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Nothing is or was securitized. No sale of any asset occurred.

The main obstacle to homeowner success in the courtroom is the asymmetry of information causing the homeowner to believe that they were part of a loan transaction instead of merely being compensated for a concealed business plan that was completely reliant on the homeowner’s unknowing cooperation. The homeowner did not receive this information for two reasons. First, no reasonable person would accept the deal without significant compensation. Second, no reasonable person would accept the deal at all. 

Just to add some clarity and simplicity — none of the paper issued and sold by Wall Street brokerage firms was backed by anything. It is erroneous to assume that any sale of any asset occurred. Securities were sold but none of them represented any ownership, right, title, or interest in any asset.

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Accordingly, it is equally wrong to assume that any investor acquired any right, title, or interest to any scheduled payment from homeowners. They did not. The problem is that most people start with the erroneous assumption that something was securitized. All of the certificates, hedge contracts, derivatives, and insurance products were bets based upon discretionary data coming from the insured — the brokerage firm.

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This became crystal clear when TARP came into existence. First, it was to bail out mortgage losses from homeowner defaults, then it was to bail out losses from owning the certificates that were supposedly backed by loans, then it was simply used to corporate welfare — resulting in the creation of Maiden Lane entities to launder the title creating the illusion of a legal creditor owning a loan account receivable. “workouts” and “modifications” are
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Wall Street’s attempt to have the homeowner agree later to what the securities brokerage firm (aka investment bank) intended when the loan was first originated or acquired. Such agreements substitute a new party as the stated or named creditor. It requires acknowledgment that this new party (usually a “servicer’ who performs no servicing, thanks to SaaS), will be treated as though an obligation payable by the homeowner exists on its ledgers. And it presumes that payment of value for the underlying obligation was made by this new entity. None of this is true.
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PRACTICE NOTE: The reason why any homeowner can win a foreclosure is that none of the parties in the foreclosure team or the securitization team have ever paid for the underlying obligation in exchange for a conveyance of ownership of the debt, note, or mortgage. This produces a failure of condition precedent for enforcement and collection. See Article 9 §203 UCC. This is not “proven” by the homeowner. It is revealed through negative inference against the foreclosure mill team. That inference arises when they fail to produce and even assert that they have made such payment.
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The main obstacle to homeowner success in the courtroom is the asymmetry of information causing the homeowner to believe that they were part of a loan transaction instead of merely being compensated for a concealed business plan that was completely reliant on the homeowner’s unknowing cooperation. The homeowner did not receive this information for two reasons. First, no reasonable person would accept the deal without significant compensation. Second, no reasonable person would accept the deal at all. 
DID YOU LIKE THIS ARTICLE?

Nobody paid me to write this. I am self-funded, supported only by donations. My mission is to stop foreclosures and other collection efforts against homeowners and consumers without proof of loss. If you want to support this effort please click on this link and donate as much as you feel you can afford.

Please Donate to Support Neil Garfield’s Efforts to Stop Foreclosure Fraud.

Click

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Neil F Garfield, MBA, JD, 73, is a Florida licensed trial and appellate attorney since 1977. He has received multiple academic and achievement awards in business and law. He is a former investment banker, securities broker, securities analyst, and financial analyst.
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CLICK HERE FOR REGISTRATION FORM. It is free, with no obligation and we keep all information private. The information you provide is not used for any purpose except for providing services you order or request from us. In  the meanwhile you can order any of the following:
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CLICK HERE ORDER ADMINISTRATIVE STRATEGY, ANALYSIS AND NARRATIVE. This could be all you need to preserve your objections and defenses to administration, collection or enforcement of your obligation. Suggestions for discovery demands are included.
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CLICK HERE TO ORDER TERA – not necessary if you order PDR PREMIUM.
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CLICK HERE TO ORDER CONSULT (not necessary if you order PDR)
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CLICK HERE TO ORDER PRELIMINARY DOCUMENT REVIEW (PDR) (PDR PLUS or BASIC includes 30 minute recorded CONSULT)
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FORECLOSURE DEFENSE IS NOT SIMPLE. THERE IS NO GUARANTEE OF A FAVORABLE RESULT. THE FORECLOSURE MILLS WILL DO EVERYTHING POSSIBLE TO WEAR YOU DOWN AND UNDERMINE YOUR CONFIDENCE. ALL EVIDENCE SHOWS THAT NO MEANINGFUL SETTLEMENT OCCURS UNTIL THE 11TH HOUR OF LITIGATION.
  • But challenging the “servicers” and other claimants before they seek enforcement can delay action by them for as much as 12 years or more.
  • Yes you DO need a lawyer.
  • If you wish to retain me as a legal consultant please write to me at neilfgarfield@hotmail.com.
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Please visit www.lendinglies.com for more information.

Latest Moratorium Extensions Are Two-Edged Sword

The new president is facing incoming fire from all directions. If he does not extend the moratorium on foreclosures and evictions, hundreds of thousands of people are going to be homeless. But the extension does not come without costs.
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As you have seen on these pages, I am quite confident that none of the scheduled payments from homeowners are legally due. On the other hand, I am loathe to tell homeowners or tenants that they should withhold payments if they can make them.
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The reason is basically extortion or duress. By withholding a scheduled payment without a court order telling you can don’t need to make the payment, you put yourself and your home in jeopardy. the Wall Street foreclosure team will use that as their excuse for pursuing collection and enforcement ending in foreclosure and eviction if you don’t properly defend.
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The situation with tenants is even more dire. Many if not most rental units are owned by small landlords who do not possess the resources to get through this pandemic period. When the time comes that their units are exempted from moratoriums by time or edict, they will be required to pay the “arrearage” just like everyone else. Those homeowners who are using the moratorium as an excuse to withhold payment without having a plan of attack are headed for trouble — possibly the kind they can’t fix.
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The obvious answer to this problem is for homeowners to launch preemptive lawsuits against the securitization team. But my observations and experience show that most judges will not allow such lawsuits to go forward. this is because it is seen as an attack on the financial system generally and because judges are afraid that allowing such lawsuits will invite many more that will clog all the court systems. I have had many judges agree that the lawsuit did state a claim but dismissed it anyway sometimes after as much as 14 months of sitting on the motion to dismiss.
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Some people believe that the judges don’t get it. But most of them do “get it” — at least in part. Since those judges believe the loan exists, the loan account exists and that the homeowners almost certainly owe the payments, they see little harm in waiting until enforcement action is brought against the offending homeowner. Then they will occasionally rule in favor of a homeowner who reveals fatal deficiencies in the proof of the claim.
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It is during the moratorium periods that homeowners have an unprecedented opportunity to start actions against the securitization team — but not entirely the way most might think. By sending a proper Qualified Written Request and Debt Validation Letter you open up a more palatable action for the Judges in advance of enforcement. This is the opening step in the homeowner’s challenge.
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They must answer and they risk some rather harsh sanctions if they lie — so they withhold information. But the information they give in response to the statutory inquiries will most likely contain inconsistencies with their correspondence.
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Your questions need to be very specific. And they should start with existence, ownership, and authority over a loan account receivable on the ledger of some company; that entry can only be legal and valid if value was paid in exchange for a conveyance of ownership of the loan account receivable (aka underlying debt or underlying obligation). This is the most basic requirement established by law and custom over centuries in English common law and statutes, American common law; it is also established as the law in every jurisdiction in their adoption of Article 9 §203 of the Uniform Commercial Code.
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Next, the homeowner can file a complaint with the Consumer Financial Protection Board and the Consumer Division of the Attorney General of their State. Once again a response is mandated by statute and the securitization/foreclosure team does no dare withhold a response. but once again their response is going to be filled with legalese evasion of admitting the simple fact that they don’t own the loan account receivable and they have not been given any authority from anyone who does own it.
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Homeowners should not allege nor try to prove that all securitization of residential “debt” is a fraudulent scheme or a lie, even though that is true. It scares judges and it sounds like a conspiracy theory to them. So keep it simple and to the point.
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Foreclosure is about restitution for an unpaid debt. If the claiming party has no actual ownership of the debt arising from a real-world transaction in which they paid value in exchange for owning the loan account receivable they fail the test of the condition precedent set forth in 9-203 of the UCC. And that opens the door to “limited” actions for violations of the FDCPA (title X, 124 Stat. 2092 (2010) and other statutes. Those statutes have a bite to them and the foreclosure mills are afraid of them.
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The advantage of the preemptive action by the homeowner is that very often the securitization/collection/foreclosure team is not ready with fabricated documents containing false information about transactions that never occurred.
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The rule of thumb is to create a vehicle that can be gradually expanded as more information is obtained and the judge is gradually educated as to the true facts of the case. And remember that attorney fees are often recoverable in such actions along with statutory or compensatory damages.
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Once filed and discovery is underway, the best practice is to take information gleaned from discovery and then request a leave of court to amend the pleadings to include a broader action for declaratory, injunctive, and supplemental relief.
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The homeowner would be seeking damages for illegally trying to enforce a debt, and disgorgement of amounts paid to parties who had no nexus to ownership, or authority over the claimed “debt.” While this premise is true in virtually all cases in which securitization claims were in play, it can only be established by revealing the inability or unwillingness of the opposition to answer the most basic questions about existence, ownership, and authority over the debt.
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They can’t but you must do much more than accusing them. You must out litigate them which is why you most likely should have a lawyer who knows how to file motions to dismiss, discovery requests and motions to enforce discovery requests, along with motions for sanctions, motions for the court to adopt a negative inference against the opposition and motions in limine.
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If small landlords take heed, they can force the situation to tilt in their own favor, pass some of the savings to tenants and come out the other end of this crisis somewhat intact. If they don’t then it is unlikely that many of them will survive after the moratorium ceases unless their tenants have been paying rent in a timely fashion.
DID YOU LIKE THIS ARTICLE?

Nobody paid me to write this. I am self-funded, supported only by donations. My mission is to stop foreclosures and other collection efforts against homeowners and consumers without proof of loss. If you want to support this effort please click on this link and donate as much as you feel you can afford. 

Please Donate to Support Neil Garfield’s Efforts to Stop Foreclosure Fraud.

Click

*
Neil F Garfield, MBA, JD, 73, is a Florida licensed trial and appellate attorney since 1977. He has received multiple academic and achievement awards in business and law. He is a former investment banker, securities broker, securities analyst, and financial analyst.
*

FREE REVIEW: Don’t wait, Act NOW!

CLICK HERE FOR REGISTRATION FORM. It is free, with no obligation and we keep all information private. The information you provide is not used for any purpose except for providing services you order or request from us. In  the meanwhile you can order any of the following:
CLICK HERE ORDER ADMINISTRATIVE STRATEGY, ANALYSIS AND NARRATIVE. This could be all you need to preserve your objections and defenses to administration, collection or enforcement of your obligation. Suggestions for discovery demands are included.
*
CLICK HERE TO ORDER TERA – not necessary if you order PDR PREMIUM.
*
CLICK HERE TO ORDER CONSULT (not necessary if you order PDR)
*
*
CLICK HERE TO ORDER PRELIMINARY DOCUMENT REVIEW (PDR) (PDR PLUS or BASIC includes 30 minute recorded CONSULT)
*
FORECLOSURE DEFENSE IS NOT SIMPLE. THERE IS NO GUARANTEE OF A FAVORABLE RESULT. THE FORECLOSURE MILLS WILL DO EVERYTHING POSSIBLE TO WEAR YOU DOWN AND UNDERMINE YOUR CONFIDENCE. ALL EVIDENCE SHOWS THAT NO MEANINGFUL SETTLEMENT OCCURS UNTIL THE 11TH HOUR OF LITIGATION.
  • But challenging the “servicers” and other claimants before they seek enforcement can delay action by them for as much as 12 years or more.
  • Yes you DO need a lawyer.
  • If you wish to retain me as a legal consultant please write to me at neilfgarfield@hotmail.com.
Please visit www.lendinglies.com for more information.

“It Must Be a Loan”: Don’t Pretend You Read and Understand the Documents

“Because corporations and their lawyers know most consumers don’t have the time or wherewithal to study their new terms, which can stretch to 20,000 words — about the length of Shakespeare’s “Julius Caesar” — they stuff them with opaque provisions and lengthy legalistic explanations meant to confuse or obfuscate. Understanding a typical company’s terms, according to one study, requires 14 years of education, which is beyond the level most Americans attain.” NY Times Editorial

Most homeowners sign documents at closing (or modification) because they believe their intentions are properly presented in those documents. They are wrong and they don’t like admitting that. We have accepted a world in which lay people are told that lawyers revewing contracts are pointless. And even where lawyers are employed, they rarely possess the skill set necessary to understand what is really happening. Everyone sees the deal through filters that require the reader to think of the deal as a loan — without any critical thinking or knowledge. — Neil F Garfield, April 6, 2006

Anyone who thinks that stockbrokers have an interest other than a profit from the sale of securities does not understand centuries of marketplace transactions, laws, rules, customs, and practices. Banks make loans. Private lenders make loans. Brokers don’t; by definition, they are supposed to be intermediaries. Periodically these brokers on Wall Street have tried to pull the wool over the eyes of regulators and investors so that they still appear to be intermediaries when in fact they are the only principal. The result has always been, without exception, catastrophic for everyone except the brokers who use a common theme: “You can’t punish us with producing apocalyptic results for finance, and your society.” As a society, we are still buying into that threat. It isn’t true and never was true. And so it goes.

The Times’ editorial points out that tech companies are using and abusing “shrink-wrapped” agreements and policies that the consumer must click “Agree” in order to gain access — often to their own information. This is not a new concept. I remember when I was on Wall Street and we were drafting prospectuses and agreements for Initial Public Offerings, one of our guiding principles was to bury anything negative under an avalanche of words. And because nobody wants to admit they did anything stupid or foolish, investors tend to think and insist they knew what they were doing. And that is why those of us who are insiders in securities brokerage privately refer to the New York Stock Exchange as the world’s largest dry-cleaning establishment.

[Hat Tip to Bill Paatalo] And that is the essence of successful con jobs. As a lawyer, I have represented some highly successful con men. And they all told me the same thing. the con only works if the “mark” (i.e., sucker) adopts it as their own. People con themselves. Take Charles C Parker for example:

George C. Parker (March 16, 1860[1] – 1936) was an American con man and prophet best known for his surprisingly successful attempts to “sell” the Brooklyn Bridge…Parker used various names as a con man, including James J. O’Brien, Warden Kennedy, Mr. Roberts and Mr. Taylor.[4]

In addition to his Brooklyn Bridge scam, other public landmarks he incorporated into his scams included the original Madison Square Garden, the Metropolitan Museum of ArtGrant’s Tomb and the Statue of Liberty.[5] Parker had multiple methods for making his sales. When he sold Grant’s Tomb, he would often pose as the general’s grandson, and he set up a fake office to handle his real estate swindles. He produced convincing forged documents as evidence to suggest that he was the legal owner of whatever property he was selling. He also sold several successful shows and plays, of which he had no legal ownership.[2] 

Like the mortgage meltdown (which continues through the writing of this article), in many (but not all) cases, Parker targeted people fresh off the boat who understood little English or American Culture. So they relied upon what he told them and then they imagined the rest. Some people were forced off the Brooklyn Bridge when they started erecting toll booths, as the new owners.

In every con job the paperwork generally has the look and feel of real documents and says, in the beginning, what you expect it to say. So people who do not have 12 weeks to parse thought the language of everything said and not said, simply assume the rest. They are conning themselves. And the perpetrators will often point to the content of what was signed by the layman as providing that the very thing that punished the consumer was disclosed in some fine print wording buried deep within all of the documents that were signed. And I can tell you from personal experience that the art of writing such documents on Wall Street relies heavily on implying something without saying it.

For example, a loan in 1980 would always refer to the loan and would recite that the Lender was Lender who was giving a loan of money to the borrower who was a borrower, receipt of which loan was acknowledged. That is and was the basic language for any loan for centuries — until around 1998. That is when the reference to a loan was dropped and the documents signed by the homeowners started to change —merely referred to the execution of a note and the execution and recording of a mortgage. The loan was implied because what else could it be? The success of this sleight of hand is well-known. Trillions of dollars poured through the hands of securities brokers who prospered during the worst crash since the Great Depression — plus receiving trillions of dollars in “bailouts” and “bond purchases.” Everything else was reduced to rubble.

But consumers and their lawyers have still failed to appreciate the significance of this paradigm shift. Under the new framework, any payment could be dressed up as a loan and therefore a legal demand for its return would be legal, proper, ethical, and moral because it was a loan.

The way this works to the extreme disadvantage of homeowners as consumers and the extreme advantage of Wall Street “banks” is this: First the con (hook): “We are lenders and you’re making applications for a loan. Therefore any transaction we do is a loan.” Then the consequences in which “We never said that we were giving you a loan. We only said we would call it that.” And the “borrower” is left without any responsible party being a lender, no loan account receivable, no creditor, no compliance with lending laws, and that means there is nobody with authority to do anything about your loan like administration, collection, modification, or enforcement. Is that a loan?

Let’s go back to the beginning. The expectation of the homeowner was that he/she was a borrower in a loan transaction. He/she thought that the application for a loan was submitted to a lender and was underwritten by someone with a risk of loss — i.e. a stake in the success of the transaction as a loan. He/she had a reasonable belief that as a loan transaction the party receiving the loan application and the party underwriting the transaction were both governed by Federal and State lending laws. As such, the responsibility for the viability of the loan, accuracy of the loan appraisal, and risk of loss was squarely on the “lender.”

Wall Street banks did what they do — the separated out functions so that only the part that looked like a loan was shown to the homeowner. For the most part, applications for loans were submitted through intermediaries who presented themselves as loan brokers and sometimes misrepresented themselves as lenders (simply because they had a license to act as a lender). In some cases, the parties accepting the applications did not legally exist. They were just names — but that did not matter to Wall Street brokers because they were not really making loans.

The underwriters were aggregators of data providing a service (e.g. Countrywide)— i.e. laundering data to make it look like a pool of loans was being created for “tranches” (layers) of fictitious entities. This service was provided to the brokers through entities totally under the control of the brokers  — for purposes of their real business — selling securities to investors. (Does anyone really think that Wall Street banks ever had any interest in lending money?)

The “aggregators” arranged the data in reports that gave information on thousands of transactions. They never said they were loans and they never said they owned them. But that is what everyone assumes. We are conning ourselves because we can’t imagine what else it could be.

The Wall Street stock brokerage firm calling itself an “investment bank” borrows $1 Billion on short-term credit for example using expected sales of securities as collateral. The broker then sells the securities to investors and repays the loans. In the interim, the money from the loan is used to fund, on average, around $700 million in transactions with homeowners.

The other $300 million is concealed “trading profit”. These fictitious profits occur when the broker shows a sale (only on its own books) of $700 million face value of notes for $1 billion. That false “sale” occurs between a “depositor” who does not own the debt, note, or security agreement and a “trust” that legally does not exist because it has nothing in trust that was entrusted to the named “trustee”. the “trustee” has no right, title or interest in the transactions, nor any right or obligation to seek or receive any information about the nonexistent contents of the”trust” or any activities undertaken in the name of the “trust.” (In other words, it is not a trustee).

All entities are owned or controlled 100% by the broker. This is the holy grail of investment banking. Selling securities without being required to turn the proceeds of the sale (money) over to any issuing entity because in substance the issuing entity is the broker. The extra $300 million trading profit is usually performed in a transaction that is both offshore and off-balance sheet so there is no report of it — until the broker wants to show an increase in profits to bolster the apparent value of its own common stock trading in the marketplace. Recent reports from the big “banks” that are in reality failing, indicate significant “trading profits” that are simply repatriating the money they stole from investors.

Investors were never told all of their money would be used for the origination or acquisition of loans. They just assumed it despite concealed language in the prospectus that did not quite promise anything other than a potential, discretionary revenue stream from the broker that was often disclosed as unsecured and expressly unrelated to any obligation owed by any homeowner. Investors made this assumption because after all the brokerage firm was a broker, not a principal. They were conning themselves. Investors were NOT beneficiaries of any trust, real or imagined but they thought they were because they assumed they were.

It was later when investors (e.g. pension funds) discovered that the broker had no interest in underwriting loans, no interest or intent of having a risk of loss or no intent for complying with any lending statutes, rules, or even custom and practice in the lending industry; investors were rudely awakened to the fact that they had no legal interest in enforcing anything against anyone. They had, as in every con, conned themselves with an assist from the con men — Wall Street brokers.

Investors were left with a “Security” that was virtually worthless because it was discretionary, unsecured, and based upon reports that the payor (broker) could issue in its sole discretion. But if they admitted all of that, they would be required to show the loss of value of the “certificates” (securities) that they had purchased which would result in devaluing the entire pension fund, which in turn would probably lead to dismissal of the fund manager.

So they sued the depositors or “sellers” for bad underwriting even though there was virtually no underwriting involved. The more savvy investors with more savvy lawyers received larger settlements without ever saying the whole thing as a scam — because they were being paid to keep silent about the true nature of this scheme. The smaller, more unsophisticated investors with lawyers who were not well versed in investment banking and securities brokerage received as little as 20-30 cents for each dollar they invested. That is what caused small banks to fail. They were trapped by the con. They too had been investors seeking a “higher return.”

The truth is that most pension funds are over-reporting the value of their assets. That means that at some time in the future, the ability to fulfill pension payments will be correspondingly reduced. Only by that time, it is highly likely that nobody will make the connection to “securitization debt” that never occurred. Even worse, the beneficiaries of pension funds and other stable managed funds still won’t realize that if they are faced with foreclosure, and they all away, they are not just giving up the largest investment of their life; they are also undermining the value of the fund that feeds them.

All of that leads to the question of what can homeowners do about this?

The answer is simple and reduced to three elements — existence, ownership, and authority. In the 1980 loan, the Lender had an entry on its ledger that was a reduction of cash to pay for the loan. In double-entry bookkeeping, this was followed by an increase in loan receivables by the exact same amount. And that is how the loan account receivable is created. It serves as the legal basis for asserting the existence of the loan and the account history for debits and credits throughout the life of the loan.

As some readers have divined from what I have written above (and elsewhere), no such account was ever created. If those ledger entries had been made, then the brokers would have actually securitized loans by selling off pieces of each loan to multiple investors. But that would have limited the brokers to selling the loans only once. If they sold loans more than once it would have been a fraudulent scheme bearing criminal accountability. So they didn’t sell them and that means they didn’t securitize homeowner transactions, which were not loans in the first place.

The brokers paid homeowners money. That much is generally true (although questionable in refis). But the brokers wanted no part of losing money if the homeowner failed or refused to make a scheduled payment. They had no risk of loss. They had no loan account. But by concealing the true nature of the business scheme — i.e. the creation, issuance, sale, and trading of securities — and using the homeowner’s knowledge against him/her, they convinced everyone that the execution of the promissory note was one exchange for the nonexistent loan. The securities were based upon the illusion of a loan transaction but certainly not the reality of a loan transaction.

Adding insult to injury then, the homeowner having played a crucial role in the illusion of a loan is then tricked into giving back the only reason why he/she entered the transaction in the first place— the receipt of money. In short, that is a return of the only consideration for involuntary participation in a securities scheme about which the homeowner knew absolutely nothing. Worse yet, the homeowner believed it was a loan and so agreed to pay “interest” and “fees” on top of returning the only consideration for the deal. This left the homeowner with negative consideration for the deal, plus concealed risks in the form of unmarketable loans, inflated appraisals, and the complete inability to reach anyone with ownership or authority of the transaction to work out arrangements that were necessary to correct the situation.

With no loan account that could be presented without committing perjury and fraud, the brokers hit upon the scheme of using still more intermediaries who were called servicers. The servicers did virtually nothing. All receipts are collected via third-party vendors who are completely controlled by the brokers. The servicers are hired to interface with homeowners, reassure them that their loan is under management, and present a “payment history” about which they know nothing because they never collected a dime from the homeowner.

Servicers are always thinly capitalized entities that can be thrown under the bus for accounting or servicing or collection irregularities. They hire employees or contract employees who know less than the servicer. these people are presented as “witnesses” in foreclosure proceedings. Such people are the only “witnesses” at trial in foreclosure cases. They’re not legally competent and travel along a very thin line between deception and perjury.

The payment history is actually printout from a data record prepared for enforcement only by third-party vendors who process payments from homeowners. Those payments are scheduled, but not due since they are paying off a loan account that does not exist. You will never find any payment history that purports to be the ledger of any creditor — i.e., the party who is named as claimant, beneficiary, or plaintiff in foreclosure. That is because no such ledger exists.

On some level, there are dozens of foreclosure defense lawyers who have realized that the documents used for foreclosure are all fabricated with false information. But only those who have persisted have either won the case or settled in extremely favorable terms to their clients as homeowners.

The time to correct this was 20 years ago when the Federal Reserve skipped regulation in the mistaken belief that market forces would make any needed corrections. Alan Greenspan who was head of the Fed has admitted that was a mistake. It is now up to homeowners and their attorneys to fight these foreclosures at every turn and win. This task will be made far easier if changes in the administration in Washington DC result in an acknowledgment of the obvious facts: the money paid to homeowners was not a loan. It was compensation for involuntary participation in a business scheme. Market forces dictated the amount of that payment. Brokers have no right to recover it.

As I have stated for a decade and a half, investors and homeowners are in the same boat. They should join forces and fight the same battle. the intention of both was a lending transaction. Neither one of them got what they intended. Current brokers and “servicers” should be forced out of the picture and regulators should stop pretending that REMICs exist or that the securities issued were unregulated mortgage-backed bonds or certificates. They were never mortgage-backed. There were no mortgage loans. Those mortgages secured a promissory note that was issued without the homeowner receiving consideration.

The only deal that was completed was the business scheme of creation, issuance, selling, and trading securities. Homeowners were already paid for that. Nobody was ever legally entitled to seek or receive payments that returned that compensation. If that compensation is too high, then let the brokers come to court and file a reformation action.

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DID YOU LIKE THIS ARTICLE?

Nobody paid me to write this. I am self-funded, supported only by donations. My mission is to stop foreclosures and other collection efforts against homeowners and consumers without proof of loss. If you want to support this effort please click on this link and donate as much as you feel you can afford. 

Please Donate to Support Neil Garfield’s Efforts to Stop Foreclosure Fraud.

Click

Neil F Garfield, MBA, JD, 73, is a Florida licensed trial and appellate attorney since 1977. He has received multiple academic and achievement awards in business and law. He is a former investment banker, securities broker, securities analyst, and financial analyst.
*

FREE REVIEW: Don’t wait, Act NOW!

CLICK HERE FOR REGISTRATION FORM. It is free, with no obligation and we keep all information private. The information you provide is not used for any purpose except for providing services you order or request from us. In  the meanwhile you can order any of the following:
*
CLICK HERE ORDER ADMINISTRATIVE STRATEGY, ANALYSIS AND NARRATIVE. This could be all you need to preserve your objections and defenses to administration, collection or enforcement of your obligation. Suggestions for discovery demands are included.
*
CLICK HERE TO ORDER TERA – not necessary if you order PDR PREMIUM.
*
CLICK HERE TO ORDER CONSULT (not necessary if you order PDR)
*
*
CLICK HERE TO ORDER PRELIMINARY DOCUMENT REVIEW (PDR) (PDR PLUS or BASIC includes 30 minute recorded CONSULT)
*
FORECLOSURE DEFENSE IS NOT SIMPLE. THERE IS NO GUARANTEE OF A FAVORABLE RESULT. THE FORECLOSURE MILLS WILL DO EVERYTHING POSSIBLE TO WEAR YOU DOWN AND UNDERMINE YOUR CONFIDENCE. ALL EVIDENCE SHOWS THAT NO MEANINGFUL SETTLEMENT OCCURS UNTIL THE 11TH HOUR OF LITIGATION.
  • But challenging the “servicers” and other claimants before they seek enforcement can delay action by them for as much as 12 years or more.
  • Yes you DO need a lawyer.
  • If you wish to retain me as a legal consultant please write to me at neilfgarfield@hotmail.com.
Please visit www.lendinglies.com for more information.

 

TONIGHT! Why Lawyers Should Want Foreclosure Defense Cases and What They Are Missing $$$

Thursdays LIVE! Click into the Neil Garfield Show

Tonight’s Show Hosted by Neil Garfield, Esq.

Call in at (347) 850-1260, 6 pm Eastern Thursdays

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This show is devoted to convincing the lawyers who will listen that they are missing out on something very profitable and important. Representing homeowners faced with foreclosure papers can and does present an opportunity for large paydays, consistent victories in court, and playing a part in changing the trajectory of home finance in this country and around the world.

In 2008 I presented a seminar that provided the essentials of foreclosure defense as we knew them at that time. We repeated it several times in different parts of the country. In that seminar, I also presented a business plan for lawyers to do it. It was the hub and spoke plan that allowed homeowners to pay monthly based upon the known length of time that any foreclosure would last.  About a dozen lawyers followed my instructions and made millions of dollars.

It’s time for a new push.

Modifications Are Part of the Big Lie: Don’t send that application for modification if you don’t want to waive important rights.

The application for modification licenses New Rez aka PHH aka Ocwen to sell, distribute the personal data and transaction data to third parties. Besides the obvious problems with data privacy, this confirms the apparent voluntary participation of the homeowner in a securities scheme that was and still is concealed from the homeowner.

By filing the application the homeowner is waiving his right to keep the compensation that was paid for the homeowner’s role in launching the securities scheme or to ask for more compensation. And it creates an assumption of risk by the homeowner that was, is, and always will be concealed from the homeowner. All of this is “illegal” but by signing the document the homeowner has launched a legal presumption that the document and everything on it is valid.

It reaffirms the concealed nature of the transaction in which the note and mortgage were executed and delivered. Instead of a loan agreement, the application alone establishes the authority of the New Rez aka PHH aka Ocwen to act as agent/servicer even though it has no such authority. It also makes New Rez aka PHH aka Ocwen the creditor, which means the homeowner is accepting a virtual creditor instead of a real one. And the homeowner is waiving any right to contest the standing of New Rez aka PHH aka Ocwen to administer, collect, and enforce the note and mortgage.

On behalf of a client, I recently received an “offer” for my client to apply for a modification. My response is going to be that we would be happy to apply for modification if New Rez aka PHH aka Ocwen can demonstrate (a) that the loan account receivable exists, (b) that U.S. Bank owns it on behalf of either a trust or certificate holders and (c) that New Rez aka PHH aka Ocwen can demonstrate that they have been authorized to act as agent/servicer for a creditor who owns the underlying obligation because (a) they paid for it and (b) they received a conveyance of ownership of the debt as part of a purchase transaction from someone who owned the loan account receivable.

Of course I know that they cannot do that. I know it because along with Patrick Giunta, Esq. in Fort Lauderdale all of that was established beyond any doubt. the Judge found that the trust, the trustee, and the agent/servicer (Ocwen) had no relationship to the debt, note, or mortgage but may have had possession of a note (now lost) that might have been an original. Final Judgment for the homeowner. In fact, at trial, the robowitness was dumbfounded when he realized that the fabricated “Power of Attorney” appointing Ocwen as servicer and as an “attorney in fact” had been not only false but incorrectly created with Chase being the grantor. Chase had nothing to do with this case.

But because they did not file the “original note” until after the lawsuit began — in 2008 — the judge felt compelled under Florida law to enter judgment for the homeowner with findings of fact that disposed of the merits of the case but dismissing the case without prejudice. that is because finding that there was not even the allegation of possession of the note before the filing of the lawsuit there was no jurisdiction. And no jurisdiction means the court is powerless to do anything but dismiss the case.

So the lawyers refiled the case even though there has been a complete negative adjudication of all facts necessary to prove a prima facie case for foreclosure. And they barely managed to squeak through a motion to dismiss because the defense of res judicata is an affirmative defense and so we will file our own motion for summary judgment.

The first interesting thing about all this is that the lawyers chose to file a case that they had already lost. Why? Well until two weeks ago, the law in that DIstrict was that there was no claim for attorney fees if the homeowner won because they established that the named claimant lacked legal standing — a fancy way of saying no case.

The recovery of attorney fees can only be based upon statute or contract. There is no statute that specifically grants the right to recover attorney fees when the named Plaintiff loses a foreclosure case. But there is the contractual provision in the note and mortgage for recovery of fees and Rule 57.105 Fla. R.C.P. that says that such provision is reciprocal.

BUT once the homeowner proves that the Plaintiff is NOT part of the contract, the law WAS that having proven that there was no contractual relationship between the Plaintiff and the homeowner, the homeowner was barred from taking advantage of the attorney’s fees provision in that contract.

All of that may seem to have some logic except for one thing: it was the Plaintiff who invoked the contract when they started the lawsuit asking for attorney fees and when they were shown to be lying, there are about a dozen reasons why they should not escape an award of attorney fees and costs. And that is what the Florida Supreme Court found. So now the attorneys have filed a new lawsuit that they thought had no risk if they lost; but they have a huge risk because the premise under which they were operating was not only wrong but downright malevolent. The playbook is designed to wear the homeowner down even if there is no case against the homeowner.

And so it is interesting that the unauthorized agent/servicer New Rez aka PHH aka Ocwen, constantly changing names to confuse the recipient, is now sending an “offer” to allow my client to apply for a modification. And just to be clear, that is no offer at all. They’re not saying they will consider it, grant it, or even that they are offering it on behalf of some named creditor. And that is why I scored points by filing three motions for sanctions against the opposing side which were granted. They showed up at “mediation” without any authorized person to settle the case. They were only authorized to offer to allow the homeowner to apply for a modification.

This particular offer was sent pursuant to a settlement agreement with the Florida Attorney General that requires them to modify loans. The AG office of course made the same mistake as all law enforcement and all regulators, to wit: that the agent/servicer was actually authorized to modify. In fact, the agreement can now be used to argue that they must have had the authority to modify — why else would that agreement require modification? THE AG was either hoodwinked or playing along. I don’t know.

But the main point of the modification is clear. It changes the falsely labeled loan agreement executed by the homeowner into something entirely different. Instead of a loan contract, the proposed application for modification changes the transaction forever. Perhaps the better description is that it reaffirms the concealed nature of the transaction in which the note and mortgage were executed and delivered. Instead of a loan agreement, the application alone establishes the authority of the New Rez aka PHH aka Ocwen to act as agent/servicer even though it has no such authority. It also makes New Rez aka PHH aka Ocwen the creditor, which means the homeowner is accepting a virtual creditor instead of a real one. And the homeowner is waiving any right to contest the standing of New Rez aka PHH aka Ocwen to administer, collect, and enforce the note and mortgage.

So there you have it. That is the reason they sent it. It was designed to lure me into sending this to my client in order to establish a fact that doesn’t exist and a fact that has already been defeated — standing for either the named Plaintiff (U.S. Bank as trustee for SASCO, etc) or anyone else designated by New Rez aka PHH aka Ocwen. If they had been successful they might have a shot on the second lawsuit. And it now licenses New Rez aka PHH aka Ocwen to sell, distribute the personal data and transaction data to third parties. Besides the obvious problems with data privacy, this confirms the apparent voluntary participation of the homeowner in a securities scheme that was and still is concealed from the homeowner.

By filing the application the homeowner is waiving his right to keep the compensation that was paid for launching the securities scheme or ask for more. And it creates an assumption of risk by the homeowner that was, is, and always will be concealed from the homeowner. All of this is “illegal” but by signing the document the homeowner has launched a legal presumption that the document and everything on it is valid. And it makes the unauthorized agent/servicer the agent of the homeowner!

The accountholder(s) [label establishes homeowner as holder of an account that exists] consent [uninformed consent] to the disclosure by my servicer  [affirms “servicer” as agent] or authorized third party,* [i.e, anyone and there is no referenced asterisk at the end of the document], or any investor/guarantor [note the introduction of new parties] of my mortgage loan(s) [affirming it is a mortgage loan], of any personal and non-personal information during the mortgage assistance process and of any information about any relief I receive, to any third party that deals with my first lien [affirming lien] or subordinate lien (if applicable) mortgage loan(s), including Fannie Mae, Freddie Mac or any investor, insurer, guarantor, or servicer of my mortgage loans(s) or any companies that provide support to them, for purposes permitted by law. Personal information may include, but is not limited to: (a) my name, address, telephone number; (b) my Social Security Number; (c) my credit score; (d) my income; and (e) my payment history [affirming paymetns were due] and information about account balances and activity and (f) my tax return and the information contained therein. I/We hereby authorize the servicer to release, furnish, and provide information related to my/our account to: [BLANK FOR ANYONE TO FILL IN LATER IF THEY NEED IT]

The Florida AG fell for this hook, line, and sinker. So have most homeowner and their lawyers. Take a closer look and ask yourself why they would have such wording if they were truly sure of their status as an agent for a lender, and why they wouldn’t announce guidelines for what the “modifications” would look like if “granted” and on whose behalf they are allegedly “modifying” the transaction falsely labeled as a loan. Every correspondence offering the hope of modification is a potential trap for homeowners who frankly, in my opinion, owe nothing. They were paid money equal to at most 8 1/2% of their revenue generated by these securities scheme, everyone received every payment to which they were entitled, and then they signed a note to give it back because they thought it was a loan.
*
But if it was a loan then there would have been an identifiable lender who had an entry on its accounting ledgers showing payment of value for the underlying debt. No such entity exists because the investment bankers were securities brokers and security brokers are interested in trading securities. They had no intention of assuming any risk of loss on nonperforming loans, so they made sure that the transaction looked like a loan but wasn’t. They had no interest in lending and they did not lend money. Investors loaned money to the brokerage firms. And nobody complied with lending statutes because there was no lender.
DID YOU LIKE THIS ARTICLE?

Nobody paid me to write this. I am self-funded, supported only by donations. My mission is to stop foreclosures and other collection efforts against homeowners and consumers without proof of loss. If you want to support this effort please click on this link and donate as much as you feel you can afford.

Please Donate to Support Neil Garfield’s Efforts to Stop Foreclosure Fraud.

Click

*
Neil F Garfield, MBA, JD, 73, is a Florida licensed trial and appellate attorney since 1977. He has received multiple academic and achievement awards in business and law. He is a former investment banker, securities broker, securities analyst, and financial analyst.
*

FREE REVIEW: Don’t wait, Act NOW!

CLICK HERE FOR REGISTRATION FORM. It is free, with no obligation and we keep all information private. The information you provide is not used for any purpose except for providing services you order or request from us. In  the meanwhile you can order any of the following:
CLICK HERE ORDER ADMINISTRATIVE STRATEGY, ANALYSIS, AND NARRATIVE. This could be all you need to preserve your objections and defenses to administration, collection or enforcement of your obligation. Suggestions for discovery demands are included.
*
CLICK HERE TO ORDER TERA – not necessary if you order PDR PREMIUM.
*
CLICK HERE TO ORDER CONSULT (not necessary if you order PDR)
*
*
CLICK HERE TO ORDER PRELIMINARY DOCUMENT REVIEW (PDR) (PDR PLUS or BASIC includes 30 minute recorded CONSULT)
*
FORECLOSURE DEFENSE IS NOT SIMPLE. THERE IS NO GUARANTEE OF A FAVORABLE RESULT. THE FORECLOSURE MILLS WILL DO EVERYTHING POSSIBLE TO WEAR YOU DOWN AND UNDERMINE YOUR CONFIDENCE. ALL EVIDENCE SHOWS THAT NO MEANINGFUL SETTLEMENT OCCURS UNTIL THE 11TH HOUR OF LITIGATION.
  • But challenging the “servicers” and other claimants before they seek enforcement can delay action by them for as much as 12 years or more.
  • Yes you DO need a lawyer.
  • If you wish to retain me as a legal consultant please write to me at neilfgarfield@hotmail.com.
Please visit www.lendinglies.com for more information.

 

Denial is not a Defense: Registrars and Clerks Are Missing the Point and Most of Them Know It

It is the transfer document itself that suggests there was something to transfer. And it suggests that there really is a transferor and transferee because that is what is written on a piece of paper. But there is no transaction that is memorialized. It is all fiction. Nothing was transferred. But that fiction leads to defeat for homeowners unless it is aggressively contested. 

If someone with no claim produces a document that says there is a claim, the courts are required to treat the supporting documents as real until proven otherwise. You can prove otherwise by direct evidence or you can prove it by indirect evidence. But the burden of proving otherwise is squarely on the homeowner and if they fail to understand how and when to apply the rules of civil procedure and evidence they lose their home to a dishonest claimant who probably never made a formal appearance in court.

Take a look at this from Minnesota:

507.413 AUTHORITY OF MORTGAGEE DESIGNATED AS NOMINEE OR AGENT.(a) An assignment, satisfaction, release, or power of attorney to foreclose is entitled to be recorded in the office of the county recorder or filed with the registrar of titles and is sufficient to assign, satisfy, release, or authorize the foreclosure of a mortgage if:(

1) a mortgage is granted to a mortgagee as nominee or agent for a third party identified in the mortgage, and the thirdparty’s successors and assigns;

(2) a subsequent assignment, satisfaction, release of the mortgage, or power of attorney to foreclose the mortgage, is executed by the mortgagee or the third party, its successors or assigns; and

(3) the assignment, satisfaction, release, or power of attorney to foreclose is in recordable form.The county recorder and registrar of titles shall rely upon this assignment, satisfaction, release, or power of attorney to foreclose to assign, satisfy, release, or foreclose the mortgage.(b) This section applies to any mortgage, assignment, satisfaction, release, or power of attorney to foreclose executed, recorded, or filed before, on, or after August 1, 2004.

History:2004 c 153 s 2Minnesota Statutes AnnotatedProperty and Property Interests (Ch. 500-515b)SuperBrowse Chapter 508. Registration of Land (Refs & Annos)M.S.A. § 508.72

This is carefully worded by lobbyists from Wall Street “Banks” (aka stockbrokers). Their plan requires the creation of illusion and in order to do that they must make it appear (a) that the underlying obligation exists, (b) that it is established on the accounting ledgers of someone who paid value for it, and (c) that it has been “transferred” to some party who is a designated virtual creditor for purposes of enforcement. Lawyers and pro se litigants who fail to pursue these points are usually destined for failure in the courtroom.

The issue here is that MERS is an agent. Calling it a nominee changes nothing. MERS is the acronym of a series of names all related to “Mortgage Electronic Registration Systems, Inc., MersCorp, or MERS, Inc. dba Mersinc.com. It is an agent for the party named as its principal who is generally either not a real company, not a real lender, or both. So MERS is the agent for a principal that has nothing to do with the homeowner transaction except that is paid a fee for getting the homeowner to sign papers under false pretense.

You will find “principal” in the mortgage (labeled as a “lender,” but is not generally lending any money or establishing any loan account receivable. MERS does not appear on any promissory note nor any other document. It neither accepts nor receives ownership of anything. It obtains bare legal naked title without any ownership of the debt, note, or mortgage (or deed of trust). The banks have worded these laws to literally create the illusion of something out of nothing.

When the successor pops up, they are playing on the court’s natural inclination, backed up by the absence of any credible contest from the homeowner, to assume that everything before the “successor” came into the picture was true, accurate, and valid — this avoiding the painful admission that the entire scheme was a scam mixing parts of Ponzi scheme, boiler room, bucket shop and other illegal practices that often scape the “Self-regulation” that is relied upon by so many people —especially if they believe the myth of “free market.”

In short, it is the transfer itself that suggests there was something to transfer. And it suggests that there really is a transferor and transferee because that is what is written on a piece of paper. But there is no transaction that is memorialized. It is all fiction. Nothing was transferred. But that fiction leads to defeat for homeowners unless it is aggressively contested. 

By allowing the words “successors and assigns” to appear, they distract from the question of whether there was a debt, whether it was really transferred by payment of value, and whether anyone is an assign or successor.

This is not rocket science. If there is no loan account receivable anywhere on any books of account, then a “payment history” produced by yet another disinterested and unauthorized third party adds nothing to the mix. In that scenario there is no basis under any law that any underlying debt or liability of the homeowner exists; but there is a facial debt created by executing the promissory note and that allows for the creation and recording of the mortgage or deed of trust.

And that is why denial doesn’t work alone. The homeowner must disprove the facial validity of the documents. And given the circumstances where the true facts under the sole custody and control of their position they can only do so through the use of indirect evidence, raising the inference that the debt does not exist and that even if it did exist it is not owned by or controlled by the named claimant. This is much easier than most homeowners and their lawyers perceive the task. I have even done it without discovery.

Someone is an assign ONLY if there is an instrument of assignment and the assignor had ownership of the thing being assigned. There is no position of “assign” if those conditions are not met, That is basic black letter law for centuries if not millennia.

Someone is a successor ONLY if they succeded to the rights and ownership of the predecessor. They can ONLY get into that position if they paid for the debt, note, and mortgage altogether or they purchased or merged with the predecessor. They are not a successor just because they’re the next person to make a claim. It doesn’t work that way. It never has worked that way and it never will work that way. This no philosophical discussion. We are an organized society with rules and those are the rules.

But that is exactly the point. The Wall Street banks have created boiler-plated gibberish and attached a meaning to it. Executing an allonge by someone without ownership or authority to do so means there is no allonge or endorsement. Executing an assignment without ownership and authority over the debt, note, and mortgage is a legal nullity in all jurisdictions.

The problem for homeowners and many lawyers is that they don’t get acquainted with the rules.

If someone with no claim produces a document that says there is a claim, the courts are required to treat the document as real until proven otherwise. You can prove otherwise by direct evidence or you can price it by indirect evidence. But the burden of proving otherwise is squarely on the homeowner and if they fail to understand how and when to apply the rules of civil procedure and evidence they end up losing their home to a dishonest claimant who probably never made a formal appearance in court because the lawyer had no agreement with the named claimant (allowing for plausible deniability in case the IRS seeks recovery of unpaid taxes the SEC seeks disgorgement and fines, the FTC seeks disgorgement, damages, and fines, or some homeowner gets a judgment for compensatory or punitive damages in whopping verdict — after the malicious intent of the scheme is revealed).

Judges are not supposed to pay any attention to discovery requests unless you make it an issue according to the rules. Judges are required to assume a valid claim as long it technically is stated to be a claim. Denying is not the same as defending.

The registrars and clerks have become addicted to what little they get from Wall Street brokers who are consistently violating the law of their jurisdiction, avoiding taxes and fees, and generally causing mayhem. And at first, they all started to scream until they were silenced by Wall Street influence, money and politics.

DID YOU LIKE THIS ARTICLE?

Nobody paid me to write this. I am self-funded, supported only by donations. My mission is to stop foreclosures and other collection efforts against homeowners and consumers without proof of loss. If you want to support this effort please click on this link and donate as much as you feel you can afford.

Please Donate to Support Neil Garfield’s Efforts to Stop Foreclosure Fraud.

Click

*
Neil F Garfield, MBA, JD, 73, is a Florida licensed trial and appellate attorney since 1977. He has received multiple academic and achievement awards in business and law. He is a former investment banker, securities broker, securities analyst, and financial analyst.
*

FREE REVIEW: Don’t wait, Act NOW!

CLICK HERE FOR REGISTRATION FORM. It is free, with no obligation and we keep all information private. The information you provide is not used for any purpose except for providing services you order or request from us. In  the meanwhile you can order any of the following:
*
CLICK HERE ORDER ADMINISTRATIVE STRATEGY, ANALYSIS AND NARRATIVE. This could be all you need to preserve your objections and defenses to administration, collection or enforcement of your obligation. Suggestions for discovery demands are included.
*
CLICK HERE TO ORDER TERA – not necessary if you order PDR PREMIUM.
*
CLICK HERE TO ORDER CONSULT (not necessary if you order PDR)
*
*
CLICK HERE TO ORDER PRELIMINARY DOCUMENT REVIEW (PDR) (PDR PLUS or BASIC includes 30 minute recorded CONSULT)
*
FORECLOSURE DEFENSE IS NOT SIMPLE. THERE IS NO GUARANTEE OF A FAVORABLE RESULT. THE FORECLOSURE MILLS WILL DO EVERYTHING POSSIBLE TO WEAR YOU DOWN AND UNDERMINE YOUR CONFIDENCE. ALL EVIDENCE SHOWS THAT NO MEANINGFUL SETTLEMENT OCCURS UNTIL THE 11TH HOUR OF LITIGATION.
  • But challenging the “servicers” and other claimants before they seek enforcement can delay action by them for as much as 12 years or more.
  • Yes you DO need a lawyer.
  • If you wish to retain me as a legal consultant please write to me at neilfgarfield@hotmail.com.
Please visit www.lendinglies.com for more information.

Banks have failed to produce any evidence that isn’t false and fabricated

If it were true that the claimants and plaintiffs in foreclosures were real, you would have reams of pleading, exhibits, and evidence showing that — and there would be very few defenses left for homeowners.

in 14 years of challenges from me — in and out of court — the banks have failed to produce any evidence that isn’t false and fabricated and they have lost their foreclosure cases most of the time because of that —  but only if they were challenged.

The banks have known that reformation is their only way out. They have known for many years. And quietly, because nobody understood what they were doing, they have been doing exactly that through the uninformed consent of homeowners who enter into “modification” agreements. 

Both law and common sense dictate that claims of any type against homeowners must only be brought by people who have suffered some injury resulting from something the homeowner did or did not do. Once you strip the presumptions arising from the facially valid transaction documents the foreclosure mill has nothing but an arcane legal argument to get their way. And it is only by wearing down the homeowners and intimidating the lawyers that would defend them, that the banks have, thus far, been successful. 

Bob Hurt and others have been paid agents of PR firms for the banks for over 10 years. They are ramping up criticism since I ramped up the attack with Appellate briefs, my announcement of petitioning the state Supreme courts for rule changes, the blog, and the radio show.

*

Like all fake news proponents, they start with a lie (e.g., there are no cases that support Garfield’s view) or perhaps something with a grain of truth and then state a conclusion that is dead wrong (e.g., foreclosure mills don’t need to show proof of payment of value even when challenged). Banks won’t show their face in this fight because they don’t want to give us more PR oxygen than is absolutely necessary from their perspective. But they are there. And as the old phrase goes, when you’re getting a lot of flack —  that’s when you know you are over the target.

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The fact remains that in 14 years not one person anywhere has ever said (on TV, Radio, blog, legal article, or live appearance) or produced exhibits showing that the REMIC trusts or trustees have ever been entrusted with any money or assets. In fact, as I demonstrated over the years the seminars for foreclosure mills and bank lawyers have always agreed with me and told the banks and the foreclosure mills that they proceed at their own peril.
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That is the bottom line. If it were true that the claimants and plaintiffs in foreclosures were real, you would have reams of pleading, exhibits, and evidence showing that — and there would be very few defenses left for homeowners. As it stands my record is over 80% success in defending over 5,000 homeowners directly and indirectly and over 50,000 indirectly because they read my blog.
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And the banks just took another hit in Florida where the Supreme Court reversed Florida law that said homeowners who prove lack of standing or who successfully defend by revealing that the foreclosure mill has no proof of standing (ownership of the debt, note or mortgage) can get recovery of attorney fees. This opens the door to more access to lawyer, which means more access to courts, and more victories for homeowners.
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The fact remains that in 14 years of challenges from me — in and out of court — the banks have failed to produce any evidence that isn’t false and fabricated and they have lost their foreclosure cases most of the time because of that —  but only if they were challenged. The only hope they have for maintaining the “securitization” infrastructure is by legally reforming the transaction with homeowners.
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They must get a court order or an agreement from homeowners that waives compensation for concealed risks (inflated appraisals, nonviable loans etc.) and waives compensation for launching the concealed securities scheme.
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While “securitization” does not mean securitizing the debt, note, or mortgage, it does mean that securities were sold that use the existence of facially valid loan documents as a reference point for the securities which are simply bets on the reports by investment banks about “performance.” In that scenario, it doesn’t matter what the homeowner does or does not do. It only matters that the investment bank issues a report on what the homeowner did or did not do as part of a group of other homeowners. There is never a report of how anyone took a loss or posted a gain resulting from any homeowner making or not making any scheduled payments.
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The banks have known that reformation is their only way out. They have known for many years. And quietly, because nobody understood what they were doing, they have been doing exactly that through the uninformed consent of homeowners who enter into “modification” agreements. In those agreements, which appear to be facially (if not substantively) valid, the homeowner (a) waives all possible claims and defenses and (b) agrees to accept the servicer as the new creditor. That is the reformation of the “loan” agreement which now exists thanks to the “modification.”
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It all comes down to one simple proposition. Both law and common sense that claims of any type against homeowners must only be brought by people who have suffered some injury resulting from something the homeowner did or did not do. Once you strip the presumptions arising from the facially valid transaction documents the foreclosure mill has nothing but an arcane legal argument to get their way. And it is only by wearing down the homeowners and intimidating the lawyers that would defend them, that the banks have, thus far, been successful.

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PRACTICE NOTE: Lawyers who entering the field of foreclosure defense will be rewarded for their efforts and they will win their cases if they litigate properly. They should be aware and remain aware that despite all appearances to the contrary, the only interested parties in the outcome of foreclosure litigation is the concealed investment bank and the homeowner. And none of the foreclosure players are participating for any reason other than fees. there is no effort for restitution for an unpaid debt because there is no unpaid debt account on the ledgers of any company anywhere.
As I have repeatedly shown in and out of court, proceeding on that premise yields exciting and at first, unexpected, results. Try it, you’ll like it. Tastes like chicken. 
*
DID YOU LIKE THIS ARTICLE?

Nobody paid me to write this. I am self-funded, supported only by donations. My mission is to stop foreclosures and other collection efforts against homeowners and consumers without proof of loss. If you want to support this effort please click on this link and donate as much as you feel you can afford.

Please Donate to Support Neil Garfield’s Efforts to Stop Foreclosure Fraud.

Click

*
Neil F Garfield, MBA, JD, 73, is a Florida licensed trial and appellate attorney since 1977. He has received multiple academic and achievement awards in business and law. He is a former investment banker, securities broker, securities analyst, and financial analyst.
*

FREE REVIEW: Don’t wait, Act NOW!

CLICK HERE FOR REGISTRATION FORM. It is free, with no obligation and we keep all information private. The information you provide is not used for any purpose except for providing services you order or request from us. In  the meanwhile you can order any of the following:
*
CLICK HERE ORDER ADMINISTRATIVE STRATEGY, ANALYSIS AND NARRATIVE. This could be all you need to preserve your objections and defenses to administration, collection or enforcement of your obligation. Suggestions for discovery demands are included.
*
CLICK HERE TO ORDER TERA – not necessary if you order PDR PREMIUM.
*
CLICK HERE TO ORDER CONSULT (not necessary if you order PDR)
*
*
CLICK HERE TO ORDER PRELIMINARY DOCUMENT REVIEW (PDR) (PDR PLUS or BASIC includes 30 minute recorded CONSULT)
*
FORECLOSURE DEFENSE IS NOT SIMPLE. THERE IS NO GUARANTEE OF A FAVORABLE RESULT. THE FORECLOSURE MILLS WILL DO EVERYTHING POSSIBLE TO WEAR YOU DOWN AND UNDERMINE YOUR CONFIDENCE. ALL EVIDENCE SHOWS THAT NO MEANINGFUL SETTLEMENT OCCURS UNTIL THE 11TH HOUR OF LITIGATION.
  • But challenging the “servicers” and other claimants before they seek enforcement can delay action by them for as much as 12 years or more.
  • Yes you DO need a lawyer.
  • If you wish to retain me as a legal consultant please write to me at neilfgarfield@hotmail.com.
*
Please visit www.lendinglies.com for more information.

Another Dubin Victory for Homeowners In Hawaii. How crazy is it that he is under fire?

see SCWC-18-0000071

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There are several things in this case that I find astonishing.

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First and foremost is the fact that here is another victory by Gary Dubin on behalf of a Hawai’i citizen fighting to defend his home against an unlawful, illegal and fraudulent claim. And yet, the same court granting his appeal is taking him out of the playground as though somehow they are protecting Hawai’i citizens. NUTS!~
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Second, this is yet another example of plainly and inescapably wrong-headedness by the lower courts. When will anyone ask why this happening and how this can be explained by anything other than institutional bias, regardless of the facts or the law?
*
Third,  this case underscores the central point of all my writing on the subject of foreclosure defense: it is civil procedure that wins or loses a case!

Crazy! Banks announcement drop in foreclosure filings due to moratoriums as if there is no problem!

Servicers relent one case at a time: The Great Escrow Balance Game. Getting money just because you asked for it.

Playing with the escrow balance and asking for more money is one of many games the “servicers” play in the Great Securitization game. Relentlessness in challenging (1) the authority of the company pretending to be a servicer and (2) their rendition of the escrow balance and reconciliation of their request for more money is how you eliminate the fake shortgage and get a refund. Don’t assume it is a honest mistake. Assume instead that they are trying to steal from you because in most cases that is what they are doing.

The truth is that without having authority to act they have no right to administer, collect or enforce any payment from homeowners under any circumstances, let alone escrow money. And if there is no creditor that they can identify that maintains on their accounting ledgers, an entry establishing the  existence of a loan account receivable, then there is nobody to authorize them.

This is not some plot by 30 million homeowners. It is a defective scheme in which Wall Street banks made trillions of dollars. Don’t blame or penalize the homeowner. Blame and penalize the banks.

Here is one such example: After a homeowner steadfastly refused to accept the demand for more escrow money, this is what they received:

SLS promptly re-ran its escrow analysis upon receipt of your below email in late December 2020. As a result, an updated escrow analysis is attached to replace the previous one with a new payment beginning February 1, 2021 in the amount of $ 1,502.07. This change reflects a credit that was issued in the amount of $2,773.82. Accordingly, escrow shortage of $2,032.29 from the December 2020 statement has been removed and the remaining $741.53 has been issued to you directly as a refund. You should be receiving those funds by check delivered by UPS in the coming days. This new escrow analysis will be timely filed with the Bankruptcy Court. Sincerely, Melissa Licker
Of course, no explanation was offered as to how they got it so wrong.
DID YOU LIKE THIS ARTICLE?

Nobody paid me to write this. I am self-funded, supported only by donations. My mission is to stop foreclosures and other collection efforts against homeowners and consumers without proof of loss. If you want to support this effort please click on this link and donate as much as you feel you can afford.

Please Donate to Support Neil Garfield’s Efforts to Stop Foreclosure Fraud.

Click

*
Neil F Garfield, MBA, JD, 73, is a Florida licensed trial and appellate attorney since 1977. He has received multiple academic and achievement awards in business and law. He is a former investment banker, securities broker, securities analyst, and financial analyst.
*

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CLICK HERE FOR REGISTRATION FORM. It is free, with no obligation and we keep all information private. The information you provide is not used for any purpose except for providing services you order or request from us. In  the meanwhile you can order any of the following:
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CLICK HERE ORDER ADMINISTRATIVE STRATEGY, ANALYSIS AND NARRATIVE. This could be all you need to preserve your objections and defenses to administration, collection or enforcement of your obligation. Suggestions for discovery demands are included.
*
CLICK HERE TO ORDER TERA – not necessary if you order PDR PREMIUM.
*
CLICK HERE TO ORDER CONSULT (not necessary if you order PDR)
*
*
CLICK HERE TO ORDER PRELIMINARY DOCUMENT REVIEW (PDR) (PDR PLUS or BASIC includes 30 minute recorded CONSULT)
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FORECLOSURE DEFENSE IS NOT SIMPLE. THERE IS NO GUARANTEE OF A FAVORABLE RESULT. THE FORECLOSURE MILLS WILL DO EVERYTHING POSSIBLE TO WEAR YOU DOWN AND UNDERMINE YOUR CONFIDENCE. ALL EVIDENCE SHOWS THAT NO MEANINGFUL SETTLEMENT OCCURS UNTIL THE 11TH HOUR OF LITIGATION.
  • But challenging the “servicers” and other claimants before they seek enforcement can delay action by them for as much as 12 years or more.
  • Yes you DO need a lawyer.
  • If you wish to retain me as a legal consultant please write to me at neilfgarfield@hotmail.com.
*
Please visit www.lendinglies.com for more information.

 

Tonight! Attorney Charles Marshall talks about anticipated 2021 trends in foreclosure nationwide, through the lens of the now “new normal” of Covid-19 restrictions

Thursdays LIVE! Click in to the Neil Garfield Show

Tonight’s Show Hosted by Charles Marshall, Esq.

Call in at (347) 850-1260, 6pm Eastern Thursdays

Host attorney Charles Marshall will address on today’s Show anticipated 2021 trends in foreclosure nationwide, through the lens of the now “new normal” of an interlay of Covid-19 restrictions micromanaging all aspects of human life. Whatever one thinks of the impact of the actual Covid-19 virus on public or their own personal health, it is indisputable that the huge and dense and all-encompassing governmental architecture which has built up to enforce restrictions on human behavior now regulates every facet and aspect of Americans’ lives. Naturally this architecture greatly impacts trends in foreclosure. Today we discuss those trends and what to expect. Listeners and interested others have asked questions as to what to expect in the following areas of foreclosure law and practice. Here are some of the most salient questions:

– Will there really be a forecloure tsunami in 2021?

– Will the eviction moratorium be maintained anywhere around the country and will Congress act to reinstate the 2020 rules?

– How will jury trials be held in 2021, and what will be the ‘social distancing’ requirements? – What trends should we expect? in the areas where foreclosure impacts are the greatest: judicial foreclosures, non-judicial foreclosures, unlawful detainers, bankruptcy practice.

Florida Supreme Court Reverses: Homeowners can recover attorney fees even if they prove lack of standing when they win

see Page v. Deutsche Bank Tr.

Kudos to Nicole R. Moskowitz of Neustein Law Group, P.A., Aventura, Florida, for Petitioner William L. Grimsley and Kimberly Held Israel, Jacksonville, Florida, Daniel Alvarado, Elia Alvarado, South Florida Defense Group, Bowin Law Group, Michael Jay Wrubel, P.A., Jonathan Kline, P.A.

“The certified conflict issue in this case is whether a unilateral attorney’s fee provision in a note and mortgage is made reciprocal to a borrower under section 57.105(7), Florida Statutes (2019), when the borrower prevails in a foreclosure action in which the plaintiff bank established standing to enforce the note and mortgage at the time of trial but not at the time suit was filed. We have jurisdiction. See art. V, § 3(b)(4), Fla. Const.”

The Bank argues in the alternative that even if we do not approve Page, the trial court nevertheless lacked “subject-matter jurisdiction” to award fees. At the heart of the Bank’s argument is the assertion that “standing is a component of subject-matter jurisdiction” and that the trial court “erred by taking any further action” beyond dismissing the case. We reject the Bank’s argument.

The Bank waived its jurisdictional argument by waiting until the appeal of the fee award to first raise the issue.

Subject-matter jurisdiction is universally acknowledged to never be waivable. See, e.g., United States v. Cotton, 16  535 U.S. *16 625, 630 (2002) (“[S]ubject-matter jurisdiction, because it involves a court’s power to hear a case, can never be forfeited or waived.”). But this Court has held that the issue of standing is a waivable defense. See Krivanek v. Take Back Tampa Political Comm., 625 So. 2d 840, 842 (Fla. 1993). And if standing is waivable, then standing is obviously not “a component of subject-matter jurisdiction.” The Bank’s foundational assertion is thus incorrect. See Paulucci v. Gen. Dynamics Corp., 842 So. 2d 797, 801 n.3 (Fla. 2003) (“Jurisdiction is a broad term that includes several concepts, each with its own legal significance.”). And the Bank offers no other explanation for why its argument should be considered timely. [e.s.]

We conclude that the unilateral fee provisions in the contracts at issue are made reciprocal to the prevailing borrowers under section 57.105(7). Accordingly, we quash Page and approve Madl and Harris.

It is so ordered. POLSTON, LABARGA, LAWSON, MUÑIZ, and COURIEL, JJ., concur.
GROSSHANS, J., did not participate. NOT FINAL UNTIL TIME EXPIRES TO FILE REHEARING MOTION AND, IF FILED, DETERMINED. Application for Review of the Decision of the District Court of Appeal – Certified Direct Conflict of Decisions

In the never-ending quest of the courts to squelch homeowner defenses, some of the courts of appeal decided that the bank argument was valid. The law was, in a word, NUTS.

This Supreme Court case cures part of the nuttiness. If someone brings a baseless claim they cannot escape liability for fees and costs on the basis that the claim is baseless.

Yes, that is the issue — the lack of basis means that the named Plaintiff in foreclosure had no contractual relationship with the Defendant homeowner. So the fee provision of the contract they were seeking to “enforce” could not apply once it was proven they had no right to enforce it. The case, in my opinion, was probably decided with the elements of estoppel in mind,. Once you invoke a contract or statute and you cannot escape the negative consequence when you lose.

One case I had which is still being litigated for the second time is illustrative of the problem. The homeowners were sued in foreclosure. The various lawyers continued to pursue foreclosure from 2008-the date of trial in August 2016.

The defense was that the named plaintiff had no business being in court and no legal standing. All the documents were all fabricated and U.S. Bank as trustee for a fictitious trust never had ownership of the debt, note, or mortgage. They also never had possession of the note but that was supposedly cured by the claim that the note was received by Ocwen  — AFTER the lawsuit began.

Patrick Giunta and I easily won the case, resting at the conclusion of the Plaintiff’s case. We never put on any evidence. The trial judge took or 2 hours to reach a decision and then dictated into the record the findings of fact and conclusions of law, entering Judgment of Involuntary Dismissal against “U.S. Bank as Trustee of SASCO trust etc.”.

The court found facts showing there was no basis for the action, that U.S. Bank did not own the note or mortgage or debt, and that the trust could not have owned it either. But the judge correctly stated that the law in that District required involuntary dismissal without prejudice once there was a finding of lack of standing.

If the Plaintiff lacked standing, then the court supposedly lacked jurisdiction to do anything except the ministerial act of dismissing without prejudice.

The law in that district also said that even though the homeowner had spent $200,000 in fees and costs, the recovery of attorney fees only applied to a much shorter period during which the Plaintiff had claimed possession of the note even though they had not shown any authority to enforce it. So recovery of fees only started when and if the foreclosure mill filed the original note with the court.

The judge we had clearly did not like what he was required to do so he made it into a final judgment for the homeowner incorporating all of the findings of fact and conclusions of law before the finding of lack of legal standing.

Under the law of that  District, the recovery of fees was thus either cut off or reduced considerably. This left foreclosure mills with the ability to claim attorney fees if they won and avoid liability for fees if they lost — something expressly prohibited by statute and the rules. Now the Florida Supreme Court, in a very well reasoned and well-written decision (J Canady) has established that lawyers cannot sue in the name of a disinterested party to claim foreclosure, attorney fees, and costs — and upon losing avoid the reciprocal liability.

This frees up homeowners’ access to legal representation to defend against illegal fraudulent foreclosures. Lawyers are far more likely to take foreclosure defense cases. If you are looking for a lawyer to represent you start with contacting the lawyers mentioned in this article.

DID YOU LIKE THIS ARTICLE?

Nobody paid me to write this. I am self-funded, supported only by donations. My mission is to stop foreclosures and other collection efforts against homeowners and consumers without proof of loss. If you want to support this effort please click on this link and donate as much as you feel you can afford.

Please Donate to Support Neil Garfield’s Efforts to Stop Foreclosure Fraud.

Click

*
Neil F Garfield, MBA, JD, 73, is a Florida licensed trial and appellate attorney since 1977. He has received multiple academic and achievement awards in business and law. He is a former investment banker, securities broker, securities analyst, and financial analyst.
*

FREE REVIEW: Don’t wait, Act NOW!

CLICK HERE FOR REGISTRATION FORM. It is free, with no obligation and we keep all information private. The information you provide is not used for any purpose except for providing services you order or request from us. In  the meanwhile you can order any of the following:
*
CLICK HERE ORDER ADMINISTRATIVE STRATEGY, ANALYSIS AND NARRATIVE. This could be all you need to preserve your objections and defenses to administration, collection or enforcement of your obligation. Suggestions for discovery demands are included.
*
CLICK HERE TO ORDER TERA – not necessary if you order PDR PREMIUM.
*
CLICK HERE TO ORDER CONSULT (not necessary if you order PDR)
*
*
CLICK HERE TO ORDER PRELIMINARY DOCUMENT REVIEW (PDR) (PDR PLUS or BASIC includes 30 minute recorded CONSULT)
*
FORECLOSURE DEFENSE IS NOT SIMPLE. THERE IS NO GUARANTEE OF A FAVORABLE RESULT. THE FORECLOSURE MILLS WILL DO EVERYTHING POSSIBLE TO WEAR YOU DOWN AND UNDERMINE YOUR CONFIDENCE. ALL EVIDENCE SHOWS THAT NO MEANINGFUL SETTLEMENT OCCURS UNTIL THE 11TH HOUR OF LITIGATION.
  • But challenging the “servicers” and other claimants before they seek enforcement can delay action by them for as much as 12 years or more.
  • Yes you DO need a lawyer.
  • If you wish to retain me as a legal consultant please write to me at neilfgarfield@hotmail.com.
*
Please visit www.lendinglies.com for more information.

 

If you have CYNTHIA RILEY’s “signature” on any document in your chain of title you need to read this. Same for Jess Almanza. 

MFI-Miami has a file cabinet filled with foreclosure files containing Riley’s stamp that weren’t consummated until months or years after she left Washington Mutual.
Nearly 2/3 of the Washington Mutual Promissory Notes in foreclosure contain an endorsement stamp of former Washington Mutual Vice President Cynthia Riley.
Riley was a Vice President of Washington Mutual until November of 2006
Nearly half of the Washington Mutual loans currently in foreclosure were consummated after November of 2006. Most of them contain Riley’s endorsement.
This was a big mystery until January of 2013 when Cynthia Riley sat for a deposition.
Riley admitted other people in her office used her stamp and she admitted she never stamped any mortgage notes. Riley admitted in her deposition she was hired by JPMorgan Chase in 2009.
She remained employed at JPM-Chase until some time between October of 2014 and April of 2015.  Attorney Daniel Milian attempted to force JPMorgan Chase to have her sit for a deposition in the Zacharakis case. Naturally, JPMorgan Chase dragged their feet with responding to the motion for nearly 6 months. JPMorgan Chase then claimed her whereabouts were unknown.
It appears JPMorgan Chase made sure her whereabouts would remain unknown. They scrubbed the internet of any record of her connection with Washington Mutual or JPMorgan Chase.
MFI-Miami discovered JPMorgan Chase was hiding a dirty secret. They were stamping these Washington Mutual notes with the Cynthia Riley endorsement stamp between 2012 and 2014. Several MFI-Miami clients had their 2009 or 2010 Washington Mutual foreclosure cases with no endorsement stamp suddenly withdrawn. Only to have them refiled in 2013 or 2014 with endorsed notes by Cynthia Riley.
JPMorgan Chase got really sloppy. JPMorgan Chase began compulsively stamping almost every promissory note with Riley’s endorsement stamp. MFI-Miami has a file cabinet filled with foreclosure files containing Riley’s stamp that weren’t consummated until months or years after she left Washington Mutual.

JPMorgan Chase’s compulsive use of Cynthia Riley’s endorsement stamp was beginning to affect the bank’s bottom line in 2015. So what should they do?

JPM-Chase executives went into the basement storage room. They searched through old Washington Mutual boxes and randomly dusted off the endorsement stamp of another former Washington Mutual VP. This time, they picked former Vice President Jess Almanza.

Almanza served as Washington Mutual’s VP of Capital Markets/National Closing Operations until July of 2006. He soon went to work for Bank of America after leaving Washington Mutual according to his Linkedin profile.

Almanza never went to work for JPM-Chase like Cynthia Riley. It appears Almanza’s endorsement stamp was used without his consent.

IS ANY OF THIS REAL? From LaSalle Bank to ABN AMRO and LaSalle Bank to Bank of America Ending With U.S. Bank

The progression from LaSalle Bank to Bank of America to US Bank is highly suspect.
While it is true that there was a merger between Bank of America and LaSalle bank, It is equally true that the merger was preceded by a reverse merger between LaSalle Bank and ABN AMRO. And there is nothing in the public record to tell us what happened in the merger with respect to the position of being a trustee for the alleged trust. Still, the pooling and servicing agreements that are often falsely presented as Trust Agreements will usually say that a successor trustee can be an acquiring bank meeting the requirements of a chartered depository institution.
The big question is whether any of the agreements talk about liabilities as a fiduciary under a trust agreement to specify beneficiaries. The answer is there is no such discussion but there is indemnification language that would cover that subject. There is no discussion of fiduciary liability because there is no fiduciary position. The named trustee has no powers to administer the active affairs of any trust. And the named trust has no assets or business.
The migration from Bank of America to US Bank is even more suspect. The assertion is that US Bank is the successor to Bank of America. If that is true there is nothing in the public record to support that assertion. US Bank is certainly not the successor to Bank of America by reason of any merger or acquisition. That part is definitely true. So the question becomes how did the position of trustee shift from Bank of America to US Bank? I know that there was an announcement of the sale of the position by Bank of America to US Bank, but I know of no legal authority under which a trustee can sell its fiduciary position under a trust agreement to a third-party without the express consent of at least the beneficiaries and probably the original trustor.
But if the sale was actually the sale of a licensing agreement in which Bank of America was receiving fees on a periodic basis for the use of its name as trustee for an alleged trust even though there was no trust, then such a sale would probably be valid — unless it was part of an illegal scheme to defraud the courts and the public. In this case, all those restrictions apply.

Tax Free Scheme Robs Homeowners and Investors — Trillions Owed to IRS and State Tax Authorities

Hat tip to Summer Chic

There are many ways this fraudulent conduct can be stopped or modified. One of them is for taxing authorities to take notice that most of the money generated from the scheme was never reported as income resulting in astronomical underpyments of income tax, transfer taxes, recording fees, etc. Sales of securities were dressed up as IPOs resulting in reports of minor fee income to “underwriters” (i.e., securities brokerage firms calling themselves “investment banks.”).

I would point out that in 2008 I was lead consultant to the Arizona legislature on balancing their budget by levying on the so-called mortgages for unpaid taxes and providing substantial relief to homeowners. The committees and the executive branch accepted the plan and only disagreed with me as to the amount of relief that they could get. I said $10 Billion, but they computed it as “only” $3 Billion.  Poltics intervened at the last minute pressure from banks) and the plan was never enacted.

The “underwriters” were in fact issuers who sold “certificates” under the name of a trustee and trust which had nothing in it. The certificates were IOUs from the investment bank. That is not a taxable event. It’s just borrowing money. But the money does not get repaid to investors in full. And the sale of hedge products and derivatives is also not reported as income — because the investment banks lie about the transactions (all of them).

The money from investors was far more than the money paid to homeowners. The difference (which I have called a tier 2 yield spread premium) was parked in off shore accounts and then  repatriated as needed, with the banks reporting “trading profits” as the unowned “portfolios” were “sold” to the nonexistent trusts in nonexistent transctions. This is what enables them to report higher earnings per sahre as needed to support their stock price. But the rest of the money is never taxed and the ROI on those funds or investments offshore is never reported.

Add to that the unpaid transfer and recording taxes each time the “mortgage” was suppoosedly transferred for purposes of initiating foreclosures plus any income tax due ins tates that have income taxes, and you have a tidy sum due to each state and the federal government. Instead the IRS and other taxing authroities have so far looked the other way thus granting trillions of dollars in corpoate welfare to the banks while the rest of the economy (and government budgets) suffers. The capture of all unpaid tax revenue fromt the banks would in most cases completely balance the budget of every government authority and then some (surplus).

Then you have the foreclosures which are strictly unreported revenue. And you have homeowners making scheduled payments that are probably not due to anyone. That is also unreported income because the proceeds of such collection activity do not result in any reduction of any loan account receivable because there is no loan account receivable and there is no loss from any homeowner failing or refusing to make a scheduled payment. There is no loss becasue hte proceeds form the falsely reported “securitization” scheme has resulted in windfall profits, commissions, bonuses and other compensation to the securitization players and the foreclosure players. They all get paid all of the time — even the investors.

So the banks write off the payments to investors as an expense and they might even be writing off the payments made to homeowners as an expense resulting in a negative tax on the entire venture. Homeowners think they are getting a loan but in fact theya re getting a comission or license fee.

A very sizable (largest in world history) lawsuit is in the making here although I cannot guarantee it will happen. It is out for review at several large litigation firms.
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Defendants are all of the largest banks including investment banks (Stockbrokers) who were chartered as commercial depository institutions over a weekend during the 2008 crisis. Damages are in excess of $5 trillion. This includes foreign banks who are directly doing business here under one guise or another or through a legally established subsidiary or affiliate company.
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The premise is that they induced homeowners and prospective homeowners to accept money as part of what was presented as a loan agreement — one which ended with no lender, no loan account receivable on the ledger of any company, no risk of loss, and no compliance with lending statutes. In short, homeowners were seeking a loan and they were instead drafted into a concealed business scheme. And the money they were paid for their participation was subject to payback plus interest leaving them with (a) no or even negative consideration for their participation in the scheme and (b) an array of risks that were unknown to them and which caused an unrecognized loss as soon as they signed the paperwork for their “loan.”
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The business scheme was the issuance of securities which the banks called “securitization” although they never quite said they were securitizing the loans. That was implied because if they had said it they would have been lying. But some of them did anyway. In fact, no residential loan or the underlying obligation was ever sold to anyone who paid value in exchange for a conveyance of ownership. Foreclosures were expected and the banks were counting on it. The foreclosures were for fun and profit because there was no risk of loss, no loss, and no basis for asserting a claim.
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The securities that were issued were considered as being NOT securities under the legislation that repealed Glass-Steagall. But they were securities and should’ve been regulated as such. Instead, the SEC and even securities lawyers failed to treat the issuance of the securities aka mortgage-backed certificates aka mortgagee backed bonds as securities. The issuance of those securities was in the form of certificates (digital mostly) issued by the banks under the name of a REMIC trust that neither a REMIC nor a trust. No attributes of ownership were ever conveyed to investors who bought the certificates.
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This has been fully litigated as between investors and the named trustee of the fictitious trust. The issuance of the certificates served only one purpose — revenue to the issuing investment bank (disguised as loans from investors for reporting purposes but then reported as a sale of loan portfolios to investors). And it was the continuing sale of the certificates that was the only incentive for investment banks to make the discretionary payments that were offered to investors.
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All the certificates and all derivatives thereon were solely bets or hedges. Their perceived value was based solely on the discretionary reporting by the bookrunner investment bank which referred to data points on putative “loans” they did not own — but which they acted as though they did own the underlying obligation. The truth is that the investment bank never entered the funding of the homeowner transactions as a loan receivable on any accounting ledger and eliminated the entry altogether by the end of the “securitization” cycle (30 days). By not conveying the underlying obligation, the note, or the mortgage for payment of value, they are not selling any loans. Therefore selling securities could not be construed as selling the same asset over and over again.
*
This allowed them to sell certificates, hedges, and derivatives on an infinite basis that resulted in sucking trillions of dollars out of the U.S, economy demonstrated by admitted investor losses and obvious homeowner losses. Most of that money was laundered through questionable tax havens like Bermuda which asserted tax jurisdiction and at the same time deferred any taxation on the hundreds of billions of dollars that was sent through their banks to offshore accounts in faraway places.
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Many investors have already sued and received settlements on condition that they do not challenge the issuance of the certificates as being fraudulent — even though they had AAA ratings from the rating agencies and apparently had insurance contracts on the certificates (but payable to the investment bank, not the investor). The investment banks had an incentive to make sure a high percentage of homeowners would refuse or fail to make scheduled payments in order to trigger insurance payments that each amounted to tens of billions of dollars (See AIG/Goldman Sachs -2008).
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I refer you to the TARP program. The regulators had no idea what the banks had done or were doing. So they started out proposing that TARP was to cover the obvious —defaults in home mortgages. But when it turned out that the banks did not own any of the mortgages or loans or underlying obligations, they changed the definition of TARP to be coverage for toxic mortgage-backed bonds. But that too failed because the certificates were not mortgage-backed, they were not bonds, and the banks were selling them, not buying them. In short, the banks had no loss. But the banks still wanted “relief” in the form of preserving the astronomical profits generated from sale of securities that were not shares of any asset.
*
And of course, the banks wanted “relief” by cashing in on insurance contracts that resulted in insurance liability for payoffs on losses that only the banks knew were guaranteed to be reported even if they did not exist. The biggest gambit on that was Goldman Sachs receiving some $40 billion from AIG only after the U.S. government gave AIG the money to pay that out plus around $150 billion on other contracts.
*
So they came up with the Maiden Lane entities that laundered the fictitious title to fictitious loans in such a way that it would support the myth that there were actual pools of loans owned by someone (they would never say who) thus supporting both the shadow banking infrastructure they had created and the pursuit of foreclosures which result in pure profit.
*
For the most part (96%) homeowners believed from beginning to end that they had loan transactions and therefore allowed the foreclosures to proceed by default —creating the myth that most of the foreclosures were lawful, proper, ethical, etc. But all the documents used in foreclosures were fabricated, false, backdated, and robosigned because there was no loan. Intermediaries were hired by intermediaries to hire workers with no knowledge or authority to execute or stamp signatures onto documents that contained nothing but lies.
*
I have directly and indirectly litigated thousands of cases to a successful conclusion for homeowners but the decisions were really based upon insufficiency of evidence that the loan account existed and that the named claimant owned the account and therefore had suffered any loss. These resulted in judgments of involuntary dismissal without prejudice because that is what state doctrine told the judges they must do even though they made findings of fact that the “trust” never could have owned the debt, note or mortgage.
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I think both investors (who have not already settled) and homeowners have solid claims that are easily proven through discovery. In thousands of cases, I have reviewed there is not one instance where the law firm representing the foreclosing party was able to produce proof payment of value for the underlying obligation — a condition precedent of 9-203 UCC adopted in all 50 states.
*
This is not just about every homeowner. It is about a cancer on our economy and our society that is growing each day. Whatever hopes we have for economic recovery will be dashed in the rocks of foreclosure and eviction. There is an answer to this besides the apocalyptic threats issued by the investment banks. It is a fair equitable determination of the entirety of the transaction that homeowners were unknowingly lured into and a determination of who much they should have been paid for the immediate loss and risks of loss associated with doing business with a counterpart that was betting against him/her from the start.
*

The first step is getting a court to recognize that there is no enforceable contract between the homeowner and anyone. Thus continuing attempts to foreclose for profit are unlawful and deserving of disgorgement, compensatory, and punitive damages. The second step is to have the court use its equitable powers to reform the total transaction (not just the visible one) using quantum meruit and quasi-contract theories. The “securitization infrastructure” can be preserved but only after the entire deal is disclosed and the homeowner is compensated for his/her role in launching the concealed business scheme.

*
DID YOU LIKE THIS ARTICLE?

Nobody paid me to write this. I am self-funded, supported only by donations. My mission is to stop foreclosures and other collection efforts against homeowners and consumers without proof of loss. If you want to support this effort please click on this link and donate as much as you feel you can afford.

Please Donate to Support Neil Garfield’s Efforts to Stop Foreclosure Fraud.

Click

*
Neil F Garfield, MBA, JD, 73, is a Florida licensed trial and appellate attorney since 1977. He has received multiple academic and achievement awards in business and law. He is a former investment banker, securities broker, securities analyst, and financial analyst.
*

FREE REVIEW: Don’t wait, Act NOW!

CLICK HERE FOR REGISTRATION FORM. It is free, with no obligation and we keep all information private. The information you provide is not used for any purpose except for providing services you order or request from us. In  the meanwhile you can order any of the following:
*
CLICK HERE ORDER ADMINISTRATIVE STRATEGY, ANALYSIS AND NARRATIVE. This could be all you need to preserve your objections and defenses to administration, collection or enforcement of your obligation. Suggestions for discovery demands are included.
*
CLICK HERE TO ORDER TERA – not necessary if you order PDR PREMIUM.
*
CLICK HERE TO ORDER CONSULT (not necessary if you order PDR)
*
*
CLICK HERE TO ORDER PRELIMINARY DOCUMENT REVIEW (PDR) (PDR PLUS or BASIC includes 30 minute recorded CONSULT)
*
FORECLOSURE DEFENSE IS NOT SIMPLE. THERE IS NO GUARANTEE OF A FAVORABLE RESULT. THE FORECLOSURE MILLS WILL DO EVERYTHING POSSIBLE TO WEAR YOU DOWN AND UNDERMINE YOUR CONFIDENCE. ALL EVIDENCE SHOWS THAT NO MEANINGFUL SETTLEMENT OCCURS UNTIL THE 11TH HOUR OF LITIGATION.
  • But challenging the “servicers” and other claimants before they seek enforcement can delay action by them for as much as 12 years or more.
  • Yes you DO need a lawyer.
  • If you wish to retain me as a legal consultant please write to me at neilfgarfield@hotmail.com.
*
Please visit www.lendinglies.com for more information.

Tonight! Homeowners are NOT FALLING BEHIND!! They are falling deeper into a trap. More Questions and More Answers!!! pm EST 3PM PST

THE COMING WAVE OF FORECLOSURES: ARE YOU READY?

Thursdays LIVE! Click in to the Neil Garfield Show

Tonight’s Show Hosted by Neil Garfield, Esq.

Call in at (347) 850-1260, 6pm Eastern Thursdays

Each payment made by the homeowner to a self-proclaimed servicer is being collected by a third-party vendor, probably under the control of Black Knight. That money is not going to anyone who maintains a loan account receivable on their accounting ledgers. The payment is not reducing the debt because the debt account does not exist under all scenarios in which false claims of securitization are present — and virtually all securitization claims are false. Neither the servicer nor the named claimant ever sees a dime from payments or foreclosures.

In simple language, the payment is not due. It is impossible to “fall behind” or become “delinquent” or to issue a “Notice of Default” on a payment that is not due. But if you admit the delinquency or default you have thrown away the biggest investment of your life — your home. Once you have admitted the default you have admitted the existence of a loan account even though it does not exist. It is nearly impossible to take back that admission which is why most homeowners walk away or lose in court.

The three things you need to know about how to defend your home:

  1. The loan, if it ever existed, no longer exists because in the process of so-called securitization the obligation was extinguished from the accounting ledgers of all securitization participants.

  2. Even if the loan existed, nobody under this scenario can offer proof of payment of value for the underlying obligation as set forth in Article 9 §203 UCC, adopted in all 50 states.

  3. You don’t need to prove anything. But you must contest everything relentlessly and aggressively in discovery and motions.

Tonight I will take questions on this and related topics.

Homeowner’s Dilemma and Pro Se Nightmare: Wanting the system to change is not the way to win a case

Homeowners win because there is no legal claim against them. But they will lose every time if they fail to establish the inability or unwillingness of the foreclosure mill to come up with concrete evidence that there is, in fact, a loan receivable entry on the accounting ledgers of the claimant and that it got there by virtue of a real-world transaction in which value was paid for the underlying obligation.

Unfortunately, as we all know, all perjury and fraud upon the court is illegal but always allowed unless it is challenged in a timely and proper way. We need to change the rules and the preapproved form pleading such that the main element of the playbook of the banks can be defeated. The main element is to force the homeowner Into a position where the homeowner must expend huge quantities of time, money, and energy defending a frivolous claim.

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Their goal is to wear out the homeowner and the homeowner’s attorney. And they are using this strategy because it works. Over 96% of all foreclosures proceed by the default of the homeowner, to wit: they simply assume that everything alleged against them is true and they walk away.

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The rules and preapproved form pleading are focussed on judicial economy and finality — i.e., how to quickly bring a dispute to final and complete resolution. They must start somewhere and in our system, they start with the claim. In most situations, the system requires a judge to treat the claim as true for most of the proceeding unless there is something obviously wrong that is clearly and indisputably known and demonstrated.

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Claiming that aliens from the planet Zorcar gave you the assignment of mortgage would be an exception to the rule. Your claim will not be accepted as true under the rules unless you claimed (and attached exhibits) also to have proof that aliens were involved, that the planet  Zorcar existed, and that they were the owners of the underlying debt. Since your premise is outside of the normal knowledge of any reasonable person or lawyer or judge, it would be dismissed for lack of credibility — because in the absence of your allegations that you did have such proof, the presumption in that situation would be that you had no way of proving it.

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In most of the small percentage of cases where homeowners contest the Foreclosure both they and their attorneys are seeking only delays in what they think is an inevitable result. So no real effort is made to reveal the fact that the attorneys in the Foreclosure Mill have absolutely no concrete evidence to support the claim they are advocating on behalf of entities that probably don’t exist. And in most of those cases, the homeowner admits that the “loan” exists, that the obligation exists, that the obligation is owed to the claimant, etc. In doing that, the homeowner falls into a trap. Once all of those facts are admitted by the homeowner, the defense becomes “yes, but” which rarely works.
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It is only where homeowners are unrelenting in their contest of the f foreclosure and where they follow the rules on discovery, motions enforcing discovery, objections, and cross-examination that the homeowner wins. They win because there is no legal claim against them. But they will lose every time if they fail to establish the inability or unwillingness of the foreclosure mill to come up with concrete evidence that there is, in fact, a loan receivable entry on the accounting ledgers of the claimant and that it got there by virtue of a real-world transaction in which value was paid for the underlying obligation.
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You might not like that answer but it is perfectly correct and true. Your only chance of winning these cases is by excepting the fact that the rules apply and that the judge is bound to follow them. You can use the rules against your opposition and reveal the fact that there is no concrete evidence for the basic elements of their claim. But if you fail to do that, the rules favor party that makes the claim. That is not just true in foreclosures, it is true in all civil cases.
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If you want an analogy, think about a murder case. Everyone knows that it is against the law to kill somebody. And yet the murderer will go completely free without any damage to his reputation Or without any damage to his record and without any loss of freedom — unless someone catches him, charges him, shows probable cause, gets a conviction, and wins on appeal.
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Homeowners must realize that is the essence of their defense is closely related to criminal fraud. That is never going to be presumed to be true at the beginning of the case. In our system, or people who are accused of such illegal behavior are presumed innocent even if they have exhibited a pattern of illegal behavior in the past. It is an age-old problem That in individual cases people are offended that such offenders go free. We could debate the philosophy behind those rules but we cannot debate the fact that those rules exist.
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It is unfair that homeowners must master the rules of court in order to defend themselves against frivolous claims. While they are allowed to represent themselves in court they have no idea how to do that. They walk into court believing that being right is enough. It isn’t enough and it never is. So they will most often lose cases that a good trial lawyer would win. Or they delay hiring a lawyer until it is too late for the lawyer to do anything constructive under the rules.
DID YOU LIKE THIS ARTICLE?

Nobody paid me to write this. I am self-funded, supported only by donations. My mission is to stop foreclosures and other collection efforts against homeowners and consumers without proof of loss. If you want to support this effort please click on this link and donate as much as you feel you can afford.

Please Donate to Support Neil Garfield’s Efforts to Stop Foreclosure Fraud.

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*
Neil F Garfield, MBA, JD, 73, is a Florida licensed trial and appellate attorney since 1977. He has received multiple academic and achievement awards in business and law. He is a former investment banker, securities broker, securities analyst, and financial analyst.
*

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*
CLICK HERE ORDER ADMINISTRATIVE STRATEGY, ANALYSIS, AND NARRATIVE. This could be all you need to preserve your objections and defenses to administration, collection or enforcement of your obligation. Suggestions for discovery demands are included.
*
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*
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*
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CLICK HERE TO ORDER PRELIMINARY DOCUMENT REVIEW (PDR) (PDR PLUS or BASIC includes 30 minute recorded CONSULT)
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FORECLOSURE DEFENSE IS NOT SIMPLE. THERE IS NO GUARANTEE OF A FAVORABLE RESULT. THE FORECLOSURE MILLS WILL DO EVERYTHING POSSIBLE TO WEAR YOU DOWN AND UNDERMINE YOUR CONFIDENCE. ALL EVIDENCE SHOWS THAT NO MEANINGFUL SETTLEMENT OCCURS UNTIL THE 11TH HOUR OF LITIGATION.
  • But challenging the “servicers” and other claimants before they seek enforcement can delay action by them for as much as 12 years or more.
  • Yes you DO need a lawyer.
  • If you wish to retain me as a legal consultant please write to me at neilfgarfield@hotmail.com.
Please visit www.lendinglies.com for more information.

In most cases the originator labelled as “lender” was never the lender and never owned the debt — so it could not transfer or convey the loan to anyone

The challenge to homeowners and attorneys who represent homeowners in foreclosure proceedings, is to see the written documents not as presumptively true, but rather as presumptive lie.

It is true that the corut will look at documents that appear to be facially valid and then apply legal presumptions based upon the facial validity of the document. But that only happens when the document’s facial validity is uncontested — and even when the judge applies those presumptions, they are rebuttable. The mistake made by most homeowners and their lawyers is in assuming that the documents are in fact an accurate memorialization of a transction that occured in the real world. They stop their inquiry at “You got the money didn’t you?”

They accept that it was a loan with a lender and a loan account receivable on the accounting ledgers of a lender. In so doing they completely miss the fact that their homeowner client was paid for being inducted into a concealed business plan and not as part of any loan that was recorded as such on the “lender” side. They completely miss that there was no risk of loss, no loss and that everyone in fact was paid even as the foreclosure process is on-going.

see https://www.courtlistener.com/opinion/1544703/in-re-lancaster-mortg-bankers-llc/

MICHAEL B. KAPLAN, Bankruptcy Judge.

“This matter comes before the Court on the motion for summary judgment filed by Defendant, Lion Financial, LLC (“Lion”) and the cross motion for summary judgment filed by Plaintiff, Peggy Stafford, Chapter 7, Trustee (“Plaintiff’ or “Trustee”) for the Debtor, Lancaster Mortgage Bankers, LLC (“Debtor” or “Lancaster”). In this adversary proceeding, Plaintiff asserts an ownership interest in certain mortgage loans originated by the Debtor, a mortgage lender, as well as the proceeds thereof. Lion contends, however, that said mortgages are not property of the estate; rather, Defendant, which purchased the subject mortgage loans from the Debtor, asserts that it is entitled to the loans and all proceeds pursuant to the terms of its pre-petition contractual agreement with the Debtor. [e.s.]The Court heard oral argument on May 19, 2008 and ruled in favor of Lion.[1] This opinion supplements the Court’s bench ruling.”

“3 During the period 2004 through 2007, Lion, pursuant to a purchase agreement (“Purchase Agreement”) dated August, 18, 2004, would purchase from Lancaster individual loans or bulk pools of loans on a regular’basis, often as many as 30 loans per day. Lion paid for each loan in full by means of wire transfer.” [Editors’ Note: Lancaster was a strawman. But nobody, including the court, brought that up. The purchase agreement predated the loans. These were part of the genre of “Purchase and Assumption Agreements” in which third party conduits were acknowledged as owners of the loans even before applications for loan were received. In most cases such orginators were not permitted to receive or disburse the loan proceeds. Closing money arrived FBO (for benefit of) the orignator from investemtn banker controlled entity.]

“4 The original promissory notes associated with each file were then stamped “Pay to the order of [blank], without recourse” by Lancaster and delivered to Lion. In the event that the original of the Note was lost, Lancaster agreed to deliver an affidavit of lost Note or similar attestation to Lion, together with a true copy of the Note.” [Editor’s Note: Why the lost note? Because it was and still is custom and practice to destroy original notes at the time of closing. It was custom and practice and contractually requried for the “Mortgage banker” or “originator” to have a “representative” endorse the note contemproaneously with closing. The ntoe ewas then destroyed after it was imaged. This is part of an ongoing effort to change from original documentation to copies that are recreated and presented in court as though they were original documents. Allowing this change opens the door to print promissory notes (regardless of their status) on a virtually infinite basis creating vast fake money supplies. The current “shadow banking market” has cash equivalent instruments and contracts carrying a nominal value of 20 times the total of all fiat currency in the world.]

“5 Lancaster would generally execute an assignment of mortgage and in some instances the mortgage was recorded. Generally, the mortgage assignment was not recorded; however, Lion was advised by Lancaster that the property transfer would be registered with Mortgage Electronic Registration System (“MERS”) by Lancaster.” [Editor’s Note: So the assignment of mrotgage was executed but often not recorded. That gave the investment bank the flexibility to name ANYONE as the virtual creditor. That would not have been a bad thing had the investment bank not been concealing the fact that it had extinguished the obligation as it was “acquired.” The law does not recognize virtual creditors and there should be no change, but Wall Street banks acting through intermediaries, are seeking to make that change official. In Hawaii, lawyers recently filed a petition for certiorari on a case that was lost twice by them (judgment for homeowner). Their real goal is in their ask for a change in the rules to allow them to name virtual creditors and then be protected by presumptions arising from the apparent facial validity of documents.]

“6 Lion would subsequently resell the loans or have such loans serviced by Specialized Loan Servicing, LLC (“Specialized”). “[So Lion was just an intermediary as well — for an investment bank, who was always the real party in interest. In the entire process, there were no entries on the ledgers of any company reflecting payment for the underlying obligation created by issuance of the promissory note — because there was no underlying obligation. At closing, the payment received by homeowners was disguised as a loan in order to get it back. This left homeowners with risks far exceeding the known parameters of the deal and without a lender or even a loan account receivable from which the homeowner could demand an accounting. It also left homeowners with no payment at all for their services in launching an astronomically profitable business of selling securities that were only discretionary promises to pay and/or that were bets on the future reports of investment banks who referred to the performance data on loans in which they had no interest.]

“In light of the foregoing, the subject loans are not property of the Debtor’s bankruptcy estate pursuant to § 541(d) and the Trustee may not assert an interest in the subject loans having priority over Lion. Likewise, Lion is entitled to the deed tendered in satisfaction of its loan on the Siguencia Property. Accordingly, the Defendant’s motion for summary judgment is granted and the Trustee’s cross motion for summary judgment is denied. “(e.s.)[Editor’s Note: What is good for the goose is good for the gander. If the originator did not own the loans and the intermediary conduit was treated as the owner, then it follows that the originator had no power to endorse the promissory note or assign the mortgage. A homeowner with an expert opinion affidavit that this is what happened in their case, can press the judge for a ruling that the source of assertion that the currently named claimant did not legally transfer or convey the note or the mortgage,  another homeowner victory would be in sight, although not guaranteed.]

DID YOU LIKE THIS ARTICLE?

Nobody paid me to write this. I am self-funded, supported only by donations. My mission is to stop foreclosures and other collection efforts against homeowners and consumers without proof of loss. If you want to support this effort please click on this link and donate as much as you feel you can afford.

Please Donate to Support Neil Garfield’s Efforts to Stop Foreclosure Fraud.

Click

*
Neil F Garfield, MBA, JD, 73, is a Florida licensed trial and appellate attorney since 1977. He has received multiple academic and achievement awards in business and law. He is a former investment banker, securities broker, securities analyst, and financial analyst.
*

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CLICK HERE FOR REGISTRATION FORM. It is free, with no obligation and we keep all information private. The information you provide is not used for any purpose except for providing services you order or request from us. In  the meanwhile you can order any of the following:
*
CLICK HERE ORDER ADMINISTRATIVE STRATEGY, ANALYSIS AND NARRATIVE. This could be all you need to preserve your objections and defenses to administration, collection or enforcement of your obligation. Suggestions for discovery demands are included.
*
CLICK HERE TO ORDER TERA – not necessary if you order PDR PREMIUM.
*
CLICK HERE TO ORDER CONSULT (not necessary if you order PDR)
*
*
CLICK HERE TO ORDER PRELIMINARY DOCUMENT REVIEW (PDR) (PDR PLUS or BASIC includes 30 minute recorded CONSULT)
*
FORECLOSURE DEFENSE IS NOT SIMPLE. THERE IS NO GUARANTEE OF A FAVORABLE RESULT. THE FORECLOSURE MILLS WILL DO EVERYTHING POSSIBLE TO WEAR YOU DOWN AND UNDERMINE YOUR CONFIDENCE. ALL EVIDENCE SHOWS THAT NO MEANINGFUL SETTLEMENT OCCURS UNTIL THE 11TH HOUR OF LITIGATION.
  • But challenging the “servicers” and other claimants before they seek enforcement can delay action by them for as much as 12 years or more.
  • Yes you DO need a lawyer.
  • If you wish to retain me as a legal consultant please write to me at neilfgarfield@hotmail.com.
Please visit www.lendinglies.com for more information.

Will 2021 be any different for investors and homeowners?

For the last 20 years nearly everyone has had it wrong about the legal, moral, and ethical position of investors and homeowners. It is time to get it right.

The economy and the world of finance will remain on thin ice until we get back to basics. The only things holding us up right now are two things: artificially depressed interest rates and a return of “irrational exuberance” in the stock markets. Meanwhile, the siphon into the wealth of our nation is firmly in place. The Fed’s impact is diminishing by the day because the real action is in the shadow banking market with cash equivalent notional values instead of the real fiat currency market.
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The bottom line is that both investors (i.e., fund managers) and homeowners (falsely labeled as borrowers) bought a hologram of an empty paper bag. Public policy, law enforcement, and regulation utterly failed to learn and regulate the “new” derivatives. There were no derivatives. There were only lies. The same thing occurred with homeowner transactions in which the false labels promoted by Securities brokerage firms made their way into the lexicon and were treated as loans simply because the Wall Street brokerage firms said so.

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The mortgage-backed bonds were neither mortgage-backed nor bonds. They were IOUs issued in the name of trusts but the proceeds went to the bookrunner investment banks who were falsely claiming to be “underwriting” the sale of certificates, and they claimed those certificates were exempt from securities regulation because the various congressional acts that ended in the repeal of Glass Steagall resulted in such certificates being labeled “private contracts” instead of what they were — securities.
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“Underwriting is the process through which an individual or institution takes on financial risk for a fee. This risk most typically involves loans, insurance, or investments. The term underwriter originated from the practice of having each risk-taker write their name under the total amount of risk they were willing to accept for a specified premium. Although the mechanics have changed over time, underwriting continues today as a key function in the financial world.” 
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Despite all appearances to the contrary, no securities firm (“investment bank”) ever accepted any risk of loss on the sale of any certificate to investors or on any transaction with homeowners that they labeled as a loan. The “loan” label was as deceptive as calling the certificates “mortgage-backed bonds.”
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The investment banks were issuers not underwriters and they were not selling portfolios of loans; they were selling bets on their own reports of data performance about a group of business transctions that were neither owned nor controlled by them. Check it out.
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There is not a single instance where any payment from any homeowner or any foreclosure sale ever resulted in more or less payment to investors. Investors were sold on the idea that they were being protected as passive owners of certificates that conveyed no interest or control in any obligation, debt, note, mortgage, payment from any homeowner, or proceeds of any forced sale. Certain banks were paid fees to allow the use of their names as trustees on the same premise. Since they had nothing entrusted to them and they had no rights, duties or obligations relative to any “loan” or portfolio of any assets, licensing their names was a simple transaction.
Investment banks leased the name of certain banks to pretend to be trustees because they wanted cases in court to be styled as “U.S. Bank, N.A. v John Smith” instead of “Unknown parties vs John Smith.”
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Payments to investors were based upon two factors — (1) receipt of scheduled payments from homeowners who had been duped into paying back their commission on the concealed securities deal and (2) continued sales of uncertificated “certificates” in “street name” wherein the investment bank retained legal ownership of the certificates and the investors only received a statement of account.
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This bears stark similarities to the “paper crash” in the late 1960s. There again the press and regulators failed to report the essence of the problem — that securities brokerage firms had been playing with money and securities that did not belong to them. The difference is that the losses hit home because the firms were partnerships, not corporations. Now managers can engage in such moral and legal turpitude without fear of any personal consequences.
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Homeowners, for their part, issued promissory notes solely because they thought they were buying a loan product. What they received was a business transaction with no lender, no loan account receivable on the books of any entity, no compliance with lending statutes, and built-in incentives to inflate appraisals and pay money under the false premise of a viable loan.
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Homeowners were convinced that they were part of a loan transaction when in fact their services were being purchased for issuance of the fundamental element in the false representation of a loan transaction, to wit: the promissory note and mortgage. If homeowners had known that they were being asked to promise to give the commission back, none of them would have done it. Who would?
==================

DID YOU LIKE THIS ARTICLE?


Nobody paid me to write this. I am self-funded, supported only by donations. My mission is to stop foreclosures and other collection efforts against homeowners and consumers without proof of loss. If you want to support this effort please click on this link and donate as much as you feel you can afford.

Please Donate to Support Neil Garfield’s Efforts to stop Foreclosure Fraud.

Click

*
Neil F Garfield, MBA, JD, 73, is a Florida licensed trial and appellate attorney since 1977. He has received multiple academic and achievement awards in business and law. He is a former investment banker, securities broker, securities analyst, and financial analyst.
*

FREE REVIEW: Don’t wait, Act NOW!

CLICK HERE FOR REGISTRATION FORM. It is free, with no obligation and we keep all information private. The information you provide is not used for any purpose except for providing services you order or request from us. Inthe meanwhile you can order any of the following:
*
CLICK HERE ORDER ADMINISTRATIVE STRATEGY, ANALYSIS AND NARRATIVE. This could be all you need to preserve your objections and defenses to administration, collection or enforcement of your obligation.Suggestions for discovery demands are included.
*
CLICK HERE TO ORDER TERA – not necessary if you order PDR PREMIUM.
*
CLICK HERE TO ORDER CONSULT (not necessary if you order PDR)
*
*
CLICK HERE TO ORDER PRELIMINARY DOCUMENT REVIEW (PDR) (PDR PLUS or BASIC includes 30 minute recorded CONSULT)
*
FORECLOSURE DEFENSE IS NOT SIMPLE. THERE IS NO GUARANTEE OF A FAVORABLE RESULT. THE FORECLOSURE MILLS WILL DO EVERYTHING POSSIBLE TO WEAR YOU DOWN AND UNDERMINE YOUR CONFIDENCE. ALL EVIDENCE SHOWS THAT NO MEANINGFUL SETTLEMENT OCCURS UNTIL THE 11TH HOUR OF LITIGATION.
  • But challenging the “servicers” and other claimants before they seek enforcement can delay action by them for as much as 12 years or more.
  • Yes you DO need a lawyer.
  • If you wish to retain me as a legal consultant please write to me at neilfgarfield@hotmail.com.
*
Please visit www.lendinglies.com for more information.

Up in Price but Not in Value—The coming collapse of the housing market and the intersection with securities and foreclosures

They paid the homeowner to acknowledge the existence of a fictitious loan transaction so that the investment bank could sell securities that were unrelated to ownership of the “loan.”
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That money is far from cheap. It will take everything you have and more.
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For 140 years since data was compiled about this subject, the most reliable indicator of housing value came from a simple proposition: median income ultimately determines value because median income determines what people can pay. Since the 1970’s when credit cards and other forms of debt products saturated the marketplace, median income has stagnated as people started carrying more and more debt. The availability of credit replaced the availability of a living wage. The increase in debt, combined with new “indispensable services” like cell, cable, and IT subscriptions further reduced the effective median income of nearly all households. Taken from that perspective, median income has actually suffered a precipitous decline buoyed only by the continuing availability of credit. Any student of history will tell you that is a bubble that will burst.
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According to the bureau of labor statistics, the median income in the U.S. in 2019, before the pandemic, was $68,703, Now it is lower at least temporarily because of the effects of COVID19. But home prices continue to escalate because the marketplace continues to be flooded with what appears to be cheap money because Wall Street investment banks are making fortunes on deals that are concealed from homeowners.  That money is far from cheap. It will take everything you have and more.
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According to Federal guidelines, a transaction labeled as a loan is only viable if the payments do not exceed 31% of household income. So do the math. $68,703 per year is $5,725.25 per month. 31% percent of that is $1774.83 — the maximum amount that the household can safely afford to pay for a mortgage payment. The average 30 year fixed rate is 4%. So that payment could service a maximum “loan” product of around $360,000. And that is how a house zooms up in price but not in value.
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The problem with those computations is that they are riddled with fallacies and lies. It assumes that gross income can be measured by the wages of the household when the first dollars the can be spent on living are now around 20% less than gross income. So the real viability equation would reflect median household income to be around $4600 — a figure to which virtually every wage earner in America can attest. That in turn reduces the highest servicing payment for a “mortgage” payment to be reduced to $1426. So a “conforming” so-called loan is actually nonviable — despite the apparent compliance with Federal guidelines. In fact, that family can only afford a mortgage loan of around $280,000 but they have a $360,000 loan.
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Add to that the inflated appraisals based upon remote comparables or even fictitious comparables, and you have the recipe for disaster. So even if somehow this beleaguered family had been able to put 20% down they bought a house for around $450,000 with $360,000 indebtedness of which they can afford to service, at best, only $280,000. And the house in a distressed market will fall below the median income level because of the usual panic in a crisis.
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Since they were already underwater at the start of the deal, they will be wiped out when the foreclosures start — either directly by foreclosure or indirectly as the prices of homes come down relative to median income. The best they can hope for is a home worth less than $280,000 with a “debt” of $360,000 thus wiping out their down payment and all the equity they thought they had. Unlike commercial counterparts, they cannot cram down the amount of secured debt or walk away. They are stuck — and that is before they lose wages from additional losses in the pandemic or the next recession and layoffs.
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Meanwhile, the Wall Street investment bank that sold them that deal and who labeled it as a loan never intended and never allowed itself to be a lender who was required to conform to requirements in lending and consumer protection laws.  They paid the homeowner to acknowledge the existence of a fictitious loan transaction so that the investment bank could sell securities that were unrelated to ownership of the “loan.” They made at least $4.5 million on the deal with the homeowner (reported as $360,000).
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So in a rinse-repeat of 2008-2009, millions of homeowners will go into foreclosure, the economy will suffer from another recession, and the investment banks will be laughing all the way to their offshore piggy banks that now amount to many trillions of dollars siphoned out of U.S. households.
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This is all happening because very few people are even curious enough to learn what happened in the mortgage meltdown. You know what they say — “Those who do not learn from history are condemned to repeat it.” So if the last crash is any example, then a small percentage of homeowners faced with foreclosures will retain title and possession to their homes as just compensation for the securities scheme, while the rest lose their homes in legal proceedings that are falsely labeled as foreclosures.
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So why are Wall Street investment bankers giving out money on these terms? The answer is simple. first, they are making $4.5 million on the deal. Second, they are only paying a small fraction to the homeowner and they are luring the homeowner into a disguised deal that requires the homeowner to pay back the only compensation he/she ever received plus “interest.” It costs nothing for investment banks to get into this deal. No risk of loss. No risk of sanctions for violating lending laws because they never become lenders. No loan account receivable to charge off so nothing to report to shareholders about any losses arising from homeowners not making scheduled payments. Wouldn’t you do that deal if you were in the position of the investment bank?
==================
Nobody paid me to write this. I am self-funded, supported only by donations. My mission is to stop foreclosures and other collection efforts against homeowners and consumers without proof of loss. If you want to support this effort please click on this link and donate as much as you feel you can afford.

Please Donate to Support Neil Garfield’s Efforts to stop Foreclosure Fraud.

Click

*
Neil F Garfield, MBA, JD, 73, is a Florida licensed trial and appellate attorney since 1977. He has received multiple academic and achievement awards in business and law. He is a former investment banker, securities broker, securities analyst, and financial analyst.
*

FREE REVIEW: Don’t wait, Act NOW!

CLICK HERE FOR REGISTRATION FORM. It is free, with no obligation and we keep all information private. The information you provide is not used for any purpose except for providing services you order or request from us. In the meanwhile you can order any of the following:
*
CLICK HERE ORDER ADMINISTRATIVE STRATEGY, ANALYSIS, AND NARRATIVE. This could be all you need to preserve your objections and defenses to administration, collection or enforcement of your obligation. Suggestions for discovery demands are included.
*
CLICK HERE TO ORDER TERA – not necessary if you order PDR PREMIUM.
*
CLICK HERE TO ORDER CONSULT (not necessary if you order PDR)
*
*
CLICK HERE TO ORDER PRELIMINARY DOCUMENT REVIEW (PDR) (PDR PLUS or BASIC includes 30 minute recorded CONSULT)
*
FORECLOSURE DEFENSE IS NOT SIMPLE. THERE IS NO GUARANTEE OF A FAVORABLE RESULT. THE FORECLOSURE MILLS WILL DO EVERYTHING POSSIBLE TO WEAR YOU DOWN AND UNDERMINE YOUR CONFIDENCE. ALL EVIDENCE SHOWS THAT NO MEANINGFUL SETTLEMENT OCCURS UNTIL THE 11TH HOUR OF LITIGATION.
  • But challenging the “servicers” and other claimants before they seek enforcement can delay action by them for as much as 12 years or more.
  • Yes you DO need a lawyer.
  • If you wish to retain me as a legal consultant please write to me at neilfgarfield@hotmail.com.
*
Please visit www.lendinglies.com for more information.
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