Lawyer’s foreclosure defense of ‘quiet title’ faces tests

“The note is often produced at some point in the litigation, but the real problem is, how did they get it? When did they get it? And did the transfer of ownership comport with federal and Florida law for the transfer of such negotiable instruments?”
In cases that are dismissed based on these arguments, foreclosure defense attorneys said lenders aren’t as eager to re-file the case.

Editor’s Note: If you ignore the hype about history being made, this is an informative article about a trend sweeping the country. Yes it IS that simple.

The best way to smoke out the REAL LENDER is by filing a lawsuit seeking to quiet title. This has already been done successfully in dozens of cases in many states. We are tracking what people are reporting. In almost ALL cases where this was the central focus of the attack against the pretender lender, the homeowner was awarded quiet title by DEFAULT. (The other side never answered).

TRANSLATION: The Court (Judge) entered a Final Judgment declaring that the homeowner owned his/her/their house free and clear of all encumbrances. The claims of the pretender lender were thrown out and the homeowner was left with his house as an asset, not alibaility. The homeowner was no longer subject to foreclosure or ANY claim on the note or mortgage that was signed at “closing.”

Like the NY York decisions recently reported quiet title is another way to invalidate the mortgage and extinguish the note and any right to enforce it.

CAUTION: “PRODUCE THE NOTE: It’s a valid strategy but it offends the sensibilities of many judges. If THAT is the focus of your attack or defense, then you are rolling the dice on ONE thing when there are many arrows in your quiver. Many Judges have held, contrary to the rules of evidence, that merely being unable to produce the original note is NOT a reason to stop the foreclosure. Legally it can be argued this is wrong. I think it is flawed legal reasoning. But the other side is that “just because the “lender” was sloppy in its record keeping does not mean the homeowner should get away scott free. ” Actually, legally, I think it DOES mean that and that Charney is right. But I think you need to couple your argument with why this is a matter of substance and not just procedure or legal sleight of hand.

The reason why many Judges HAVE applied the evidentiary rules regarding production of the note is that there could be someone else holding it with a greater right to enforce it than the pretender lender who is trying to foreclose. And in fact (with the help of a forensic analyst to assist as an expert) the securitization process multiple parties who COULD have the actual original note in their position and/or who COULD be parties with a superior legal right to be paid on the note —because THEY are the ones who actually advanced the money for the loan or they advanced the money to third parties who advanced the money to fund the loan.

Lawyer’s foreclosure defense of ‘quiet title’ faces tests

Jacksonville Business Journal – by Kimberly Morrison

April Charney of Jacksonville Area Legal Aid.

The house at 12920 Mt. Pleasant Road is a modest ranch-style home. The man in it is John McCampbell, a 61-year-old car mechanic who lives with his two children and fiancée.
He took out a $156,000 mortgage from the now-defunct Washington Mutual, which foreclosed on his home in 2004 after he lost his job. But when the lender was unable to produce the deed to prove it had a right to foreclose, McCampbell beat the foreclosure and remains there today.
Now McCampbell and his Fort Caroline home are poised to make history in foreclosure defense with an experimental legal approach that would wipe out his mortgage debt and hand him a clean deed. It’s called a “quiet title,” where the court establishes a party’s title to the property to remove or “quiet” any challenges or claims to it.
It sounds like an impossible endeavour. But April Charney, a Jacksonville Area Legal Aid attorney, has spent the past four years teaching lawyers across the country the legal framework of this foreclosure defense. With an average of 3,000 foreclosures filed every month in Jacksonville alone, there’s no shortage of lawyers tapping her expertise.
“It’s an exceptionally layered, nuanced practice of law, but right now a very productive one,” Charney said recently after her latest sold-out seminar in Jacksonville.
Bankers counter that Charney is taking advantage of a legal technicality.
Anthony DiMarco, executive vice president of governmental affairs for the Florida Bankers Association, said errors on assignments are not tantamount to a person not being responsible for their mortgage.
“When you are doing lots and lots of anything — and there were lots of these loans written — there are human beings involved and there were mistakes along the way just like anything else,” DiMarco said.

