even have a chance to defend against such challenge for the simple reason that its putative "interest" is unrecorded and they are not entitled to any notice, while the party whose interest is recorded does not care anymore, as they have sold/transferred the loan. Moreover, the original pretender-lender is likely long gone, in bankruptcy, etc.
Those of you especially with MERS loans – its time to stop this loan mod nonsense at the expense of taxpayer bailouts and play hard ball. Put your bank, which doesn't usually have a scintilla of interest in your home, on a dual track system of loan-mod/quiet-title!