Michigan Court Relies on New York Trust Theory, Rules Loan Never Made it to Trust




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EDITOR’S NOTE: In plain language the “securitization” of loans at least with respect to residential mortgage loans is a myth, an illusion, A LIE. It is one of many lies about these mortgages and we are living it as though it was real, which is why this blog is entitled LIVINGLIES. If the loans never made it to the trust, there was no transfer and thus there was no securitization, which means that the investors bought empty mortgage bonds with no value and no prospects for value.

This fact does NOT invalidate the obligation, however. But the fact that securitization was faked doesn’t validate the obligation either. Nor does it create a valid perfected lien against a home. That is a lie too, but for different reasons. In most instances there is no money due to anyone (except to the investors from the investment bankers) because the obligation that would been created was contemporaneously transferred to third parties who paid it. The fact that it was paid to the agents of the investors rather than the trusts or the investors themselves does not remove the fact that the obligation is paid in full and therefore not due, much less capable of being in default.

Where the article misses a key point is in its knee-jerk reaction to the accusation of free house to the borrower. If that is the collateral benefit arising out of Wall Street misconduct, so be it.

The real issue here is not whether there is going to be a free house awarded, but to whom it will be awarded. There is no reason that interlopers (pretenders) should be allowed to get the collateral benefit of a free house, having defrauded all the real parties in interest. It stands to reason that the victims of the fraud should get the collateral benefit. If that means they get a little more than they are entitled to spending upon how you look at it, this seems far more preferable than proceeding in the business as usual manner of only letting collateral benefits flow toward big business and big banks. Every once in a while, if the banks screw up enough and step on enough rakes, the little guy should get the benefits if that is the way the cards fall.

The article below from Naked Capitalism attributes the original idea that securitization was always a myth to others. It happened here first and for a long time was ignored. Now everyone is adopting it as their own idea. That is good news for homeowners. Yet it is only fair that after nearly 4 years of work to get the message out, that credit be given here that the new decisions in the last week are the result of, and in some instances quotes from the expert declarations written and signed by me. 

Michigan Court Relies on New York Trust Theory, Rules Loan Never Made it to Trust

A June 6 trial court decision in Michigan, Hendricks v. US Bank, has not gotten the attention it warrants because to the extent it has been noticed, it has been depicted as invalidating an effort to effect a note (the borrower IOU) transfer via MERS. While that was one of the grounds for a ruling favorable to the borrower, the court also considered and gave a thumbs’ up to what we call the New York trust theory. That has far more significance, as readers will see shortly (hat tip to Foreclosure Fraud for this sighting).

This legal argument, which so far has been tested in a very few cases (primarily in Alabama, since it was perfected by Alabama attorney Nick Wooten) was the basis of a favorable ruling in Alabama trial court. The reason it bears watching is that if the New York trust theory continues to be validated in court, it has devastating consequences for most post 2004 vintage residential mortgage backed securities. it has been the subject of a long-running argument among legal experts, with the Congressional Oversight Panel, Adam Levitin, as well as consumer lawyers like respected bankruptcy attorney Max Gardner on one side, and securitization industry incumbents like the American Securitization Forum and SNR Denton.

The bare bones outline of the argument is that the trusts, the legal vehicle that holds the mortgage loan, in virtually all securitizations, elected New York law as the governing law for the trust. New York law is well established and very rigid. A trust can act ONLY as stipulated; any deviation is a “void act” and has no legal force.

But the problem is that the notes appeared not to have gotten to the trust. As we wrote earlier:

…. there is substantial evidence that in many cases, the notes were not conveyed to the trust as stipulated. As we have discussed, the pooling and servicing agreement, which governs who does what when in a mortgage securitization, requires the note (the borrower IOU) to be endorsed (just like a check, signed by one party over to the next), showing the full chain of title. The minimum conveyance chain in recent vintage transactions is A (originator) => B (sponsor) => C (depositor) => D (trust).

The proper conveyance of the note is crucial, since the mortgage, which is the lien, is a mere accessory to the note and can be enforced only by the proper note holder (the legalese is “real party of interest”). The investors in the mortgage securitization relied upon certifications by the trustee for the trust at and post closing that the trust did indeed have the assets that the investors were told it possessed.

The pooling and servicing agreement also provided that the transfers had to take place by a particular cutoff date, which was typically no later than 90 days after the closing of the deal. That means notes cannot be transferred in at a later date.

The ruling is very clear that the note never made it to the trust:

Note that the judge rules that someone can foreclose, but it’s not the trust, it’s the original lender. But that is unacceptable to the mortgage industrial complex. They cannot afford to admit they defrauded investors, which is what a foreclosure in the name of the original lender amounts to.

So when people complain about borrowers getting free houses, they act as if it’s the borrower’s fault. That’s the wrong place to assign blame. No one is saying the borrower does not owe somebody money. And the borrowers aren’t seeking a free house; they usually came to this juncture because they thought their records had overcharges in them or they thought they were a good candidate for a mod but could not get the servicer to consider their case. It’s the originators and packagers who put themselves in the situation of not being able to enforce the debt, not the borrower.

The apparent widespread abandonment of the practice of crossing the ts and dotting the is potentially devastating. If the failure to convey notes properly is as widespread as we have been told by various observers (and Abigail Field’s sample confirms), the mortgage industry has a monstrous problem on its hands. As the Michigan ruling suggests, at a minimum, notes not transferred properly are actually owned by someone earlier in the securitization chain. But no one wants to admit that; it means the investors were lied to and hold paper that does not have clear legal rights to foreclose and that originatorrs, servicers and trustees have committed massive securities fraud. And in a worse case scenario, if no notes were transferred to the trust by closing, there is a contract formation failure.

This is the sword of Damocles hanging over the bond markets. The incumbents, bizarrely, seem intent on pretending it does not exist rather than trying to do something to alleviate the damage.

I’m including the full ruling below since it’s short and readable and I know some readers enjoy court filings.

Hendricks v. US Bank, June 6, 2011

41 Responses


  2. What happens to a liability of the acquired corporation in a 368(a) merger? If it disappears then the beneficial ownership of the loan is in outer space – neither with the originator nor the trust.

  3. Jan van Eck

    “You get rid of the “originator” First Franklin later on, in a quiet title action. That way, you have a shot at clearing both the Note and the Mortgage. I invite comments on the above analysis.”

    Wondering about Quiet Title for a loan paid on time to date. Cannot keep paying. This state no tender required if current or not in default yet I think.

    Original “lender and benficiary” same on Deed of Trust and Note. Nothing else recorded. Have PSA – loan identified. Original “lender and benficiary” bankrupt and taken over by FDIC and sold to “Servicer – pretender” (or is new servicer – pretender now the same as original pretender by divine decreee from FDIC?). Wiring instructions do not name “lender and beneficary”. Title Co Trust to Title Co.

    Quiet title on original pretender only? Quiet title on original pretender, current servicer pretender, trustee on Deed of Trust, Trustee for the trust…..wondering how to do this if I can talk any attorney in my town into it at any price which I cannot afford.

  4. Impac Funding (originator) refinanced me in March 2003. Securitized my loan to ? in May 2003. No assignments recorded at all. Now servicer is BoA. Sent QWR to BoA who sent me a “Certified Copy” of my loan – no endorsements at all (not even in blank). Separate letter from them “claiming” Aurora MSF Lehman owns my note without any proof.

    On May 16, 2011, I sent a letter to Impac Funding requesting that they record a Satisfaction of my mortgage as they no longer hold an interest in my mortgage or note. They have 45 days to respond. If they do record a Satisfaction, the investors (since 2003) have no recourse and will go after Impac. If they don’t record a Satisfaction, I can go to court and sue them up to the amount of the original mortgage. Damned if they do, damned if they don’t.

    Note: I am current on my mortage. Will keep you posted. 🙂

  5. On a side note to this..I am the buyer in a Private seller financed deal. We hired an account servicing agency to safeguard the “ORIGINALS DOCUMENTS FILE ” in their location of business, and to receive payments and keep impounds for insurance and taxes.
    several times the servicing has been assigned to a substitute account servicer, and now I have discovered that the ORIGINAL PROMISSORY NOTE was removed from the file, and replaced with a photocopy. There are other issues that have occured with regards to the treatment I have received from the servicing agents , but the blatant theft of MY promissory note is unacceptable, particularly in a private deal , they should never even have touched the documents other than to verify they were in fact in the file.
    I am gathering info and evidence, but can some one please help me to clearly understand how I present this to the courts, and the servicers , AND the seller, so they know I can and will take this to it’s full recourse and remedy.
    thank you…

  6. to Marie:

    It remains irrelevant if First Franklin is or was still in business at this point. It is pretty much a sure bet that First Franklin is not really the party that the appearing attorneys are representing (except on paper) or arguing for. First Franklin is not financing the defense to the Suit, nor the counterclaim. US Bank is. With the Judgment, US Bank will force First Franklin to sign over the Judgment to US Bank, then US Bank will simply take the property.

    US Bank lost in Court, but US Bank takes the property. Just watch.

    And that is why you do not sue the “originating lender” in the first place, when you also sue the other players. You will get shuffled. Remember: US Bank does not much care who gets the Judgment; they will have that entity simply sign it over to US Bank. You have to really watch out for these little traps when you go toe-to-toe with these bums. And they are bums.

  7. Jan van Eck

    Amazing scenario. Was first Franklin still in business to accept this windfall. I assume yes…

  8. My good friend just received his Lumiaq.com report to identify who the LENDER and ‘acquisiton’ company are. Thank you Neil.

    The big bad wolf (JPM) as Chase Manhattan Mortgage Corp LENDER dba Chase Home Lending (Servicer) for JP Morgan Securities won’t foreclosue on property they mishandled HAMP! So what to do about it? OFFENSE is your best defense. You don’t have to wait for foreclosure now! You can trust Luminaq.com to reveal who and without worry htey are operating for benefit of ‘Owner of Mortgage Loan’.

    You see the ‘other’ loan forensic auditors hedge what they do. They sell to consumer ‘Reconstituted Servicing Agreement’ information.

    Thank you and God Bless You Neil & Company for you indeed are Patriots!

  9. Where have all the ‘great’ attorney’s as patriots gone? They are certainly not sitting in Congress.

    I can’t believe that there is no one smart enough to fix this mess in the public domain! There is not one blessed patriot among you? You won’t even share annoymously what to do about the fact the mortgages are counterfiet and consumers as borrowers are sitting ducks not doing anything ‘meanwhile’ about the harm to the person. Why are consumers as borrowers not before the courts simultaneously pulling in the agent, broker, dealer, distributor wholesale and retail fo the local state one by one in court? Tell the truth because you can’t? or wont’?

    BURGLARY; INVASION OF THE HOME NRS 205.060 Burglary: Definition; penalties; venue.

    1. A person who, by day or night, enters any house, room, apartment, tenement, shop, warehouse, store, mill, barn, stable, outhouse or other building, tent, vessel, vehicle, vehicle trailer, semitrailer or house trailer, airplane, glider, boat or railroad car, with the intent to commit grand or petit larceny, assault or battery on any person or any felony, or to obtain money or property by false pretenses, is guilty of burglary.

    Did you invite into your home the agent? Or was the agent sent into your home by the Agency (Agreements) between (Notary Closing Settlement Services of the Settlemetn Agent who closed during Origianton for ‘Purchaser’ of Mortgage Loans, and why don’t we have in court all of the parties? Notary, AGent of Settlemebnt Agent, Mortgage Broker, Appraiser, Underweriter (Title Corporation who approved policy for LENDER), and funded transactions for ‘Lender’ in AGency with ‘Mortgage Loan Owner’ who remains undisclosed party only by the individual’s acts of omissions.

    Omissions are sins when with intent to hide takings of property by deceptive acts in which third parties are taking possession of property in larcenous manner and not following stautory federal and state laws rather are conducing ‘business’ via ‘Agency’ limited powers of attorney, bailment letters, etc.

    Interesting list of – CRIMES AGAINST PROPERTY

    ‘Counterfeit Mortgages’
    ‘Counterfiet Mortgage Bonds’
    ‘Counterfiet Mortgage securities Fraud Relevations…’
    ‘Counterfiet Court Summons’
    ‘Counterfeiting mortgage fraud’
    ‘Warehouse Lending Losses under Financial Institution Bonds’
    ‘Counterfiet mortgage-backed securities ‘items’ nearly identifical to authentic cashier’s checks…’


    NRS 205.0821 Definitions.

    NRS 205.0822 “Check” defined.

    NRS 205.0823 “Control” defined.

    NRS 205.0824 “Deprive” defined.

    NRS 205.0825 “Draw” defined.

    NRS 205.08255 “Intangible property” defined.

    NRS 205.0826 “Issue” defined.

    NRS 205.0827 “Obtain” defined.

    NRS 205.0828 “Property of another person” defined.

    NRS 205.0829 “Services” defined.

    NRS 205.083 “Transfer” defined.

    NRS 205.0831 “Value” defined.

    NRS 205.0832 Actions which constitute theft.

    NRS 205.0833 Theft constitutes single offense embracing certain separate offenses; specification of charge in indictment or information.

    NRS 205.0834 Determination of amount involved in particular theft.

    NRS 205.08345 Participation in organized retail theft ring; penalties; determination of amount involved in thefts committed by organized retail theft ring; venue.

    NRS 205.0835 Penalties.


    NRS 205.085 Definitions.

    NRS 205.090 Forgery of conveyances, negotiable instruments, stock certificates, wills and other instruments; utterance of forged instrument.

    NRS 205.095 Other acts constituting forgery.

    NRS 205.100 Making, uttering or possessing with intent to utter fictitious bill, note or check.

    NRS 205.105 Forgery of instrument purporting to have been issued by corporation or state.

    NRS 205.110 Uttering forged instruments: Forgery.

    NRS 205.115 True writing signed by wrongdoer’s name or name of person not in existence.

    NRS 205.120 False certificate to certain instruments punishable as forgery.

    NRS 205.125 Misconduct in signing, filing or altering petition; penalties.

    NRS 205.130 Issuance of check or draft without sufficient money or credit: Penalties.

    NRS 205.132 Issuance of check or draft without sufficient money or credit: Presumptions of intent to defraud and knowledge of insufficiency; malice in causing prosecution.

    NRS 205.134 Issuance of check or draft without sufficient money or credit: Posting notices.

    NRS 205.160 Possessing or receiving forged instruments or bills.

    NRS 205.165 General reputation may be used to prove incorporation in trial for forgery of bill or note of incorporated company or bank.

    NRS 205.170 Expert may prove forgery or counterfeit.

    NRS 205.175 Counterfeiting seals; forgery of signatures of public officers; sale or possession of counterfeit badge or identification of law enforcement agency.

    NRS 205.180 Counterfeiting gold dust, bars or other articles; making or possessing instruments.

    NRS 205.185 Possessing or receiving counterfeit gold dust, silver, bullion or bars.

    NRS 205.195 Counterfeiting stamps and labels.

    NRS 205.200 Goods containing forged stamps.

    NRS 205.205 Counterfeiting trademark or design.

    NRS 205.210 Selling, displaying or advertising goods with false trademark.

    NRS 205.215 Fraudulent registration of trademark.

    NRS 205.216 Unlawful operation of audiovisual recording function in motion picture theater.

    NRS 205.217 Unlawful reproduction or sale of sound recordings.


    NRS 205.2175 Definitions.

    NRS 205.218 “Domesticated animals” defined.

    NRS 205.2185 “Domesticated birds” defined.

    NRS 205.219 “Livestock” defined.

    NRS 205.2195 “Property” defined.

    NRS 205.220 Grand larceny: Definition.

    NRS 205.222 Grand larceny: Penalties.

    NRS 205.226 Grand larceny of firearm; penalty.

    NRS 205.228 Grand larceny of motor vehicle; penalty.

    NRS 205.230 Duties of peace officer concerning grand larceny of animal.

    NRS 205.240 Petit larceny; penalty.

    NRS 205.251 Determination of value of property involved in larceny offense.

    NRS 205.260 Negotiable and other instruments subjects of larceny.

    NRS 205.265 Commission or part ownership no defense for larceny.

    NRS 205.267 Penalty for theft of scrap metal.

    NRS 205.270 Penalty for taking property from person of another under circumstances not amounting to robbery; limitation on granting of probation or suspension of sentence.

    NRS 205.2705 Use of unlawful coin or cheating device in vending machine, telephone or other coin operated device prohibited; penalty.

    NRS 205.2707 Penalty for theft of money or property of value of $250 or more from vending machines; determination of value of property taken includes cost to repair any damage to vending machine.


    NRS 205.275 Offense involving stolen property: Definition; penalty; restitution; prima facie evidence; determination of value of property.

    NRS 205.290 Restoration of stolen property to owner.

    NRS 205.295 Restoration of stolen property: Duties of officers.


    NRS 205.300 Definition; punishment.

    NRS 205.305 Prima facie evidence of embezzlement.

    NRS 205.310 Contractor failing to pay for labor or material.

    NRS 205.312 Willful or intentional failure to return leased or rented vehicle to owner: Inference of embezzlement.


    NRS 205.320 Threats.

    NRS 205.322 Extortionate collection of debt.


    NRS 205.330 Fraudulent conveyances.

    NRS 205.335 Sale or removal of goods subject to security interest by debtor in possession without consent of secured party.

    NRS 205.340 Sale or creation of security interest in personal property subject to security interest or lien without informing purchaser or secured party.

    NRS 205.345 Destruction or removal of personal property upon which security interest or lease exists.

    NRS 205.350 Removal or sale of property to defraud creditors.

    NRS 205.355 Fraudulent sale or concealment of personal property after action commenced or judgment rendered.

    NRS 205.360 Knowingly receiving fraudulent conveyance.

    NRS 205.365 Fraudulently selling real estate twice.

    NRS 205.370 Swindling; credit by false representations.

    NRS 205.372 Mortgage lending fraud; penalties.

    NRS 205.375 False written statements to obtain property or credit.

    NRS 205.377 Multiple transactions involving fraud or deceit in course of enterprise or occupation; penalty.

    NRS 205.380 Obtaining money, property, rent or labor by false pretenses.

    NRS 205.390 Obtaining signature by false pretense.

    NRS 205.395 False representation concerning title.

    NRS 205.400 Fraud by bailee of animal.

    NRS 205.405 Falsifying accounts.

    NRS 205.410 Improper use of insignia.

    NRS 205.415 Collecting for benefit without authority.

    NRS 205.420 Use of false permit, license or writing.

    NRS 205.435 Fraudulent issue of stock.

    NRS 205.440 Publishing false statement to affect market price.

    NRS 205.445 Defrauding proprietor of hotel, inn, restaurant, motel or similar establishment.

    NRS 205.450 Personating another.

    NRS 205.455 Personating another same as stealing.

    NRS 205.460 Preparation, transfer or use of false identification regarding person under 21 years of age; penalties; demand of proof of age as defense to certain proceedings.


    NRS 205.461 Definitions.

    NRS 205.4611 “Artificial person” defined.

    NRS 205.4613 “Document” defined.

    NRS 205.4615 “Older person” defined.

    NRS 205.4617 “Personal identifying information” defined.

    NRS 205.462 “Public body” defined.

    NRS 205.4623 “Public employee” defined.

    NRS 205.4627 “Public officer” defined.

    NRS 205.4629 “Vulnerable person” defined.

    NRS 205.463 Obtaining and using personal identifying information of another person to harm or impersonate person, to obtain certain nonpublic records or for other unlawful purpose; penalties; rebuttable inference that possessor of personal identifying information intended to unlawfully use such information.

    NRS 205.464 Obtaining, using, possessing or selling personal identifying information for unlawful purpose by public officer or public employee; penalties; rebuttable inference that possessor of personal identifying information intended to unlawfully use such information.

    NRS 205.465 Possession or sale of document or personal identifying information to establish false status or identity; penalties; rebuttable inference that possessor of personal identifying information intended to unlawfully use such information.

    NRS 205.4651 Identity theft program card: Application; issuance; presentation to law enforcement agency or creditors; discretion to accept or reject program card; application not public record; regulations; acceptance of gifts, grants and donations.

    NRS 205.46513 Establishing or possessing financial forgery laboratory unlawful; penalty; expert testimony.

    NRS 205.46515 Capturing, storing, reading, retaining, using or disclosing information from radio frequency identification document of another person; penalty.

    NRS 205.46517 Court records.

    NRS 205.4653 Prosecution regardless of whether person whose personal identifying information was stolen is living or deceased, is artificial person or suffers financial loss or injury.

    NRS 205.4655 Exempt persons.

    NRS 205.4657 Defenses not available; jurisdiction.


    NRS 205.466 Creation and operation of program; acceptance of person in program.

    NRS 205.467 Notice to persons accepted into program.

    NRS 205.468 Actions required of persons accepted into program.

    NRS 205.469 Agreement to suspend prosecution of person accepted into program: Entry; conditions; completion.

    NRS 205.471 Collection of fee from offender; amount and disposition of fee.

    NRS 205.472 Statements by person referred to or participating in program inadmissible in civil and criminal proceedings.


    NRS 205.473 Definitions.

    NRS 205.4732 “Access” defined.

    NRS 205.4735 “Computer” defined.

    NRS 205.4737 “Computer contaminant” defined.

    NRS 205.474 “Data” defined.

    NRS 205.4742 “Encryption” defined.

    NRS 205.4743 “Information service” defined.

    NRS 205.4744 “Internet or network site” defined.

    NRS 205.4745 “Network” defined.

    NRS 205.475 “Program” defined.

    NRS 205.4755 “Property” defined.

    NRS 205.4757 “Provider” defined.

    NRS 205.4758 “Provider of Internet service” defined.

    NRS 205.4759 “Response costs” defined.

    NRS 205.476 “System” defined.

    NRS 205.4765 Unlawful acts regarding computers: Generally.

    NRS 205.477 Unlawful interference with or denial of access to or use of computers; unlawful use or access of computers; affirmative defense.

    NRS 205.481 Forgery by creation, alteration or deletion of data, information, image, program, signal or sound contained in computer.

    NRS 205.486 Unlawful use of encryption.

    NRS 205.492 Unlawful acts involving electronic mail or transmission of other data, information, images, programs, signals or sounds to computer, system or network.

    NRS 205.498 Provider of Internet service required to keep certain information concerning subscribers confidential; notice required to be provided to subscribers.

    NRS 205.506 Unlawful acts regarding information services.

    NRS 205.509 Presumption of authority of employee.

    NRS 205.511 Victim authorized to bring civil action.

    NRS 205.513 Enforcement of provisions.


    NRS 205.520 Issue of document of title for goods not received.

    NRS 205.530 Issue of document of title containing false statement.

    NRS 205.540 Issue of duplicate or additional negotiable document of title not so marked.

    NRS 205.550 Delivery of goods covered by outstanding negotiable document of title without obtaining negotiable document.

    NRS 205.560 Issue of negotiable warehouse receipt not stating fact of warehouseman’s ownership.

    NRS 205.570 Obtaining or negotiating document of title for goods with intent to defraud.

    NRS 205.580 Inducing bailee to issue negotiable document of title when goods have not been received.

    NRS 205.590 Negotiation of document of title when goods are not in bailee’s possession.


    NRS 205.601 Definitions.

    NRS 205.602 “Payment card” defined.

    NRS 205.603 “Reencoder” defined.

    NRS 205.604 “Scanning device” defined.

    NRS 205.605 Using scanning device or reencoder to defraud.

    NRS 205.606 Possession of scanning device or reencoder for unlawful purpose.

    NRS 205.607 Exempt persons.

    NRS 205.608 Defenses not available.


    NRS 205.900 Unlawful use of hotel key; penalty.

    NRS 205.910 Unlawful use of television or radio signals; unlawful manufacture or sale of devices to intercept or decode signals; penalty; exceptions.

    NRS 205.920 Obtaining or attempting to obtain telephone or telegraph service with intent to avoid payment; penalty.

    NRS 205.930 Manufacture, possession, sale or other disposition of equipment or information for obtaining telephone or telegraph service with intent to avoid payment; penalty.

    NRS 205.940 Conversion of rented or leased personal property; penalty; defenses to civil action.

    NRS 205.950 Unlawful receipt of fee, salary, deposit or money to obtain loan for another; penalties.

    NRS 205.960 Qualified intermediaries of clients with certain property: Unlawful acts; criminal penalty; civil penalty.

    NRS 205.965 Unlawful possession, making, altering, forgery or counterfeiting of sales receipt or inventory pricing label; penalties.

    NRS 205.970 Unlawful possession, manufacture, sale or distribution of theft detection shielding device or theft detection device deactivator; penalty.


    NRS 205.980 Determination of value of loss from crime; notice to victim; order of restitution deemed judgment to collect damages.


  10. @Jose and @Louie – I’m really trying to be a consumer advocate and point out what should be obvious : that yes, the site has some great information, but that it’s also a commercial enterprise selling Neil’s products. No one else has gotten flamed for pointing out that the securitization reports and expert declarations are not admissible in a court setting. All I’m really saying is that you need to be careful how and with whom you spend the limited resources available to save your home. I’m not living the hell that some of the commenters here are, but I venture to say that many of us who are not may only be 2 or 3 paychecks away from it. And that’s assuming it’s a payment issue. Misapplication of payments, screwed escrow accounts, etc. can happen to anyone. I do play devils advocate and I do pick on Neil sometimes. But each time is because I think he’s either not telling the complete story or because aspects of the case cited are pulled out of context in order to fluff up the ideas of this site. Read my posts again – I always praise Neil’s efforts and those of other major commenters. @Louie – I think you’re trying to suggest I’m M. Soliman. I’m not. He’s been posting in the last couple days as well.

  11. The most difficult thing to do is foreclose outside a robust market. It cannot be done – but continues to happen . Our lawyers should be ashamed of themselves.

    This is a case i live for. JPM Chase Bank is foreclosing as the “assignee” / succcessor to Chase Finance LLC . JPM Chase Bank is the acceptance, settlement , source and use and “Name on the Promissory Note ”

    Its common to make a note payable to the makers order. In such a case the payee could not bring an action against himself ….as maker. But in repsect to form, the note is valid and if tranferred to a second person the instrument becomes enforcable as an obligation. Upon a transfer to a thrid person , the acceptance becomes operative.

    Prima facie evidence of a fact, is in law sufficient to establish the fact, unless rebutted. it is prima facie evidence of negligence on the part of those who have the charge of it.

    Make it a great day –


  12. foreclosurewebpage@wordpress.com, on June 16, 2011 at 6:11 am said:

    The most difficult thing to do is herein subject matter is foreclose outside a robust market. It cannot be done – but continues to happen . Our lawyers should be ashamed of themselves.

    This is a case i live for. JPM Chase Bank is foreclosing as the “assignee” / succcessor to Chase Finance LLC . JPM Chase Bank is the acceptance, settlement , source and use and “Name on the Promissory Note ”

    Its common to make a note payable to the makers order. In such a case the payee could not bring an action against himself ….as maker. But in repsect to form, the note is valid and if tranferred to a second person the instrument becomes enforcable as an obligation. Upon a transfer to a thrid person , the acceptance becomes operative.

    Prima facie evidence of a fact, is in law sufficient to establish the fact, unless rebutted. For example, when buildings are fired by sparks emitted from a locomotive engine passing along the road, it is prima facie evidence of negligence on the part of those who have the charge of it.

    Make it a great day –


  13. This case was argued in part by Jeff Barnes, who is much better at this than I am. I would note, however, that the case seems to have a structural flaw in that it cited “First Franklin” as a Defendant. First Franklin was the so-called “original lender”, the one on the Note, so the County Trial Court did what could be expected – they proceeded to “grant Defendants’ Motion for a judgment of foreclosure, in favor of First Franklin, on their judicial foreclosure counterclaim…” [see last paragraph]. So the homeowner substantively lost the house.

    You may have defeated MERS and the “NY Trusts,” but you get foreclosed on. That is not a good ending. You sue to win, not to lose.

    Let’s go back to look at how the transactions went. First Franklin is (on paper) sitting at the closing table with the homeowner borrower on “October 30, 2006” [see 2nd paragraph of the Opinion]. MERS gets the Mortgage to “hold the legal title to the interest granted” in the mortgage [see pg. 4]. Now First Franklin tries to “endorse” the Note from itself to “First Franklin Financial Corp.,” which in turn endorses the Note “in blank” [see pg 6]. The Court rules that these transfers are “void ab initio,” although in all candor I find the Court’s reasoning muddled. Nonetheless, by the time the dust settled, the Note at least is Ruled to still belong to First Franklin.

    By suing First Franklin together with everybody else, the door was opened for the joint defendants (presumably First Franklin never really showed up before the Court, it was US Bank pretending to be First Franklin and US Bank filed the counterclaim for foreclosure in First Franklin’s name and probably with their permission outside the Court’s knowledge) to go into Court and say: “OK, if you guys don’t like our MERS theory or our NY Trust theory then hand us the property based on the ‘lender’ theory of First Franklin” – and that is exactly what the Court did! Yet, obviously, First Franklin no longer had any interest to protect -the note and mortgage were “sold.”

    That leads us to the real stumbling block, that Jeff Barnes did not put to the Court: that “First Franklin” was a stooge outfit, a “table-funded lender,” really just a fee-based loan brokerage. How do we know this? Because First Franklin had the mortgage made out to MERS on the closing date of Oct. 30, 2006, and then MERS “assigned” the mortgage to US Bank also on October 30, 2006. The money came from some warehouse lender (unknown to the Court and the homeowner) which got the money from some pre-assembled and pre-sold “pool” of cash assembled on Wall Street months before, probably by Merrill Lynch [they seem to show up on the papers] and floated through some back-door or back-alley channels to the warehouse outfit, then advanced to the closing escrow agent by some wire transfer in the name of First Franklin although the cash never even went through First Franklin’s bank account! We have all seen this cute little punt before.

    So what is the raw truth? Somebody else, probably an outfit in Iceland or Norway, put up some pension-fund cash into the grubby mitts of Merrill Lynch, who issued a worthless “certificate”as a claim onto an unfunded NY Trust in return. The real investor got nothing. Half the cash ended up directly in the hands of the NY hustlers as “bonus money” [I won’t describe this one, but take my word for it] and the other half gets floated out to the warehouse lender, unknown to anyone. The homebuyer goes to the table and is told the loan is from the smiling folks at First Franklin – except that not one penny comes from them. They “close” – and First Franklin pockets some “origination fee,” probably about $15,000. The paper gets stamped to the FF Service Corp, then to “blank,” and goes into the black hole of Star Trek. The mortgage goes to MERS, their own black hole, and some “assignment” reconstructed in 2009 is made to look like it was in 2006 – all phony, of course. The Court sees all this, cannot make head nor tail of it, declares MERS a non-holder of anything (all true), declares the Trust never got the loan (all true) – but then goes ahead and hands the property to the fee-based loan broker – First Franklin!

    Why does the Court do this amazing thing? Because the Court is at wit’s end – they do not know how to resolve the issue. Nobody raised the issue that FF was a broker, not a lender, and (most critical) that the Note and Mortgage did not describe the real lending transaction! That the lending transaction was with some unknown party, deep in the shadows, that was never on the Papers and not identified! Now I surmise that Jeff Barnes figured that the Court could not think that far ahead, so he took a measured litigation step and just went after Merrill and US Bank – except that left the door open to a Judgement for First Franklin and a defeat for the homeowner. In my view, if you go that route, then do not Summons and Serve (and sue) the “originator:” here, First Franklin. Leave them out of it completely. They are not coming in of their own volition because they have no interest to protect.

    You get rid of the “originator” First Franklin later on, in a quiet title action. That way, you have a shot at clearing both the Note and the Mortgage. I invite comments on the above analysis.

  14. I find this on the web and wanted to share:

    I thought the banks had gone as far as possible to take money from the taxpayers and the government through their TARP funds and the manner in which they paid it back, enabling them to pay bonuses to their executives without government interference. They did not make the money by doing what banks are supposed to do, which is lend money. Instead, they invested it in the stock market, driving it up, and then selling and reaping the profits.

    Of course, that results in capital gains that is taxable income with no offsetting deductions other than capital losses. God forbid the banksters should pay tax to the government (and the taxpayers) who bailed them out. They had to come up with a way to create more capital losses.

    Of course, for these brilliant people, this was an easy task. Here is what they did, and I have the proof, which I am forwarding to the Internal Revenue Service this week. This was a JP Morgan Chase Bank transaction.

    1. When they foreclose on a property, they report the “transfer value” to the county recorder. I am not sure how this affects the property taxes in other states, but in California the property taxes are assessed based upon the transfer value, as are the transfer taxes. The property for which I have the proof was reported to the county as having a transfer value of $143,000.

    2. Chase then issued to the previous owner a 1099-A, as required by Federal law, to report the amount of the obligation and the fair market value of the property. In this case the outstanding principle was $283,000.00. In spite of the fact that they had shown a transfer value of $143,000 to the county, Chase reported that the Fair Market Value of the property was $345,000, more than $200,000 higher!

    3. Chase then put the property on the market for $147,000, even though they had already turned down a short sale offer of $150,000 cash. They ultimately sold the property for $130,000.

    What this means is that they now showed a capital loss of the difference between what they reported as the Fair Market Value ($345,000) and the final selling price ($130,000). Using those numbers, their capital loss was $215,000 which they could now offset against the capital gains from their stock dealings, saving them $32,250 in Federal taxes, and who knows how much in state taxes.

    Doesn’t seem like all that much for a big corporation such as Chase, but multiply that by 100,000 foreclosures and you come up with something like $3 billion dollars in fraudulent tax evasion.

    In the mean time, our government leaders ignore these facts and have allowed the big banks and the rest of the financial markets to run our country because they have all of the wealth. They continue to drive down the prices of homes through the foreclosure process, while the government sits on the side lines making meaningless gestures regarding helping homeowners, while allowing the banksters free reign in destroying the fabric of America.

  15. Retaining Foreclosure Defense Attorney After Post Judgment
    Mark Stopa Esq. http://www.stayinmyhome.com

    I had an awesome day today, as I was able to get a St. Augustine judge to grant a motion for rehearing, vacate a Final Judgment of Foreclosure, and cancel a pending foreclosure sale. The homeowner tried to defend himself, pro se, lost, and he got a lawyer involved just in the nick of time.

    After the hearing, when I got back to the office, a staff member asked me why I don’t accept more foreclosure cases where a Final Judgment of Foreclosure has already been entered. I got this judgment vacated, so it was a legitimate question – particularly since we get inquiries for such cases on a regular basis.

    Here’s the problem. No matter how erroneous a Final Judgment of Foreclosure may be, i.e. regardless of the existence of foreclosure-fraud, robo-signers, etc., there are certain procedures that must be followed to get a Final Judgment vacated, failing which it must remain in place.

    Specifically, the homeowner has 10 days to move for a rehearing, 30 days to file a Notice of Appeal, and, generally speaking, 1 year to file a 1.540 motion (for things like fraud on the court).

    If you don’t meet these deadlines, it doesn’t matter if you’re correct on the merits – you lose. (The only exception is if the judgment is void for something like improper service and that argument wasn’t waived, but that’s relatively rare). You can’t go to the appellate court on day 31; it’s too late. Unfortunately, this is what happens on a regular basis – the homeowner loses the case via entry of a Final Judgment of Foreclosure (having defended the case pro se or not at all), and the sale date is set 60 days out. On day 40 or 50, with the sale approaching, the homeowner realizes he better hire a lawyer. But by then it’s basically too late. Game over.

    In theory, you could still file a 1.540 motion, but that’s typically the equivalent of a Hail Mary. And yes, you can still file a bankruptcy, take advantage of the automatic stay, and get the sale cancelled, but that’s basically just a stall – it’s not going to unwind the Final Judgment of Foreclosure.

    Hence, as much as I want to help homeowners facing foreclosure, I’m not going to take their money when they essentially have no chance of winning, for procedural reasons. In other words, to answer my staff member’s question, this is why I don’t take many cases post-judgment – typically, the homeowner is procedurally barred from challenging the court’s ruling, even if it’s erroneous.

    So what’s the lesson here? Don’t wait to hire a lawyer. Get one right away. Otherwise, it may be too late, even if your arguments have merit.

    I don’t think I’ll ever see a better illustration of that than what I saw today.

    At the summary judgment hearing, the pro se homeowner argued that summary judgment was inappropriate because discovery was outstanding (in particular his request for production and interrogatories). He was right, too – there are dozens of Florida cases setting forth this proposition of law – but the judge entered summary judgment anyway.