‘Show me the note’

Before asking the court to quiet a title, a foreclosure must be dormant for five years. That brings Charney to a critical juncture in many of her early cases where the five years is at or near its expiration. She’ll be seeking multiple quiet titles in 2010, including one for McCampbell, her client.
Charney is a national authority on foreclosure defense, and a driving force behind what is often called the “show me the note” movement making its way through jurisdictions across the country. The strategy is crippling lenders’ ability to foreclose on homes when they are not able to produce the note as evidence of their right to bring a foreclosure.
At the crux of her argument is the very loan itself, securitized loans that became commonplace in the late 1990s, and quickly dominated mortgage lending practice.
Mortgage securitization is the process of bundling home loans into securities and selling them to investors. Mortgage servicers collect monthly payments and distribute them to securities investors.
But Charney said the critical error was that the originating lenders systematically pledged the loans, and didn’t actually transfer them to the trusts that are supposed to hold them and issue the securities. The result is a paper trail that goes nowhere, and a reasonably successful legal strategy.

‘A red herring’

A secondary snag in lenders’ ability to obtain a foreclosure is the physical note, or lack thereof. The Florida Bankers Association testified to the Supreme Court task force on residential mortgage foreclosure that originals were “deliberately eliminated to avoid confusion” when entered into an electronic format. The problem with that is the court requires an original.
Ownership transfers after the foreclosure has been assigned, copies of notes and false signatures have been argued to amount to fraud.
“The ‘produce the note’ argument is really a red herring,” said Chip Parker, a Jacksonville foreclosure defense attorney. “The note is often produced at some point in the litigation, but the real problem is, how did they get it? When did they get it? And did the transfer of ownership comport with federal and Florida law for the transfer of such negotiable instruments?”
In cases that are dismissed based on these arguments, foreclosure defense attorneys said lenders aren’t as eager to re-file the case.

“There is some sloppiness, and what used to be tolerated by the courts is no longer being tolerated because the judges are starting to see the effect of sloppy pleading,” Parker said.

A slippery slope?

Lenders bringing foreclosures and attorneys defending them both claim to be on the side of their communities. Lawyers said the best thing for neighborhood stability and property values is to keep people in their homes. Bankers have a different approach.
“The best thing is to get through the foreclosure as quickly as you can,” DiMarco said. “The faster you can get through a foreclosure process, the faster we can get it sold and in the hands of someone who can get to be a contributing member of the community.”
DiMarco maintained that lenders are doing everything they can to work with homeowners and avoid a money-losing foreclosure, but took notice of a new phenomenon in the housing market — strategic foreclosures on the part of consumers. With courts backed up, mortgages upside down and banks more timid about foreclosing, some consumers who can pay are opting not to.
Lawyers don’t advise those who can afford to make their mortgage payments to stop in hopes they can get a free house out of it, and aren’t convinced that their tactics could provide an incentive for people to intentionally enter foreclosure. They point out that these are long, hard-fought battles that destroy credit.
Lawyers recognize that there must be some end other than a country full of ownerless and free homes. Charney is fiercely advocating a federal intervention, which bankers similarly see as the only reasonable solution.
“I had the vice president of a big mortgage company ask me, ‘What you’re doing here — do you understand what’s going to happen? You’re going to destroy the country. And if you don’t stop, we’re just going to go to Congress and get the laws changed.’ ” said Max Gardner III, a Shelby, N.C.-based bankruptcy attorney who also teaches foreclosure defense. “And my response is, ‘We have some changes we’d like to make, too.’ ” | 265-2218

Jose L. Semidey

23 Responses

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  3. Here is something that may interest you…when researching for info to go pro se…I discovered that the mortgage had a date changed on the recorded document to coincide with the HUD and note date…the change is obvious when you enlarge the doc…also…the satisfaction of mortgage letter was not received by the homeowner who had refinanced nor was it filed until a year later by the previous lender and that original note was not returned to the homeowner at all as it should have been, this is in Miami.
    Also, the loan was supposed to be a portfolio loan…not to be sold…and when did securitization and dirivitives start? This loan was taken out in 1997…

    I would like to file for quiet title…I also had robosigning assignments…I used to pay advanced principal and never participated in the sub prime and had not idea my loan was sold…do they sell portfolio loans? What makes them different besides that they are kept in house…how can you do both? keep in house and securitized at the same time?

