REMIC AND UCC EXPLAINED BY “SUI JURIS 249”

FROM THE EDITOR: REQUIRED READING

under FAS 140, the original lender sold it to the REMIC
and forever lost their rights to enforce the note.

the REMIC holds all the loans together into a pooling and servicing
agreement. However, because they chose to avoid the IRS tax rules for double
taxing, they pass on the real party of interest/ownership of the asset to the
individual shareholders. So neither the REMIC nor the Trustee may foreclose.

The Servicer is Not a Real Party of Interest
The Servicer can only collect the money and pass it to the REMIC. That’s the
extent of their job.

Once a loan has been written off, it is discharge. Once a loan has been
securitized, reattachment is impossible.

Reattachment is impossible for the following reasons:

1) Permanent Conversion
The promissory note had been converted into a stock as a permanent fixture.
Its nature is forever changed. It is now and forever a stock. It is treated as a
stock and governed as a stock under the SEC.
Since the Deed of Trust secures the promissory note, once the promissory
note is destroyed, the Deed of Trust secures nothing. Therefore, the Trust is
invalid.

2) Asset has been written off
Once an asset is written off, the debt is discharged since the owner of the
asset has received compensation for the discharge in the form of tax credits
from the IRS. The debt has been settled.

The servicer acts as a debt collector of an unsecured note. The servicer is
deceiving the court, the county, and the borrower when it tries to re-attach the
note to the Deed of Trust as if nothing has happened. It’s called adhesion.

3) Broken Chain of Assignment
Under Uniform Commercial Code (UCC), the promissory note is a one of a
kind instrument. All assignments (much like endorsements on the back of a
check) have to be done as a permanent fixture onto the original promissory
note. The original promissory note has the only legally binding chain of title.
Without a proper chain of title, the instrument is faulty.

Rarely can a lender “produce the note” because by law, the original note has
to be destroyed. Remember? The note and the stock cannot exist at the
same time. Often times, the lender would come into court with a photocopy of
the original note made years ago.

Another popular method of deceit “lenders” would perform is to use State Civil
Code in non-judicial states to state that “there is no law requiring a lender to
produce the note or any other proof of claim.” THEY DON’T HAVE IT and
CANNOT PRODUCE IT.

Oftentimes, the pretender lender would do blank assignments of the original
promissory note into the REMIC. Then, when they need the note to perform
the foreclosure, they will magically produce a blank assignment. Again, this is
not legal and is bringing fraudulent documents before the courts and at the
county records.

*****Let’s be very clear here. Once a loan has been securitized, the note is no
more. Anything the lender brings to court as evidence is prima facia evidence
of fraud. The attorney for the lender is either an accessory to the fraud
through ignorance or willful intent. Either way, as an informed borrower, it is
your job to bring this deception to light so these lawyers can be sanctioned****

From: The Florclosure Defense Handbook google it to get the pdf.

44 Responses

  1. I have one last question since it is tax time. Bank of America paid the taxes once again for Bank of New York Mellon/CWABS 2007-2. Problem is there is no money in escrow so who is paying the property tax? Should this be reported to any state or government officials. Also, Bank of America sends someone to my door to knock on the door. They give you a gold envelope and tell you that you need to call this number and they leave. The gold envelope has a number which is a number for Bank of America. You call the number and Bank of America states “We are a Debt Collector”. When I call the number the so called account manager is never available. I just leave a message telling them to please advise who Bank of America is a Debt Collector for?. Bank of New York has already written and said they do not have say in loan modifications nor do they physically hold the note or the property. I ask them to please put in writing who they are debt collector for. Bank of America reports to the credit bureau every single month under Bank of America that I am late on my mortgage. Bank of America is not the creditor and I have not a clue who the creditor is anymore.

