Consumer complaint received 2024-11-20 00:00:00
Product: Mortgage — Home equity loan or line of credit (HELOC)
Issue: Struggling to pay mortgage — Foreclosure
Company: Fay Servicing, LLC
State: PA

Complaint narrative:
XXXX XXXX : LXXXX XXXX XXXX XXXX XXXX XXXX XXXX XXXX XXXX XXXXXXXX XXXX XXXX XXXX XXXX : XXXX XXXX XXXX XXXX XXXX XXXX XXXX XXXXXXXX. 
XXXX XXXX " anyone who sins and is aware of it must testify before the lord and bring as his penalty a ram from the flock, one without defect or fault. 

First there is a bifurcation of the note and mortgage, debt collectors now have the account violation of FTC SEC IRS XXXX XXXX XXXX OTHERS and violations of the FDCPA etc .... 


On XX/XX/XXXX FROM THE XXXX XXXX XXXX a XXXX based company and representatives of said company settled upon a XXXX XXXX with XXXX XXXX XXXX. We assumed the company was acting in good faith but after further investigation of the mortgage we found that the companies involved acted in bad faith. Falsification of submitted documents, signatures, recordings in the courts, double bookkeeping entries, and the transfer of the asset. XXXX XXXXXXXX XXXX XXXX XXXX XXXXXXXX XXXX XXXX XXXX XXXX ( not in its official capacity solely as trustee for XXXX XXXX XXXX, are apart of this fraudulent transfer of the asset. We noticed a discrepancies once were we contacted by FAY SERVICING LLC that claimed payments were missed ( default ) and that immediate payment was needed or they would accelerate to foreclosure proceedings. XX/XX/XXXX was the referenced date in which a payment was made and accepted by FAY SERVICING LLC. The payment included the 3 months of payments plus interest. FAY SERVICING had direct access to the account to retrieve funds do to the account made payable was set up through autopay at XXXX XXXX  located at XXXX XXXX XXXXXXXX XXXX XXXX XXXX XXXX XXXX FAY SERVICING LLC claimed the same issue XXXX of XXXX in which payment was made again to FAY SERVICING LLC and accepted. That is when we started to research the issue with payments and the account. We reached out to XXXX Bank to investigate the allegations made by FAY SERVICING LLC that we were not making payments as scheduled from autopay out of the account held by XXXX BANK. XXXX BANK informed XXXX of the transaction history and found thaXXXX FAY SERVICING DID INDEED receive payment electronically from the autopay set up on the account. There was no return funds from FAY SERVICING LLC back to the account only payments sent. FAY SERVICING XXXX claimed that on the first of every month they would retrieve the payment, and then they would return the payment on the XXXX of every month. FAY SERVICING XXXX when asked claimed that they never received the payments and they returned what the did receive during that transaction. But after investigating the transaction with XXXX BANK we concluded that something was not right. XXXX BANK launched an investigation into the account which caused a domino affect into the hardships now faced by our family. With the account being on hold do to investigation it created economic hardships. Which affected our personal and business credit profiles, missed payments to other accounts and tons of pain and suffering. Which ended up with the account being closed. We experienced identity theft issues do to the negligence of FAY SERVICING XXXX and its agents and affiliates. FAY SERVICING XXXX then accelerated to foreclosure proceedings in which we were contacted by a lawyer based in XXXX. We were not properly served and did not receive any proper form of communication. From XXXX of XXXX Until XXXX of XXXX we tried to reach a conclusion with FAY SERVICING XXXX. We researched the transaction from the best of our knowledge with clean hands and honor. Due to the lack of information being shared by the companies, we could only gather as much information as publicly possible. FAY SERVICING XXXX XXXX XXXX XXXX XXXX XXXX XXXX XXXX claimed that they did not have to disclose account information to the account holder because it was company policy. But in Pennsylvania the right to know law a adopted interpretation of the FREEDOM OF INFORMATION ACT, states we have right to full disclosure of any information. After several attempts and blatant refusal by the companies we pursued to gather what we could. Starting at the beginning, what is a mortgage? What type of mortgage do we have? What bank or banks are involved? etc.. We concluded with a few red flags starting with the settlement. Loan amount was for XXXX in which on the day of closing only about XXXX was deposited we asked why and was informed it went into the escrow account incase payments can not be made. So we looked into escrow accounts and according the IRS XXXX XXXX the buyers obligation is paid in full when the balance of purchase price is deposited into the escrow account. When the escrow account is established, you no longer rely on the buyer for the rest of the payment, but on the escrow arrangement. Which means they held another XXXX in the escrow account along with the funds deducted from the initial amount. Which led us further into what accounting means, double bookkeeping entry systems, and all that involved XXXX XXXX, and XXXX. We tracked the account all the way into a Fund held by XXXX XXXX XXXX XXXX XXXX XXXX XXXX : XXXX being sold on the market. Which meant that our transaction was a secondary one and that we were never compensated and valuable consideration for the cashable item used by the bank to secure funding. We now know that the application was a cashable item and was pooled with other items and being serviced under XXXX account. Which lead us into how the loan was structured and the identity of all parties. This information was not disclosed to us in anyway. We were unaware of the funds held in escrow by the title company the day of settlement. That they use false misleading business tactics like taking the escrow after the fact to mask what intentions they truly have. We found that banks can not lend there own money. We found that banks are borrowers of the FEDERAL RESERVE SYSTEM operating circular XXXX. We found that XXXX ( that all banks are XXXX ). We found that banks invest on behalf of customers and investors. We are the customers, our taxpayer identification number was used in this transaction. Which means that this is a tax issue and according to IRS XXXX XXXX. In which the parties involved are falsifying documents submitting and not submitting tax forms using legalese to mislead cause economic harm etc. We have proof of the accounting from an independent audit, and almost positive that once full accounting is obtained we may also conclude all the violations this transaction. With further investigation we found that sharing account information with anyone outside the account holder is a violation major violation according to the FEDERAL TRADE COMMISSION etc... We have tried to settle the matter but all the parties involved have provided a safe avenue to redemption of the mortgage. We have a right to equitable redemption. We are the Owners of the accounts all proceeds rights titles interest chattels rents debits credits debentures derivatives. As these company are using unjust enrichment errors of omission, piracy, identity theft, bank XXXX, false tax reporting 's securities reporting financial statements agreements etc. filed with SEC and local and state departments of revenue etc.. So we ask some questions for clarity to foreclosure. 
Definitions and Resources : FORECLOSURE. To shut out, to bar, to destroy an equity of redemption. XXXX XXXX XXXX, XXXX Okl. XXXX, XXXX XXXX XXXX, XXXX. A termination of all rights of the mortgagor or his grantee in the property covered by the mortgage. XXXX v. XXXX XXXX XXXX XXXX XXXX XXXX XXXX. XXXXXXXX XXXX XXXX 
XXXX, XXXX. 
The term is also loosely applied to any of the various methods, statutory or otherwise, known in different juris- dictions, of enforcing payment of the debt secured by a mortgage, by taking and selling the mortgaged estate. XXXX XXXX XXXX XXXX XXXX XXXX, XXXX, XXXX XXXX XXXX ; XXXX Mortgage XXXX XXXX XXXX XXXX XXXX XXXX XXXX, XXXX So. XXXX, XXXX. 

XXXX XXXX XXXX article XXXX definitions : ( XXXX ) " Adverse claim '' means a claim that a claimant has a property interest in a financial asset and that it is a violation of the rights of the claimant for another person to hold, transfer, or deal with the financial asset. 
( XXXX ) " Financial asset, '' except as otherwise provided in Section XXXX, means : ( i ) a security ; ( ii ) an obligation of a person or a share, participation, or other interest in a person or in property or an enterprise of a person, which is, or is of a type, dealt in or traded on financial markets, or which is recognized in any area in which it is issued or dealt in as a medium for investment ; or ( as this applies because the XXXX XXXX XXXX ) What is a mortgage? 
XXXX XXXX. Mortgages XXXX Definitions " The literal meaning of the word " mortgage '' is " dead pledge '', XXXX a mortuum vadium. XXXX The term " mortgage '' XXXX be employed as meaning the debt secured by the mortgage ; XXXX but in its true sense an ordinary mortgage is not a debt, XXXX as the debt is the principle obligation, and the mortgage is generally regarded as merely an incident or accessory to the XXXX A mortgage is an interest in land XXXX created by a written instrument XXXX providing security for the performance of a duty or payment of debt, XXXX and is usually evidenced by a note. XXXX ( do to the lack of signatures by the opposing party only our signatures to the contract are here ) Which makes the contract unenforceable and we sent communications certified mail to the responsible parties with no response from all accept XXXX Bank XXXX XXXX that stated that Fay Servicing is the party that needed to be addressed. They claimed they had no dealings with the transaction. Which was false, and according to the foreclosure case they were directly involved. 

The term qualified mortgage means ( A ) any obligation ( including any participation or certificate of beneficial ownership therein ) which is principally secured by an interest in real property and which ( i ) is transferred to the XXXX on the startup day in exchange for regular or residual interests in the XXXX, ( ii ) is purchased by the XXXX within the XXXX period beginning on the startup day XXXX XXXX XXXX XXXX G ) ( A ) ( XXXX ) What is a XXXX? 
XXXX XXXX XXXX : For purposes of this title, the terms real estate mortgage investment conduit and XXXX mean any entity ( XXXX ) to which an election to be treated as a XXXX applies for the taxable year and all prior taxable years, ( XXXX ) as of the close of the XXXX month beginning after the startup day and at all times thereafter, substantially all of the assets of which consist of qualified mortgages and permitted investments, ( B ) Inadvertent terminations If ( i ) an entity ceases to be a XXXX, XXXX XXXX XXXX : A corporation, trust, or XXXX shall not be considered a real estate investment trust for any taxable year unless ( XXXX ) it files with its return for the taxable year an election to be a real estate investment trust or has made such election for a previous taxable year, and such election has not been terminated or revoked under subsection ( g ) ; What must the XXXX do to foreclose on your property? 
XXXX XXXX XXXX ( XXXX ) SPECIAL RULES FOR FORECLOSURE PROPERTY ( XXXX ) FORECLOSURE PROPERTY DEFINED For purposes of this part, the term foreclosure property means any real property ( including interests in real property ), and any personal property incident to such real property, acquired by the real estate investment trust as the result of such trust having bid in such property at foreclosure, or having otherwise reduced such property to ownership or possession by agreement or process of law, after there was default ( or default was imminent ) on a lease of such property or on an indebtedness which such property secured. Such term does not include property acquired by the XXXX XXXX XXXX XXXX as a result of indebtedness arising from the sale or other disposition of property of the trust described in section XXXX ( a ) ( XXXX ) which was not originally acquired as foreclosure property. 

XXXX XXXX XXXX ( XXXX ) TAXPAYER MUST MAKE ELECTION Property shall be treated as foreclosure property for purposes of this part only if the real estate investment trust so elects ( in the manner provided in regulations prescribed by the Secretary ) on or before the due date ( including any extensions of time ) for filing its return of tax under this chapter for the taxable year in which such trust acquires such property. A real estate investment trust XXXX revoke any such election for a taxable year by filing the revocation ( in the manner provided by the XXXX ) on or before the due date ( including any extension of time ) for filing its return of tax under this chapter for the taxable year. If a trust revokes an election for any property, no election XXXX be made by the trust under this paragraph with respect to the property for any subsequent taxable year. 
What regulation are they talking about? lets take a look! 
https : XXXX Keep in mind that the taxpayer here is the XXXX, meaning the trustee who presides over the XXXX must XXXX these elections and do everything in his fiduciary power NOT TO COMPROMISE THE TAX STATUS OF THE XXXX! XXXX!! 

XXXX XXXX XXXX ( g ) TERMINATION OF ELECTION ( XXXX ) FAILURE TO QUALIFY An election under subsection ( c ) ( XXXX ) made by a corporation, trust, or XXXX shall terminate if the corporation, trust, or association is not a real estate investment trust to which the provisions of this part apply for the taxable year with respect to which the election is made, or for any succeeding taxable year unless paragraph ( XXXX ) applies. Such termination shall be effective for the taxable year for which the corporation, trust, or association is not a real estate investment trust to which the provisions of this part apply, and for all succeeding taxable years. 
( XXXX ) XXXX XXXX election under subsection ( c ) ( XXXX ) made by a corporation, trust, or association XXXX be revoked by it for any taxable year after the first taxable year for which the election is effective. 
A revocation under this paragraph shall be effective for the taxable year in which made and for all succeeding taxable years. Such revocation must be made on or before the XXXX day after the first day of the first taxable year for which the revocation is to be effective. Such revocation shall be made in such manner as the XXXX shall prescribe by regulations. 
( XXXX ) ELECTION AFTER TERMINATION OR REVOCATION Except as provided in paragraph ( XXXX ), if a corporation, trust, or association has made an election under subsection ( c ) ( XXXX ) and such election has been terminated or revoked under paragraph ( XXXX ) or paragraph ( XXXX ), such corporation, trust, or association ( and any successor corporation, trust, or association ) shall not be eligible to make an election under subsection ( c ) ( XXXX ) for any taxable year prior to the fifth taxable year which begins after the first taxable year for which such termination or revocation is effective. 
The servicer or attorney is liable for the tax, or whoever did not transfer it in time. Keep in mind that if the XXXX takes the defaulted note and transfers it after the 3 month deadline the whole XXXX loses it's tax status. 
How does a XXXX acquire property? 
Formation and Initial Transfer of Assets : When a XXXX is initially formed, it acquires a pool of mortgages or mortgage-backed assets from a transferor, typically using a trust agreement. This transfer is often part of the XXXX  creation, where the transferor places qualifying mortgages or mortgage-related assets into the XXXX structure XXXX 
Form XXXX, XXXX Real Estate Mortgage Investment Conduit ( XXXX ) Income Tax Return, is then used by the XXXX to report its income and tax elections but is not required to formally acquire the property. 
Foreclosure and XXXX for Foreclosure XXXX : When the XXXX acquires property through foreclosure or similar means ( if a borrower defaults on a mortgage within the XXXX ), it can make an election to treat the property as foreclosure property. This is done on Form XXXX by attaching a statement to the form for the tax year in which the XXXX acquires the property. 
This election classifies the foreclosed property as foreclosure property, which is important for favorable tax treatment, as it avoids having the income from the property treated as prohibited income for XXXX purposes. 
Reporting Requirements : While Form XXXX is the primary reporting form, theres no form specifically required to acquire property into the XXXX. Instead, the acquisition is documented through legal agreements and records with the trust XXXX, often filed in county records for foreclosures. 
Schedule Q ( Form XXXX ) is also used by the XXXX to report information to residual interest holders, including details about the income and property held by the XXXX. 

Form XXXX Statement : This statement is an attachment to Form XXXX, XXXX Real Estate Mortgage Investment Conduit ( XXXX ) Income Tax Return. 
It includes details about the property that the XXXX acquired through foreclosure and an explicit election under IRC XXXX ( XXXX ) to treat the property as foreclosure property. 
Purpose : This election allows the XXXX to classify the property as foreclosure property for tax purposes, meaning it can avoid taxes on income that would otherwise be considered non-qualifying income. 
Form XXXX : Form XXXX is issued by a lender when there is an acquisition or abandonment of secured property, typically by a financial institution to report the acquisition or abandonment of property to both the IRS and the borrower XXXX 
Purpose : For the XXXX, Form XXXX is relevant only if the XXXX must report the acquisition or abandonment of a secured property ( typically when the borrower defaults and the XXXX acquires XXXX property ). The XXXX might use Form XXXX to document the foreclosure for reporting purposes. 
Key Detail : Form XXXX is sent to the IRS and the borrower, while the election statement attached to Form XXXX is only for the IRS to XXXX the foreclosure property status. 
and now the entire fund has been compromised ..... 
FORM XXXX AND FORM XXXX were issued to the IRS on all the financial institutions involved and all other persons breach of this relationship lack of disclosure etc .... 

In order to transfer or assign a mortgage one must satisfy the mortgage meaning it was paid in exchange for the asset. I notice the fraudulent recording of the mortgage on public record as there were issues with chain of title and recording and by using affiliations and quid pro quo tactics these institutions are stealing properties all across the United States. We have requested an audit from the internal revenue service for the matter. 

the company discharges its obligations with the XXXX Treasury. All deposits notes bills bonds coupon etc ... .as per XXXX prospectus XXXX XXXX company is the registered agent to XXXXXXXX XXXX XXXXXXXX XXXX and is now liable for damages we seek... 

this is a tax issue, payment means to perform and these companies did not perform therefore we revoke there power of attorney over the transaction. We have a right to opt of the sharing of our information. These companies have a fiduciary duty to handle these accounts properly and these companies listed are repeat offenders of major violations and have been disciplined as such. Yet they continue to defraud the public interest the government the financial industry etc. The asset has been foreclosed on and sold and threats have been made to us. As we seek equitable relief and to restore our rights we have now begun alerting the property authorities. We pray for relief in the matter In XXXX we trust. 

Issues : Lack and Failure of Consideration Failure to Comply with Notice Provisions Failure to Comply with Release Provisions Electing the fraud Remedy Non-justified threats of physical harm, criminal prosecution or financial ruin XXXX XXXX XXXX XXXX XXXX or Benefit Non-waiver Provisions Unclean hands Doctrine Absence of impairment of security tender of payment etc... 

Following disciplinary actions as to the complaint being made. 
CFPB TAKES ACTION AGAINST FAY SERVICING FOR ILLEGAL FORECLOSURE ACTIONS AND VIOLATING LAW ENFORCEMENT ORDER XXXX XXXX XXXX XX/XX/XXXX FOLLOWING THE INVESTIGATION FROM XXXX. 

XXXX XXXX XXXX XXXX XXXX PENALTY FOR VIOLATIONS OF ANTI-MONEY LAUNDERING LAWS. XX/XX/XXXXXXXX XXXX XXXX XXXX XXXX XXXX XXXX XXXX SPECIAL PURPOSE ENTITIES are powerful financial tools. Can be either on and offshore and normally Off-balance sheet, bankruptcy remote, and illegitimate uses. They can be structures that lend themselves to money laundering, disguised as loans of revenue misstate earning through wash trades, concealment of losses embezzlement and accounting improprieties the asset was granted conveyed and transferred to XXXX XXXX XXXX REVOCABLE LIVING TRUST by the OWNER of FROM THE MUSCLE INVESTMENTS as true owner of the asset. Poa filled with the internal revenue service The account has been pledged and assigned to the XXXX Treasury per XXXX XXXX & XXXX filed in the great state of XXXX XXXX. non XXXX agricultural XXXX... 

We are left at alerting the regulatory authorities for this breach of fiduciary duty and a host of other violations. CFPB, XXXX, SEC, FDIC, FTC, FBI, IRS, TREASURY, XXXX, XXXX, ATTORNEY GENERAL etc .... 

we tried to upload supporting documents but they wont take

Company response to consumer: Closed with explanation