COMBO Title and Securitization Search, Report, Documents, Analysis & Commentary COMBO Title and Securitization Search, Report, Documents, Analysis & Commentary

“it was the cash that was sliced and diced and not the note and mortgage, and therefore that the mortgage and note, besides being fatally defective, besides being unsecured, were intentionally split TWICE. First the obligation was split from the note and therefore the mortgage as well. And second the note and mortgage were split from each other as well. The law appears well settled that an intentional split renders the mortgage or encumbrance void.”

EDITOR’S NOTE: The reporter for Bloomberg is making a valid point, about the number of hands that touch your loan in some manner shape or form. But it misinforms the public on the basis of passing the loan around “like a whiskey bottle at a frat party.” (Mike Stuckey, MSNBC News). The assumption continues that the actual mortgage was transferred when in fact it never moved. You get the notion that the promissory note signed by the homeowner was a REAL instrument and that it too went on a journey, when in fact, it never took the first step. And so you get the idea that the note and mortgage (or deed of trust), just because there are paper documents calling themselves the note and mortgage, are related to the borrower’s obligation when in fact they are at best incomplete descriptions of the obligation, and most probably invalid or void.

The misleading theme behind all this lying and spinning is the old “you took the money, so you must be liable” line. But the fact that you received the benefit of funding or “took the money” doesn’t mean that you are liable, and it certainly doesn’t mean that you are liable to ANYONE who claims it. If that were the case, our entire system of commerce would come to a standstill because nobody would know where the transaction ended.

If you write a promissory note and mortgage ( or deed of trust) it is just paper. It doesn’t mean anything unless it describes an actual transaction. The fact that it is recorded is probably a crime in many states. So take a close look at your mortgage and note. The note, according to law, is intended to be “evidence” of the obligation. If you took money as a result of making a deal with someone, then the deal you made is the one that can be enforced — not some other deal that is described on a promissory note you were told to sign because you were told that the note contained in words the terms of the deal you agreed to take. In fact, getting you to sign that note is fraud in the execution because they got you to sign it under false pretenses.

THIS IS WHERE A CLOSE LOOK AT THE LOAN SPECIFIC TITLE AND SECURITIZATION REVIEW MAY REVEAL FATAL DEFECTS IN THE NOTE. If the note is invalid then it can’t be enforced. The note does NOT entitle ANYONE to create a substitute agreement without your consent. If it names a lender, interest rate or terms to which you never agreed, then you still owe the obligation, but the note is NOT evidence of your obligation. If the note is partially true, then outside (parole) evidence must be allowed for the court to hear the whole deal as it really was offered and accepted.

Then you get to the mortgage or deed of trust, which I have referred to as a WILD DEED. A WILD DEED is one which is executed and recorded after having been signed by or on behalf of a party who has no interest in the property or any transaction relating to the property, and whose name does not otherwise appear in the chain of title. The mortgage or deed of trust is, under the laws of most states (actually al of them as far as I know) only an incident to the NOTE because it says in black and white that it is intended to create security for the “Lender” as stated on the note. But since the “lender” was never disclosed to the borrower at all, much less on the note or mortgage, and in fact was misrepresented in the closing documents, the execution of the mortgage or deed of trust was also procured by fraud in the execution and probably qualifies as a WILD DEED or, at the very least, to be treated as a WILD DEED.

OK, since we know the note and mortgage don’t describe the obligation WE STILL NEED TO BE ABLE TO DESCRIBE THE TRANSACTION WITH FACTS CONSTITUTING ADMISSIBLE EVIDENCE IN A COURT OF COMPETENT JURISDICTION. We are left with THE NECESSITY OF PROVING the details of the ACTUAL transaction, not the one shown on paper in the note and mortgage. Since the mortgage does not secure the real transaction, the mortgage secures nothing, which means there is no legal encumbrance upon the property, which means there can be no foreclosure because the mortgage or deed of trust were fatally defective and procured by fraud at inception.

And by the way, according to Reg Z from our friends at the Federal Reserve, a “table-funded” loan is presumptively predatory if that is the pattern of conduct of the parties because it deprives the borrower of the knowledge of who is on the other side of the transaction and the opportunity to negotiate directly with that party for the terms. A Table-Funded loan is one on which the real lender is behind the curtain and the party from whom you think you are taking the loan and with whom you thought you were negotiating, and in whom you reposed your trust as  “lender” is neither a lender nor an underwriter, all representations to the contrary being false, deceptive and misleading.

