You Only THINK You Know When Your Transaction Became a “Loan”

The truth is, it never quite made it as a loan, as I would define it as a loan. It was merely an obligation arising at common law through the receipt of money that wasn’t your own money, to which the common law adds the presumption that upon receipt there is reasonable expectation of either getting something, like goods or services, or repayment.

Some enterprising people , like of of our title analysts, recognized this anomaly when tracing the records. It appeared that only when the “loan” was reported to the investor was it created and it was at that time that the “trust” was attempted to be used as a REMIC to avoid tax consequences. She noticed and inquired to government sources who confirmed that the first time they could say the loan ever was represented to exist, with all terms and conditions known, was long after the closing and in many cases, long after the eviction resulting from the foreclosure of a lien that was recorded, but didn’t exist.

So she asked me about that and here is what I responded:

Assuming you can name the government source and that means either producing a witness or showing a website entry that you request the court to take judicial notice, then you can use such information as evidence. Otherwise it is just information.

The rest of what you are saying is interesting because it is most probably true. So here is my take, as you will also get from recent posts.

The so-called creditors in this action never were creditors, never fulfilled the definition of a party who could submit a credit bid, never funded or purchased the loan, and never maintained a loan receivable account in which they identified themselves as the owner of the loan receivable. Their own records show that it was not a loan receivable that was created but rather a Ponzi scheme in which bogus mortgage bonds were substituted for the loan receivable. These bonds were neither signed nor even known to the alleged borrower. The note was neither accepted nor known to the lender. Instead the parties that foreclosed on the subject properties intervened as strangers tot he transaction without knowledge or consent from either the lender or the borrower. The funding occurred but it came from an entirely different source unrelated to the chain of securitization documents and assignments upon which the “pretender lenders” rely.

The account from which the loan was funded came from a bank account that was named not for the First Magnus, nor even the certificate holders who should have been on the note and mortgage in the first place, if they wanted the note to be evidence of the obligation or the mortgage or deed of trust to collateralize the obligations and the terms of repayment as set forth in the note.

Instead, the investment bank funded the loan from a an escrow superfund that commingled money from hundreds of pension funds and other managed funds each of whom thought their investment was being processed through a discrete REMIC or SPV entity. But the investment bank was the owner of the account and sent misrepresented fact sheets to the investors as though the funding had been processed through trust accounts maintained for each pool (REMIC, SPV Trust, all terms interchangeably used).

The investment bank was therefore able to portray itself through lies and deception as the lender and thus able to sell the loan obligation multiple times using outright sales of bonds, exotic CDO instruments, insurance, and even claim losses for purposes of Federal bailout on loans that it had neither funded nor purchased, but rather had merely acted as a commercial bank or conduit through which the funds passed.

The investors were unaware that they were not the owners the owners of the loan nor was the pool described in the prospectus or pooling and servicing agreement. They were common law partners with all other investors whose money was in the escrow superfund at the time of the funding of the loan. Hence the exact moment of the creation of the obligation must be determined before the total number of partners and their identities can be determined.

In order to facilitate the Ponzi scheme in which investors were being paid through the sale of additional interests in the same or related bonds and loans, it was necessary to have paperwork and to report to regulators on the existence and status of loans. The investment bank could not put the name of the pool on the note as payee nor as the described lender, but instead rented the name of other companies, some of whom were banks with internationally known brand names.

The reason the investment bank did not instruct the closing agent to put the name of the pool on the note and mortgage is that would have defeated the essence of the Ponzi scheme in which trillions were reaped in profits. Instead of making money in multiples of the amounts funded as “loans” they would have to go back to the old way of getting a few basis points for facilitating the loan transaction.

They had to be able to pretend to own the loan even though they neither funded nor purchased the loan. Nobody did except the investors and nobody ever bought such a loan, as discovery in any case picked at random will demonstrate — no money is ever exchanged. Why not?

Hence, the named “originator” had no right,justification or excuse to allow itself to be used as the nominee for the payee on the note, the nominee for the lender or the nominee for the beneficiary. In the case of the note, the “originators” were acting exactly the same as MERS with no stake in the loan, but receiving fees to create the appearance of a standard loan.