    I hope my questions contribution is helping some others also…thank you.

  4. Does anyone know what happened to the fraudulent notes and robosigned documents that Stern filed with the Clerk of the Courts before he went belly up? Are these banks using these as their originals? Are they requesting the court returned their “original notes” to them thereby creating replacement ones?

  5. My question is…what if the case was dismiss once or twice? Do you still have to wait for 5 years? Also, what GMAC is doing now is to send a letter saying that IMPAC that funded the loan…and transferred it to…now wants to offer a modification…but these names were never mentioned in the attempted fraudclosure…the are not sending out any bills, only notice of forced insurance..which we have our own insurance coverd and pay our own taxes…

    Thew were told that sending out any attempt to claim the loan would commit mail fraud…so now they are using realtors in complicity with some IMPAC rep, with no signature to the letter offering the modification, only GMAC letter head and the realtor sticks it in your door…or UPS notices by these modification people offering modification but with serious requirements…not automatic…your thoughts…

  6. Also if someone could post actual links to *successful* cases with case numbers that would be helpful for this and future posts.
    There is too much ranting and not enough successful clean strategy on this blog.
    Bitching about loan servicer’s wanting money is pointless; of course they do.. they will do what they can to get it.
    That kind of nonsense cheapens the whole blog as it makes casual observers think it is just a bunch of wackos spouting garbage because they can’t/won’t pay their mortgage.

    We need to keep the detritus to a minimum and focus on sharing successful strategies and case law with actual links. Pasting successful court pleadings would be great too.

    Please also state your State of origin and contact info so we can get in touch.
    Ang in Atlanta

  7. Dave Kreiger (or anyone else with info),

    Can you please post Dave’s website and contact information? Very interested in your Quiet Title action work.


  8. You can file quiet title as soon as foreclosed… at least in AZ according to the commission/judges in forcible eviction.

    YES – two thumbs up to usedkarguy !!!!

  9. Does anyone have any new information on quiet title. I too would like to know about if you have to wait 5 years to quiet title. Thanks for any new info.

  10. looking for all the answers I can find.. i am blogging from personal standpoint but I am liking the information I am finding here.

  11. Let’s cut the crap about “destroying credit”. I do credit repair. I am suing Chase Bank NA for violation of the Fair Credit Reporting Act and Fair Debt Collection Practices Act because they are now reporting my old paid off WAMU home loans as theirs and they don’t legally have the right to. They never owned them in the first place, even though my old, paid off loans were in their portfolios when they acquired them.

    The credit bureaus are going to be faced with the arduous task of now having to “legitimize” whether or not a “creditor” is the real “creditor” and not just because they claim to be. Can you see where the lawsuits against credit repositories is going to start up? These so-called subscribers of the BIG 3 may be setting up the credit bureaus for a big fall.

    FCRA 15 USC 1681e(b); 15 USC 1681s-2
    FDCPA 15 USC 1962e(2)(A); 15 USC 1692f(6)(A)

    As you can see above, which I am using as statutory violations, for each credit bureau report Chase has my 2 loans listed as being theirs (when they weren’t), X 3 credit reports = 6 total listings X 4 statutory violations X $1,000 statutory penalities each = $24,000 plus attorneys fees and costs … just for messing with my credit bureau reports! The last one with the FDCPA [808. Unfair practices] is taking a non-judicial action to effect dispossession or disablement of property if there is no present right to possession of the property claimed as collateral through an enforceable security interest. Reporting on a credit bureau report is a non-judicial action. Chase is claiming the loan was theirs. They have no enforceable security interest. The loans are paid off. The security interest was transferred to the new lender. To add insult to injury, Chase reported incorrect mailing addresses on my bureau reports. I sent a certified letter to that address that is supposed to be listed on my credit file and it came back undeliverable. Experian will hear from me on that.

