Pondering TILA Rescission

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see Jonathen Foxx article on TILA Rescission BEFORE the Supreme Court decision http://nationalmortgageprofessional.com/news/42119/tila-versus-tila-rescission-notice-or-lawsuit


In my continuing research into the mechanics of rescission I keep bumping into articles like the Foxx article in the link shown above. While he concedes that no lawsuit is required to “effect” rescission, he seems concerned that the mechanics (procedure) are such that the impact on banks would be onerous and impossible to fulfill.

My answer to that is simple and seems to be borne out by the unanimous Supreme Court decision penned by Justice Scalia. The answer is that it isn’t supposed to be nice to the banks. It was decided by the highest legislative authority in the country (Congress, and now the highest court in the land) that rescission is effective as of the date of mailing and that all the duties and obligations of the creditor commence as of the date of rescission, and that they have 20 days to do it all. If they fail to comply then they are responsible for their own “injury’ (if that have one) in potentially waiving or suspending any right they have to recover the net debt due from the borrower whose obligation they purport to own, manage or service.

Foxx is right when he says that getting an actual final decision from any court during the 20 day period puts an impossible burden on the creditor who believes that the the rescission was improper or otherwise barred by some set of facts, rules or laws. But that is exactly what  Congress did after very careful consideration of the competing ideas and claims from both the consumer side and the banking side.

The simple truth is that if the bank was the actual lender and they had all their proof of their disclosures etc., they would easily get a court order to set aside the rescission. Presumably their failure to comply with TILA would then be excused. And speaking of presumptions TILA says that if the borrower signs an acknowledgement that the disclosures were made, there is a presumption that the disclosures were in compliance with statute.

So IF the creditor proves they are a creditor on the basis of proper pleading the burden shifts back to the borrower to justify the rescission notice. BUT that is only true if the creditor files a lawsuit within 20 days of the notice contesting the the rescission. And yet, there is no evidence that any 20 day lawsuit has been filed by any creditor or servicer who received a rescission notice. Instead they have cooked themselves in their own stew.

Instead of complying with statute by giving back the note, mortgage satisfaction and the money AND/OR filing the action to contest the rescission, the banks instead either ignored the notice or sent back a notice of rejection of the rescission which completely cures the borrower’s problem about delivery of the notice.

Actually in most cases the Banks had no choice. If they had filed suit the way the TILA statute demands, then they would be admitting that the loan was not necessarily secured (and that the note was not necessarily a negotiable instrument) and in fact that the alleged debt was at that moment unsecured by operation of law. Sales and resales, of mortgage backed securities, guarantees, insurance, credit default swaps and other hedge products would have come to a screeching halt. So the banking industry took the position that there was at least an arguable basis for rejecting the rescission. By kicking the can down the road they enlarged the time that they could sell more bogus mortgage backed securities and enlarged the negative impact on the country.

PRACTICE SUGGESTION: Consider the fact that the current interpretation of TILA allows for rescission and might allow for equitable tolling (this is still in doubt), the defined elements of negotiable paper might not be present until all possibilities of rescission were obliterated. Hence being a holder or even a holder in due course of the paper would not give rise to any presumptions in favor of the bank, “lender,” or servicer as holder or anything else. It would be a simple lawsuit based upon alleging and proving up the debt and alleging and proving the mortgage as collateral for the debt — something the banks don’t seem to be able to do because they misused the investor money in the first place and if they proved or even alleged what they really did with the investor money they would be admitting to potentially criminal and certainly civil fraud.

Here are some quotes form the Foxx article that I found interesting:

