EDITOR’S NOTE: The impact of rising suspicions and scrutiny seems to be evidence that the securitization intermediaries have painted themselves into a corner. It’s not over yet, folks, but reports around the nation show outright voluntary dismissals, several dismissals with prejudice executed by Judges, and even the Judges that were so dismissive of defenses raised by borrowers are slowing up the process, examining documents and applying the principles set forth in the Massachusetts IBANEZ case.

see judge-schack-dismisses-case-with-prejudice-against-citibank-due-to-counsel-failure-to-comply

These actions appear to corroborate the principles set forth on this blog in October, 2007 — that most of the so-called securitized loans were never transferred to anyone, that the originating lender was acting as a broker and not a lender, that the mortgage backed securities were sold first and THEN the loans were solicited, and that the note and mortgage were invalid although theoretically the unsecured obligation still existed without any proper documentation. It has always been the opinion expressed here that these actions were neither negligent or unintentional. The receivables were split amongst the dozen or more participants in the scheme without documentation and that was intentional because in many cases the loans were subtly changed as to one or more data fields and then sold as a different loan 2 or more times.

Thus the credit default swaps, insurance (AIG now the subject of an IPO that essentially gives control to the megabanks to hide information) and other credit enhancements were figments of imagination, entirely fictitious and comparable in style to Madoff although the amount stolen was at least 100 times as much as Madoff ever achieved. It was easy for Madoff and it was easy for the investment banks who all knew that Madoff was a fraud. They never reported it because they liked his style and intended to use it to their own advantage on an even larger scale.

With the reminder that these banks play rough and that this is not over, the outcome of these dismissals is a clear path for clear title free and clear of any mortgage, note or even obligation — not because the obligation does not exist, but because the only potential owners of that obligations have an easier and better shot at recovery by suing the investment banks than getting involved in millions of individual legal actions for damages for an unsecured undocumented obligation.


Banks drop foreclosures in Lee County & Southwest Florida.Hundreds of lawsuits dismissed.

April Charney, a Jacksonville-area legal aid attorney who’s an expert on foreclosure issues, said for the most part banks have no way to prosecute their cases because the mortgages in mortgage-backed securities were never actually legally transferred to the trusts
By DICK HOGAN • • January 19, 2011

1:10 A.M. — Banks in recent weeks have been dropping hundreds of their Southwest Florida foreclosure lawsuits instead of facing defendants at trial, according to local attorneys and court records.
Opinions varied sharply on whether that means banks are just taking a breather before refiling with stronger evidence – or giving up for good on hopelessly flawed cases.
Some foreclosures at large law firms were never actually read by the attorneys who filed them here and elsewhere, and some of the mortgages that ended up in mortgage-backed securities sold to investors were never legally transferred by the banks, defense attorneys have alleged.

“We think they’re going to come back and refile,” Lee County Clerk of Court Charlie Green said.

That’s an expensive proposition, he said, noting foreclosure suits carry a hefty filing fee: about $1,900 for a $250,000 house, for example.

What happens is lawyers for the banks are asking judges to dismiss their cases, which is “very much out of the ordinary,” Green said. “You don’t see cases dismissed without prejudice that often.”

Foreclosures were rare in Southwest Florida until the housing market crashed at the end of 2005, bringing on waves of mortgage defaults by investors and homeowners.

Green said he hasn’t calculated exactly how many foreclosures are being dismissed.

But eight voluntary dismissals were filed Tuesday alone by seven different banks including Bank of America, one of the largest filers of foreclosures in this area. Bank of America did not reply to a request for comment Tuesday.

At one court hearing alone, attorney Kevin Jursinski said, one of his associates watched as “50 in a row” were withdrawn.

“Can they re-litigate?” Fort Myers-based attorney Carmen Dellutri asked. “I don’t think so.”

Most of the mortgages in dispute were sold to Wall Street and sold in bundles to investors as mortgage-backed securities, he said. But so many mistakes were made in the process it’s unlikely the banks can win those cases.
Some mortgages still held by the bank that made the loan might be defensible but those are in the minority, Dellutri said.

He said he’s seeing cases withdrawn in large numbers in Lee, Collier and Charlotte counties, and he heard from an attorney in Jacksonville the situation is the same there.
April Charney, a Jacksonville-area legal aid attorney who’s an expert on foreclosure issues, said for the most part banks have no way to prosecute their cases because the mortgages in mortgage-backed securities were never actually legally transferred to the trusts.

