Why The PSA is Never Included as an Exhibit to a “Colorable” Claim to Foreclose

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Editor’s Note: I would add that if the PSA was required to be placed in evidence and to be attached as an exhibit to the would-be forecloser’s pleadings, it would put facts in issue that the forecloser would never be able maintain. Amongst others, the facts would not support that the transfer into the pool ever occurred nor was it accepted by the trustee nor could it be accepted by the pool trustee — thus depriving the alleged servicer of any legal contract relationship with the investor lender or the homeowner borrower.

By leaving it out and dancing around the subject, the banks convince the Judge to improperly put the burden of pleading and the burden of proof on the borrower rather than the party making the claim for collection or foreclosure. And the accounting from the”servicer” carries with it a presumption of accuracy that is unwarranted, leaving out all the financial transactions that are NOT reported by the loan servicer starting with the initial funding of the loan all the way through the payment of the debt by parties who are not in privity with the borrower.

Looking at the transaction from the standpoint of where money exchanged hands it is easy to see that the lenders were the investors whose purchase of a mortgage bond was a ruse and the homeowner whose purchase of an exotic guaranteed to fail loan (or loan in a pool that was guaranteed to fail) was a fraud (both investor and homeowner being fooled by fraudulent appraisals and fine print conflicting with the rest of the documentation), it is all too easy to see how the closing documents with the investor are not complete without the closing documents from the borrower and vica versa. Had this simple rule been followed, nearly all of the foreclosures would have been withdrawn or settled leaving both the housing market and the economy in far better shape than current circumstances.

by Patrick Downey

In order to have a colorable claim, the mortgage servicer plaintiff must be entitled via separate agreement with its principal to enforce the debt owner’s property rights and interests provided to the debt owner by the note and lien instrument. A mortgage servicer may have possession of the genuine note, but it is never an owner of the property rights and interests the note is supposed to evidence and represent. The note was stripped and denuded of those property rights and interests when they were irrevocably assigned to a pool in order to capitalize a securities offering.

Revised UCC Article 9 contains a series of provisions that broadly expand the property rights and interests that may be assigned, regardless of anti-assignment language in contracts or other state statutes. These rules are not limited merely to restrictions prohibiting an assignment. They also override restrictions that permit assignment only with the consent of a third-party obligor or with restrictions that simply declare that assignment will constitute a default. The party that takes the right to collect via a distinct assignment of the lender’s inherent collection right in lieu of a negotiation and conveyance of the whole and inseparable loan contract is not a successor to the lender under the terms of the mortgage instrument. Likewise, the party that takes the lender’s inherent right to payment via a distinct assignment of the lender’s beneficial interests in lieu of a negotiation and transfer of the whole and inseparable loan contract is not a successor to the lender under the terms of the mortgage instrument. Both parties are considered partial assignees provided for in UCC article 3-203(a). A partial assignee is never a mortgagee and this is the real reason why MERS was created. MERS acts as a lien holder strawman, or bailee, whereas otherwise the lien would be vanquished due to these distinct property assignments. MERS allows the lien to survive these intangible property assignments and it placated the ratings agencies whereby they granted AAA status to the MBS offerings.

The servicing agreement is never attached as an exhibit to the complaint because if it ever saw the light day, it would reveal that the defendant’s payments were being remitted by the servicer for the benefit of a party lacking contract privity with the defendant and that the contract holder is not an aggrieved party nor did it suffer default. Neither the servicer or its principal have contract privity with the defendant.

 

The contract holder has executed UCC article 9 assignments of its property rights and interests for the benefit of strangers to the loan contract whereby the note it possesses is a carcass or relic of the property rights and interests it used to evidence. Proof of this is contained within the notice of servicing transfer whereby it should state that the “right to collect” has been sold, assigned or transferred. The “right to collect” is a property right of the lender provided by debt ownership, it doesn’t just appear out of thin air. That property right is required to be reported as a distinct loan asset on the mortgage servicers balance sheet. Ask yourself how the servicer can report the “right to collect” as a distinct loan asset and also claim to report the note as a distinct loan asset.

Blank endorsements act as a smoke screen for these distinct article 9 assignments and any endorsement exhibited on the note in favor of a mortgage servicer is bogus because all the property rights and interests of the debt owner were not transferred with the conveyance of a whole and inseparable loan contract. The “right to collect” was stripped and assigned to the servicer separate and independent from the loan contract. Section 20 of the lien instrument provides that these property rights and interests can be assigned independent and separate from each other. Section 13 grants the lien binds and benefits the lender’s successors and assigns (except under the circumstances provided for in section 20). Taken together, the mortgage instrument grants the lien only transfers with a conveyance of the real property and not an assignment of the lender’s intangible property rights and interests. Under Florida law, contracts are construed in accordance with their plain language, as bargained for by the parties. see Auto-Owners Ins. Co. v. Anderson, 756 So. 2d 29, 34 (Fla. 2000).

The foreclosure complaint filed by the mortgage servicer plaintiff is an in rem action in equity to enforce a mortgage instrument not an in personam action at law for enforcement of a note for money damages see, Sun Trust Mortgage v Fullerton FLWSUPP,1612, (6th Circuit Court, Pinellas County, Oct 2009). Be advised only the mortgagee or anyone authorized in writing by the mortgagee may accelerate the debt and file a lawsuit to foreclose on the mortgage because of the Florida Statute of Frauds Title XLI.

The servicer doesn’t qualify as an entity entitled to enforce the note and mortgage because it doesn’t have contract privity with the defendant. An entity lacking contract privity with the defendant is not the mortgagee nor can it grant or convey a higher status to another than what it possesses. A simple pre foreclosure QWR asking for the name of loan investor will reveal the servicer’s principal but not substantiate the principal is the note owner and holder. Thereby, a written agreement with a substantiated note owning principal granting the servicer administrative authority to enforce the lien instrument must be attached to the complaint. FL R Civ P 1.130(a) provides in pertinent part “All bonds, notes, bills of exchange, contracts accounts or documents upon which action must be brought or defense made, a copy thereof or a copy of the portions thereof material to the pleadings must be incorporated in or attached as an exhibit to the complaint.”

#1 The defendant is prejudiced in its ability to raise certain defenses without attachment of the written servicing agreement as an exhibit to the complaint.

#2 When provisions contained within exhibits are inconsistent with the plaintiff’s allegations of material fact as to whom the real party at interest is, such allegations cancel each other out. Fladell v Palm Beach County Canvassing Board 772 So 2d 1240 (FL 2000), Greenwald v Triple D Properties, Inc. 424 So 2d 185, 187 (FL 4th DCA 1983)

#3 In Florida, prosecution of a foreclosure action is by the owner and holder of the note see Your Construction Center Inc. v Gross 316 So 2d 596 (FL 4th DCA 1975) Florida is a fact pleading State and plaintiff’s failure to plead and show competent evidence it or its principal is both owner and holder of the note renders the complaint fatally defective on its face.

70 Responses

  1. I am curious to get your opinion when a Plaintiff in a non-judicial state (CA) argues the PSA issue in detail as a result of being able to get loan level evidence that the loan was supposed to go into the Trust. As a result of Kent v Countrywide (defunct pretender lender sold note to CW) which includes testimony that confirms the Trust never received the CW Notes as a general practice. The Defendants answered the Complaint indicating that the Plaintiff cannot argue the merits of whether the Note was or was not delivered because the Plaintiff is not a party to the PSA.

    What legal reference is there in CA or SCt. that the Plaintiff can bring this argument forward?

  2. @JG and joann

    The bankster scum were not satisfied with one marketplace for loans. They lobbied to get UCC 9 revised so they could monitize the debt owners rights and interests, thereby creating two distinct markets. One for servicing and collection rights and one for cash flow rights.

    These rights are derivatives of the loan and they allow the banksters to maximize their return. Instead of one single transaction under UCC 3 whereby the debt owners rights and interests get conveyed to one single successor, they were able to convey the debt owner’s rights and interests in two distinct transactions for max fees and profit.under revised UCC 9. If your job is to maximize profit, which option would you choose?

    MERS tracks the owners of the servicing and collection rights and is vital to this marketplace. MERS doesn’t track ownership of the cash flow rights.

    Two distinct marketplaces for the debt owner’s rights and interests = loss of contract privity with the debtor. There can be no single successor to the lender’s rights and interests via a note transfer if the debt owners rights and interests were assigned separate and independent from each other.

    mortgagee = successor to the lender.

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  4. I am just curious, Fannie and Freddie have been mentioned several times why is Ginnie mae never mentioned. I have a fha- Ginnie Mae loan, Mers on the title and JPM as a servicer who is doing everything in its power to get me to do a mod. in which I am telling them to go ahead and foreclose. It has been two years????? I live in ND a judicial state. The property is 30,000 underwater, and needs a roof and siding. What are they doing, waiting for me to move? Can I challenge them before the actual foreclosure proceedings on the note?

  5. @ Joann
    The example you described in your last post (2/24 @12:25pm) fit my situation far too well!
    I am non-judicial, with the same assignment you describe.
    (to FHLT by MERS at the request of Litton -yrs after CH 11)
    They never submit the assignment as a proof of claim (is what I have noticed) mention it in published notices which is required in my state.

  6. @joann – obviously I am a newby to the tenets being advanced by
    Patrick (and others) and I struggle to assimilate what is being said.
    Hopefully Patrick will weigh in on your querries.
    As to assignments, I start at they had to be done even if unrecorded pursuant to the statute of frauds. My next own tenet is that unrecorded assignments are valid as to the parties thereto. My next one is in order to enforce, they have to be Noticed, which generally means recordation. I don’t subscribe to the idea that a deed of trust follows a note, like a mortgage might. These impressions of mine
    necessarily come from my other impressions of who MERS is and isn’t in the dot and any authority of MERS. Some cases I looked at recently and also have to assimilate have found it helpful to prescribe to “MERS IS the beneficiary”. The ensuing argument is not bifurcation; it’s something else and I’m still trying to get my head around it. None of these impressions of mine consider some other ideas of mine, which is that the dot crafted by MERS is a legal piece of dog-doobage, is unconscionable and that it’s possible that an original beneficiary may not be named in the instrument. Imo, the dot should have said B of A is the beneficiary of this dot and MERS is the 1) agent or 2) nominee of B of A. And none of this considers Patrick’s arguments because I have not assimilated them and am still trying to do that. I feel like I need to take a crash course and I’m not joking.
    Every idea I have, except that MERS is absolutely nobody and the dot is fatally tweaked as a collateral instrument (kind of a big deal) tells me MERS has nothing to assign regardless of who purports to execute it for MERS. But because MERS appears in the doc and in public record, a quit-claim deed from MERS to somebody might be appropriate. MERS has said many times it merely holds “title” (huh?) to the collateral instrument. Pretenders have also said things about MERS position in various suits over the years: MERS is the true beneficiary, MERS is the agent of so and so, and I forget if anything else. There has been great inconsistancy historically in MERS’ and pretenders’ position about who MERS is. Taking MERS’ position that it merely “holds title” to the coll instrument as dispositive, then a MERS’ assignment isn’t good for much; it only, if executed by one with proper authority, relinquishes that title, but it can’t convey interest not held. I can’t think yet to whom MERS should convey this alleged title to the coll instrument, who in the chain of assignments which should have been done and apparently not done. Maybe the last guy or maybe the first. Anyone? Til someone can show me otherwise, I stand on a MERS’ assignment, if otherwise valid given by whom it’s actually executed (self-assignment), merely relinquishes the “title” to the instrument, nothing more, and is effectively a quit-claim. This without figuring Patrick’s stuff into the equation is where I see it. The only way I know to show a court this is to find a way to rely on MERS’ averments in cases that it merely “holds title” to the collateral instrument. A court’s jn does not generally extend to the records of other courts, is what I think I’ve gotten over the years. If I got this right, that’s an obstacle to be overcome when trying to use those averments in our cases. There are often exception to rules – gotta find them fwi might be worth, which I think is something since it’s dispositive about those honky assignments. Or find the MERS’ averments in easily judically noticeable material.

  7. Thank you Patrick and johngault

    I am following this discussion great interest even if not on the front page anymore.

    Thank you Patrick for clearly explaining many things. And good questions johngault.

    Patrick: “My comment was originally posted under “Servicer as Plaintiff, I think not.” It applies to situations when the servicer is claiming to be the mortagee.”

    joann: Would all of these points also be the case when the servicer (not even really the servicer – it is a robo signing employee of the trustee company on DOT turned foreclosure sale processor pretending to be ceo of the servicer) is making an assignment:

    “For Value Received” …..of….. “all beneficial interest under that certain Deed of Trust”….. “TOGETHER with the note or notes herein described and secured thereby, the money due and to become due hereon with interest and all rights accrued or to accrue under said Deed of Trust including the right to have reconveyed in whole or in part the real property described therein”

    To a trust closed years ago?

    So in non- judicial when naming the servicer as a defendant (taking issue with the ADOT and the NOD) all of the same points would apply?

    This is what I have been thinking…..??

    First the assignment – transfer “For Value Received” is void because it is made by a servicer (successor servicer to bankrupt originator on DOT) and not a “lender” – owner of asset – beneficiary ect. – not in “privity with debtor” stranger (because purportedly sold if not actually assigned -transferred to trust years before). This actually undermines the ability of the trust (indentured trustee bank for the trust) to foreclose. The title is now clouded by an assignment by a stranger that transfers nothing.

    Second it is an indication or even proof that the asset was never actually acquired by the trust (who cannot acquire it now and would not accept an assignment like this now by any means (because of PSA, IRS, SEC ect) – in default or not and if not assigned by the depositor). Otherwise this fraudulent transfer would not need to take place in order to foreclose. The only assignments needed would have been originator- sponsor-depositor which were warrented and represented to investors to be kept in “recordable” form for the state where the property is located.

    I do have a bit of trouble understanding the rights and recourse of the parties if investors paid for an asset (before during or after cut off and closing dates) but did not actually receive ownership of the asset and where that leaves the homeowner.

    Also now just wondering in the quite common occurrence as above (servicer assignment to trust closed years ago) who does have contract privity now with the debtor?

  8. @patrick – thanks so much for taking the time to respond. I’m working my way thru your answers. I think the available motion for a more definitive statement is in fact underused. It would be handy, too, in forcing the banksters to take some ‘finite’ position(s) and eliminate a lot of the wiggle room they currently enjoy. One last thing if I may – are you a fan of Max Gardner’s arguments? Thanks again.

  9. @John Gault

    My apologies if I wasn’t clear enough. My comment was originally posted under “Servicer as Plaintiff, I think not.” It applies to situations when the servicer is claiming to be the mortagee.

    When a servicer, through its lawyer, files a complaint for foreclosure pretending to be a mortgagee, it is absolutely necessary to focus on the provisions in the mortgage instrument rather than the note because the lien is being enforced, not the note. That is why I say when a servicer claims to be a mortgagee in a foreclosure complaint, it will never attach the servicing agreement as an exhibit because it would reveal that it has been collecting for the benefit of an entity that is not the mortgagee, ergo, a stranger to the loan contract. Whereby it would be revealed that its principal does not have contract privity with the defendant by virute of the the servicers own affirmative pleadings and exhibits which by the way have to be verified under penalty of perjury. Florida is a fact pleading State.

    Under this circumstance, including the servicing agreement as an exhibit would reveal the claimed mortgagee, the servicer, has not been aggrieved and the servicer’s principal has no contract privity with the defendant by the palintiff’s own fact pleadings because it is not the successor to the lender and as such has no rights to access the court to foreclose on the mortgage instrument. By extension, the servicer has no right to access the court on behalf of if its principal if it admits tn its own complaint that its principal is not the mortgagee, ergo, lacks contract privity with the defendant.

    The servicer is doing the defendant a favor by filing a bogus lawsuit.

    The note was stripped and denuded of those property rights and interests when they were irrevocably assigned to a pool in order to capitalize a securities offering.

    jg: note to self: keep reading to see if statement is supported
    well, not exactly

    Pat: Do securities investors control the right to receive loan payments (i.e. cash flow) or not? Investors don’t receive dividends based on loan payments, they must actually control the right to receive and enjoy loan payments directly because if not, the securities they purchased were never properly capitalized. Only one instrument can claim to convey the right to receive and enjoy the loans cash flow and if you’re saying its the note rather than the securities then the securities investors were defrauded.

    Revised UCC Article 9
    jg: it’s article 9 now?

    Pat: Yes. Intangibles such as the right to collect loan payments are the personal property of the debt owner. UCC article 9 controls personal property assignments, not UCC article 3.

    is not a successor to the lender under the terms of the mortgage instrument.

    jg: HUH? can another instrument limit or impact at all a note?

    Pat: a foreclosure action is an enforcement of the lien instrument not an enforcement of a note so we should pay attention to the provisions in the lien instrument. The mortgagor grants the lien binds and benefits the successor and assign of the lender. Lender= asset owner in contract privity with the debtor.

    MERS allows the lien to survive these

    jg: does it now? That may have been the intent, the desired goal, but is it the reality?

    Pat: in reality, the lien survives in title only, not in equity as there is no equitable lien holder.

    The servicing agreement is never attached as an exhibit to the complaint because if it ever saw the light day, it would reveal that the defendant’s payments were being remitted by the servicer for the benefit of a party lacking contract privity with the defendant

    jg: i don’t follow where in the psa this would be found

    Pat: The servicer has affirmatively plead it is the mortgagee. Mortgagee = successor to the lender. Lender = asset owner in contract privity with debtor. If the servicing agreement were attached as an exhibit, it would reveal the defendant’s payments were being remitted for the benefit the servicer’s principal. The servicer has plead facts that it is the mortgagee thereby its principal lacks contract privity with the defendant by the plaintiff’s own admittance. Now, if the recorded mortgagee was remitting payments for the benefit of another entity under a separate agreement, it isn’t entitled to receive payments and isn’t the note holder and successor to the lender’s rights.

    The terms of the promissory note contract attached as an exhibit to the complaint is facially more restrictive in its characterization of who may enforce it than FL statute 671.201(20) and requires a two part test to determine if an entity is the note holder entitled to enforce the instrument. The note must be acquired via transfer and the entity must be entitled to receive payments made under the note.

    Plaintiff and its principal would not be an aggreived party and can’t avail itself to the jurisdiction of the court because is suffers no default and neither are in contract privity with the defendent as exhibited by the strict terms of the note, provisions within the lien instrument, and the fact pleadings.

    and that the contract holder

    jg: who is this exactly?

    Pat: The guy who has possession of the written embodiment of the loan contract. The note.

    jg: who are the strangers? the investors? Do you mean by ” property rights and interests” either collection rights or right to payments (which are not the same thing)

    Pat: strangers are entities lacking contract privity with the debtor. Property rights and interests are the intangible rights and interests derived from owning a debt. You can’t see, touch, or taste them but they exist and have value. If you loan chuck $100, and chuck signs a negotiable debt agreement to pay you back, you then own the right to collect from chuck and you own the right to receive and enjoy the payments chuck makes for your benefit.

    Now, if you decide to assign your right to receive and enjoy the payments chuck makes under the agreement to Joe, then you are left with the right to collect from chuck for Joe’s benefit. Joe doesn’t have contract privity with chuck, and if chuck decides not to pay you then you are not an aggreived party because you don’t control the right to receive and enjoy chuck’s payments anymore, all you control is the right to collect for Joe’s benefit. Joe can’t sue because he doesn’t have contract privity with chuck. Joe was only a partial assignee of the entire array of debt owner’s rights and interests. under the agreement. You don’t control 100% of a debt owner’s intangible rights and interests and so you can’t report the agreement as a loan asset on your balance sheet as if you own 100% of the agreement nor can you negotiate the agreement as if it will give the transferee 100% of the lenders rights and interests. All you can report is the right to collect as a distinct loan asset and if you choose to assign that right, so be it.

    If chuck granted you a lien, it is enforeable on chuck so long as chuck doesn’t find out that you assigned your rights to Joe. In reality, the debt agreement is a carcass because it no longer evidences a debt owner’s rights and interests and so it is not an asset to you anymore. If its not an asset anymore, then the lien is vanquished.

    Section 20 of the lien instrument provides that these property rights and interests can be assigned independent and separate from each other.

    jg: do tell. Do tell more, because I’m not getting that from section 20.

    Pat: Section 20 provides that the loan may be serviced by a loan servicer other than the purchaser of the note. A servicer has retained or taken the debt owner’s right to collect via personal property assignment and is required to report that right as a distinct loan asset on its balance sheet ledger per asset reporting rules promulgated by FASB.

    jg: Who would the qwr likely show as the servicer’s ALLEGED principal? The investor, who is without ownership of the note, who has only been vested with the right to payments made or some third party guarantee if not co-obligor?

    Pat: I’m looking at a response to a QWR from a servicer and it states that Freddie Mac is the loan investor and Citimortgage collects loan payments and services the loan on behalf of Freddie Mac. Do not send payments directly to Freddie because it won’t be credited to your account. It doesn’t substantiate if Freddie is the asset owner.

    Thereby, a written agreement with a substantiated note owning principal
    granting the servicer administrative authority to enforce the lien instrument
    must be attached to the complaint.

    jg: but of what value is this is the ‘note owning principal’ has sold
    the rights to payments, so there is no unity of the note ownership
    and the right to payments, and apparently now a third ‘right’, collection rights? I don’t see how either of the first two parties herein could have collection rights because neither has both ownership and right to payment, so can’t contract out collection rights it doesn’t have.

    Pat: Collection rights aren’t contracted out, they are intangible personal property of the lender which are retained or sold by the lender with provisions in the sale agreement that the collector will perform certain duties and obligations for the benefit of the entity that purchased control of the lender’s payment rights. Remember, collection rights must be reported as a distinct loan asset by the servicer only when stripped and assigned separate from the note. It is well known that the right to collect and service loans has its own multi billion dollar marketplace. A market participant can’t purchase duties and obligations. They are interested in purchasing rights, Rights are intangibles

    jg: sounds good – is failure to comply violative or merely works against the claimmant as to his claim or both?

    Pat: Plaintiff’s complaint is so vague and ambiguous that the defendant cannot reasonably frame a responsive pleading where plaintiff, in its alleged capacity of mortgage servicer, files an action claiming it has standing based on a mortgage assignment but omits attaching its servicing agreement to substantiate its capacity as an exhibit to the complaint. The defendant is predjudiced in its ability to raise certain defenses without the servicing agreement . Motion to dismiss or alternatively make more definite and certain.

    .

  10. @ zurenarrh

    Thanks for the encouragement though I never let my guard down for a second with these scum buckets. I hope and pray every day that I will log on and hear of more wins day by day. As I keep saying, each win by any of us is a win for all of us!

  11. @joann
    I hope you are able to go after them soon. Is a recast kind of like a refi? We put $127,000 just on the down payment and closing. Then made 5 years of payments not to mention what we put in to it out of our pockets for fence, etc. It is very disheartening and all we have left is our will to fight these bottom feeders. That is what we, who can, must do if there is ever any hope in stopping them.

  12. Congrats Katheryn! Keep it up! All power to the pro se litigants!

  13. Kathryn:

    “I am trying to keep things simplified enough for my comfort level and what I can quickly articulate to a court with it then reduced to writing with backup support and proof by Exhibits.”

    Very good advice especially for a pro se. It is what I wish to do also one day if it ever arrives before my home is seized (by the wrong party????!!!!). Right now mere survival is taking precedent. I made the mistake of paying on time and paying down principal then many things hit all at once along with a recast (have a feeling there are many more like me that aren’t heard of yet). In the meantime there are precious few sites that can educate and raise the “comfort level”. None of this should ever have been necessary. My guess is Beau Biden has read your letters. He is one AG that looks like he has the weight of the world on his shoulders….

  14. The issue isn’t privity. That’s just another one of the banksters par for the course red herrings, and apparently, the use of the red herring has been successful. The issue is a servicer’s (or anyone’s) authority and where is that authority granted? Has nothing to do with privity to the agreement. I don’t have to have “privity” to a contract or other agreement between two parties wherein one of them apparently relies on that agreement to engage in an act about me and mine to have standing to ascertain that the authority exists. There’s just no rational basis for an assumption or legal conclusion that authority exists without evidence of that authority.

  15. i really like this comment below……

    The servicing agreement is never attached as an exhibit to the complaint because if it ever saw the light day, it would reveal that the defendant’s payments were being remitted by the servicer for the benefit of a party lacking contract privity with the defendant

    BECAUSE some courts say we can’t access the PSA bec we are not in privity. OK fine then very simply how can someone who is not in contract collect????

    jeez that seems awfull simple.

    I dont have contract with servicer. They are allowed to notify me of servicing rights change but they must be agent of some principal who has the right to collect.

    Some day we will figure this out.

  16. @joann

    I am in Delaware. I have been keeping AG Biden up-dated with all that goes on with my case but I have never received even one response from him even acknowledging that he gets my packages. Believe it or not; I literally either called or sent letters to most of every litigation firm in Delaware; not one willing to take on the banks. They know the banks have deep pockets and they all want to represent the banks. My case is probably a little different in some aspects to others and started in BK court after BoA drained every penny we had with the “mod on a string” as I like to call it and in the end denied giving us. I kept waiting for them to file a lift stay motion but they never did; so that is when I went on the offense and filed an adversary complaint and it has rolled on now for a year so far. Believe me when I tell you that it has been very difficult and time consumming to take them on because I didn’t know any of this stuff. I follow you all here but I feel very inadequate to most of you all on an intellectual level. It’s like I said to the judge yesterday; ” I have a college degree in Nothing and here I am, your honor standing before you trying to present the best legal argument I know how”. I began my opportunity to speak with asking for permission to request a continuance of ruling in order that he could read my ‘written’ oral rebuttal to the motions from the defense that I had only received 6 days prior. I spent one week, literally, preparing it and it was, I believe, pretty solid and the truth as far as proving and calling out the lies that had been presented in their motions.

    My feeling is that the judges that have not been bought off and really do want to rule within the law, just don’t have time to prepare themselves to understanding the deep deep levels of this ponzi scheme that has ruined lives and our economy. I understand to a certain extent what you all here discuss with the many defenses and the unwinding of the money trail; but not well enough to articulate it very quickly in a court room setting where there may be 20 more motions on the docket for the judge to rule on. I am trying to keep things simplified enough for my comfort level and what I can quickly articulate to a court with it then reduced to writing with backup support and proof by Exhibits. That is basically how I constructed my complaint which in total with Exhibits is approximately 150 pages. Because I am the Plaintiff the burdon of proof to a reasonable degree was on me. The legal bar was raised with the Twombly case in surviving the first dismissal hit. That was the focus I kept in the forefront of my thinking when I constructed my complaint and I used the law everywhere possible to support surviving the first request for dismissal. Again, I am not a brainiac in any way so I have to struggle to stay one step ahead at all times because they are as underhanded in their legal dealings as they have been at stealing away our economy and homes. I hope that you will get the chance to challenge them in court even without an attorney!

  17. @ Katheryn

    :-bd

  18. Oops, in Hilmon, forgot to mention those were MERS’ arguments, not HIlmon’s.

  19. From Hilmon v MERS, 06-13055, ED MI, dkt 19, February 1, 2007:

    “Promissory notes are not negotiable instruments under
    the UCC Article 4, rather they are security interests
    covered under Article 9. Specifically, pursuant to
    MCL 440.9102(mmm) promissory note means an instrument
    that evidences a promise to pay a monetary obligation,
    and does not evidence an order to pay, nor does not contain an acknowledgement by a bank that the bank has
    received for deposit a sum of money or funds. (huh?!)

    ….Under UCC Article 3, a holder in due course is used
    to describe a valid property ownership in a negotiable
    instrument. The term is only used under the UCC and in
    Michigan law in conjunction with negotiable instruments
    to signify priority of rights in a negotiable
    instrument.

    As stated above, a promissory note is not a negotiable instrument to which the UCC’s holder in due course analysis applies……..”

    ( “holder” is also found in the article of the UCC where hidc is found, so apparently there’s no ‘holder’ either under article 9)

    I have another case where ‘they’ said these notes are not negotiable instruments, but I guess the dog ate it. Sorry if I already cited this case – just don’t remember.

  20. @ Patrick – I’m trying veeeerrry hard to get what you are saying:

    “In order to have a colorable claim, the mortgage servicer plaintiff must be entitled via separate agreement with its principal to enforce the debt owner’s property rights and interests provided to the debt owner by the note and lien instrument. A mortgage servicer may have possession of the genuine note, but it is never an owner of the property rights and interests the note is supposed to evidence and represent.
    jg: uh huh
    The note was stripped and denuded of those property rights and interests when they were irrevocably assigned to a pool in order to capitalize a securities offering.

    jg: note to self: keep reading to see if statement is supported
    well, not exactly

    Revised UCC Article 9
    jg: it’s article 9 now?
    contains a series of provisions that broadly expand the property rights and interests that may be assigned, regardless of anti-assignment language in contracts or other state statutes. These rules are not limited merely to restrictions prohibiting an assignment. They also override restrictions that permit assignment only with the consent of a third-party obligor or with
    restrictions that simply declare that assignment will constitute a default.
    The party that takes the right to collect via a distinct assignment of the lender’s inherent collection right in lieu of a negotiation and conveyance of the whole and inseparable loan contract
    is not a successor to the lender under the terms of the mortgage instrument.

    jg: HUH? can another instrument limit or impact at all a note?

    Likewise, the party that takes the lender’s inherent right to payment
    via a distinct assignment of the lender’s beneficial interests
    in lieu of a negotiation and transfer of the whole and inseparable loancontract is not a successor to the lender under the terms of the mortgage instrument.
    Both parties are considered partial assignees provided for in
    UCC article 3-203(a).
    A partial assignee is never a mortgagee and this is the real reason why MERS was created.
    MERS acts as a lien holder strawman, or bailee, whereas otherwise the lien would be vanquished due to these distinct property
    assignments.
    MERS allows the lien to survive these

    jg: does it now? That may have been the intent, the desired goal, but is it the reality?

    intangible property assignments and it placated the ratings agencies whereby they granted AAA status to the MBS offerings
    The servicing agreement is never attached as an exhibit to the complaint because if it ever saw the light day, it would reveal that the defendant’s payments were being remitted by the servicer for the benefit of a party lacking contract privity with the defendant

    jg: i don’t follow where in the psa this would be found

    and that the contract holder

    jg: who is this exactly?

    is not an aggrieved party nor did it suffer default. Neither the servicer or its principal have contract privity with the defendant.

    The contract holder has executed UCC article 9 assignments of its property rights and interests for the benefit of strangers to the loan contract

    jg: who are the strangers? the investors? Do you mean by ” property rights and interests” either collection rights or right to payments (which are not the same thing)

    whereby the note

    it

    jg: “it” must be the contract holder who is ?

    possesses is a carcass or relic of the property rights and interests it used to evidence.

    jg: I have wondered aloud if the note is enforceable if one party actually owns the note but another has the right to payments….?

    Proof of this is contained within the notice of servicing transfer whereby it should state that the “right to collect” has been sold, assigned or transferred.

    jg: how can it be in the notice of servicing transfer if it only should
    say something but doesn’t?

    The “right to collect” is a property right of the lender provided by debt ownership, it doesn’t just appear out of thin air. That property right is required to be reported as a distinct loan asset on the mortgage servicers balance sheet.

    jg: why? One party (who is?) owns the note ‘carcass”, one party owns the rights to payments made and yet another has the collection rights? The service can’t have the collection rights in its own right, or are you saying it does and if so, how’d it get that?

    Ask yourself how the servicer can report the “right to collect” as a distinct loan asset and also claim to report the note as a distinct loan asset.

    jg: okay, but I don’t know how or why I know there can’t be two distinct reports by the servicer as to a note, so how can I tell a judge this? I get a quick accounting degree and then try to explain this to the judge? I’m not being smarmy – really don’t know.

    Blank endorsements act as a smoke screen for these distinct article 9 assignments and any endorsement exhibited on the note in favor of a mortgage servicer is bogus because all the property rights and interests of the debt owner were not transferred with the conveyance of a whole and inseparable loan contract.

    jg: we know the blank endorsement is a smoke screen, was designed for note enforcement by anyone who could show possession, but …..how does one explain to the court that the
    article 3 tenets being relied on are errantly applied?

    The “right to collect” was stripped and assigned to the servicer separate and independent from the loan contract.

    Section 20 of the lien instrument provides that these property rights and interests can be assigned independent and separate from each other.

    jg: do tell. Do tell more, because I’m not getting that from section 20.

    Section 13 grants the lien binds and benefits the lender’s successors and assigns (except under the circumstances provided for in section 20). Taken together, the mortgage instrument grants the lien only transfers with a conveyance of the real property and not an assignment of the lender’s intangible property rights and interests.
    Under Florida law, contracts are construed in accordance with their plain language, as bargained for by the parties. see Auto-Owners Ins. Co. v. Anderson, 756 So. 2d 29, 34 (Fla. 2000).

    jg: sounds reasonable

    The foreclosure complaint filed by the mortgage servicer plaintiff is an in rem action in equity to enforce a mortgage instrument
    not an in personam action at law for enforcement of a note for money damages see, Sun Trust Mortgage v Fullerton FLWSUPP,1612, (6th Circuit Court, Pinellas County, Oct 2009).

    jg: okay. isn’t this why deficiency judgments aren’t allowed when they’re not? In rem only?

    Be advised only the mortgagee or anyone authorized in writing by the mortgagee may accelerate the debt and file a lawsuit to foreclose on the mortgage because of the Florida Statute of Frauds Title XLI.

    The servicer doesn’t qualify as an entity entitled to enforce the note and mortgage because it doesn’t have contract privity with the defendant.

    An entity lacking contract privity with the defendant is not the mortgagee nor can it grant or convey a higher status to another than what it possesses.
    A simple pre foreclosure QWR asking for the name of loan investor will reveal the servicer’s principal but not substantiate the principal is the note owner and holder.

    jg: Who would the qwr likely show as the servicer’s ALLEGED principal? The investor, who is without ownership of the note, who has only been vested with the right to payments made or some third party guarantee if not co-obligor?
    Why do psa’s call for possession by the sec’n trustee? Possession is 9/10th’s of the law! Owner = no possession = no raight to enforce. Investor = no ownership bur right yo payment

    Thereby, a written agreement with a substantiated note owning principal

    granting the servicer administrative authority to enforce the lien instrument

    must be attached to the complaint.

    jg: but of what value is this is the ‘note owning principal’ has sold
    the rights to payments, so there is no unity of the note ownership
    and the right to payments, and apparently now a third ‘right’, collection
    rights? I don’t see how either of the first two parties herein could
    have collection rights because neither has both ownership and right to
    payment, so can’t contract out collection rights it doesn’t have.

    FL R Civ P 1.130(a) provides in pertinent part “All bonds, notes, bills of exchange, contracts accounts or documents upon which action must be brought or defense made, a copy thereof or a copy of the portions thereof material to the pleadings must be incorporated in or attached as an exhibit to the complaint.”

    jg: sounds good – is failure to comply violative or merely works against the claimmant as to his claim or both?

    #1 The defendant is prejudiced in its ability to raise certain defenses without attachment of the written servicing agreement as an exhibit to the complaint.

    jg: that’s the damn truth.

    #2 When provisions contained within exhibits are inconsistent with the plaintiff’s allegations of material fact as to whom the real party at interest is, such allegations cancel each other out. Fladell v Palm Beach County Canvassing Board 772 So 2d 1240 (FL 2000), Greenwald v Triple D Properties, Inc. 424 So 2d 185, 187 (FL 4th DCA 1983)

    jg: sounds good, also.
    #3 In Florida, prosecution of a foreclosure action is by the owner and holder of the note see Your Construction Center Inc. v Gross 316 So 2d 596 (FL 4th DCA 1975)
    Florida is a fact pleading State and plaintiff’s failure to plead and show competent evidence it or its principal is both owner and holder of the note renders the complaint fatally defective on its face.
    jg: sounds groovy; now to employ strategy to get it dismissed WITH PREJUDICe or get summary judgment which i think acts as adj on the merits.

  21. @Kathryn

    “He upheld all of my motion to compel except for the sanctions. He denied their motion to compel notices to depose until they have provided the discovery.”

    Wow!

    “I told the judge that it didn’t matter if they backed up a dump truck to my home and delivered 9,000 pages if it was unrequested and unuseful information to my case.”

    LOL

    “He also warned the attorney several times that he better tell BoA that they better start taking this case very seriously”

    Sanctions on the horizon if not taken seriously and not providing discovery? As in “except for the sanctions” above?

    “it was a very good day in court”

    Understatement.

  22. Kathryn

    Congratulations. Sounds like you are finally going to be taken seriously and your hard work will back you up. If a pro se could represent a pro se I wish you could represent me (haven’t filed anything and honestly can’t afford an attorney)! Your perserverence helps all homeowners though. It is also possible a pro se can be more assertiive with their claims in court than attorneys are willing to be – don’t know about this but suspect it may be the case (so many wish to broker mods only). Anyway – if you don’t mind saying – what state are you in and are you in federal court or state court or local court – you may have already said this before but I forget….

  23. to those who wished me good luck today..I thank you. I just got home and it was a very good day in court. I won’t go in to all the details, but the judge recessed us so that he could go back and read my (thesis) lol as my oral rebuttal to all the stuff their attorney served on me last week. I think my week of hard work payed off because he allowed both the defense and I to rebut our issues a few more rounds before he came down pretty hard on them. He upheld all of my motion to compel except for the sanctions. He denied their motion to compel notices to depose until they have provided the discovery. I told the judge that it didn’t matter if they backed up a dump truck to my home and delivered 9,000 pages if it was unrequested and unuseful information to my case. He also warned the attorney several times that he better tell BoA that they better start taking this case very seriously. The attorney told us on the way out that he was not going to handle the case anymore and he was giving it to another attorney in his office. We’ll see. Still so much to do and I feel so exhausted as I know we all do. Each teeny tiny victory is a victory to all of us and we will all keep up the good fight!
    I also had a call from the recorders office on my voice mail in reference to the letter I sent him about the 3 different versions of my mortgage. I’ll call him back tomorrow and see if I can get them also involved with challenging these phony assignments and stuff. Wanted to share and to give each hope to keep on keepin on!

  24. @johngault

    “it gives rise to a duty to assign the dot when the note is sold.”

    I believe this is the case and that there is no ambiguity.

    It is also in the language of the psa which requires both assignments to the DOT and endoresements to the note to be maintained by the indentured trustee for the trust “in recordable form” and other language (could quote just don’t have time to dig it out right now) essentially….as appropriate according to the laws for the state in which the property is located in order to protect the interests of the investors

    My DOT uses the word “can”.

    “Can” meaning it “can” be sold “ (together with this security instrument)” The parenthesis is in the original…….not “can” be sold with or without “this security instrument”.

    The “mortgage” is an agreement for an obligation secured by real property. The DOT encumbers the home, identifies the land, the parties to the agreement and lays out the obligations and rights of the parties relating to the encumbrance of the real property. The note lays out the terms of the repayment. The two documents refer to a single transaction and a single obligation to one party at a time and if this party is not paid it is the party who can direct the trustee to sell the home. Only one party can declare that a default has occurred to its interest and the amount of the default must be produced from the records of that party. The right to be paid and the right to the power of sale belongs to one party – the beneficiary.

    What has been going on is none of the above. The note was split from the deed (security instrument). One party claims the right to be paid (or two or three parties are claiming they have a right to be paid or have received the benefit of payments) – another party claims the right to seize a home for non payment (or two or three parties claim the right to receive the benefit of a sale..….) – the default is not declared by the one and only true beneficiary and the amount of the default does not come from the true records of the one and only true beneficiary (as required by state statutes and UCC ect.) who is the only party with a right to be paid and if paid the amount is reduced by that amount.

    20. Sale of note; Change of Loan Servicer; Notice of Grievance. The note or a partial interest in the note (together with this Security Instrument) can be sold one or more times ….

    (A) “Security Instrument” means this document, which is dated…….together with all Riders to this document.….

    Where a power to sell real property is given to a mortgagee, or other encumbrancer, in an instrument intended to secure the payment of money, the power is part of the security….

    23. Reconveyance. Upon payment of all sums secured by this Security Instrument, Lender shall request Trustee to reconvey the Property and shall surrender this Security Instrument, and all notes evidencing debt secured by this Security Instrument to Trustee. Trustee shall reconvey the Property without warranty to the person or persons legally entitled to it…

    Once the secured obligation ceases to exist – there is no obligation – just my point of view – there is no such thing as an unsecured obligation by the documents signed. Unsecured means note was split which is not possible by the documents signed and not possible in a “secured” anything or an “asset” backed anything.

  25. @ian – note endorsements never have a date that I know of. The law should be changed so that they do imo. These guys are desperate in using some alleged attorney in fact bull to execute an endorsement as far as I can tell, but I can’t know; without disc, who could? Not the judge, that’s for sure. “The record produces no evidence of the poa”, right? They are just 1) making up things or 2) have twisted some reality to reach the conclusion of poa-ness or whatever-could-that-be authority to suit themselves. I am vaguely familiar with the broker(originator)-lender agreement which includes the buy-sell of loans between them, where an original authority would have had to be given by the broker to the lender to do a thing (limited poa – I do not recall one in those agreements fwiw) in the stead of the broker. Endorsing a note just can’t be one of them or I’d croak. Recitation of right to fix “clerical error” ? For that, maybe, and only maybe.
    That authority, any authority IF found in that agreement relevant to the endorsement issue at all, had to first exist and then ‘go to’ the lender’s successors or assigns 1) by way of the assignment of the lender’s business entity or the succession to the lender’s business entity (presumably by sale) or 2) by an agreement, particularly expressed in the broker / lender agreement which included the buy/sell provisons of loans between them, that it would inure to the benefit of both parties’ successors and or assigns. That is the only way I can think of that a current pretender could allege to find authority to execute an endorsement by / on behalf of an out-of business entity. IF that out of business entity went outie by way of a bankruptcy, would such an agreement survive? I don’t know. Might depend on what happend in the bk. Even had such a deal been
    expressed in the broker-lender agreement, which I seriously, seriously doubt, the current bankster must have something, at least a copy, I don’t know, in order to rely on it as existing and inurring to their benefit somehow. When securitization and MERS came about, they may have in fact included some kind of poa in the broker-lender deal, but still, that is such a big deal as to a note, I still doubt it.

    All I (think I) know about notes on this score is that if I sell you a note and you pay me for it and I don’t fork it over to you endorsed to you or in blank, I can sue you for 1) delivery/possession and 2) your endorsement. If you disappear in the interim, what is the status? Got me. Is this an article 3 remedy and not relevant to say, article 9? I don’t know. The answer to these questions may make my recitation above or something like it the likely source of the material twisting into authority. I saw a note in one case not long ago where the same
    little missy employee of someone like B of A signed both endorsements on a note as the (something like) v.p. of both entities.
    Amazing.

  26. @katheryn – kudos on your research on unjust enrichment. Please continue to share with us.

  27. johngault- I was referring to ‘attorney in fact’ as a statement at the bottom of an allonge. The entity bestowing the attorney in fact was o.o.business in 09, the entity receiving the the attorney in fact? o.o.business in 08. The allonge is dated late 2011. I have to go dig that up and look at it again. More later. btw, no date, no notary on allonge. (apart from the date of recordation of the ‘loan’) also, (drumroll), wrong loan number.

  28. That first TX statute is in reference to probate code, I see now, so not applicable to ‘our’ issues. But that does’t mean there isn’t one just like it in other TX statutes (outside probate).

  29. Neil,

    Why are you not involved in the fight against the ‘unconstitutional’ bills blasting through committees in the Florida House and Senate. We need informed, educated, out-spoken messengers of truth like you in the Florida Government’s fight to turn our state into a pseudo-non-judicial foreclosure state. We must defeat House Bill 213 and Senate Bill 1890. Help us Obi-Wan Kenobi, you’re our only hope!

  30. Btw, those poa’s for one spouse to sign for the other, for instance,
    were most definitely Limited Powers of Attorney and only gave rise to authority to do a very specific thing, that is, execute loan docs. Who cares? Well, I’m just pointing out that poa’s are often very limited in what they authorize. They often are not General(?) poa’s. The same is true for any true agency agreements: they are limit the scope of the acts authorized. A listing agent, for instance, (my fav) has a limited agency agreement with the homeowner. He may not sell the homeowner’s car or go open a charge account at Sears or agree to sell the property below the list price and / or at terms not contemplated by the listing (agency) agreement. It’s a specific and
    therefore limited agency, as are many poa’s. Without the poa or agency agreement, how does one know John is authorized to do what for Gregory? We don’t. The reason the title co. had to review the limited poa from one spouse to another to execute closing docs is that, if nothing else, 1) anything to do with real property interests must be in writing pursuant to the sofrauds and 2) they had to make sure the writing were 1) formatted appropriately so it would be binding and 2) that it granted the (necessary) authority to do the act authorized.

  31. @Ian – I don’t know. I’d have to research it. But maybe so, because when a poa is properly signed and notarized, I think (think is key word here) it reads like this:

    ____________________________________
    John Q. Smith as attorney in fact for Gregory J. Brown

    It’s been such a long time since I was involved with this language.
    Was it instead:

    __________________________________________

    John Q. Smith as power of attorney for Gregory J. Brown

    I don’t think so. Just hard to remember. Does it matter? I don’t know.

    As I’ve said here, if one spouse can’t attend a closing, say, and the other is going to execute for missing spouse, we always had to have the poa approved by title co. first and then I am almost positive the poa was recorded right ahead of the executed docs so that ” the record would demonstrate the spouse’s authority” to execute for the missing spouse. If not, the chain of title is corrupt, wouldn’t it be? That’s why I always say the “record produces no evidence of anyone’s authority to execute” whatever. Like AMC executing a NOD for XYZ Alleged Trustee. No authority is even recited in the NOD, let alone proven or demonstrated. Just an “XYZ Trustee by AMC and then by “some guys name”.

    Let’s say version one is correct. The notary, then, must state that the instrument was acknowledged by “John Q. Smith as attorney in fact for Gregory J. Brown”. The acknowledgment may not just read “by
    John Q. Smith”.

  32. @zurenarrh – I think the dot actually says something like this note may be sold or what not “(together with the deed of trust)”. I don’t see a must there; a “must” is an interpretation, but it’s not factual imo. I don’t believe this langauge creates any agreement about anything like to imply the dot follows a note, because imo it can’t because of the sof . One interpretation is that there is merely disclosure that the note may be sold. Buuut, does the language give rise to a duty? I’m not sure, but another interpretation is that it gives rise to a duty to assign the dot when the note is sold. If that is the interpretation, that it gives rise to a duty to assign the dot when the note is sold, since it wasn’t done (no assignment), it’s a breach of contract. How material is the breach? Got me, but it may be very material.

  33. johngault- is an “attorney in fact” the result of a POA being filed? Or, what is it as a legal animal? Thanks.

  34. @dee – I went thru my files to see what i have on Texas (looking for attorneys who rep homeowners). I must have more, but a quick search found this:

    TEX PB. CODE ANN. § 489 : Texas Statutes – Section 489: RECORDING DURABLE POWER OF ATTORNEY FOR REAL PROPERTY TRANSACTIONS
    Search TEX PB. CODE ANN. § 489 : Texas Statutes – Section 489: RECORDING DURABLE POWER OF ATTORNEY FOR REAL PROPERTY TRANSACTIONS

    A durable power of attorney for a real property transaction requiring the execution and delivery of an instrument that is to be recorded, including a release, assignment, satisfaction, mortgage, security agreement, deed of trust, encumbrance, deed of conveyance, oil, gas, or other mineral lease, memorandum of a lease, lien, or other claim or right to real property, shall be recorded in the office of the county clerk of the county in which the property is located.
    Added by Acts 1993, 73rd Leg., ch. 49, Sec. 1, eff. Sept. 1, 1993.

    and this:

    “Texas Statutes – Section 13.001:
    VALIDITY OF UNRECORDED INSTRUMENT

    (a) A conveyance of real property or an interest in real property or a mortgage or deed of trust is void as to a creditor or to a subsequent purchaser for a valuable consideration without notice unless the instrument has been acknowledged, sworn to, or proved and filed for record as required by law.

    (b) The unrecorded instrument is binding on a party to the instrument, on the party’s heirs, *and on a subsequent purchaser who does not pay a valuable consideration or who has notice of the instrument.

    (c) This section does not apply to a financing statement, a security agreement filed as a financing statement, or a continuation statement filed for record under the Business & Commerce Code.

    Acts 1983, 68th Leg., p. 3495, ch. 576, Sec. 1, eff. Jan. 1, 1984. Amended by Acts 1989, 71st Leg., ch. 162, Sec. 4, eff. Sept. 1, 1989.

  35. Patrick

    Thank you – very clear explanation.

    Would the points you make apply equally in judicial and non judicial? Seems like they would.

  36. @Ian,

    “Anybody know why servicers/debt collectors, who “service mortgages for trusts and investors” are receiving TARP money?”

    Because… everybody is except homeowners. Homeowners are here to make it so everyobe else can enjoy it. 🙂

  37. @ Ian

    NC, non-judicial…we need to get rid of those…to much rule breaking.

  38. @ Ian

    That’s a very good question! Anyone want to try and answer?

  39. I was just thinking thast we’ve lost some of the most virulent defenders of our legal system, broken and all… I wonder whatever happened to Pat.

  40. @dcbingo

    Intangible property rights assignments vs. tangible property conveyance and what revised UCC 9 allows contract holders to assign.

    The owner of the loan is not the owner of the note. The loan is the liability side of the balance sheet. The liability side = the receivables or cash flow. When they say owner of the loan, it is banker speak for owner of the loan’s liability.

    The note, or written embodiment of the loan contract, is the asset side.

    The owner of the loan has taken the debt owner’s intangible “right to payment” (receivables) via a distinct UCC9 property assignment in lieu of a negotiation and conveyance of the tangible loan contract. Basically, the note holder’s receivables (the beneficial interest) have been purchased (or financed) by a stranger to the loan contract because it didn’t want to wait 30 years to recoup its outlay.

    So the owner of the loan in fact does not have contract privity with you and the servicer has taken the debt owner’s intangible “right to collect” for the benefit of that entity. Hell, it stands to chance that the servicer retained the tangible note, even though it no longer benefits from it, and is recorded as mortgagee in the public record. Ah, but section 20 of the lien describes this situation and the last sentence in section 13 provides that entities which have arisen from the situation described in section 20, are not bound and do not benefit from the lien.

    An entity that no longer benefits from the tangible note cannot report it as a loan asset on its balance sheet because in accounting, assets and their corresponding liability must counterbalance each other. The terms of the promissory note contract attached as an exhibit to the complaint is facially more restrictive in its characterization of who may enforce it than FL statute 671.201(20) and requires a two part test to determine if an entity is the note holder entitled to enforce the instrument. The note must be acquired via transfer and the entity must be entitled to receive payments made under the note. This requires the plaintiff, or anybody alleging possession of the genuine note, to recognize the asset transfer by reporting the instrument as financial asset along with the corresponding liability on its balance sheet ledger. The servicer does not, therefore, own the promissory note asset because its duties include remiting payment to the benefit of the loan investor and if it has affirmatively pleaded holder status, it admits that no other entity claims holder status. Oops. Verified under penalty of perjury in Florida, Double oops.

    Think about this. If the note holder sold its receivable stream to a stranger to the loan contract, you can no longer perform under the terms of the loan contract because your payments won’t count towards the benefit of the note holder as was agreed upon at inception of the loan. Property rights assignments destroy the negotiability of the note. You need to ask if the servicer can identify the entity that reports your note as loan asset on its balance sheet ledger and if it is the same entity as the owner of the loan. What you may find is that the recorded mortgagee does not report the promissory note asset on its balance sheet whereby it cannot assign the lien to a successor.

    No asset reported = no liability reported. No liability reported = no mortgage lien. No mortgage lien = clouded title

    MERS was created as a way to save the lien and avoid title defects but it too does not have an asset owner to act as its principal after these distinct property rights assignments take place. Remember, MERS is nominee for the lender and lenders successors and assigns. Mortgage Lender = asset owner in contract privity with debtor.

    The production of a servicing agreement will lay this bare and expose that it has been remitting payments to an entity lacking contract privity with the borrower. This entity is not the mortgagee because it lacks contract privity and their can be no other entity aggreived by failure to pay. Only an aggrieved party can avail itself to the jurisdiction of the court.

    I am under the opinion that a forclosure filing naming the servicer as plaintiff without attaching a servicing agreement is a frivolous suit and the opposing lawyer is subject to sanctions. This is ripe for firing off a debt validation and confirmation letter asking the lawyer to obtain the name and address of the creditor and the liability amount evidenced by the promissory note asset. Any mailed response backing up the claim of servicer may be construed as mail fraud or fraudulent concealment.

  41. Katheryn–let em know you came to kick ass and chew bubble gum…and you’re fresh outta bubble gum! Godspeed!

  42. @Katheryn
    Good luck ,all the best, may you prevail.

  43. @Kathryn

    “Please everyone send your good wishes and prayers (for those that pray) as I need all the help I can get for tomorrow! Thanks!”

    All of the above! You are an inspiration.

  44. Kathertn, I wish you the best of luck in the world tomorrow !!!

  45. Last March I sent a letter to the originator explaining that I knew they had been paid and requested a “Satisfaction of Mortgage”. They ignored that letter. After the servicer had given me four “different” owners of my loan, I sent all of them plus the originator a QWR. The originator responded that they had sold my loan 8.5 years ago to Lehman Brothers and they knew nothing about my account or loan since that time. There were no assignments recorded – no endorsements on the three notes BofA sent me as “certified copy” of the original. On 2/2/12, U.S. Bank recorded an assignment – from originator to them (the trustee). Do I have them over a barrell – I think I do!

  46. Good start, but need more than the PSA for conveyance. Cannot be “holder” without conveyance. PSA must be followed to the tee. PSA refers to Mortgage Loan Purchase Agreement and Mortgage Schedule. Have never seen a MLPA that is not just an “intent” to sell. Never seen one actually executed (see Ibanez). And, Mortgage Schedule must be up to date, not a “tracking” of “intent” to “assign” various loans. Mortgage Schedule, which is not required to be updated due to 15-D, is obsolete. Many loans reported to Mortgage Schedule — AFTER the loan “cash flows” were actually removed from the trust. Can there be tracking for “loans” from the inception of the trust??? NO. Not according to the Federal Reserve. They cannot “GO BACK.” Thus, servicer can report whatever they want — without EVER going back to see if loan was actually part of original Mortgage Schedule, or removed prior to current date. Servicer can do whatever it wants. Key is the MLPA —- none were executed.

    And then, of course, we have the issue of “account numbers.” Original mortgage loan numbers — GONE.

  47. @joann 4:12 p.m.

    My complaint I used the bifurcation argument – note went west and mortgage went east. My understanding is that this does, in fact, remove the ‘security interest’ but the money obligation remains. Step 2 is then the argument of what, if any, monetary obligation remains and to whom? I am in a chap. 7. Several things could happen with this one argument alone.
    1. The trustee could step in and sell the home and disburse the proceeds. We get to take our $125,000 exemption and go on our way.

    2. Depending on what amount is owed and to whom, we could end up taking our portion, paying the creditors and not follow through with the chap. 7 and see if we prevail monetarily on the additional counts.

    3. If the Judge finds that our rescission holds, we would not have been obligated to pay anything for the last year because they did not file a declatory motion as they should have done. Then we are reimbursed for the years we did pay and have to tend over the house, maybe. Again, it gets muddled here because I also asked for a quiet title based on the bonus satisfaction of the original note. (This is a very short summary of this allegation of my complaint)

    4. Unjust Enrichment – is another biggie I went with. I know it is used mostly for enjoyment by one from a mistake, etc., however, I found law and cases that seemed to fit very well with our circumstances. Like the HMan above…will it work…only the judge knows for sure.

    This is along the lines of how I used it.

    Was the enrichment unjust?

    Liability under the principle of unjust enrichment is wholly independent of liability for wrongdoing. Claims in unjust enrichment do not depend upon proof of any wrong. However, it is possible that on a single set of facts a claim based on unjust enrichment and a claim based on a wrong may both be available. A claim based on unjust enrichment always results in an obligation to make restitution. A claim based on a wrong always results in an obligation to make compensation but may additionally result in an obligation to make restitution. For discussion of restitution for wrongs, see the page on restitution.

    At common law, a claim based on unjust enrichment can be submitted to five stages of analysis. These can be summarized in the form of the following questions:
    1.Was the defendant enriched?
    2.Was the enrichment at the expense of the claimant?
    3.Was the enrichment unjust?
    4.Does the defendant have a defense?
    5.What remedies are available to the claimant?

    Was the enrichment unjust? This one is the tough one: making more money off of us rather than giving us a modification is not in and of itself something that a court would find as unjust and for obvious reasons a court isn’t going to open that door. However, in a court of equity when all of the other facts of defendant’s behavior to the detriment of the plaintiffs (again, I am reducing to the simplest of terms here) from what I was able to find in my research, just might be winable. (is that a word?) Anyway, I have been toiling away preparing my argument, in written motion form, for court hearing tomorrow. My little friend, BoA’s pit bull is going to be in for quite a treat when I personally hand him my 100 page argument or to my mind; thesis. LOL Please everyone send your good wishes and prayers (for those that pray) as I need all the help I can get for tomorrow! 🙂 Thanks!

  48. Dummy question. FL mortgage contract says mortgagee is MERS.

    MERS says we don’t foreclose in our name anymore.

    FL case law now says MERS can’t foreclose in its name.

    FNMA does not like to foreclose in its name. FNMA says its the ‘investor’.

    Question is… if you dummies on high at Wall Street/FNMA/govt put the name of an entity, MERS, on my contract that can not now foreclose in its name ….. A. why the heck are there even any court cases and fraudulent assignments to TRY to foreclose at all and why not a work out agreement and B. how the heck given the above can MERS assign to another entity to now foreclose???

    Just saying from a logic/layman standpoint.

    It just seems simple that I granted them the mortgage lien but they SCREWED IT UP on the contract.

  49. chris- what state are you in? Besides, of course, a state of disgust……

  50. chris- as I recall you were with NC as of 2007? Mine was in 01. DLJ had a hand in things back then. Credit Suisse owns them, also Select Portfolio Services, out in Salt Lake. fka Fairbanks. Uses various mills across the country. SPS received 646million under TARP, and they are just a debt collector. Anybody know why servicers/debt collectors, who “service mortgages for trusts and investors” are receiving TARP money?

  51. This Patrick Downey is on the money. I know diddly but I think it is simpler than the securitization trail. Simple contract law. I love that he is talking about Florida.

  52. Should have said “as though the two documents were separable.

  53. Joann,
    Yes, when we go strictly on what both the Note and Deed of Trust actually say in plain language, many of the banks’ arguments/defenses completely fall apart. For instance, the Note says very plainly that the “Note Holder” has to fulfill BOTH of 2 criteria: 1) take the Note by transfer and 2) be entitled to receive payments under the Note.

    The pools certainly never took the Notes by transfer–the Notes were held by a document custodian or destroyed. The pools were supposedly, according to the PSA/Trust documents, entitled to receive payment under the Note. So who is even the Note Holder? The trust never got the Note but is purportedly entitled to payment, and the pretender lender or its custodian purportedly has the Note but is not entitled to receive payments thereunder.

    I agree with the above article re: MERS–the scenario outlined above is where MERS comes in. MERS is supposed to be the link between the payment-entitled trust and the note-holding pretender, but this is impossible because whether or not the Note and DOT are inseparable (and Carpenter v. Longan says they are), the trusts and the pretenders treated the Note and Deed of Trust as though the two documents were inseparable. Even though they aren’t.

    I think that’s what’s hard for judges to understand–that such an obviously absurd scheme would be foisted on us. It really is a silly scheme that easily falls apart under the most basic scrutiny, but that’s precisely what makes it difficult for judges to believe. In other words, judges must think that the banks/pretenders wouldn’t do something so stupid and foolhardy, so it must not be true and there must be something more to it. So they reflexively rule against the homeowners.

  54. @ Pamela

    I agree. The judges don’t understand. I think the comprehension will increase as time goes on. The fraud seems to be getting more and more exposed everyday. However, it appears as though not much is being done. All the fines happening is really just for show so the bulk of society thinks our officials are taking action and holding people accountable.

    I think as time passes the banks fraud will become more and more apparent. I just can’t wait for anything so I’ve had to take action.

    I think it is really easy for the judge to grasp the investors were screwed over. I think it’s easy to get the investors to side with you being as you both have a mutual goal. You want to save the house and they want to save their returns.

    Do the investors have title to the home?and can the undisclosed lenders agree to modify my home? I don’t know but I’m betting it’s a pretty easy concept for the judge to wrap his head around. What I think is irrelevant.

    Who directs the trustee? The principal (investors)?. Who is paying taxes? The investors and the homeowner. Who is a party to the PSA and can bring it up in court? The investors.

    I’m not trying to get anyone to jump on my bandwagon and honestly don’t even know if what I’m attempting will work. I know a lot of people will say this will never work but I’ll be the guinea pig and let you know.

    I can’t risk the show me the note or securitization argument in my state. Or the Mers is illegal, etc…Even though I know many of these things are valid arguments but the judges in my state disagree. Unfortunately the law is what the judge says it is.

  55. zurenarrh, on February 21, 2012 at 3:33 pm said:

    “Section 20 of my DOT says that the Note can be transferred, but it must be “together with this security instrument.” It specifically does NOT say that the Note and DOT can be transferred separately. Either that, or my reading comprehension is very poor…”

    I keep coming back to this too – what the DOT actually says. It seems to me there is clearly no separation possible in the agreement signed by the trustor. If a separation occurred it is void and constitutes unjust enrichment.

  56. I filed a UCC claim and in WA . state it was like everthing else simply ignored.Was then told by a lawyer that i hired for UD that I needed to get that off my house and out of the county records as that would be held against me as judges don’t like stuff like that as they don’t understand it.I’ve tried everything and so far nothing has worked.

  57. The terminology on this site is confusing for someone without a law degree like me : )

    Ok – suppose every person foreclosed, instead had a disease – not exotic – just maybe measles.

    Would we bail out hospitals ? or would we deal IMMEDIATELY with the people who had measles ? Would we bicker over how many ‘spots’ deemed it measles or would we get on with finding a way to help people affected and IMMEDIATELY keep others from ‘catching’ it ?
    An outbreak of Measles would be a HIGH PRIORITY for all areas of government – why isn’t foreclosure.

    Foreclosure or measles – both are dangerous BUT measles does not leave you homeless, with a feeling of failure, or wondering how this could happen to someone fairly intelligent.

    Two requests:

    First, please consider foreclosure the ‘last resort’ and stop them until everyone is on the same page eg. bank reps are points of contact with knowledge of ALL state and national programs and have a stake in finding a win-win solution.

    Second, how precisely can we REVERSE a foreclosure when the customer was qualified for a state program and partial claim (FHA) but neither the company, Citi, nor the stupid HUD counselor, was trained to know this ?

    Naive in Arizona 🙁

  58. Section 20 of my DOT says that the Note can be transferred, but it must be “together with this security instrument.” It specifically does NOT say that the Note and DOT can be transferred separately. Either that, or my reading comprehension is very poor…

  59. I pay an attorney monthly with a % on any claims we win. I would say it’s been worth it. My two other foreclosures from the same servicer were foreclosed within 3 months of default without an attorney. Since I’ve had an attorney it’s been about a year and a half without a mortgage payment. Maybe I’m prolonging the inevitable only time will tell.

    I look at it like this. I could pay my mortgage at $1800 a month or an attorney at $1500 a month. I have been paying all my own taxes and insurance so I am at a break even point fighting with an attorney.

    The hardest part was finding an attorney. It had 4 consultations before I found 1 that knew what I was talking about with Quiet Title, etc…

  60. @ Enraged, the folks of your state and thus our country would be well served by you in D.C. Would you consider being a delegate? I’d like to see that. We need clear thinkers such as yourself to pick up the pieces. Wouldn’t you like to be there to point all 500+ to the exits?

    @ Dee, sorry….I know no one in Texas. It’s too bad how few attorneys understand the problem, or better yet, the solutions.

  61. @E.Tolle

    We are in Texas.

  62. @ Dee, I know an attorney who’s a good guy who charges folks a reasonable monthly fee. I wouldn’t hesitate to go that way, rather than the evisceration that can come with pro se. Just my $.02.

    Procedure hurts.

  63. @Enraged

    Thanks!!

  64. Some of you might want to check DLJ Mortgage Capital, subsidiary of Credit Suisse,

    no board members, no key executives, no committee.

    2007 MBS Transactions, being sued, by the way, by investors, AMBAC Insured…

  65. @ All

    I just found a guy, post the link later, who is VP for 28 entities, yes, 28…all having to do with the transfer of MBS, trusts (not securitized)…so, no good…all in bed with US Bank NA, Credit Suisse, New Century, Countrywide, etc…get back with more…

  66. @ Enraged

    I have been able to acquire an attorney for the Federal Case against my servicer. He charges me for the paperwork, not the actual claim or complaints, but rather discovery, appeals, certain motions,etc…it is doable. I, in turn do most of the research, pull documents and email him with any ideas, new court decisions and such…so far, so good! You really need help guys. I have so many claims, complaints and cases right now, I need a small office, ’cause it can get that big. As you start to unravel the entire mess, it is a maze and it takes a lot of time and effort.

    Just my $.02

  67. @Dee,

    I hired maine on monthly installments and 10% of whatever he collects on my behalf. But… we also included in it attorney’s fees (which is a hell of a lot more than what he charges me). So, he’ll walk with a reasonable and, in the end, will not have cost me a penny.

    @E. Toile,

    I posted that link and I’m going to send regularly a few bucks. Just haven’t had a minute yet. You’ll see my name on it in a few. I am really determined to see the big fireworks from front row.

  68. @Enraged or E.Tolle

    Would you even consider hiring an attorney on hourly bases or Monthly installment?

  69. @ Enraged, you showed us the fix in a link yesterday. It’s the only way to get the bums out of D.C. and stop the backflow of revolving door cesspool waste from Wall Street at the same time. It forces a one on one fix of the foreclosure crisis, and pretty much cleans up everything else at the same time. Squeaky clean planet wrestled from the multinationals, I can go for that.

    Although serious measures indeed, the other path, the path of doing nothing, you know….the one we’ve been on for several decades while being fleeced, will undoubtedly lead to an implosion so great as to leave a crater where America once stood. I say bring it on. Pro-action anyone?

    The 99% Declaration

    Sign up, unless of course you enjoy pillage and pain. I won’t tell anyone.

  70. Something just occurred to me…

    If all the “legal” minds behind this charade were able to find ways to circumvent the laws, it should be incumbent to them to fix that mess by restoring every messed up mortgage exactly within the frame of the existing laws. They knew where and how to fudge. They knew to be creative when it was about allowing banks to deprive counties of legitimate revenues and homeowners of their house. Therefore they’re expected to be creative about where and how to fix it and restore everyone into wholeness. Or… if they don’t understand the monster they created, their law degrees should be pulled once and for all.

    The law was never intended to know just enough to be dangerous, for Pete’s sake!

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