    The homeowner hired an attorney, who quickly filed a motion for rehearing. Months later, when the sale got rescheduled, he hired me. I saw the motion for rehearing had been filed, and I like how the homeowner preserved the argument about outstanding discovery, so I took the case. Anyway, at the hearing, the judge made a point of saying that he was perturbed at how the homeowner was pro se and was filing papers that were inartfully drafted. He made a point of this, at length, before granting my motion.

    Bear in mind, the argument I made, which the judge agreed with, was the exact same argument the homeowner made, pro se, which the judge rejected. I’d like to think I made the argument more eloquently than my client did, and I supported the argument with case law. But the judge was aware of that line of cases already. Hence, in a sense, I didn’t do anything different than the homeowner did, except he lost and I won.

    If you think this is unfair, and the result shouldn’t be different simply because it is argued by a lawyer, I wouldn’t disagree with you. But here’s the point. Judges in foreclosure cases are, in my opinion, more likely to follow the law when a lawyer is arguing for the homeowner. The way I presented the argument, I made it clear to the judge, in a respectful way, that if he didn’t vacate the Final Judgment that I would procure that result in the appellate court. To illustrate, after showing him several cases which reversed judgments where discovery was outstanding, I asked the judge, as an alternative argument, to cancel the sale and stay the case pending appeal. Pro se homeowners just aren’t able to do that, and without the threat of appeal, judges are more likely to what they think is fair. Often, given how many judges feel about foreclosure cases, that is a Final Judgment of Foreclosure.

    Think about it this way – if you know your boss is looking over your shoulder while you’re working, aren’t you a little more cautious about crossing your Ts and dotting your Is? That’s my take on how judges are in this context. Judges often don’t want to let pro se homeowners live for free. They’ll often do so if the law requires, but if a lawyer isn’t there showing them the law, they’re more likely to do what they want.

    In sum, if you’re wondering how a lawyer can help, remember this case. I made the same argument this pro se homeowner did, but he lost and I won. And if you’re wondering when to hire a lawyer, remember those procedural bars. This homeowner was lucky; many wait too long, and at that point, they’re out of luck.

    Mark Stopa Esq.


  16. Thank you Leapfrog. I’m checkin it out right now.

  17. SO EASY TO SEE HOW ECONOMY HARMED WHEN “Borrower not at this closing table with OWNER of ‘Mortgage Loan’ and OWNER of Mortgage Loan not at the Table with the Borrower. What’s the violation of your state’s disclosure laws?


    The Depositor (an SPV) special purpose vehicle (subsidiary) of Lehman Brothers Holdings Inc. has acquired the Mortgage Loans FROM
    Lehman Brothers Holdings Inc. (the “Seller”) (CASH DEPOSIT GOAL into Bank owners convert into securities as stock $100M cash = $100M stock (S/3 and S/3A Forms) over rolling six month period.

    At the Closing Date is the owner of the Mortgage Loans and the other property being conveyed by it to the Trustee for inclusion in the Trust Fund.

    On the Closing Date, the Depositor will acquire the Certificates from the Trust Fund, as consideration for its transfer to the Trust Fund of the Mortgage Loans and the other property constituting the Trust Fund.

    The Depositor has duly authorized the execution and delivery of this Agreement to provide for the conveyance to the Trustee of the Mortgage Loans and the other property constituting the Trust Fund.

    how by bailee letter?

    All covenants and agreements made by the Depositor, the Master Servicer and the Trustee herein with respect to the Mortgage Loans and the other property constituting the Trust Fund are for the benefit of the Holders from time to time of the Certificates. The Depositor and the Master Servicer are entering into this Agreement, and the Trustee is accepting the Trust Fund created hereby, for good and valuable consideration, the receipt and sufficiency of which are hereby acknowledg

  18. Sorry if this question has been answered already, but I’m not understanding how the heck someone can be foreclosed on if the trust is nonexistent at this point—and the fake “loan” never even went to a trust! Hello? No actual lender—just the servicer trying to foreclose… My servicer said that my loan was in such and such trust, and Deutsche owns the trust…BUT THE TRUST IS EMPTY SO HOW CAN THEY FORECLOSE???

  19. Louie Hammer I couldnt have said it better. But a devils advocate is a good thing.
    What motivates tnharry to comment on this site.

  20. Dear Tnharry, it seems you are a new comer to this web site. It took Mr. Garfield almost three years to get his head around generating a report that made sense and that if used as evidence at least it has served as a reference, in a world where we were being sold crappy TILA computer generated fluff for even $3,500.00, his pseudo report is a bargain. It also seems you have some beef with the editor of this blog. If that is the case, you will do well in coming out and be honest about it. at least the editor of the blog is not crucifying you or editing your relentless attacks.

    It has taken four years for the truth to come out. And for the victims to be vindicated. It may never be fair, but at least the thieves will finally be known as such. A $1,000 report is more than fair to pay to some one who has spent thousands of hours sharing freely and without regard to who you are. What we do with the info is another thing. If were unlucky to hire incompetent lawyers, if we were ignorant about the laws, the courts and other no less important minutia.

    so there you go Mr. Tnharry, try to be more constructive and collaborative. we welcome everyone ideas, but to crap in the yard of your neighbor is not the best idea and it looks really trashy as well.


  21. “It doesn’t seem like (Fannie) really cares much about our homeowners or assisting homeowners stay in their homes,” Sen. Rosalyn Baker, who co-introduced the mortgage bill, said in an email.”


  22. “I expect the courts to look with great scrutiny on any foreclosure matter that comes before them, especially now.



  23. How do you like these banana’s:


    “In May, Gov. Neil Abercrombie signed Act 48, a measure requiring lenders to meet face-to-face with homeowners for mediation before foreclosing on a property.”

    “Lenders” http://en.wikipedia.org/wiki/Loan

    “One reason supporters of Act 48 were so pleased with its passing was the requirement that lenders prove they have authority to foreclose on a home.”


    “If Fannie Mae thinks somehow they’re going to get a better deal going through the courts and that they won’t have to present the same documentation demonstrating their legal ability to foreclose, I believe they will be sadly mistaken,” Baker wrote Civil Beat via email. “I expect the courts to look with great scrutiny on any foreclosure matter that comes before them, especially now.

    “The people of Hawaii today are very proud of their Legislature for (Act 48),” Andleman said. “It was a grassroots movement, they felt like they had a real success on a national scale. I mean it was a big deal. They won and they did something good. And then Fannie just went, ‘(expletive) you.'”

    “We’ve tightened up the law to protect, we think, both sides,” Herkes said. “And I think the lenders were having a little bit of a free ride under Part 1 of the non-judicial (foreclosures) and certainly, they’ve got a wake up call. They say, ‘Oh my. Now we have to prove we’re the lender. How rude.”


  24. My wife and I applied for a home modification. Of course, this led to a foreclosure action beginning some 10 months later. We didn’t know this was “the usual” when we applied, but after 9 months and 250 calls, we had become well informed.
    I sued in small claims court, inspired by a San Bernidino County, CA BofA customer:
    Other helpful sites: http://livinglies.wordpress.com/ http://stopforeclosurefraud.com/
    I knew that Small Claims DIDN’T HAVE THE JURISDICTION under New York State laws that I was going to bring up and the case would likely be transferred to a higher court. However, I needed to offensively move against BofA in some court someway before they took our house. Small Claims was all I could afford. Available Justice of some kind has to be guaranteed, even to the poor, in New York State (and everywhere else too, really).
    As soon as I sued, BofA started to respond! They stopped the Foreclosure actions. They fixed our credit rating that THEY had trashed when they reported us “late” on our payments. We never missed any payment of any kind to that bank or to ANYONE ELSE. After more than 200 phone calls TO THEM over nine months, WE RECEIVED OUR FIRST PHONE CALLS FROM THEM!!!
    Eventually we got a cash settlement, indemnification of the deed of trust and original note (because we knew that none of the big banks have either). We discovered that BofA didn’t want to go INTO ANY COURT. In a nutshell, I told them we would move for Quiet Title or they could settle. They settled.
    A high powered New York City law firm handled the case for them.
    The reason that our case is interesting is that we were able to judicially raise issues against BofA for $20. I can honestly say that we got everything from them we wanted (and deserved)…over a four month period during which they repeatedly “continued” the case while negotiating with us mostly in good faith…for a change!
    We now have a good working borrower’s relationship with the bank.
    I would suggest that it is time for a revolution if all our institutions have failed us. BUT, we will not know, for at least 5 years, if such is the case. We must be as patient as the Founders were patient.
    I had a choice to go for Quiet Title or for a Settlement and in my case it would have been impossible to commit the TIME to deal with all the attorney’s that BofA would have HAD to put up against me to DELAY, perhaps, for years, a single “free house” decision. While there are significant numbers of “free houses” being had right now*, but no one has gotten a FREE HOUSE from BofA yet (that I’m aware of)! Besides, I was not pursuing a LEGAL matter. I wanted a settlement, not a house for FREE or an exciting LEGAL PRECEDENT. I am a Taliesin trained architectural designer, not an attorney!
    That said, I believe that 1,000 attorneys must get their clients houses for FREE if the banks and government are NOT GOING TO DO ANYTHING! Either that or we start shooting. Every homeowner caught in the present system should threaten to move for Quiet Title and take the Settlement every bank always offers, because (1) you will be in Court and (2) they certainly won’t want to be there. Because? Well, because that’s because our “civil wars” in this Republic (you know, the one established for the “General Welfare” and all that), the Court is our bloodless battleground where things do get settled!!!
    Bank of America has to guarantee for the life of my mortgage that I don’t have to pay for my house TWICE. I’m happy with that and the Courts that may rule in my case in the future will be happy with that. If I had not gotten that protection, I might have to pay for my home twice. Some “investor” somewhere, sometime, could prove in Court (as they surely will be able to do) that BofA didn’t really own my Note or Mortgage. If some “investor” does, I’m going to be happy to get any standard attorney, to fight my rather standard court case against BofA. (Actually, because of many little “wins” against BofA and their ilk, in future reality BofA will probably face a different kind of end.)
    I’m positive that they don’t have the (negotiable) Note or the (supporting) Mortgage. I am positive, they know they don’t own either of them. (The big shot banks and et al, all jumped off the MERS cliff together.) AG’s collectively lack character and guts to do anything. Congress is owned almost completely outright by the banks. The President is either in the same position or HE HAS SOME LONG TERM PLAN that, in the meantime, puts all of us on our own. I believe that a person has to be equally owned by our financial culture, ignorant or fearful and spineless not to AT LEAST GO INTO COURT. I only chose Small Claims, because I knew everything would be kept so simple that BofA’s high powered lawyers would be powerless against me there.
    I also went into Small Claims court because my attorney, well that is, the only attorney I could afford to talk to, thought it was a plausible choice for me to make. “My Attorney” was a certain Assistant Attorney General for the State of New York.
    I put Small Claims “out on the table” and I paused. I waited for him to say something. He didn’t say anything to discourage me. I GOT the message.
    And, by the way (I’m sorry to take up so much space), during the grueling 4 months of hammering out a settlement (after filing the Small Claims Suit) and getting all the “poison pills” out of their documents (refusing to sign the first modification), BofA’s management “higher ups” called the State Attorney General of New York’s office in Albany to whine about how mean, bad and unfair we were being to them!!! At the time, when an Assistant Attorney General called my wife, it gave us quite a lift to receive SUCH RELIABLE CONFIRMATION that we WERE being tough enough to make BofA’s key management people squeal!

    *This is only one example of five that I know of from MA to UT
    Anthony Ray
    Tila Solutions, LLC
    702 410 8466
    Dear John,
    Recently you contacted us because you were having troubles with your mortgage. At that time, we discussed possible solutions for you and I sent follow up information for you to review. Since then, very important information has come out in the Wall Street Journal. Now is the time to take decisive action to keep your home. I think after you read this article you will begin to see why so many homeowners contact Tila Solutions to get audits done.
    Also, I want you to know that just last week, we heard from an attorney who was able to get a foreclosure vacated because of our audit. Just two days ago, we heard from a paralegal firm that the audit we provided to them was a key document in getting a homeowner title to his property free and clear. And finally, last week alone our negotiators reported that more than a dozen auctions were stopped and we had a record week for approved loan modifications. Everywhere you turn, you hear the name Tila Solutions associated with success. …
    Anthony Ray

  25. Issa wants more evidence before granting servicer subpoenas

    Sign The Stop Foreclosure NOW Petition! Rep. Darrell Issa needs proof I say lets give it to him. Please send your Foreclosure Story to: Jon Prior of Housing Wire

    Monday, June 13th, 2011, 4:40 pm
    Rep. Darrell Issa (R-Calif.) asked Rep. Elijah Cummings (D-Md.) last week to present “a clear case” before he issues a subpoena to mortgage servicers under investigation for possible mishandled foreclosures.

    Cummings, a ranking member of the House Committee on Oversight and Government Reform, opened his investigation in February. In May, he sent a letter to Issa, chairman of the committee, formerly requesting to subpoena servicers that refused his requests for information.

    Please Sing the Stop Foreclosures NOW Petition!

    In a meeting between the two staffs June 6, Issa said he needed to see more evidence that the banks were ignoring Cummings and a subpoena was the only way to get the information.

    “In this case, Ranking Member Cummings has not prepared any persuasive report or memo outlining the evidence of the necessity for a subpoena,” an Issa spokesman told HousingWire.
    According to Issa’s office, when Bank of America heard of Cummings’ letter, the bank contacted both staffs and insisted they did not receive a request from Cummings. The spokesman said both Issa and Cummings are still in discussions but a decision will only be made “once the facts are clear,” the spokesman said.

  26. tnharry, every chance you get you try and find fault with Neil’s articles,or his business of selling services to people, which they can determine of their own free will, the benefit that they will receive from them. Neil has made it clear on many occassions what it is the people will receive. As a business man he has every right to be compensated for his effort. If you can do a better job why don’t you get your own site and leave Neil’s site alone for people with a more positive input. Your manners and the way you attack things reminds me a self proclaimed expert witness that frequented this site in the past. My thought is that your probably the same guy with an ax to grind and won’t just pick up your toys and go bye, bye.

  27. A California court has ruled that MERS business model is legal:

  28. @Caryl – kudos to you. This site does facilitate the exchange of ideas and theories, but its primary function is to sell Neil’s products, many of which are either nearly useless and all of which are overpriced in comparison to the outside market. That Neil claims credit for this and the Alabama decision is beyond me, and that he claims that his expert declaration was relevant is just ludicrous. The reports and searches are useful tools for prep, but they are just that – tools. They aren’t admissible, and the expert declaration isn’t admissible in court in any way. Neil’s done a lot of good for a lot of people, but Max Gardner has been doing this much longer than the 4 years that Neil references in the self-serving editorial commentary…

  29. It’s official: We have truly entered the Twilight Zone…


  30. Once again, here is the frauddigest.com info re. trusts:


  31. Dylan Ratigan wrote a new post America for Sale: Is Goldman Sachs Buying Your City?

  32. Neil: In reading your comments on the Hendricks vs. U.S. Bank case in MI, it appears to me that you are patting yourself on the back rather than giving credit to the fact that Jeff Barnes successfully argued the case. See
    WSJ: “In Michigan Case, Securities Trip Up Foreclosure”, by Nick Timoraos (June 10, 2011) http://blogs.wsj.com/developments/2011/06/10/in-michigan-case-securities-trip-up-foreclosure ~ if the Wall Street Journal can get it right, so should you.

  33. Issa wants more evidence before granting servicer subpoenas

    Sign The Stop Foreclosure NOW Petition! Lets Present it to Issa!

    Monday, June 13th, 2011, 4:40 pm
    Rep. Darrell Issa (R-Calif.) asked Rep. Elijah Cummings (D-Md.) last week to present “a clear case” before he issues a subpoena to mortgage servicers under investigation for possible mishandled foreclosures.


    Cummings, a ranking member of the House Committee on Oversight and Government Reform, opened his investigation in February. In May, he sent a letter to Issa, chairman of the committee, formerly requesting to subpoena servicers that refused his requests for information.

    Bank of America (BAC: 10.505 -2.73%), Wells Fargo (WFC: 26.51 -1.89%), U.S. Bank (USB: 24.019 -1.96%), SunTrust Bank (STI: 25.40 -2.12%) and PHH Mortgage (PHH: 19.535 -1.59%) refused to comply. MetLife (MET: 39.385 -4.59%) said it would send him more documentation — but only under subpoena.

    In a meeting between the two staffs June 6, Issa said he needed to see more evidence that the banks were ignoring Cummings and a subpoena was the only way to get the information.

    “In this case, Ranking Member Cummings has not prepared any persuasive report or memo outlining the evidence of the necessity for a subpoena,” an Issa spokesman told HousingWire.

    According to Issa’s office, when Bank of America heard of Cummings’ letter, the bank contacted both staffs and insisted they did not receive a request from Cummings. The spokesman said both Issa and Cummings are still in discussions but a decision will only be made “once the facts are clear,” the spokesman said.

    “We responded to the original letter to Rep. Cummings and we continue to work with his office on these issues,” a BofA spokesperson told HousingWire.

    These and other servicers signed consent orders with federal regulators over foreclosure issues, and continue to negotiate terms from another investigation from the 50 state attorneys general.

    The Treasury Department will withhold Home Affordable Modification Program funding from BofA, JPMorgan Chase (JPM: 40.60 -2.42%) and Wells until the three companies make improvements.

    And Fitch Ratings downgraded mortgage servicer ratings on nine of the largest mortgage servicers on Friday.

    Write to Jon Prior.

  34. Can an attorney please answer the following:
    -If the loan didn’t make it into the trust wouldn’t the effective date of First Franklin’s assignment be the date to go off of?
    -First Franklin was owned by National City.
    -National City was merged with PNC as a reorganization under IRC 368(a) during the latter part of 2008.
    -I believe National City’s liabilities were dissolved in the 368(a) reorganization.
    -A loan after sale is no longer an asset to the selling party – it is a liability as far as a repurchase goes.
    -If the loan reverts back to First Franklin/National City it would now become a liability to First Franklin.
    -Wouldn’t this loan then have been extinguished during the 368(a) reorg? First Franklin had already been made whole – they received payment upon sale and wrote off the liability in the reorg.

  35. Yes, I read here before in the comment section that there have been successful damages ruled against servicers, ie. judgement for homeowners of ALL monies paid to servicer from time of “origination”—how about some more info about that???? Neil???

    Obviously, I think the judges are not readily making precedent because if one person gets a $60,000 house free and clear (due to the fraud) in addition to all monies paid to servicer—the same rules will have to apply to multimillion dollar houses/homeowners too…ouch!

    But—they did it to themselves…and the law is the law…

  36. The concept that the homeowner is getting a “free house” based on this set of facts is erroneous because the homeowner was paying the servicer up until the
    time a payment issue arose. Also, most borrowers put down something as a downpayment so they have “skin in the game”.
    Meanwhile the “pretender lender” servicers were collecting payments from the
    homeowner and “banking” the proceeds, so they were getting “free money” and
    then later, it was them that got the “free house’ after a fraudclosure (because they
    counterfeited the notes, fabricated the assignments and did whatever else was necessary to “hoodwink” the Judge into ruling in their favor.)
    Finally, some of the Judges are starting to realize how badly they were fooled by these servicers using phony trusts and other phony documents to prevail over the gullible homeowners and their lawyers.
    In the future, I see law suits against the servicers who took money from the homeowners under false pretenses, ie that they were forwarding it on to a non existant trust in the sky.

  37. $1900 for an appeal is awfully high. what’s in that figure other than filing fees? is there a bond of some sort that gets it up to $1900? why did you have to move out pending appeal? had there already been a judgment for eviction?

  38. ok…so like in all of the reports…..what happens next. no one seems to want to deal with the fact that most homeowners who are waiting for a court dat (lis pendens) are on a roller coaster ride up to to the top and once the court date arrives we free fall to the bottom. you see florida is very corrupt , how do i know this check out our traffic ticket/ lawyer conspricy. its an incredible knock on our heads to our constitutional rights.

    in florida you drive down a road and get a tick from any police force city, county, troopers. ok be it a speeding, in my husbands case he had his brights on on the suncoast parkway where it was dark at 5am, or anyother violation that does not cause injury or accident. the 1st thing you do is obtain a lawyer , you pay the lawyer a retainer speeding tickets are alot 300-400 dollars othe violations 200=300 some advertised 99$. the lawyer goes to court for you, you get no points sometimes driving school then oyu pay another fee for court. my husband paid the lawyer for the lights and court fees totalling 364$ for an infraction that was subjective. they were on oposite sides of a large parkway but our corruption in florida allowed this officer to stop my husband . with his stop the lawyer made 200$ and the courts made 164$

    sorry but had to give an example of corrupt florida. my point being i can go to foreclosure court but becuase florida is bankrupt many of our case go to summary judgment so we have to pey the 1900k for appeal. do you think anyone cares that we have to move into a rental waiiting fo rmy appeal. that my house may be sold. NO just like the state trooper did not car my husband would have to pay 364$ becuase he used his brights on a dark parkway at 5am. my husband could get a warning, the judge could dimmiss with prejidice. but neither would make any money for the state.

    yes i am scared about my looming court date becuas ei know about this corruption does not make it better for me at least i am telling someone and maybe some one else can figure out what florida homeowners are to do. we are vicitms here of so much sorruption, please help us i do not want to loose my house but as long as floridas buget thrives on corruption there will be no end in site for foreclsoures and summary judgements do you notice no one in florida is ever posted as a win because there are very few. florida is making their money on appeals this needs to stop. conflict of intrest not due proccess.

  39. This is just a trial court decision, so it may be far from over, but it’s the clearest acceptance of the “Livinglies plan” and the Max Gardner plan I’ve seen to date. It’s a long way from Alabama to Michigan, but the ideas are crossing state lines.

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