As discussed repeatedly elsewhere in my blog, books, and videos, the burden of proving the transaction SHOULD be on the party seeking affirmative relief, which is the right to enforce the obligation and the right to foreclose on the invalid mortgage. Unfortunately most judges up to this point, although their number is diminishing daily, still force the borrower to prove the transaction, even though the borrower is simply entering a denial of the would-be enforcer/forecloser (pretender lender). The actual party seeking affirmative relief whether it is a judicial state or non-judicial state is the one seeking to change title to the property from you to the claimant. What could be more obvious?

But the judicial system is slow to catch up with the truth of securitization. And so you need to waive around independent title and securitization reports showing that the note and mortgage never moved, showing that it was the cash that was sliced and diced and not the note and mortgage, and therefore that the mortgage and note, besides being fatally defective, besides being unsecured, were intentionally split TWICE. First the obligation was split from the note and therefore the mortgage as well. And second the note and mortgage were split from each other as well. The law appears well settled that an intentional split renders the mortgage or encumbrance void.



In Foreclosure Limbo

A Florida couple is caught in a tangle of paperwork as their mortgage makes the rounds of lenders, databases, and debt-service agencies

By Devin Leonard

Ernie and Teri Hassell are currently in a place millions of Americans call home: mortgage hell.

In 1997 the couple used their solid credit rating to buy a house in St. Petersburg, Fla., for approximately $200,000. After Teri became sick with a gland disorder, the couple refinanced twice—once in 2003 and again in 2007—taking on additional debt to pay for her treatment. In 2008, Ernie Hassell, 62, lost his full-time job as a risk-management consultant, and the couple fell behind on mortgage payments. As a result, they tried to sell their home, on which they then owed $537,000. The best offer they got was for $259,000. The deal fell apart, and their lender tried to foreclose.

By that time the Hassells’ mortgage was already making the rounds. Their most recent lender, American Brokers Conduit, transferred custody of the loan [Editor’s note: Not true. MERS never touches one document or one penny in the transaction. Easy to prove now because of the representations on their web site and the transcripts that have gone viral on the internet]. to Mortgage Electronic Registration Systems, a digital database owned by huge lenders such as Bank of America (BAC). When the Hassells defaulted in 2008, MERS kicked the debt to American Home Mortgage Servicing, a company that specializes in handling subprime mortgages. AHMS filed a foreclosure suit against the Hassells—admitting in court papers that the couple’s promissory note had been “lost, stolen, or destroyed.” [Editor’s note: AHMS had no idea where the documents were located, if they existed or even if they were accurate renditions of the transactions with borrower].

AHMS now says it has rediscovered the document. [Editor’s Note: Maybe they have it and maybe they don’t. The use of modern technology can make any document look like an original. But even if they literally are holding the original, that doesn’t explain how they they got it, from whom they received it and what claims are being made by what parties as to any alleged liability that is expressed on the note, nor does it provide an accounting for third party loss mitigation payments that are made WITHOUT subrogation, thus providing set-off against the obligation]. A company spokeswoman blames the mishap on AHMS’s own financial woes: The firm’s parent filed for bankruptcy in 2007. Yet Matthew Weidner, the Hassells’ lawyer, is still fighting the claim. “This is a microcosm of the financial crisis,” he says. Meanwhile, the Hassells’ debt is again on the move. In November, AHMS passed the debt to Residential Credit Solutions, a Texas operation that buys busted home loans. For now, the Hassells aren’t budging. “We own this home,” Ernie says. “Even if they say we don’t.”

Leonard is a reporter for Bloomberg Businessweek in New York.

18 Responses

  1. Forensic Documents Research says: A “wild deed” is void on its face. If the self serving Trustee named in the Deed of Trust does not have a letter of indemnity, or some other kind of certification, prior to its use, it is identity theft. We must first start with the language used in the Deed, itself.

    For instance, Mortgage Electronics Registration Systems Inc. is named on my Deed of Trust, yet they were Suspended by the CA Secretary of State from 2002 until June 2010.

    First American National Title Co. is named as the Trustee, but I now have a letter from them stating they were uninformed of its responsibility and did not authorize use of their name. The Deed is void ab initio.

    Pamela Zander (760) 617-7989


    An associate came to me a couple of months ago and told me that two of his income props had been foreclosed upon by Bank of America, N.A. The bank had obtained foreclosure judgments in both cases via default, and had actually held a foreclosure sale in one case. The other case had its sale scheduled for a week hence.

    Put together two Orders to Show Cause allowing my bud defendant to submit a late Answer by reason of excusable default, based on the fact that he was a pro se litigant, the bank never even included a copy of the note and mortgage in its complaint, fraud, misrepresentation, lack of subject matter jurisdiction, etc. My friend’s papers also stated that he didn’t put in an Answer because he just naturally assumed that the judge would dismiss based on lack of submission of copies of the note and mortgage.

    Both judges signed the OSCs. Litigation mill attys for BAC claimed they needed extensions of time to get in touch with their client, BAC. My guy said to the judges why do they need a couple more weeks (which, by the way, turned into two months) to produce the note when they’ve already had two years to do so? The extensions were granted nevertheless.

    So we sent letters to the judges and copies to BAC’s attys stating that we demanded the right to have any purported original notes submitted to the Court so that our forensic expert could examine them, using yellow dot, ink and paper analytic techniques. The letters also stated that should BAC put in lost note affidavits, they would be required to double bond the value of the notes pursuant to the UCC (in NY, double bonding is mandatory).

    In the meantime, I checked Fannie and Freddie’s websites and Lo’ and Behold, guess what? Fannie owns the notes and mortgages, not BAC! So off to the judges go supplemental affidavits in further support of the OSC, showing as exhibits the Fannie web pages stating that they own the notes and mortgages.

    A couple of days ago we got the first opposition papers from BAC’s attys. No lost note affidavit, no copies of notes, no addressing the fact that Fannie owns the notes. Counsel claims that they are not required to submit a copy of the note or mortgage with the foreclosure complaint. Well, pursuant to NYUCC 3-505, they are required to present the original unless presentment is waived pursuant to NYUCC 3-511. Most mortgage notes contain this waiver of presentment language. This waiver, however, only holds up if the defendant does not dispute that the plaintiff is the owner/holder of the note.

    Also, in NY, CPLR 4539 also allows for a photocopy to be admitted into evidence if the original is unavailable. Since the original always seems to be “unavailable” a photocopy is usually admitted because the defendant doesn’t know how to challenge the submission. [Neil’s writings and products are excellent sources of ways to challenge this.] Essentially, these proposed submissions are challenged on the basis of lack of foundation and authentication, i.e., the photocopy must be authenticated by someone who had personal knowledge of the original note creation and execution, and can attest via personal knowledge that the photocopy is an exact replica of the original. No such person will ever be found who can so authenticate.
    The next thing that BAC’s attys threw into their opposition papers was an affidavit from a BAC litigation specialist, attesting to the fact that she had examined the books and records of the plaintiff and concluded that my guy was in default under the terms of the note and mortgage. Again, this is like shooting fish in a barrel. The affiant had no personal knowledge of the actual transactions between the bank and my guy. All she was competent to testify to was that she examined the books and records of BAC and that they said my guy was in default. Pure hearsay and inadmissible if challenged. She could not testify that BAC was the actual creditor and that my guy was in default to the actual creditor, because she has no personal knowledge of such matters.

    So now we come to demonstrating that it is impossible for both Fannie and BAC to own the same note and mortgage at the same time. (BTW, this note was actually an original holding of BAC, not in trust.) And this brings us to NYUCC 3-603, that states that the obligation is satisfied or discharged if payment is made by a third party even if that party is a stranger to the transaction. So we put this in his Reply Affidavits, as well. If BAC unloaded the note on Fannie, and it is sitting in Fannie’s loan portfolio and on its balance sheet, it didn’t get there by accident. Fannie paid BAC for it.

    I think that BAC has sealed off all the exits on this one all by itself. It cannot now come back to the court with the original note unendorsed to Fannie. If it is endorsed to Fannie, then BAC and its attys have perjured themselves by stating that BAC was the owner of the note and mortgage. (Another BTW…there are no assignments of these notes to Fannie from BAC to be found in the county clerks’ offices.) If they show up with an unendorsed note, they will have to explain how Fannie now owns the same note. Discovery will show that Fannie paid them for the note, and so the obligation no longer exists. My guess is that BAC will try and settle discreetly prior to final judgment, and stipulate to seal the records. This would be a big mistake on my guy’s part. He needs a final judgment on the merits, so as to preclude Fannie via res judicata from coming back and suing him on the notes. Clearly BAC is the servicing agent for this note, and will be found to be in privity with Fannie so as to preclude Fannie from initiating another action in its own name.

    Stay tuned for more news on this one.

    Also, here’s a special treat for anyone with securitized mortgages, courtesy of Brian Davies.

    I know Prof. Bloom. He has done some estate and trust work for me. He charges $500/hour. He is a renowned expert on NY trust law, and teaches at Albany Law School.
    What Bloom and Adams say in their expert witness affidavits is that it was impossible for the subject loan to have been transferred into the subject trust. Readers herein would be well advised to seek these guys out when challenging the securitization of their loans.

  3. Mary

    You do not want them to insert name of Trust — that would be fraudulent as trusts are only for current payments (pass-through receivables). You want them to name the debt buyer/hedge fund who purchased collection rights on the charged-off receivables. The mortgage contract is gone — and so is any receivable pass-through via a trust. You want to know who wrote off your receivables — and who now owns (or believes they own- as they must demonstrate this) — the collection rights to the now unsecured debt.

  4. Follow Up to my post below.


    Looks like Fan or Fred would be precluded after all.

  5. Neva,

    Please go to

    Under “enforcement actions” you will find American Home Mortgage Servicing Inc. The Department of Corps has already made the determination that AHMSI and ABC are the same.

    MY FAVORITE ONE. Zoom in on the bottom of the advertisement disclaimer and it will say dba American Brokers Conduit

    AHMSI sent letter saying they were only the servicer and not the originator when they waited four months to reply to my Qualified Written Request. gathering late fees They still foreclosed denying to be the same.

    Now I’m just getting them to send over a few docs. with help from the Department of Corps. They still wont send me the ones I’m requesting like the loan application.

    ABC and AHMSI both filed bankruptcy with in one week of each other August of 2007. Yes Wilbur purchased the falling company but AHMSI still continued to service the loans.

  6. Here’s something to consider re a Quiet Title action:

    1. Kick a pretender lender off title and sell off the property and cash out.

    2. Let’s say that Fan or Fred really owns the note.

    3. If the bank is obligated to repo the loan from Fan or Fred, will the bank then be able to
    bring another action to collect on the now unsecured note?

    4. Maybe not. Maybe res judicata will preclude the bank from bringing another action.

    5. What about Fan or Fred? Could they then come back and sue on the now unsecured note?
    If Fan or Fred owned the note, they owned the mortgage or deed of trust that goes with it. Is their
    note thus unsecured or not?

    6. If Fan or Fred’s interests in the foreclosure were being represented adequately by the bank
    foreclosing attorneys, and the bank was servicing the loan, then it may very well be that both
    Fan and Fred are also precluded from bringing another action to foreclose. (But could they
    possibly still sue on the note?)

    7. If the bank that sold the note to Fan or Fred is bound to repo the note if it goes south, that may very well explain why the banks tenaciously fight these contested foreclosure actions
    to the death.

  7. Here is the twist with mine:

    New Century originated it. Under contract with Goldman Sachs mortgage corp., to purchase. (Pre-sold agreement). Avelo serviced it and then Litton. A supposed Note (bearer paper) filed in court (stamp endorsement of a VP ercords management) in blank. Assignment in 2009 dated June 4, 2009, effective date of Feb. 21, 2009 and recorded in Land records in August 2009. Assignor MERS/servicer as nominee, for defunct NCMC to BOA, as successor by merger to lasalle bank as turstee under the pooling and servicing agreement dated March 1, 2007. No trust named in caption of complaint and no identity of any sort in complaint. two years of no discovery, now want the court to allow insert of trust name, scrivener’s error, I oppose and now set for hearing soon. Under the schedule with sec, only six loans from this area I live in and so it looks like one could be mine, but it shows all zeros across other than the amount of loan.

    No attachment to filings of authority, and there is also a collusion in my opinion regarding my mortgage. Predatory to begin with. In process of filing adversary proceeding against ncmc in delware bktcy case, already filed claim.

    It seems as though there is some hefty fraudulent activity that went on and is going on now, in aid to cover up.

  8. mary

    According to precedent case law, it depends on the terms of the warehouse line of credit. The warehouse lines of credit were provided by the major financial institutions. However, stated warehouse lender may not be the bank that purchased your origination. But, according to several courts, if the warehouse line of credit – provided to the originator, states that the line of credit can only be used to fund mortgages that the bank will purchase — and cannot be used for any other purpose — then, it is table-funded.

  9. So if abc originator on documents pre-sold loans and financed by warehouse line of credit, by def, is that considered a table funded loan?

    I have letter to closing agent, showing where the funds came from.

  10. Nei

    Again, another great post —- and, particularly “lBut the judicial system is slow to catch up with the truth of securitization” Does anyone remember that attorneys for ENRON crooks relied on judicial lack of knowledge? Oh yeah — and ENRON used the same off-balance sheet conduits.

  11. Steve, American Brokers Conduit went bankrupt in August of 2007. The top three guys were charged and one did time. Supposedly, they became American Home Mortgage Servicing, Inc. However, AHMSI only bought the right to servicing loans and did not buy the debt attached to the company, etc. They were purchased by the bottom feeder Wilbur Ross, who is attached to a hedge fund. So, if you are looking at a mortgage loan that supposedly belongs to American Brokers Conduit–that is impossible. They no longer exist. If the loan was assigned to AHMSI after August of 2007, they had no way to assign it, because they had no employees and were, in fact, defunct.

  12. American Home Mortgage Servicing has always been doing business as American Brokers Conduit.

  13. […] This post was mentioned on Twitter by Start Revolt, USA Advocate. USA Advocate said: FORECLOSURES FROM HELL — WILD DEEDS: Dec. 17, 2010 […]

  14. How does this wild deed issue play out in states such as Oklahoma, where the court of appeals last week said the mortgage ALWAYS follows the note, therefore it is not possible to separate a mortgage and a note.

    It holding that the MERS assignment was “no effect,” it seems that the Court interprets the Carpenter vs Longan case (Supreme Court 1873) exactly the opposite to what I’ve seen on many foreclosure defense sites. The Court it appears held that the MERS assignment was the nullity, not the mortgage, and reading again the often-quoted excerpt for that case grammatically, it seems the Court just might be right. I would appreciate any opinions about this.

    Here’s the quote:

    Supreme Court decision, Carpenter v. Longan (Carpenter v. Longan, 83 U.S. 271, 21 L.Ed. 313 [1873])):

    “The note and mortgage are inseparable; the former as essential, the latter as an incident. An assignment of the note carries the mortgage with it, while an assignment of the latter alone is a nullity.”

    It appears to me, without knowing more about the case, that “latter” refers to the mortgage, but “nullity” refers to the assignment.

  15. Bob-o, sounds like they assigned your loan on the lock date. check your closing doc’s for forms dated prior to closing. the EX-99’s (loan schedules) show lock date. some lenders posted the loan prior to the closing actually occurring, and failing to unwind the transaction. Hence, stories of foreclosures by banks who never held a loan.

    this is not legal advice, this is the free exchange of information amongst total strangers.

    trust me.

  16. I have an assignment of mortgage that is notarized and dated April 30, 2004 transferring the mortgage from Harris Trust and Savings Bank to the entity that is named on the note and mortgage which is The Harris Bank N.A.

    However I closed and signed the note and mortgage on May 5, 2004. Never knew about this until I checked the county records and got a copy.

    Is this standard procedure?


  18. Apparently, AHMSI and other loan servicers (pretender/lenders) just keep selling the “loan” over and over for pennies on the dollar. That may seem strange, but that is how debt collectors work. If they cannot collect for some reason (usually missing original documents, account numbers, accurate amount owed), they sell it to another debt collector (not revealing why they are selling) who assumes the new debt and tries to collect again. If the first company could not collect, all the rest of the chain of debt collectors cannot collect either IF THE HOMEOWNER DOES NOT CAVE.

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