    Let the fireworks begin …

  12. Does anyone have a suit based on breech of contract. Lack of consideration. Banks cannot loan thier credit?

  13. LL has a quiet title example from a California law firm here.
    Does anyone have a template or more examples and resources to win this if it comes to trial? Looking for a powerful action to stop foreclosure in California. Once in with lis pendens, I’m looking to use the time to master the issues and beat the bankers.

    David (Pro Se)


  15. Is there a standard form in county court houses for the “quieting of the title” or is this something you may need a laywer to draw up?

  16. QUIET TITLE TEMPLATES- I have wanted to sue for quiet title on a loan, but can;t find an attorney that knows anything about sold loans.

    ANYONE- with a template for a quiet title suit?

  17. I have been writing about and asking about quiet title for some time. It amazes me how such a simple tactic is not understood by most people and attorneys.

    If we all are in agreement that the notes are defective, were split up in thousand of pieces, the assignments were never recorded most parties who originated those notes are no longer in existence, they will not step up either to face all the fraud claims and those who are trying to get your home in foreclosure would have to prove their standing. It seems to me that this strategy should work at any time.

    Why wait until the end when you can get the bastards off the table from the beginning and in fact once they are removed from the table , you can then go after them for all the other fraud and illegality.

    There is an outfit called Kondour Capital entering the fray, they are purchasing servicing rights from GMAC and others. These people knowing that the consumer is ill informed and that the court are ignorant about what happens behind their closed doors are foreclosing under their name, they do not even bother to file the Trust or anything. They acquire the servicing rights , foreclose without proper standing , kick the rightful owner from their homes and sell the property right after that for a ill gotten windfall.

    The sad part is that they are choosing jurisdictions where the landlord tenant laws benefit them. In our Nations Capital, Washington DC, the owner once his property has been foreclosed , needs to get a bond of 5% of the properties current market value, plus pay the thieves rent while the court case is going.

    Can you imagine anyone of us, paying 5% of $500,000 of property market value as a bond plus a monthly rent to the same people who stole your home through fraud.

    that is more less the case in DC, in VA they require you post a bond, and so on. The courts make it impossible for many of the victims to exercise their constitutional rights. Our court system in many areas of the country are still in denial. They have no idea that the real victims are not the “LENDERS” but WE THE PEOPLE.

    It is up yto you to push your lawyer from the naive believe that they can negotiate their way through a quick settlement and for the courts to see your case for what it is, mostly your constitutional rights were crushed in the process of home ownership and now in the process of the theft of your home.

    Most lawyers out there are in for the sweet ride, piling on cases and playing the delay game. Well that does not work either. Either you fight or go and work as a greeter at WALMART, and that would still be a tall order for many lawyer who are not fit to be that LAWYERS.

    There are great lawyers out there, and you know who you are. If we could only clone Mr. Garfield we could solve half the problem we face out there.

  18. Mortgage Auditor,
    That is not what I am saying. That may be a true statement though – along the lines of “show me the note” (which I don’t think will work on its own). I am saying that if the originator pledged the note, they still have an interest in the note and it was not a true sale. Actually I would consider this an incomplete sale. The assignments should have been done WITHOUT RECOURSE, but instead they were done WITH RECOURSE. The Pooling and Servicing agreement, the Assignment and Assumption agreement and the Prospectus state that the Depositor had full legal title BEFORE assigning the mortgage to the Trustee (in my case this would be on or before the closing for the securitization, dated 11/17/2005). If this is true, why did the assignment used to foreclose on me state that Mortgage Lenders Network (the originator) assigned the mortgage to US Bank (the Trustee) in February 2009 FOR VALUE RECEIVED? Especially since the Trustee has NO PECUNIARY interest and NEVER paid anything to anyone for the mortgage.

    It may be that if they had gone to judicial foreclosure and explained what really happened, the judge would have ruled in their favor. Instead, they have resorted to fraud upon and identity theft (among other things).

    I think I have strayed away from the original question. Let me know if you still have questions.

    I am not an attorney and this is not legal advice, just my own opinions.

    Dan Edstrom

  19. Is the same Richard Davet whose appeal is on my coffee table? Guess so. You’re a legend! Sorry to hear you lost your home. You put up a helluva fight! I guess you’re still fighting. Right On! Right On! Right On!!!
    Your story was summarized in some half-assed article I hadn’t seen before, nor does it deserve any other reference. Other than that they finish it up with descriptions of your efforts as “manuevers” or “tactics” or “theories”. That “blame the borrower” CRAP that always ends up in the next-to-last sentence. We have to put an end to that.
    The way I see it, after eleven years of pro-se litigation, the day you left your property that story should have been on the six o’clock news! And that leads me to my point.
    We have to start pounding the media outlets. And maybe we have to concentrate on FOX NEWS. I know that Cavuto and O’Reilly are “blame the borrower” guys. We might get Glenn Beck’s ear when he gets off health care, but that’s going to be awhile. So here’s the plan: Start pounding your local FOX affilliate with e-mails. One a day. Compile a list of reporter e-mails and make sure they all get it. Tell them you are fighting the bank. Tell them how long you have been fighting. Tell them why you fell behind and tell them how you were wronged.
    The only businesses that haven’t been harmed by the financial crisis are GOVERNMENT, MEDIA, and BANKING! Let’s start telling these newsrooms what is going on in the Homeowner’s War and WHY!
    The reason they won’t tell anyone is THE TRUTH HURTS! The truth hurts the banks, the government, AND the media! When have you EVER heard a “consumer-corner” story about a BANK on television? You won’t, because those banks are “advertisers”. Every time I hear or see a Wells Fargo commercial: “Together, we’ll go far” ,(YEAH……INTO BANKRUPTCY!!!!!!!) I want to throw up! So let’s call these guys on FAIR AND BALANCED! Let’s start hitting their newsrooms with the stories about the court rulings and evolution of the “Homeowner’s War”. And see if we can’t get the other side of the story told. It’s about time……

  20. “No matter who else comes along, they cannot legally fulfill the terms of the pledge. If this is the case there is no owner and their cannot be an owner – except for the homeowner.”


    Is it your position that if the Note was not physically transferred to the buyer and subsequently the seller either filed for BK or stopped doing business, the debt must be nullified?

  21. It’s called the “GSE Business Model”. According to scholars, “fatally flawed”, “hopelessly conflicted” and “just does not work”. The “players” in the “Model” have worked the franchise to their own end for the past 15 years………………………………… comes reconcilement. The “investors” know it ………..but the taxpayers have not yet figured it out. When they do……….God help the “Players”.

  22. So we have come full circle. I thought the warehouse lender (sponser and/or seller and/or master servicer) PLEDGED the note on to the Depositor, who pledged it to the Trust and to the Trustee.

    From the article:

    “But Charney said the critical error was that the originating lenders systematically pledged the loans, and didn’t actually transfer them to the trusts that are supposed to hold them and issue the securities. The result is a paper trail that goes nowhere, and a reasonably successful legal strategy.”

    It is important to know who all the parties are that made a pledge. If the originator pledged it and they are no longer in business (or in my case, bankruptcy), they are unable to win if you fight correctly.

    A pledge is a promise to do something. If it never gets completed, it has not been fulfilled and their is no sale.

    So the originator pledged it and is not the owner (they were paid in full or how much? Doesn’t matter, right?)

    The parties down the assignment chain all purchased a pledge, but the company went out of business (or into bankruptcy) before it fulfilled its pledge, so they do not own it.

    No matter who else comes along, they cannot legally fulfill the terms of the pledge. If this is the case there is no owner and their cannot be an owner – except for the homeowner.

    I am not an attorney and this is not legal advice.

    Dan Edstrom

  23. Neil,

    I’m confused. The article says the foreclosure must be dormant 5 years before filing quiet title. Are you saying this is a follow-up to “produce the note” or an action onto itself?


    Fighting in CA

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