  2. Where can I go to find standing of REMIC for CWABS 2007-2. I guess my question is this; In January 2008, CWABS 2007-2 filed form 15-D which shows that the pool only had 8 or less investors left which was not enough for reporting to continue to the SEC. What I know I have uncovered doing my own investigation is Bank of America is claiming to be a debt collector for Bank of New York Mellon. However, Bank of New York Mellon states they are only a trustee and do not physically own the loan or the property. Bank of America is persistent that Bank of New York Mellon is Owner/Holder of the note. Bank of America denied loan modification stating that the Investor/Bank of New York Mellon denied the modification but Bank of New York Mellon has written they have no say in loan modifications. So in my case we have America’s Wholesale Lender as the pretender lender; MERS who is as Bank of America and Recontrust claims is the Original Mortgagee and Bank of New York Mellon is the Current Mortgagee but yet I have never paid MERS, Bank of New York Mellon, CWABS 2007-2 and I am not sure that CWABS 2007-2 even exist anymore.
    I do know that Bank of America still states they will be foreclosing on the property but whose behalfe will they be foreclosing? I have in my possession Appointment of Substitute Trustee document with robo signature that I stopped the foreclosure January 31, 2011. I am wondering if Quiet Title will work in my situation.

  3. ANONYMOUS, NEIL OR OTHER EXPERTS:

    comments please:

    how can a REMIC trust, whose cutoff date was years ago, go out and buy properties at a foreclosure sale in non-judicial states such as California, and then turn around, as the new owner of the property, and file an Unlawful Detainer (eviction lawsuit)…..can this even be possible? The REMIC trust is actually named on the UD lawsuit as the plaintiff.

    The REMIC trust is named as the purchaser on the Trustee’s Deed Upon Sale which is recorded after foreclosure sale is completed.

  4. Neil

    :Yes. But will also add — that even if one assumes proper transfer — that all was done properly (which — I agree — it was not) — then we certificates derived from loan receivable assets that the security underwriters own. Once the underlying asset is non-performing — they are no longer a receivable — and can only remain in a “securitized” trust for as long as servicer advances payments to trustees. Once that ceases – and servicer deems non-collectible — derivative contracts take effect — which “swap out” collection rights.

    Foreclosure attorneys try to claim that the trust/trustee is still alive (current receivable) — when, in fact, collection rights have been swapped out. The falsity in court is naming a PAST creditor (current receivable MBS certificate holders) — when there is no longer any current receivable MBS

    To further complicate, the MBS security investors were paid by the bail out. They have no other recourse. It was the mezzanine tranche holders who were not bailed out. These were tranche holders who were entitled to pass-through of any “remaining receivables.” There are no remaining receivables because the senior certificate holders have been paid. Those trusts have been torn apart — with remnants purchased by the US government — and sold to distressed debt buyer/hedge funds — and M. Soliman may be right — also to organized REITs.

    Nevertheless, when foreclosure attorneys go to court — they still claim the original trustee is the creditor for such and such pass-through receivable trust. Unknown to many, the trustee to the trust — was also the trustee for counterparty derivative agreements. It is like attaching yourself to a shoestring that has long been detached –broken.

    Now, the question is —playing devil’s advocate — well SOMEONE is owned the money. Maybe. First — there has to be clear conveyance and execution of contract agreements from the onset — and, if that is correct — then there must be valid assignment/execution to the current creditor — if this cannot be demonstrated — and is not verified to the borrower — it is in violation of federal law.

    Further, removal of collection rights from prior “current” receivable trusts — is at a steep discount. Without disclosure of the current creditor who purchased such rights at such discount — the borrower loses all opportunity to negotiate with his/her true creditor — in violation of HAMP — and is forever unaware of the now steep discount in the mortgage loan he/she is still being held responsible for at past inflated market value.

    Equitable ??— NO!!!!

  5. Well….
    I meant “Prospectus”, but “Pro-Pest-Us” does seem apropos.

  6. Thanks Neil!

    I see your point(s).

    The certificates are just assuming ‘revenue’ from some source ill-defined.

    If I read the Propestus correctly, however, the only actual certificate ‘holder’ is DTC/Cede. The actual certificate ‘owners’ NEVER receive certificates. It’s all a book/account function of DTC/Cede for distributions.

