Banks Restarting Private Label “Securitizations”


What’s the Next Step? Consult with Neil Garfield

For assistance with presenting a case for wrongful foreclosure, please call 520-405-1688, customer service, who will put you in touch with an attorney in the states of Florida, Tennessee, Georgia, California, Ohio, and Nevada. (NOTE: Chapter 11 may be easier than you think).

Editor’s Comment: As we travel down the road of misguided policy and judicial decisions, the banks are starting up a major effort to sell more mortgage securities under private label, which means that (a) they are not required to register them with the SEC and (b) they will continue to veil the secret movement of money making it more difficult for any borrower to know the identity of the lender in a residential loan transaction, contrary to the requirements of Federal and State laws.

The whole purpose of the Truth in Lending Act was to give the consumer an opportunity to choose between one vendor of loans and another. The banks obliterated that choice in the first round of the mortgage meltdown and you can be sure that the only reason they are doing it again is because they intend to make the same gargantuan “profits” in this second round, so far, at $25 Billion.

One of the reasons why they feel emboldened to do this is because the basic laws have not been changed regarding the definition of a security, which excludes mortgage bonds and the hedges like insurance and credit default swaps, courtesy of laws passed in 1998. Another reason is that the Wall Street club still has enough strength to sell the mortgage bonds through intermediaries who trumpet higher returns for stable funds, which we have all seen went from stable in the layman sense to completely unstable and underfunded. The pension funds that got hit the hardest will be the first ones to announce that the pensioners are not going to get the full amount of their payments because of losses in the fund, vested or not.

The “qualified mortgage” regulations passed by the Federal Agency, which might lose its head literally if Cordray’s appointment remains rejected by the Courts, still have plenty of daylight in them to push through false appraisals and false data on the ability of the borrower to pay, and the viability of the loan over its entire term. The easily projected fall in prices to the values charted by Case-Schiller together with reset provisions on adjustable mortgages and “teaser” rates that could be paid only if the majority of the required payment was added on to the principal due on the mortgage, made the crash inevitable and remains unaddressed by law or regulations.

So despite the 0.1% contraction of the economy in the last quarter of 2012, we have the banks again ramping up to make trillions more while the economy stagnates from lack of oxygen — the money diverted from the economy by the banks whose officers have escaped prosecution and whose antics in corrupting the title system of the all the states, have created massive uncertainty over the end result.

Wall Street is allowed to exist as the engine of growth, stability and confidence in our economy. As intermediaries, they are required to meet the needs of the times in terms of providing capital in a capitalist society. Instead, they have become principals without anyone noticing. And their motive is not to intermediate but to make a profit, taking advantage of every loophole in laws, rules or the enforcement thereof. A receding economy won’t stop the banks from making money as long as they are permitted to lie.

If the economy is contracting, Wall Street activity should be expected to drop as the need for capital declines. Instead we see that over the last 4 years and we will see over the coming four years and beyond, an increase in profits for Wall Street firms which are owned by shareholders and directed by officers whose main goal is to create and enlarge their own wealth.

A lot of this has been made possible by the average citizen who can’t be expected to understand the complexities of finance or the law. Of paramount importance in the process is the shame heaped upon borrowers who are all seen as deadbeats despite all evidence to the contrary. And lastly, all this is possible because of the general assumption, often mistakenly used as a conclusive presumption in court, that the borrower received a loan, didn’t pay it back, therefore is in default and based upon the terms of their contract, their homes are sold at auction to satisfy as much of the debt as possible.

The idea that the money demanded as the balance of principal and interest due might be totally misstated, and that the repayment provisions loan is NOT represented by the note and mortgage (or deed of trust), seems impossible to both borrowers and judicial participants alike. The banks laid a trap in setting up bad paperwork because there was no real paperwork that would actually track the movement of money in bona fide transactions with money exchanging hands. Lawyers and pro se litigants cried foul and yet the foreclosures kept proceeding because the judge figured that the bad behavior of the banks was a separate matter from the “obvious” fact that the borrower took a loan and didn’t repay it.

It’s true that the money arrived at the closing table, but beyond that, there is nothing but misdirection, lies and fraud. The money arrived at the closing table from a source that was never disclosed to the borrower, preventing the borrower from any choice in the matter.

The nominee used to play the part of “lender” was not even allowed to touch the money — Wall Street having determined that some “originators” might find it too tempting to let the tens of millions going through their own account go by without skimming some of it or even taking all of it. Wall Street thought this way because it was what they were doing when they sold the original mortgage bonds.

The money was never put in a trust, as specifically provided for  in the enabling documents which might or might not have legally created a common law trust. The bankers took out as much as 1/2 of the investor money as trading profits when they arranged fictitious sales of actual and fictitious loans to the unfunded trust without consideration. The consideration was passed from investors directly to the investment bank that underwrote the sale of the mortgage bonds.

The balance of the investor money was used for fees and costs that were problematic at their best and then finally the balance was used to fund loans (and bets against the loans) that were completely undocumented in terms of the actual financial transactions that took place. None of the paperwork upon which the banks rely in reporting their assets or enforcing invalid notes and mortgages is supported by any transaction in which the named parties exchanged actual money. Thus none of the paperwork could be considered valid or enforceable (lack of consideration). They can sue but they can’t win if the borrower denies the transaction, the note, the debt, the mortgage and lays claim to false disclosures.

The banks understood this fatal error and thus created massive efforts at robo-signing, surrogate signing, fabrication, forgery, and fraud in supporting the alleged transfer of the loan from a nominee who originated the loan but who never funded the loan, up the false securitization chain. In simple words the mountain of paperwork produced by the banks covers a cup that is empty. There was no money involved in ANY of the transactions from origination through assignments that were offered but could not be accepted because they were specifically prohibited by the PSA and Prospectus.

Lawyers and pro se litigants went down the rabbit hole after the false paperwork leaving the judge with the simple proposition that there was a loan, it wasn’t paid back, and therefore the enforcement provisions apply. Nobody asked WHY there was need for false paperwork. What was the false paperwork hiding?

It was hiding an empty cup in which the borrower signed loan documents and never received a loan pursuant to those documents. The borrower received a loan from other parties whose identity was intentionally concealed, and if the various compensation and profit and fees had been disclosed as required by TILA the borrower would have been alerted tot he fact that half or all of his loan was generating fees, profits and costs either equal to or even more than the loan itself. Even an unsophisticated borrower confronted with these facts would get nervous about a transaction where he knew that the real parties were making excessive profits had this been disclosed as required by law.

Hence our strategy of DENY and DISCOVER, which will be the subject of tonight’s discussion on the member teleconference. If you go after the money first, demanding proof of payment and proof of loss you stand a good chance of knocking out both the filing of the foreclosure and the ability of the forecloser to submit a credit bid — simply because they are not the creditor. By going after the money first, the attack on the paperwork becomes both relevant and corroborative of the principal attack over consideration between the borrower and nominee lender who seemed to be the lender at the closing of the loan.

If you assume all of the above is correct, then it is malpractice for any lawyer to admit the debt, the security, the balance due, the note, the mortgage and the enforceability of the note and mortgage. And it is malpractice for a lawyer doing real estate closings to fail to question title and demand a guarantee of title from a qualified source.

As seen in California this will cause even a non-judicial state to  go judicial in practice because the forecloser has a case to prove and in most cases it can’t because it can never show that it ever took the loan in as a loan receivable — which in accounting, is inevitable because there is no place for an entry debiting a cash or other asset account to make the loan.

The entire loan is off balance sheet and solely appears on the income statement as a fee for service transaction in which the apparent lender was really a nominee for undisclosed parties who promised the real lenders one set of terms in the bogus mortgage bonds and an entirely different set of terms in the note signed by the borrower which was unsupported by consideration.

The bottom line is that the discovery should be directed at all parties who have knowledge of the actual transfer of money and documents, including internal documents. The Master servicer, the investment banker, the Trustee of the so-called trust should all be subpoenaed if necessary to determine what records they have and who handled them. And the principal record you want to see is a copy of a canceled check or wire transfer receipt (and wire transfer instructions).

‘Private Label’ Gains Appeal in Mortgage Market

21 Responses

  1. […] “Credit Supernova!”As I’ve been saying about the financial transactions taxbuitresBanks Restarting Private Label “Securitizations” .recentcomments a{display:inline !important;padding:0 !important;margin:0 !important;} var […]

  2. The bank owners, their bank shareholders & directors, the judiciary, the traitor politicians and most of the media simply have no morals. Do a background check on them and that truth will be revealed.