Thus at the time of the loan closing there was no known payee, no known lender and no known mortgagee or beneficiary. If the borrower turned around and instead of rescinding, wanted to pay the balance due, none of those parties on the note, mortgage and disclosure materials would have had the legal right to accept the money or execute a satisfaction as that would have been embezzlement or larceny.

The closing agent knew only the source of the funds and presumed that the money was received on behalf of the named payee but no such documentation exists nor was it intended to exist since the banks were intent on trading the loans as though they owned them. Thus the investors are left with a loan receivable instead of the bond receivable they thought they were getting and the loan receivable is neither supported by a note nor secured by a mortgage or deed of trust. Meanwhile, the executed documents are unsupported by any consideration (payment). Thus neither has a completed closing upon which they can rely for enforcement.

The problem is further exacerbated by the fact that the terms of repayment offered to the lenders from the bond, were materially different from the terms of repayment recited on the note executed by the homeowner. Hence while money exchanged hands, there was no offer or acceptance of an offer on the terms stated in the offer.

As corroboration of this implausible scenario made credible only when viewed as a Ponzi scheme, the creation of the transaction as a loan was attempted only long after the origination closing that was never completed, and usually long after the foreclosure auction in which a non-creditor’s credit bid was accepted in lieu of cash. Government sources show exactly that. Further, the official “loan”, without offer, acceptance or consideration was brought into apparent reality when AMBAC, AIG and others paid for the bond losses based upon the “default” of a loan whose terms of repayment had never been agreed upon. Any argument to the contrary would mean that the investment bank was claiming to be the authorized agent or fiduciary for the investors during foreclosure or collection —  but not while they were trading against the interests of the investors and reaping the benefits for the investment bank instead of crediting the principal investors as they they properly should.

26 Responses

  1. Can you tell me the account that receives the book entry is this a Custodial Account? and is this what you are referring to? Is the
    custodial account a borrowers mortgage and is there usually evidence of this? and what if there is evidence?

  2. The account

  3. guest..it is true ..they are psycohpaths. Experts estimate there is $1.2 QUADRILLION DOLLARS in derivatives fraud floating somewhere in their electronic fraud world.

  4. Correction: 1000 to 2000 times face value of Swaptions which were bought with 5-10 cents a piece!!!

  5. @Ivent: yes, & on top of their bogus created CDS they had issued time-sensitive SWAPTIONS, which were Options written against the CDS. For one $100 worth of CDS they wrote and sold to themselves one SWAPTION for between 5-10 cents. Since CDS were created to fail and drop to zero, the price of the Swaptions automatically exploded to $100, which means 1000-2000 times face value of CDS, so bailout funds paid these insider mobsters who created and bought the Swaptions over 1000 times of what they paid in pure speculation (thus there were no investors). This is why only $1 trillion foreclosed mortgages resulted in payouts of over $30 trillion already & counting!! while the entire U.S. mortgage market is only $10 trillion, per link I already provided on a previous page.

  6. OH WHAT A TANGLED WEB WE WEAVE…

    http://www.huffingtonpost.com/2012/09/08/lily-diaz-wells-fargo_n_1865837.html?utm_hp_ref=business

    “These days, the process of selling a home is hard enough. Now imagine selling one you thought you owned but did not.

    That’s what happened to Lily Diaz, a California woman who got two offers on her house, only to find that Wells Fargo had actually foreclosed on the home, according to CBS Los Angeles. Diaz says the foreclosure must have been a mistake because she has paperwork indicating she completed a loan modification with Wells Fargo in January, and has made her monthly payments in full since.

    Wells Fargo called Diaz to straighten things out, but the home still can’t be sold until the mix up is settled, according to CBS Los Angeles…”

  7. so then they hit you with the motion in limine…..information that’s prejudicial…..if it’s the truth, and it’s relevant, how can it be excluded….?

  8. doesn’t your list of exhibits require notice?