She said much of the recent wave of voluntary dismissals may be a result of a Massachusetts Supreme Court ruling Jan. 7 upholding a judge’s decision two foreclosures were invalid because the banks didn’t prove they owned the mortgages, which he said were improperly transferred into two mortgage-backed trusts.

Now, she said, many mortgages simply aren’t fixable. “You can’t go back and securitize. You run a red light, you can’t go back and unrun it.”

30 Responses

  1. Bob G can you contact a fellow new yorker about this stuff. I work with an excellent attorney from Brooklyn that is actually has an appeal on record using some of the theories and techniques on this blog.

    Look up deutsche bank vs barnett (2007) 2nd division. I also have help other draft prose motion look up hsbc vs bryant (2009) and I would like to currently share with you sample motions to tried ideas.

    Your NYUCC references were awesome and cplr 4359 and its association with bringing in the original note put a smile on my face. We have been using evidence from the servicer to dispute facts alleged by the foreclosure attorneys and real property actions procedures and law violations to get judgments vacated but from what I am reading your stuff sounds alot rosier.

    What Appellate division are you located in?

  2. Bob G.

    No harm in bragging. Anything that helps homeowners is a win!!! That is all I care about.

    Believe me — people are MORE than doing their homework. “Stuff” is not without support . But – always open to other ideas!!! We all should be. Sorry you are so disturbed by it!!!! But, you do not have to listen.

  3. If I sounded like I was bragging, my apologies. Pride does goeth before a fall. Sometimes when we are on a winning streak, we tend to forget that, at our peril. Gotta stay vigilant to that one.

    Not trying to brag, just exhibiting my frustration with some of the stuff being posted here. Just seems like a damn shame that so many folks don’t do their homework or are persuaded to take unavailing and counterproductive actions in an attempt to save their homes.

    At some point, I will post my pro se law library listings. Maybe that will help.

  4. mymisstake,

    But Bob has not fallen yet — anxious to see the case–

  5. @Bob – Pride goeth before a fall. Remember that.

  6. Bob G.,

    Okay— will check NY decisions — and keep quiet – exponentially.- until you post.

  7. actually, i do for the present. connecting my cases with my name and my blog name would compromise my ongoing financial litigation interests exponentially. will release just as soon as i can. i promise.

  8. Bob G

    Would love to see you case!!! Would you share??

    You must forget — have told you many times that I cannot divulge all details. Precluded.

    Trying to give others some areas to look into. Can take it – or leave it. Up to them. I have no financial incentive – only share what I can because I care.. The who, what, where — is then up to them — in their own individual case.

    But, since your case is already decided — let us have a look-see!!!! YOU have no reason to hide!!

  9. We keep seeing articles about “Bank of JoeMagarotz sells $3MM in non-performing loans”, but they don’t mention the buyers. These are the “hedge funds”. Would these NPL’s already be extinguished, or just held as “defaulted” and then sold off as collection rights, or whole loans?


  10. they don’t need to endorse, just deposit.

  11. my check tendered for payment to Wells flew through my bank without being endorsed on the back. Just a bunch of “dots” like the printer was broke. Previous checks (prior to the mod) were endorsed legibly, this one is vacant.


  12. usedcarguy

    don’t want to rain on the parade, but that can be easily explained. loan recorded in two different pools? was sold from one to the next, but paperwork hadn’t yet had a chance to cycle through properly. that’s how it will be explained away. but keep at it.

  13. and BOB G.,


  14. @Bob G., rockin’ Rog here. Throughout my litigation I received HAMP solicitations with 2 different account numbers. I would contend my loan (defaulted and extinguished) resides in more than one balance sheet. I found it in the EX-99 for a 1999 Wells Fargo trust, but not in the WFHET 05-2 trust where it was supposed to be.


  15. ANON

    Don’t mean to be harsh with you or Neil. But dammit, you can’t just make these statements here. YOU HAVE TO SUPPORT THEM WITH PROOF. Who, what, when, where, how and why. That’s what folks here need to go into court with and win. Just saying that “these guys did this, and those guys did that”…that’s the crap that’s getting thrown out of court without concrete proof to back it up.

    I just won an appellate division case today against Wells Fargo. I FORECLOSED THEM OFF. I beat them at the trial level, and I beat them at the appellate level…as a pro se litigant. I don’t think that there are many folks in the U.S. that can say the same thing. So when I say that facts drive legal arguments, I’m not kidding. Without provable facts, and without proper legal analytics, you don’t win. Period. That’s why ya gotta have them. Leave all your speculations and emotions home. They are not only useless, but counterproductive as well. If you can’t prove it, don’t even bring it up.

  16. ANON

    Still way too complicated. Gotta simplify so even I can understand and follow the logic here. If I can’t get it…no judge is going to get it. So far, all I’ve heard is “inside baseball” by Neil and perhaps you. Nobody here is going to win any cases without making this stuff so simple even a cave man or trial judge can get it. So enough of the cloak and dagger stuff. If you guys have the goods, and the proofs, then lay them out for the world to see and understand.

    It is no longer acceptable to continue with all this “teaser” stuff. If you’re on the inside and know stuff that can actually be presented in court, so folks here can win and keep their homes and families intact, then please lay it out. All the speculative accusations and academic crap just isn’t cutting it with the judges. We need facts, and we need understandable context. Please, no more esoteric mumbo jumbo. Ya gotta lay this stuff out so that it can be shown in court to be evidence in admissible form. And it has to be understood by even an uneducated judge and his or her law clerk.

  17. Bob G.

    Think Neil is right — to an extent — but something is missing. Something important is missing. The reason that the “mortgage backed securities were sold first” — is because the refinance loans were ALREADY in MBS. The refinance itself was just to generate more fees to brokers/originators — and for them to deliver a larger debt to certificate holders. Some SPVs were set up — just as a front — with knowledge of rejection of the loan due to “missing docs”/non-compliance, violation of consumer laws, etc. etc.

    And, why did they have to reject?? Because the prior SPV that held the loan — is never paid off by payoff (among many other reasons such as paid for mortgage title not transferred to custodians (and, of course missing docs/notes/assignments.. But, no one has access to information as to loans that were actually rejected – and, no access to payoff of prior trust.

    Viola!! — reject from both trusts — and “MBS were sold first.”- but to the first trust.

    And, as far as new purchases — many were placed on path for Freddie/Fannie rejection — bumped as non-compliant — but then Fannie/Freddie were waiting in wings to purchase new MBS – not backed by them — but by the banks that scooped up the Fannie/Freddie rejects. Most PSAs/Prospectus state that loans “may or may not conform to Fannie/Freddie standards.” SPVs were set up for the rejects — but then Fannie/Freddie would “invest” in their own rejects!!!

    Under both scenarios, loans were placed in default — before they were even in default. And, insurance……….what happened there????

    Look — these players BANKED on default — that is what they wanted — they just did not want all to blow up as it did. That was a major flaw in the plan.

    Need AGs to do their job.

  18. Ian

    The motions posted on 4closurefraud do not constitute “proof” in any sense of the word. These are mere allegations, going back and forth, about a specific corporate BK case wherein BA wants discovery to ascertain if the mortgage notes were transferred unlawfully to Freddie Mac, while BA allegedly had an interest in the collateral, having provided funding for the loans in question. There was no indication of any wholesale, systemic bankster fraud being perpetrated upon investors by the banks, via selling notes to multiple parties, multiple times. But that’s what Neil’s post above alleges. And so far, I can see absolutely no proof of these allegations.

    Folks, you have to get a grip. If you don’t understand the law or legal reasoning, you’re going to get killed trying to play lawyer in this arena. Legal analysis is a science: there is no room for emotion or wishing something true when it cannot be proved so.

  19. BobG- go to 4closurefraud,today’s posting regarding Taylor Bean &Whitaker mortgage co, this suit is from 09 and 10,involves BOA,Colonial Bank,Deutschebank and loans being pledged multiple times. This is from the court transcripts,so I would say it is on the money. There’s your proof.

  20. “Evidentiary facts in admissible form drive legal arguments.”

    That is a good statement. I would love to see a pleading that references the statements made as well.

  21. Neil

    The following two excerpts from your post are troubling:

    “most of the so-called securitized loans were never transferred to anyone, that the originating lender was acting as a broker and not a lender, that the mortgage backed securities were sold first and THEN the loans were solicited”

    The receivables were split amongst the dozen or more participants * * * in many cases the loans were subtly changed as to one or more data fields and then sold as a different loan 2 or more times.”

    I have yet to see anyone produce proof positive evidence re the statements above. Further, I find it hard to believe that if such evidence exists—and it is as systemic as you assert—that it would not have surfaced to date. It seems to me, that getting folks all fire up over these unsubstantiated claims, is not only not helpful, but actually harmful. If a litigant marches into court ranting about these conspiracy theories absent any evidentiary substantiation, the Court will be predisposed to dismiss the entire case, because the defendant sounds like a lunatic with respect to these claims. So what happens is that not only will this pro se litigant lose credibility with this judge (and also lose his case), but this judge will be predisposed to treat all such foreclosure defendants similarly.

    Evidentiary facts in admissible form drive legal arguments.

    Now if I’ve missed the actual proof of these allegations elsewhere in this blog, my apologies to Neil and to all. If so, I would appreciate someone directing me to the link establishing the above allegations as factual. Thanx.

  22. NEIL said
    that most of the so-called securitized loans were never transferred to anyone, that the originating lender was acting as a broker and not a lender,

    The loans were ” Table funded ” or Brokered. After the funding in most cases NO DOCS WERE TRANSFERRED!

    WHY? The Originating correspondent was DRUNK with stupidity which infected that firms ability to operate under the Law.

    Case in point. A Broker lender like IMPAC FUNDING misses the cut-off date to trust. So IMPAC executive decides to Swap another loan for defective Loan, BUT THEY NEVER DO! So IMPAC ends up holding Mtg & Note for Certificate Holder until the deal BLOWS UP!

    So they run to the attorney’s to FIX IT. And for nearly 3 years lied to court, and Judges, and got away with it!

  23. The best part is the Fraud in the Affidavit and Fraud by Dufuss Bank Lawyer Dufuss.

    Always enjoyed reading the complaint from Attny over the lost note, but somehow the Bank ROBO was able to make a sworn affidavit that they “are in possession of Note & Mortgage ” when it was lost?????

    When the Note & Mortgage were never transferred to the trust, but Fake Lender Trust says it was lost, and Originating entity had the note & mtg the whole time ( isnt that stolen property? ).

    Then the Originating lender illegally forges a Blank Endorsement to make it look like the Trust had the docs the whole time when they were never transferred! What about a Date on that BLANK ENDORSEMENT??


  24. Ian,

    Yes – have seen this too — but, also believe — as you state — most tanked.

  25. No “game over” yet for the banks here in Cali but it gives us hope. In the meantime, all of us in non judicial states, well we just have to keep on fighting and giving them hell.

  26. You may have seen following the robosigning reports that the banks which were implicated (although every bank in the US was doing the same thing) later stated that they were resuming foreclosures in 23 states. Those were all the nonjudicial foreclosure states,where the chance of getting caught are alot less. As far as the trusts,I saw recently where over 5500 pools of loans have been resecuritized,although I wasn’t able to find out if there were 1000 loans in each pool,or 5000,or what. But apparently the issuers are,once again,shopping for the best ratings,paying 6.5% credit enhancement insurance,the same fraud. Some of these re-REMICS have already tanked again. Your loan may be in here, or in the original trust,or floating in cyberspace.NOTE: IF YOUR LOAN HAS BEEN RESECURITIZED THEN THE TRUST HOLDING THE NEWLY SECURITIZED LOAN IS DEFINITELY NOT YOUR LENDER.

  27. Why don’t we just 1099 the pretend lenders for the payment we have made to them and then let them and the IRS sort this whole mess out

  28. Would it ever be possible to back track when the certificates of trusts were issued?, then it would be very clear to what Neil is getting at, That the lenders were just brokers, and that they solicited the Predatory loans, and not vice versa!!

  29. I live in a state where there is no involvement of the judicial process in order to foreclose. That worries me and it seems really unfair in light of what is going on. If they are foreclosing with fraudulent documents in court, what must they do where the court is not involved. It must be a free for all.

  30. Just wondering if anyone know if a 1st mtg. which has been modified with additional money put on note for attorney fee which escalated the amount of the original loan and is very underwater now, Can an owner sue the mtg. company anyway as the mod has MERS all over it and owner had to sign fearing loss of home entirely. Would be nice to know if this owner would not be laughed out of court. This would be a Chase mtg. owned by Fannie Mae. Would love to know if they can fight this and have a chance.

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