  7. Neil- why is the note extinguished by ‘operation of law’. I for one have not seen this term before. And the problem the pretenders have is ‘that the note doesn’t describe the receiveables’ . I also don’t know of anyone -judge,atty,etc. questioning the description of the receivables in a court pleading or where that leaves us. Should this be questioned? How? Thanks

  8. BUYER: It is not that it must physically be destroyed. The issue is whether the note actually describes the obligation. It doesn’t. First the act of closing a loan wherein the lender is not revealed invalidates or destroys the note even though acceptance of the money creates an obligation. The question is to whom that obligation is owed. Second by “securitizing the receivable according to terms far different than the note ever recited, the description contained in the note becomes increasingly remote from a proper description of the obligation, which keeps changing as the receivable, not the note, moves up the securitization chain. Thus the receivable — the actual obligation that the note purported to describe — keeps changing while the note remains the same and the original note never moves physically by delivery, transfer documents (endorsement, assignment etc.) Thus the point is that the note is destroyed by operation of law. And the problem the pretender lenders have is that the note, even if it is transferred and delivered does not describe the receivable (payments from borrower, insurer, counterparties etc.).

  9. I love this argument. But, could someone please point to the rule/law which states the note MUST be destroyed once it is securitized?

    There’s kind of a disconnect there. Seems destroying the note cuts off the funding mechanism for the Certificates, so isn’t making sense to me.

  10. ANONYMOUS- in 2008 the IRS 1120REIT rules were relaxed so that REITs with insufficient cash to pay dividends to investors were allowed to pay partially in stock(of the REIT). I am trying to get a handle on how this affects everything we are discussing here. I believe msoliman’s relentless push on accounting issues is on the right track, but as you and deb wynn are currently discussing,as far as fraud in the origination(or before,when the schemes were set up,RICO statutes) once there is fraud, everything else downstream is void,or voidable. It is these void instruments or actions which the pretenders are trying to rectify via their robosigned,forged,backdated paperwork, lubricated by lobbying money,and fueled by the public’s ignorance of the issues here.

  11. Anon that’s my
    point if you have fraud at inception then nothing else follows I’ll get there. I’m working on this and will share when I got it down lol. I go the longway home lol

  12. Deb wynn

    Agree with what YOU are saying. Trying to look at M. Soliman’s angle. Appears he connects SPV/QSPE to REITs. But, if there was fraud to begin with — how is there a continuation into REIT??

  13. But… If the loans were not perfected and there were no true sales and the trust was empty what gives them the right to package and sell a cdo so one thoery is that happened on or shortly after closing behind the mers wall ….and the rest was a charade an illusion…. because ” default” and foreclosure was the goal. How perfect to have the deregulation inplace. I know I need to read more on this it got me

  14. I was just reading a copy of the Foreclosure Defense Handbook. It is 111 pages, easy to read, and explains securitization in a simple way. The lender’s game of fraud and why they have no legal authority to foreclose is very well explained. Good for the beginner too.

    http://consumerdefense.s3.amazonaws.com/ForeclosureDefenseHandbook.pdf

  15. It seems as if Niel has finally explained Soliman’s sputterings. I was glad for the explanation. Yet, now Soliman is even arguing against some of his own diatribe. Now we are confused again! Back to square one. This guy just can’t seem to get it together so he can really help anyone.
    I give him an “E” for effort, though.

    He says that his “clients don’t want to hear this” and that is simply FALSE. The truth is that EVERYONE wants to hear it and understand it and use this juicy information or they would not being giving him the time of day! …Not to mention giving him upfront fees to help us incorporate this information into our complaints. He cannot adequately convey this to our attorneys so they can use it, either.

    He just cannot seem to formulate this information into cohesive causes of action and as a consequence, we are forced to interpret him as if we were Stephen Hawkings’ sidekick.

    Then he mocks us because we are suing the bank when we should be suing the FDIC, he says… at least filing a complaint against them. But he can’t explain that either so that it makes sense and he won’t tell us how to do it. Since he can’t adequately explain things so that people can understand them, it is nearly impossible to try to figure it out for ourselves. We have the sense he is saying something really important but we cannot ever put our finger on it. Personally, I think he likes the attention of stirring up dust.

    You ask for your money back and he says okay, then he never returns it. In the meantime, you are being evicted and he accuses you of being crazy because you don’t listen to him.

    All of his “clients” are wrong and he is right. We are all stupid and he is brilliant.

    How is that behavior any better than a bankster?

  16. So deregation means that I was set up to never be allowed my right ( I assume I had the right being an instrument if negotiation I believed I had signed up for) to know who to negotiate with. And in the intrim of a fake offer of modification they take my home under false pretense that they can yet the obligation has Been reduced let’s say ” at dome point in time”
    to another party/ group of investors who are distressed debt buyers who
    then get the proceeds or what’s left of the proceeds if anything after the home is sold and liquidated I did not know this was to be my fate in the deal. What I need to proove is thst they did

  17. Yep the fraud is concealed alright. Gives new meaning to onion! Everyday I learn that the
    more I try to ” get it” the more there is to ” get” it’s important that I understand the why and that I know enough, in time, to help stop them destroying our legal foundation or what’s left of it

  18. Deb wynn,

    I understand. I am not in foreclosure — but — I am here to stand up for anyone who is in foreclosure — because – I KNOW the foreclosures are FALSE.

    It is at this time that all MUST be exposed in order to prevail. Do not need emphasis on rules or laws that protect investors. While investors may have a say in fraudulently rated MBS — the issue as to foreclosure fraud is concealed — and more pronounced than the claims for investor deception by falsely rated securities.

    Everyone must remember that securities are for cash flows — current cash flows. Foreclosures are not cash flows — and not current.

    If we are to work with “distressed debt” investors — they MUST show their face. This is not happening — and it is not happening because of deregulation which allows these distressed debt investors to keep their identity concealed..

    This is the critical issue. Willing to work with them — just show your face.

  19. indio007,

    Possession not enough — need conveyance/execution to establish possession. AND — that is the problem.

  20. Indio said “A blank endorsement turns the note into a bearer instrument. The Federal Reserve Notes in your pocket are bearer notes. Possession is enough to enforce them.”

    Lets not lose sight that we are talking about a home, aka property rights.

    Possession is NOT ENOUGH if terms are changed to the original agreement, aka, change in terms.

  21. Be careful with this “handbook.” First, it confuses matters by talking about “assignments” of notes. No such thing. Notes are commercial paper under UCC and are transferred by ENDORSEMENT and change in POSSESSION. The endorsements must be made on the original note itself or on a paper affixed to the note. Also, Article 9 of the UCC provides for alternative transfers of the note (similar to transferring/assigning rights in a contract).

    Second, when mortgages are pooled together, it is true that individual investors are owners of the beneficial interest, but the trustee holds legal title to the pool (where securitization was executed properly), and there is ample case law out there holding that such a trustee is the real party in interest with standing to pursue individual investors’ claims.

    Third, while it would be nice if blank endorsements were illegal, they are not. At least not at this point. Ibanez involved ASSIGNMENTS in blank (of MORTGAGES, not notes), while promissory NOTES are often claimed to have been transferred by ENDORSEMENTS in blank. While I wish that Levitin were right about blank endorsements violating most PSAs, he appears to be wrong on this point. Thus, brace yourselves for an uphill battle.

  22. @Scot

    A blank endorsement turns the note into a bearer instrument. The Federal Reserve Notes in your pocket are bearer notes. Possession is enough to enforce them.

  23. I too like you, M. Soliman, & wish I could understand better. I can’t really explain your reasoning to my attorney/direction I want my case to go if I can’t grasp it myself though. Can you make a “Mortgage Fraud for Dummies” article? Not calling anyone a dummy here – just myself – lol.

  24. Anon I’m a big fan of your posts it’s like rabi says it sparks discussion … It’s minefield out there. I just must prevail this is the fight of my life and so I want it all exposed no one should suffer again the way we all have as for that safe harbor repeal I also want to know more we must get ready for the next round of lies and frauds because the banksters have this desire to win even if it’s wrong. It’s in their genes …. I hope more n more folks get onboard asap.

  25. To Soliman:
    What I love about this site is that we can all benefit from the intellectual gyroscope of people like yourself .Much appreciated.

  26. @Kickboxer,
    ummm, yes. It is a shame no one can understand Soliman….he probably has some good points.

  27. Deb wynn,

    No one is questioning M. Soliman’s knowledge — clearly he is knowledgeable. His premise regarding FDIC and Safe Harbor is what I question — and his own statement regarding “the game is over” as to foreclosure victims. Do not agree with his interpretation as to this issue.

    Would appreciate other opinions on this particular issue. Thanks.

  28. Anybody see this video:

    http://www.consumerdefenseprograms.com/2011/01/

  29. In California they dont need the note. Please clarify.

  30. IN California i thought they dont need the note.

  31. I think this post is great–very clear. However, let me just say this: it would make everything much more clear if people would use punctuation like periods and commas in their posts. Also, full sentences with a subject and a predicate would be greatly appreciated. I want to read and understand every post. I appreciate that people are taking their time and work hard to post, and I want to understand what they are posting. Thank you. http://www.challengingforeclosure.com Sirak@challengingforeclosure.com

  32. M Soliman your knowledge is superior. Maybe now the world is ready for you now… your contributions on this site are appreciated this is important that you critique Neil and clarify as you have tried to today. Thankyou ” your best work has yet to be done”

  33. Wish someone else would review FDIC – Safe Harbor — Final Rule for response to M.Soliman.

    Even in there is any relevance, the MBS security investors were bailed out way before the Final Rule took effect. Derivatives are not part of Trust.

  34. m.soliman- if the banks NEVER RELINQUISHED THE NOTES- (your emphasis), but under the terms of the prospectus,the psa,the Remic/IRS laws, GAAP, FASB they were supposed to assign or otherwise disburse the notes- then this by itself would void everything downstream, including FRB 2009 changing definition of lender/creditor.

  35. I have 2 questions.
    1st- Why is a blank endorsment illegal?
    2nd- What is the difference with a partial charge off, and can this be done after the summary judgement but before the sale?

  36. TO THE EDITOR

    Dear Kick boxer

    Thank you, no acknowledgement here and still do not know why these people reject my knowledge.

    I was analyst in 2002 (What caused the major hedge funds and capital markets to rely on my analysis that caused these readers to turn on my material introduced into their cases . . .what did they know?.

    I have also engaged our firm as a servicer for all the majors (sub serving role) .

    I was a CFO for a company “Mortgage Guarantee” 1998-2001 that sold into GAAP and MBO MBS REMIC Structured finance. I was a director for a couple of REITS in SF ’96 I have been outspoken against the fraud in a CDO and preferred trust offering since 2002. This from when I and a “major hitter” Bear Sterns joined to declare to this sector and industry NO CAN DO!

    Fraudulent statements a discriminating testimony? We have spent hours on the phone with Washington office for the FDIC and they have worked to clarify things where they can and as for other material representation’s they have remained “No Comment”.

    . You would not believe what saw firsthand behind the scenes. If you ask for it we can provide it. But wow, what we saw to allow these guys to cook the books.

    By M.Soliman
    expert.witness@live.com

  37. TO THE EDITOR
    FROM M.SOLIMAN – REQUIRED CLARIFICATION
    (Have you guys consulted with a securities attorney?)

    FALSE STATEMENT Under FAS 140, the original lender sold it to the REMIC and forever lost their rights to enforce the note.

    Not true – Sold to a REIT who is the investor and beneficiary empowering the nominal interest. The REIT owns a mortgage investment portfolio and investments held in the conduit. The conduit offers common shares and preferred trust shares.

    CONFUSION -The REMIC holds all the loans together into a pooling and servicing agreement.

    What is the fascination with the pooling and servicing agreement?

    A bankrupt insulate and isolated remote entity for purposes of FAS 140 and codified IASB and FASB cannot service anything at all. You’re reading a document for the MASTER SERVICER authorizing distribution of investors earnings from a lump sum dividend that entitles each under the provisions of the SEC registration for issuing trust certificates’.

    THE INVESTMENTS WERE CHARGED YEARS AGO AND DELISTED FROM SEC ENFORCEMENT UNDER THE SEC REPURDIATORYPOWERS OF AVOIDANCE.

    Payments are not direct concern to the servicing function other than to monitor the after math of a declining pool of BORROWERS and monthly accrual obtained from a lock box in a brain dead entity.

    FALSE STATEMENTS -However, because they chose to avoid the IRS tax rules for double taxing, they pass on the real party of interest/ownership of the asset to the individual shareholders.

    NOT TRUE AGAIN. The pass through feature allows each investor to settle their tax burden with the IRS and thus the meaning of the Pass through. The management’s avoidance is unnecessary where the ownership is (1) limited to 10% for no controlling interest and (2) held as a taxable REIT subsidiary for reinvestment purposes allocated to a ceiling of 10% retaining earnings.

    TRUE – So neither the REMIC nor the Trustee may foreclose.
    WHY- Divesture and triggering recognition.

    FALSE – The Servicer is Not a Real Party of Interest
    LOOK – There is no servicing function and you’re giving them fuel by acknowledgements.

    TRUE – The Servicer can only collect the money and pass it to the REMIC. That’s the extent of their job. (MASTER SERVICER) And not true upon appointment of a special servicer such as Litton or Saxon.

    CONFUSION – Once a loan has been written off, it is discharge. IMPORTANT – Loans were “DELETED” by means and methods of deception and upon which we are working to complete our report with the US Office of the AG to show how they accomplished a BAC $10 .3 billion error.

    FALSE once a loan has been securitized, reattachment is impossible.
    NOTE – THANKS TO THE Sec of treasury and spineless ness of FASB that changed and note is no longer needed (Guys you’re going back over two years here).

    The beneficiary is actually the Bank who is now in receivership. They moved the liabilities off balance sheet and NEVER RELINQUISHED THE NOTES! THIUS TEHRATIONALE FOR DELEOTED ASSETS LISTED IN TRUST.
    Once a loan has been written off, it is either charged and Reattachment is impossible for the following reasons:

    NOTE – THE REST OF THIS PREAMBLE IS FOR RECOGNITION PURPOSES – CORRECT.

    Derecognition is exactly what they try to avoid in a trustee sale. So they orchestrate a reverse repurchase and re-establish basis in assets which is after the fact.

    We had a case by the name of Vicky Mas and presented this argument after the fact (sale). It resulted in a call from BAC Vice chairman and counsel seeking our understanding of GAAP and interpretation for BAC culpability – Our demand was for BAC to reconsider a workout or resolution to unwind the sale.

    The end to this night mare and tale of absolute bizarre consumer behavior is beyond us.

    Many early clients (published here) received this HUGE head start as early as 2008 and elected to go out on their own? Part of the problem was – I really do not know?

    It may have been due to the State and early Loan Mod confusion for loan modification scams and allegations of rouge attorneys – to avoid what the State knew and to overcome fruitful efforts of qualified professional’s engaged to assist counsel, the US AG, other States collectively and US Government agencies.

    A lot of clients did not want to hear any of this and I am not sure why?

    Note – our counsel is always and therein and above, particpating on line (BAC matter Vs. Mas 2009) and will provide affidavit if necessary. This subject matter is good stuff but a little too late….

    By M.Soliman
    expert.witness@live.com

  38. About 2 yrs ago
    I’m common sense language I asked an obnoxious attorney here in az who was making me feel
    like some kinda deadbeat…. Yeh imagine that …. Well I asked her what she knew about securitization I got a blank look at that point I told her I didn’t think she was the attorney for me … I said ” surely when you sign a contract under a believed set of terms and conditions and you later discover that those terms were changed into a different set if terms and conditions then surely there are some questions of fact about the ” loan” this was infact my starting point and I realised fairly quickly I had been used my good credit standing my name my life my money my future everything I had even my existing home 25 yrs of my hard work was pledged unknowingly by me, why, because as we all know bets were hedged in my default. How can that be a coincidence look at your neighborhood lookbat the economy … Is it ever time heads rolled

  39. Thanks for the explanation. Very much appreciated.

  40. This is the clearest,most easily understood explanation of this topic which I have seen anywhere. Who,or what,is Sui Juris 249? Did I miss something?

  41. Your quote…”Let’s be very clear here. Once a loan has been securitized, the note is no
    more.”

    I used common sense to reach the same conclusion. Securitization results in a change in terms to the original mortgage note.

    If a homeowner is foreclosed because of penalties and fees that were changed because of securitization, I believe that should qualify as a change in terms and therefore be an invalid foreclosure.

    There was a couple that was 14 cents short on a check, and they could not afford the penalties and fees that were then tacked on and they eventually lose their home.

    I think they were the victim of a change in terms from when they originally signed the mortgage note and they should be able to fight the foreclosure because it was a change in terms that led to the foreclosure.

    Thoughts?

  42. This is what M. Soliman has been saying all along isn’t it?

  43. Wow! Finally, this is explained in such a way that even I could understand it. Thank you so much.

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