  9. And ALL if the BANKSTERS and THEIR investor friends FOREIGN and DOMESTIC got paid AGAIN…when the loans defaulted…! THATS WHAT THE BAILOUTS WERE FOR…..! The documentary INSIDE JOB said the BANKSTERS and THE INVESTORS had CREDIT DEFAULT SWAP INSURANCE…! THAT’S WHY THE ECONOMY STINKS…! The greedy jerks are robbing US blind for debt they created that there is NO CURE FOR…!

  10. In addition:

    “…false default occurred because the PRIOR loan was reported as in default, and this prior loan was NEVER paid off by the borrower, as it should have been, by the refinance in question. Money missing. Insurance pay-outs. Borrower was in false default before they ever signed on the dotted line for the subprime refinance. Subprime refinance is not valid. Not legal.”

    This is why the foreclosures are illegal.

    Go back to the beginning, Neil.

  11. Again, Neil—your precious securities investors only invested in the CASH PASS THROUGH RECEIVABLES…not a funded “loan”—no matter how you try to spin it.

    Here it is again:

    “…The subprime was born out of loans that were reported to GSEs as in default and risky. You would not even know that this was reported about you, you would not even know that you are now classified as subprime. No one would tell you. But, if the GSEs (Fannie/Freddie) did NOT purchase your refinanced loan, you know you were subprime. This is especially problematic if you were a GSE loan BEFORE you refinanced. How do you find that out? Not easy. GSEs will not disclose if any prior loan was a GSE loan.

    Nothing on credit report will reflect a prior foreclosure item. In fact, unless you look closely, credit report may disclose little (however, someone who is well versed in reading credit reports will be able to pick up slight discrepancies). Credit report will report the prior loan as paid —- but, they will not disclose that it was not paid by you! Someone else paid the GSEs off to acquire the collection rights. So, yes the loan was paid — but just not by you — you remain in default with the GSE.

    No new mortgages could be issued on the above scenario. But, LOANs in the FALSE FORM of mortgages were issued by the subprime. They were just NOT valid “mortgages” as they claimed to be, because you did not qualify for a valid mortgage. Relate it to credit card debt. If in default, the collection rights can be sold at anytime. This is not balance sheet assets, but rather income to the debt buyer — if they can collect.

    Same with the false mortgages. Although, people were not told they were reported as in default (some may have actually been in default — then ask yourself — how do you think you would qualify for mortgage? How do you think you refinance a default loan?) You cannot. YOU REFINANCED DEBT COLLECTION RIGHTS. Not a secured loan. There is a reason that loans were not sold to GSEs. Big question is — was it a GSE loan BEFORE you refinanced?

    Collection rights carried at face value — not the loan itself. These loans are not, and NEVER WERE, a part of bank’s balance sheet receivables. The problem with the banks is that they securitized the CASH PASS-THROUGHS to the collections rights — and then purchased the securities themselves. THOSE securities were on the banks balance sheets — until the government purchased them.

    “Loan” collection rights still there AFTER trust liquidations because it was collection rights ONLY that backed the trusts. Collection rights do not go away — despite liquidation of the trust. Collection rights survive the trust liquidation…”

    DEBT BUYER INDUSTRY IS THE BIGGEST BUSINESS IN THE WORLD.

    That is why we get no help, and are sent running in circles with all this fake “document” crap.

    It’s all about the money…screw the people.

  12. All of these debts are insolvent because of what the World Bank did via the FED and their bankster perps. We the People need to sue the FED….the private bank who robbed us. We need a referendum on the 2012 ballot to restore the Constitution, issue our own currency via private state banks. We need to privatize our wealth away from Wall Street investors and we need to vote to abolish OBAMACARE…IT IS A PONZI SCHEME INVESTMENT FOR THE RICH.

  13. when its foreclosure time we all got busy trying to protect ourselves, i got the prospectus i isolate my loan, its amongst a looong list of REO status properties in a Dalt A trust, my loan was unqualified to have anything to do with that” trust,”claiming all the rights thereto, we know this is not ununsual now, but yes its the “when” did it become REO, AFTER NOTS, after 90 days?, after receivership after buyout?, enter countefeitng, forgery notary fraud, and atty general settlements ect ect, now i ask myself how come, the originator, otherwise all this was never possible without my signature and without the hyperinflated appraisal bottom line,, no appraisal, no “loan” the appraised value was booked at that value, the obligation to that purported value arose by deception and a bad appraisal, the bubble took a few years and it looked very convincing but ask the economists, without the co operation from appraisers-( who been complaining for years about the pressure they were under ) should protect the public as under USPAP the inflation of that bubble would never have been possible, economically there was no increased demand nor population shifts, and median home price outstripped median income, there are public sources to verify this fact. do we have reasonable doubt ? i mean really?
    then the 1099A, then the 1099c, ? im still in court, albiet by the skin of my teeth asking questions but no answers yet from authorities, they have to give me it by law….and the rest is history ill keep plugging away
    3 darn years and we are still hung out to dry where is our government, i pray for relief from my court.

  14. Does anyone here know whether the Negotiable Instrument Act is still effective in any way?

  15. carie- i did same 3 yrs ago, nothings changed because they do not fear the consequrces of breaking the law, whos going to make them- this is the worst part because no boundaries- whats next, do you all realise what happened to poor people in medevil times- so what do we have if we do not have due process of law and equality in our courts i beg our judges to their job, never mind your pension, ours are gone, so should yours, protect us as you promised. if our courts start to do the right thing, we may eventually swing the scales of lady justice. i believe in non resistance but theres a time and a place where others may not get that concept and that is the worst thing that could happen.

  16. http://mcadams.posc.mu.edu/ike.htm

    From Eisenhower’s farewell address in 1961:

    “…We pray that peoples of all faiths, all races, all nations, may have their great human needs satisfied; that those now denied opportunity shall come to enjoy it to the full; that all who yearn for freedom may experience its spiritual blessings; that those who have freedom will understand, also, its heavy responsibilities; that all who are insensitive to the needs of others will learn charity; that the scourges of poverty, disease and ignorance will be made to disappear from the earth, and that, in the goodness of time, all peoples will come to live together in a peace guaranteed by the binding force of mutual respect and love…”

    Sorry, Ike…not even close…with our “leaders” anyway…

    We need a “new earth”…

  17. Time to get mad??? http://www.youtube.com/watch?v=1Qgzy29A05A

  18. @guest….it is true, banks don’t lend money…they lend credit. They are the borrowers from the Treasury who create money for themselves and their friends and debt for all of us by lending credit. It is Unconstitutional and Illegal under Article 1; Section 10 of the Constitution to take anything other than Gold or Silver backed currency in exchange for credit.

  19. NICE ANSWER FROM THE SERVICER WHO STOLE MY PROPERTY IN FLAGRANT VIOLATION OF FDCPA…(among other things)…

    “OneWest Bank respectfully declines your request to rescind the foreclosure. We disagree with your claims that the foreclosure was invalid and consider the matter closed.”

    See how easy they get away with it? All they have to do is disagree with all of your evidence. Just like the judges do.

  20. Wrong Neil: Federal Counterfeit X-PRESS is the only thing creating loans: http://presstv.com/Program/260131.html

  21. the credit bid is the REAL THEFT !!!!!!!!!!!!

  22. Right Neil. Even the bank attorneys refer to the debt as the “loans.” They never lent us any money. It was a ginormous credit scam and WE THE PEOPLE were all used and victimized by this insolvent debt that all of these entities created it….not the people. I spoke with the FBI early on in my investigation, they asked me “are you talking about the ORIGINATION FRAUD…?” They told me to call the LOAN ORIGINATOR and ask them to send me the original note and the original mortgage stamped paid. I believe that would have to be stamped paid by the U.S. TREASURY DEPT.

  23. April having explained in detail in our phone meeting how 2005 forward credit was recorded as a lien by each subscribing title agents desktop computer – Credit extended to consumer who would advance cash for use and benefit of SERVICE PROVIDER Investor. The credit up to the value of the appraisal recorded inside a data base of like kind System harmed this country and I’ve been waiting for your call.

Contribute to the discussion!

%d bloggers like this: