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STATE OF WASHINGTON

DEPARTMENT OF COMMERCE
1011 Plum Street SE ! PO Box 42525 ! Olympia, Washington 98504-2525 ! (360) 725-4000
www.commerce.wa.gov

FORECLOSURE FAIRNESS PROGRAM MEMORANDUM

DATE: January 30, 2018

TO: Diane Klontz

FROM: Nathan Peppin, Foreclosure Fairness Program Manager

SUBJECT: Mr. Levitz’s & Mr. King’s request to reopen or begin a new mediation

BACKGROUND:
Commerce received a referral from Matthew W. Anderson, PLLC on 5/18/2016 for Mr. Levitz’s home
located in Seattle, WA. Per the referral the Notice of Default was issued 12/26/2012 and the Notice of
Trustee Sale was recorded 4/28/2016 with a Trustee sale date scheduled for 8/26/2016. The referral
was sent to Quality Loan Service Corp. on 5/19/2016 and assigned to mediator Allyson Henry on the
same day. Between 5/19/2016 and the date we received the Certification from the mediator on
9/1/2016 we received only one piece of correspondence. On 7/7/2016 Mrs. Henry sent an email
regarding the mediation scheduling notice identifying August 1, 2016 as the scheduled date. On
9/1/2016 the program received the Certification from Mrs. Henry identifying the session occurred but
no agreement was reached. Additionally the note “Borrower wanted contact information regarding
selling part of the land covered by mortgage.” was included.

HOMEOWNER, MEDIATOR AND STAKEHOLDER CONTACT AND ISSUES RAISED:

Homeowner – Mr. Levitz:


On 1/8/2016 Nancy Ogden of the program sent Mr. King an email containing Mr. Levitz’s certification.
We do not have a record of the request by Mr. King but the email references a request for the
information. On 1/9/2016 Mr. Levitz sent two broadcast emails to multiple AAG’s, the mediator, his
prior attorney, the foreclosure program and Mr. King. That email requested his mediation be reopened
for bad faith after the fact. In his emails Mr. Levitz’s cites:

• A violation of law regarding the certification based on a lack of comments for a certification
where no agreement was reached and no NPV test was conducted.
• Dual tracking, which appears to be a current allegation, however he references his inability to
contact anyone in 2009 when he states he was ready to pay off the loan.
• That he filed a formal complaint with the AG’s office a few days prior to his 1/9/2016 email
based on government documents which indicate why he could not contact the bank in 2009 and

that the Trust involved are not registered and/or did not exist and MERS assigned things without
authority.
• States his lawyer failed to diligently represent his interest, that an agreement was reached, and
that agreement was a sale of the property to satisfy the lien, not a short sale.
• Statement that a review of the Beneficiary Declaration will show MERS as part of the chain of
title with assignments that are void and cites a Court of Appeals case Grant v. First Horizon,
QLSC et al. SLS had all of the RMA information because Mr. Levitz was working with the Urban League.
SLS had his food stamp info, all of it. Allyson Henry is full of shit and the SLS Contingency sale document proves this.
This all echoes the complaint about her counseling service i.e. “negligence and disdain.”
Mediator – Allyson Henry: I note further that the Department refused to reach out to Counsel for Mr. Levitz, nice.
On the same day, 1/9/2018, Mrs. Henry, the mediator, replied via email that after reviewing the emails
associated with the case that she would not be reopening the case. In a subsequent email on 1/10/2018
Mrs. Henry communicated to the program that an NPV is not required and was not done because Mr.
Levitz failed to submit a Request for Mortgage Assistance (RMA) package and the other required
documents to verify income. Mrs. Henry then forwarded a series of email from the mediation which
documented this and an email that affirmed she would not update the certification with the information
she had provided the program. She additionally addressed the agreement regarding the sale of land and
communicated that was solely the idea of the borrower and there was no agreement regarding a
specific path as they could not address the viability of the plan. It would be incumbent on Mr. Levitz to
sell the parcel at an amount to retire the debt.

Stakeholder – Mr. King:
Mr. King’s first email was received on 1/16/2018 and was followed by a string of 25 back and forth
emails regarding his request to reopen or begin a new mediation. The issues presented are similar in
nature to Mr. Levitz’s and included:

• The assertion that the mediator certification does not comply with law or Commerce’s
guidelines. That no income documentation was provided because a) a modified loan was not
being requested and b) Mr. Levitz had no income in 2016.
• An agreement was reached during mediation regarding the land disposition that did not
contemplate a short sale.
• Dual tracking occurred.
• Chain of title and assignments by MERS are in conflict with law.

On January 25, 2018 Mr. King provided the link to a video that recorded his portion of a call with Mrs.
Klontz. In that video Mr. King identifies 3 issues he would like Mrs. Klontz to respond to:

• There was an agreement regarding the sale of the land
• Mediator certification.
• Dual tracking was present despite SLS letter providing conditions of a sale.


PROGRAM RESPONSE:

• Agreement regarding the sale of the land – the parties do not agree on the “agreement” that
was in place. Mr. King has provided snippets of documents but we have not seen the complete
document. Mr. Levitz’s assertion that the agreement was not related to a short sale is not
supported by the snippet of his attorney’s letter, which describes his notes including a “short
The Department lied. I submitted the entire letter from Attorney Anderson on 17 January 2018.
Also, I did not provide the entire SLS letter, only the relevant part noting approval to sell the property.
If the Department is now claiming that SLS refused to back off of the arrearages then what would be
the point of Mediation in the first place? Exactly. None. And SLS would have been coming in Bad Faith.

Also, it’s not as if the Department really gave a shit. They called the Mediator who covered her own ass,
but the Memo fails to indicate where they contacted Attorney Anderson even though he specifically invited
the Department to do so. Bureaucrats hard at work.

negotiated payoff offer” or by the SLS snippet which identifies a “Short Sale – Contingently
Approve”.

The documentation provided to date appears to support the mediator’s recollection that Mr.
Levitz was provided the opportunity to sell the property and there is no evidence that supports
the claim the beneficiary agreed to waive arrearages.
Claim a property, so what. The point was they were supposed to work with Attorney Anderson and the Urban League on that.
Anyone can Quit
Assuming there was a clear, documented and enforceable agreement, Commerce does not have
the authority to enforce it. Mr. Levitz would need to ask a court to enforce the agreement. It is a
civil matter outside the bounds of the program. This is communicated explicitly in the guidelines
(page 9).

• Certification – The language in the guidelines is unfortunately contradictory. In the “Net Present
Value Requirements” Page 16 “2. Was an NPV test/analysis completed?” it states that if an
agreement was not reached and no NPV was performed “the mediator must provide an
explanation on the certification”. Additionally there is language in the “Guidance Regarding
Certifications/Reports” that “ALL fields must be completed” (page 24 item 4).

In regard to the “must” there is simply no basis in statute to require this. When no agreement is
reached and an NPV test wasn’t performed a mediator may provide additional information as to
why but has no requirement to do so. The fields being referred to are the base of the document.
Comments and the comment sections are called out separately in the guidelines however this
distinction is not explicit when referring to “all fields”.

Ultimately the Introduction to the guidelines does explicitly state they are best practices, non-
binding, and the only determinative requirements come from statute. The program reached out
to the mediator and asked Mrs. Henry to add comments and she denied our request. The form
is not incomplete or inaccurate per statute and we have no basis to require a modification or
provide Mr. Levitz with a second mediation due to the lack of comments.
Oh, great so you reached out to Mediator Allyson Henry (but not Attorney Anderson) and she refused to provide any explanation. You plan on continuing to use her?

Finally, Mr. King’s asserted that providing financial documents wasn’t necessary because Mr.
Levitz had no income. This is incorrect. The financial institution must verify the lack of income
with tax returns, bank statements, etc. If a hardship is being claimed, which is a necessary
component of a short sale and/or forgiveness of interest and fees that had accumulated, it is
incumbent upon the borrower to provide the necessary information to document that hardship.
In this case those documents were not provided.

• Dual tracking & Chain of Title – Both issues are a matter of law. Commerce has no authority to
determine the merits of the claims being made by Mr. King. It has been communicated by Mr.
Levitz that a complaint has been filed with the Attorney General’s office, which is one option for
these issues. It may also be necessary for Mr. Levitz to file a court action on his own behalf as
the AG’s office cannot represent or act on behalf of an individual borrower. If the outcome of
any such court action resulted in a new NOD/NOTS Mr. Levitz could be referred into the
program again.

For years and years we have been telling DoC that they can’t be accepting the Beneficiary Declaration as carte blanche.
These financial institutions will lie and commit False and Deceptive Acts, as noted in the links I provided
to actions the Department of Financial Institutions has taken relative to MERS being a False and Deceptive Business Practice.

Why must it take a full-blown Trial such as the one I filmed in Bradburn v. ReconTrust to shame a Beneficiary into admitting
that their self-serving Declaration is completely false?

Washington Foreclosure Attorney Scott Stafne Oral Arguments in Bradburn v ReconTrust Fraudclosure.
https://www.youtube.com/watch?v=IIvdb_p3ftU

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