  3. These crooks, both foreign & domestic are laughing their asses off at ALL OF US. We don’t even know we are at war on our own soil and have been since 9/11…..These bank owner crooks have hijacked our wealth, freedom and liberty without much notice from the people…They have no idea the U.S. CONSTITUTION….THE U.S. BILL OF RIGHTS…..OUR WEALTH …..PROPERTY……LIBERTY AND THE U.S. TREASURY ARE HIJACKED BY THE BANK OWNERS….MOSTLY FOREIGN….AND THIS IS ALL BEING CONTROLLED BY THEIR SHAREHOLDERS ..& DIRECTORS WHO TELL THEIR BANKS & THE TRAITOR POLITICIANS HOW TO TERRORIZE US WITHOUT MOST EVEN NOTICING….THESE CROOKS FRAUDULENTLY RULE BY MIND CONTROL…..SECRETS….LIES…AND DECEPTION….THAT’S HOW THEY DEFRAUD…..AND WIN THE WAR WITHOUT YOUR KNOWLEDGE OR CONSENT…..



  4. That’s what these tyrants want, a section 8 U.S.A…a third world economy….at the 2% rate we are NOT growing as reported today by CNBC, the tyrants will have their way soon. Third world countries probably have more growth. The RENTERS will be the foreigners the sheisters are handing our property to. These tyrants destroyed our economy for a reason.

    They want a welfare nation fully dependent on these tyrants who robbed us and are holding this country hostage.

    Do you want help…..? Well you better learn to HELP YOURSELF because this Government is completely corrupt & useless and are oppressing the people. They all should be hung for treason.


  5. Warning… know your fka ,dba and aka or BK comeback with New Name……… Ring Around the Rosie, Pocket Full of Air, They All Fall Down!

  6. Yes Winston, it’s all about the fraud. Take fraud out of the equation and the crooks are out of business. The bank owners & their minions are totalitarian control freaks. They believe they have an ultra vires contract with the American people……An unconditional contract to rob and control us that never expires. I for one, never signed or agreed to any such contract.

  7. S8(v) … Section 8 vouchers?

  8. So,they are going to try to reinflate the housing bubble.
    Add that to the;Bond Bubble,Stock market bubble,and the
    Student loan bubble.
    The only questions are; which bursts ,first and when ?
    Bubbles created by _ricks.
    What could go wrong?
    No, its not different this time.

  9. Power of Sale was not available to the servicer or MERS …

  10. Howdy folks,

    You just might want to take a look, BACK @ my Sept. 26th, 2011 comment… Posted here, under: Michigan Law (see the left margin of this page)… Mid-way down, the comment… maked “WARNING of the Day”… I gave you good citizens, some hints/clues… Why, I could have just as easily dropped a few more companies, names, the motivations (), the process, the cover, the end-buyer (which would explain the slow movement by, the powers-that-B), the exit-strategy and … what most Americans seem to love the most… the re-Packaging.

    some like to talk… while others, actually live (and therefore can give)… I could even give you folks, (nevermind, ‘ll save that one for ole’hooWhistling-hooWilly S8*{(v)…

    If you need help; we might (no guarantees) be able to provide assistance (if we work with you) or at least, a few possible solutions or positive direction…

    send us an email and Have a Good afternoon.

    nuff said

  11. They are not ruling by law or fact…they are ruling on legal theory…these judges are behaving like judicial supremecists and not doing their job upholding the rule of law and therefore they are i direct violation of our legal rights to life & liberty…& the pursuit of happiness.

  12. The FED does this scam with anything they issue credit on… cards, student loans….car loans etc…that is how they destroyed the economy & it was intended to do permanent harm to every American.

  13. This is all about destruction of the value of everything to steal everything from WE THE PEOPLE….That is how the perps and the owners get paid….credit default insurance ….based upon the grand illusion that you defaulted when in fact it was the Originator ….THE FED who defaulted in your name, without your knowledge…The issuer of that original bill of credit, the FED ……LENDS NO MONEY…….THEY BORROW TONS OF MONEY IN YOUR NAME FROM THE TREASURY……WITHOUT YOUR KNOWLEDGE…OR CONSENT….NEVER PAY IT BACK…..then destroy the value of the original bill of credit by overissuing investments in fictitious revenue flows that they never owned…ON WALL STREET…..again without your knowledge or consent…..This BIG SWINDLE IS CRIMINAL & DECEPTIVE….and is how they steal & destroy our wealth and make us believe BIG LIES… steal our wealth, property and our freedom….

  14. It’s the origination fraud poppy….in my case that happened in 1992. That plaintiff trying to fraudclose on all of us are the Origination Fraudsters…THE FED…..that is what they are concealing. Neil said a while back securitization is illegal under U.S. & COMMON LAW… The owners of the FED….A PRIVATE BANK ARE CROOKS AND SHEISTERS…THEY ARE ALSO TERRORISTS. INTIMIDATION IS THEIR ONLY WEAPON…WHAT THEY CAN MAKE US BELIEVE…ARTICLE 3 OF THE UCC GOVERNS TRANSACTIONS RELATED TO NEGOTIABLE INSTRUMENTS ….

  15. From what I have learned as Christine states
    it is the “letter of the law”, doesn’t mean it
    makes sense, or is fair or just, it simply means
    the “the letter of the law” which can be so frustrating.

  16. Respectfully Disagree…I have some case law dating back to early 1900’s, still applies. My case is very different.

    Cannot get into all of it, site is monitored. We’ll wait and see. The vast MAJORITY of attorneys are taking clients money and make no headway!

    Have chains…they lead right in a circle and still no actual transfers of money, no checks, nada!

    And have discovery, if that’s what you want to call it. I know what I see…the paperwork, its “chaos” and contradictory.

    Don’t know the end result, but I have no title, assignments in the documents are entirety are fake (waiting for an analysis), from beginning to end.

    Contract law, UCC handling of instruments and wire transfer of nothing are on the top of my Motions before the court. Everyone has their own path…they themselves have given me a great deal of the information, due to two different courts handling the case. One hand does not know what the other is handing out…hopefully that is good enough.

    I take all the advice and process it, but keep in mind, my ledger has a zero balance, straight from the servicer! And the loan paperwork is dated from 1986…I purchased the property in 2005?

    Now, I will gladly take an opinion on that one!

  17. Very Good Advice Christine! 🙂

  18. @Poppy – you won’t find the money until you get past the stonewalling in discovery, like I am encountering. It is there you will find the gems like ‘vesting assignment’ (lender at time of TS) – I can’t wait to find out what the consideration for THAT is.

  19. Poppy,

    From a legal standpoint, you need to show some kind of a chain in order to prove that it was broken. Whether or not money changed hands is almost irrelevant, for what homeowners are concerned. It is a regulator’s issue. It can only be handled by regulators and even they, themselves, won’t touch it with a 20 foot pole. What is relevant for homeowners is: where is it alleged to have originated, how was it transferred, who alleges to have paid what to whom, when and by what means. What paperwork exists (or doesn’t exist) to show for it, etc.

    “Follow the money” just means that. Follow the accounting. Makes little difference it the numbers were empty and meaningless from the get go. By showing false or wrong accounting, you can prove the fraud. Blurting out that there never was any money changing hands has cost a house to many who used to post here and stopped after losing it all. The “no money” theory might be absolutely true. Those who have advanced it the most vehemently have embarked in lengthy, painful and costly losing battles they’re still fighting 10 years down the road. Ask Anonymous. And you and I know very well that, but for her privileged position, attorney wise, she never would have gone that far. She knows it too and admits to it. Her position is very, very difficult to advance, let alone prove in court. I’ve always said it is a dangerous game to play.

    My opinion, of course. But also that of many attorneys who get results without using it, by sticking to the letter of law. I know I’m going to get some flack but until I see one homeowner winning his case by repeating over and over: “No money ever changed hands”, I will stick to my guns. it is dangerous and it will backfire.

  20. “discovery should be directed at all the parties who have knowledge of the ACTUAL transfer of money”

    What money, Neil? You know the truth. There never was any money.

    FYI: I have the wire transfers, but still cannot find anyone with the money…consideration they call it, which makes a legal contract!

Leave a Reply

%d bloggers like this: