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Sunday, February 8, 2015

How To Frack a Mortgage. It’s Easy as Pie!

"Alma Hasse (Worked in the mortgage industry for 14 years in California, doing everything from “filling out applications,” to managing the Palmdale branch of the American Bankers Mortgage Corporation.): So in talking about the private property rights, most people don’t have the ability to go pay cash for their property, so most people have a mortgage on their home or their land. And those mortgages, 90 percent of those mortgages, have some sort of a government guarantee or insurance associated with them: FHA, VA, Fannie Mae, Freddie Mac. And in every Uniform Deed of Trust in which those mortgages use, if it has a guarantee or insurance that the government backs it has to have this Uniform Deed of Trust, there is paragraph in there titled “Hazardous Substances”, and that paragraph says that you, the buyer, can not do certain things to this property because this property is our, the lender’s security and collateral, and specifically, what that paragraph says is that you cannot do anything that could cause environmental contamination or degradation to our, the lender’s collateral. And it goes even further. It actually says not only can you not do it to our property but you can’t do anything that could cause environmental contamination to your neighbor’s property as well. And the very next paragraph is entitled “Acceleration Remedies”. So, not only can you not do these things, but if you do these things with our security, or this property, we can accelerate your note and call it due. We can find you in default and say you’ve got to come up with $150,000 to pay this off because you’re… you have just violated our contractual obligation.

Koch: And if you don’t, you could lose your home?

Hasse: Yes. They could foreclose on you. They can find you in default and foreclose on you. Absolutely, yes.

Koch: And I'm sure that these companies are aware of that clause?

Hasse: Well, they claim they are not. Mr. Peiserich (attorney for Alta Mesa Idaho and partner with Perkins, Peiserich, Greathouse, Morgan, Rankin of Little Rock, Arkansas) claimed he had never heard of it in a meeting in Payette County about three years ago but, at that point in time we had already seen lenders have problems getting new loans for potential buyers of property because there was a lease on the property. They would not loan. So, he claimed ignorance on it back then. He’s certainly aware of it now because I’ve brought it up multiple, multiple times. But, every time I bring it up in a meeting they don’t want to talk about it. Which is very interesting to me. Quite frankly I think we need to have a class-action lawsuit because they landsmen aren’t disclosing this at all. And what happens is, they’re making all these promises to people without their… they’re giving them information that is not factual. In fact in a lot of the cases they are flat out lying to people, telling them that signing this lease will have no impact on their private property rights, or their mortgage, or their insurance, and that is patently false. It can impact all of these. "

*Correspondence with local bank PNC included in the above report from