TILA Versus TILA: Rescission by Notice or Lawsuit

Thursday, September 4, 2014 – 12:54
Given the immense legal implications, especially with respect to the loan flow process from point of sale through portfolio and securitization, I would urge a familiarity with the positions taken by both parties to the litigation. ….
The Big Question
Jesinoski v. Countrywide cites Section 1635 of TILA to present the foundation upon which the deliberations are to proceed. In that section, it states that a borrower “shall have the right to rescind the transaction until midnight of the third business day following … the delivery of the information and rescission forms required under this section … by notifying the creditor … of his intention to do so.” …
“Does a borrower exercise his right to rescind a transaction in satisfaction of the requirements of Section 1635 by “notifying the creditor” in writing within three years of the consummation of the transaction, as the Third, Fourth, and Eleventh Circuits have held, or must a borrower file a lawsuit within three years of the consummation of the transaction, as the First, Sixth, Eighth, Ninth, and Tenth Circuits have held?” [Editor’s note: this article was written before the Supreme Court decision stating that no lawsuit was required for rescission to be effective under TILA. Thus a matter considered settled by the legal communities in a majority of states were wrong.] …
The Three-Year Gauntlet
Stepping through the rescission timeframe toward the three year mark, this is a brief outline of how TILA  sets forth the obligations of borrower and creditor:
1. A borrower who secures the loan with a principal dwelling “shall have the right to rescind the transaction until midnight of the third business day following the consummation of the transaction or the delivery of the information and rescission forms required under this section … whichever is later” by notifying the creditor of the intention to do so.
This means that the borrower has an unconditional right to rescind for business three days after the consummation of the transaction and, as a remedy for a creditor’s violation of the Act’s disclosure requirements, extends that right to rescind until three days following the ultimate delivery of the required disclosures.
2. A borrower’s exercise of the right to rescind “sets in motion a series of automatic steps to unwind the transaction,”  imposing obligations on both the creditor and the borrower. When a borrower “exercises his right to rescind, he is not liable for any finance or other charge, and any security interest given by the borrower becomes void upon such a rescission.”
3.  Following the borrower giving notice to rescind, and within 20 days after receipt of a notice of rescission, the creditor must return to the borrower any money or property given as … down payment … and “shall take any action necessary or appropriate to reflect the termination of any security interest created under the transaction.”
4. The borrower’s time limit for exercising the right of rescission is three years from the transaction’s consummation,  even if a creditor never delivers the disclosures required by the Act. …
the respondents (banks) concluded that, outside of the three-day unconditional rescission period, TILA does not impose any obligation on lenders to rescind a mortgage upon a borrower’s unilateral demand. [Editor’s note: As said above, they were wrong — but wrong like a fox. They steadfastly refused to file an 20 day actions required by TILA because the negotiability of the notes and mortgages would have been obliterated. It doesn’t matter, they will now argue, that we were wrong — everyone thought we were right. AND now it is too late to file an enforcement action under the provisions of TILA because it is time-barred. The problem for the banks is that the borrower does not need to file an action to enforce the rescission. They can if they want to. But all they really need to do is to clear title based upon the FACT that the mortgage is void.] …
Even if it could somehow be interpreted that a lawsuit is required to rescind the loan transaction, within the specified timeframe, Section 1635’s procedures clearly do not contemplate how a court proceeding could be held in a timely manner.
Recall that the statute expressly states that within 20 days after receipt of a notice of rescission, the creditor must return any “money or property given as earnest money, down payment, or otherwise” and “shall take any action necessary or appropriate to reflect the termination of any security interest created under the transaction.”  The provision specifies that those procedures of Section 1635(b) are triggered by “receipt of notice of rescission,” not by a lawsuit. Moreover, the time limits established here and elsewhere in Section 1635(b) are tied to the actions of the borrower and creditor.  Therefore, operationally, to comply with the pleadings timeframe, the statute would be inconsistent with the established rules to commence legal action set forth in the Federal Rules of Civil Procedure for establishing times for responsive pleadings.
A reasonable interpretation of Section 1635,  therefore, is that the notice to a creditor triggers rescission, and the default procedures of Section 1635(b) follow automatically in due course from that notice, without requiring the initiation of a court proceeding.”

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  1. Loan Agreement
    This is an actual contract by Residential Capital.
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    Sectors: Financial Services
    Governing Law: Delaware, View Delaware State Laws Free Law Reference
    Effective Date: June 04, 2008
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    as Borrower,GMAC MORTGAGE, LLC,
    as Guarantors,Certain Affiliates of the Borrowers and the Guarantors
    party hereto as Obligors,GMAC LLC,as Initial Lender and as Lender AgentandCertain Other Financial Institutions and Persons from
    time to time party hereto as LendersDated as of June 4, 2008

    Table of Contents Page ARTICLE I DEFINITIONS AND ACCOUNTING MATTERS 1 Section 1.01. Definitions; Construction 1 Section 1.02. Accounting Matters 2 ARTICLE II COMMITMENTS, LOANS, BORROWING, PREPAYMENT 2 Section 2.01. Commitments and Loans 2 Section 2.02. Note 3 Section 2.03. Borrowing Procedures 4 Section 2.04. Borrowing Base 5 Section 2.05. Interest 6 Section 2.06. Fees 6 Section 2.07. Alternate Rate of Interest; Increased Costs 6 Section 2.08. Mandatory Repayment of Loans 8 Section 2.09. Optional Prepayment 9 Section 2.10. Termination of Commitments and Reduction of Aggregate Commitment Amount 9 ARTICLE III PAYMENTS; COMPUTATIONS; TAXES; EXPENSES 10 Section 3.01. Payments and Computations, Etc 10 Section 3.02. Taxes 12 Section 3.03. Fees and Expenses 15 Section 3.04. Setoff 15 ARTICLE IV ACCOUNTS AND COLLECTIONS 15 Section 4.01. Concentration Accounts 15 Section 4.02. Sales Proceeds Accounts 15 Section 4.03. Collections Deposited to Collection Accounts 16 Section 4.04. Withdrawals from Designated Accounts; Account Notices 16 Section 4.05. Cash and Cash Equivalents 16 ARTICLE V CONDITIONS PRECEDENT 16 Section 5.01. Conditions Precedent 17 Section 5.02. Further Conditions Precedent 17 ARTICLE VI REPRESENTATIONS AND WARRANTIES 17


    Table of Contents
    (continued) Page Section 6.01. Representations and Warranties of the Borrowers 17 ARTICLE VII COVENANTS 21 Section 7.01. Affirmative Covenants of the Obligors 21 Section 7.02. Negative Covenants of the Obligors 25 Section 7.03. Notice of Certain Occurrences 28 ARTICLE VIII EVENTS OF DEFAULT 31 Section 8.01. Events of Default 31 Section 8.02. Remedies 33 ARTICLE IX ASSIGNMENT, PARTICIPATION 34 Section 9.01. Assignments 34 Section 9.02. Evidence of Assignment 36 Section 9.03. Rights of Assignee, Evidence of Assignment 36 Section 9.04. Participations 36 ARTICLE X INDEMNIFICATION 37 Section 10.01. Indemnities by the Borrowers 37 Section 10.02. General Provisions 38 ARTICLE XI GUARANTEE 39 Section 11.01. Unconditional Guarantee 39 Section 11.02. Nature of Guarantee 39 Section 11.03. Certain Agreements; Waivers of Certain Notices 40 Section 11.04. Waiver of Subrogation 40 Section 11.05. Taxes 40 Section 11.06. Payments 41 Section 11.07. Severability of Article XI 41 Section 11.08. Acceleration of Guarantee 41 Section 11.09. Election of Remedies 42 Section 11.10. Benefit to Guarantor 42 ARTICLE XII LENDER AGENT 42 Section 12.01. Appointment and Authorization 42 Section 12.02. Delegation of Duties 43


    Table of Contents
    (continued) Page Section 12.03. Liability of Lender Agent 43 Section 12.04. Reliance by Lender Agent 43 Section 12.05. Notice of Default 43 Section 12.06. Credit Decision 44 Section 12.07. Indemnification 44 Section 12.08. Lender Agent in Individual Capacity 44 Section 12.09. Successor Lender Agent 45 Section 12.10. Funding Reliance 45 Section 12.11. Security Matters; Release of Collateral 46 ARTICLE XIII MISCELLANEOUS 47 Section 13.01. Amendments, Etc 47 Section 13.02. Notices, Etc 48 Section 13.03. No Waiver; Remedies 48 Section 13.04. Binding Effect; Assignability 48 Section 13.05. GOVERNING LAW; SUBMISSION TO JURISDICTION 48 Section 13.06. Entire Agreement 49 Section 13.07. Acknowledgment 49 Section 13.08. Captions and Cross References 49 Section 13.09. Execution in Counterpart; Effectiveness 49 Section 13.10. Confidentiality 49 Section 13.11. Survival 50 Section 13.12. Joint and Several Liability of Borrowers 50 Section 13.13. Obligors Bound by Intercreditor Agreement 52 Section 13.14. Third-Party Beneficiaries 52 Section 13.15. First Priority Collateral Agent; Capacity under this Agreement and Protections Afforded 52


    Schedules Schedule 1.01 DefinitionsSchedule 2.04 Collateral Value CalculationsSchedule 5.01 Conditions Precedent to the Initial LoanSchedule 5.02 Conditions Precedent to each LoanSchedule 7.01(g) GMAC LLC Required ReportsSchedule 7.01(m) Master Custodial AgreementSchedule 7.01(t) Bilateral FacilitiesSchedule 8.01(m) Post-Closing RequirementsSchedule 13.02 Notices Exhibits Exhibit A Eligibility RequirementsExhibit B [Reserved]Exhibit C Initial Permitted Funding IndebtednessExhibit 2.02(a)(i) Form of Revolving NoteExhibit 2.02(a)(ii) Form of Term NoteExhibit 2.03(a) Form of Borrower Funding RequestExhibit 2.03(b) Form of Interim Borrowing Base ReportExhibit 2.04(a) Form of Collateral Value ReportExhibit 2.04(b) Form of Collateral Value CertificateExhibit 2.08(b) Form of Repayment NoticeExhibit 2.09(a) Form of Prepayment NoticeExhibit 7.01 Form of Compliance CertificateExhibit 7.01(s) Form of JoinderExhibit 9.01 Form of Assignment and Acceptance


    This LOAN AGREEMENT (as amended or supplemented from time to time, this ” Agreement” ) dated as of June 4, 2008, is by and among Residential Funding Company, LLC, a Delaware limited liability company (” RFC” ), GMAC Mortgage, LLC, a Delaware limited liability company (” GMAC Mortgage” , and together with RFC, each a ” Borrower” and collectively, the ” Borrowers” ), Residential Capital, LLC and the other Affiliates of the Borrowers party hereto as Guarantors (each, a ” Guarantor” ), the various other parties signatory hereto as obligors (the ” Obligors” ), GMAC LLC, a Delaware limited liability company (the ” Initial Lender” ), the financial institutions and other Persons that are or may from time to time become parties hereto as Lenders (together with the Initial Lender and their respective successors and assigns, each a ” Lender” and collectively, the ” Lenders” ), and GMAC LLC, a Delaware limited liability company, as agent for the Lenders (in such capacity together with its successors and assigns in such capacity, the ” Lender Agent” ) and Wells Fargo Bank, N.A., solely with respect to Section 12.11(b) and in its capacity as First Priority Collateral Agent. BACKGROUND The Borrowers desire to obtain Commitments from the Lenders so that the Lenders will from time to time and subject to the terms hereof make revolving Loans to the Borrowers, which Loans are secured by the Collateral. The Guarantors have entered into this Agreement and have agreed to provide guarantees of the Obligations hereunder and to pledge Collateral to secure such guarantees. The Lenders have agreed to acquire certain outstanding term loans made to ResCap pursuant to that certain Term Loan Facility dated as of July 28, 2005 (the ” Term Loan Agreement” ) among ResCap, the lenders thereunder, Citibank, N.A., as syndication agent, the documentation agents thereunder, and JPMorgan Chase Bank, N.A., as administrative agent, from the lenders thereunder. The Borrowers, the Guarantors and the Lenders have agreed to convert the existing term loans referred to immediately above to Loans subject to the terms of this Agreement. The Lenders are willing, on the terms and subject to the conditions hereafter set forth, to extend the Commitments and make Revolving Loans to the Borrowers. NOW, THEREFORE, in consideration of the premises and the mutual agreements herein contained, and intending to be legally bound, the parties hereto agree as follows: ARTICLE I DEFINITIONS AND ACCOUNTING MATTERS Section 1.01. Definitions; Construction . (a) Capitalized terms used herein and not otherwise defined herein shall have the meanings specified in Schedule 1.01 .

    (b) All terms used in Article 9 of the UCC, and not specifically defined herein, are used herein as defined in such Article 9. (c) Unless otherwise stated in this Agreement, in the computation of a period of time from a specified date to a later specified date, the word ” from” means ” from and including” and the words ” to” and ” until” each means ” to but excluding” . (d) The definitions of terms herein shall apply equally to the singular and plural forms of the terms defined. (e) Whenever the context may require, any pronoun shall include the corresponding masculine, feminine and neuter forms. (f) The words ” include” , ” includes” and ” including” shall be deemed to be followed by the phrase ” without limitation” . The word ” will” shall be construed to have the same meaning and effect as the word ” shall” . (g) Unless the context requires otherwise (i) any definition of or reference to any agreement, instrument or other document herein shall be construed as referring to such agreement, instrument or other document as from time to time amended, supplemented or otherwise modified (subject to any restrictions on such amendments, supplements or modifications set forth herein), (ii) any reference herein to any Person shall be construed to include such Person’ s successors and assigns, provided that such successors and assigns are not prohibited by the Facility Documents, (iii) the words ” herein” , ” hereof” and ” hereunder” , and words of similar import, shall be construed to refer to this Agreement in its entirety and not to any particular provision hereof, (iv) all references herein to Articles, Sections, Exhibits and Schedules shall be construed to refer to Articles and Sections of, and Exhibits and Schedules to, this Agreement, and (v) the words ” asset” and ” property” shall be construed to have the same meaning and effect and to refer to any and all tangible and intangible assets and properties, including cash, securities, accounts and contract rights. Section 1.02. Accounting Matters . Except as otherwise expressly provided herein, all accounting terms used herein shall be interpreted, and all financial statements and certificates and reports as to financial matters required to be delivered to the Lenders hereunder shall be prepared, in accordance with GAAP applied in a manner consistent with that used in preparing the financial statements described in Section 7.01(f) hereof. ARTICLE II COMMITMENTS, LOANS, BORROWING, PREPAYMENT Section 2.01. Commitments and Loans . (a) On the terms and subject to the conditions set forth in this Agreement, each of the Lenders severally agrees, from time to time on any Business Day occurring on or after Closing Date but prior to the Commitment Termination Date, to make loans (relative to each Lender, its ” Revolving Loans” ) to the Borrowers in an aggregate amount equal to such Lender’ s Pro Rata Share of the aggregate amount of the Revolving Loans requested by the Loan Agreement


    Borrowers to be made on such Business Day. The Lenders shall distribute the proceeds of such Revolving Loan to the Borrowers no later than 2:00 p.m. (New York City time) on the related Funding Date in accordance with Section 2.03 . (b) On the terms and subject to the conditions hereof, the Borrowers may from time to time borrow, prepay and reborrow Revolving Loans. No Lender shall be required to make any Revolving Loan if, after giving effect thereto, (i) the Outstanding Aggregate Loan Amount would exceed the Available Amount or (ii) such Lender’ s Outstanding Lender Loan Amount would exceed such Lender’ s Pro Rata Share of the Available Amount. (c) Pursuant to the Term Loan Assignment, each Lender shall have acquired Existing Term Loans in an aggregate principal amount equal to such Lender’ s Pro Rata Share of the Term Loan Initial Balance, which Existing Term Loans shall on the date hereof be deemed for all purposes to be term loans extended to the Borrowers hereunder (the ” Term Loans” ). Once repaid or prepaid hereunder, the Term Loans may not be reborrowed. (d) Upon the effectiveness of the transfer of the Existing Term Loans and to the extent such Existing Term Loans are deemed converted to Term Loans hereunder, the parties hereto acknowledge and agree that ResCap shall have no obligations to the Lenders with respect to the Term Loan Agreement or the Term Loan Assignment. Section 2.02. Note . (a) The Loans made by each Lender shall be evidenced by a promissory note executed by each Borrower substantially in the form of Exhibit 2.02(a)(i) hereto (a ” Revolving Note” ), in the case of a Revolving Loan, or Exhibit 2.02(a)(ii) hereto (a ” Term Note” ), in the case of a Term Loan (each a ” Note” ), in each case dated the date hereof, payable to the applicable Lender in a maximum principal amount equal to such Lender’ s Pro Rata Share of the Aggregate Commitment Amount. The Borrowers hereby irrevocably authorize each Lender to make (or cause to be made) appropriate notations on the grid attached to such Lender’ s Note (or on any continuation of such grid), which notations, if made, shall evidence, inter alia , the date of, the outstanding principal amount of, and the interest rate and Interest Period applicable to the Loans evidenced thereby. Such notations shall, to the extent not inconsistent with notations made by the Lender Agent in the Register, be conclusive and binding on each Obligor absent manifest error; provided that, the failure of any Lender to make any such notations shall not limit or otherwise affect any Obligations of any Obligor. (b) The Borrowers hereby designate the Lender Agent to serve as the Borrowers’ agent, solely for the purpose of this clause, to maintain a register (the ” Register” ) on which the Lender Agent will record each Lender’ s Commitments, the Loans (and interest due thereon) made by each Lender and each repayment in respect of the principal amount of the Loans, annexed to which the Lender Agent shall retain a copy of each Assignment and Acceptance, and each participation (as described in Section 9.04 ), delivered to the Lender Agent pursuant to Article IX . Failure to make any recordation, or any error in such recordation, shall not affect any Obligor’ s Obligations. The entries in the Register shall be conclusive, in the absence of manifest error, and the Borrowers, the Obligors, the Lender Agent and the other Lender Parties shall treat each Person in whose name a Loan is registered as the owner thereof Loan Agreement


    for the purposes of all Facility Documents, notwithstanding notice or any provision herein to the contrary. Any assignment or transfer of a Commitment or the Loans made pursuant hereto shall be registered in the Register only upon delivery to the Lender Agent of an Assignment and Acceptance that has been executed by the requisite parties pursuant to Article IX . Upon its receipt of a duly completed Assignment and Acceptance, the Lender Agent shall record the information contained therein in the Register. No assignment or transfer of a Lender’ s Commitment or Revolving Loans, including those transfers or assignments to an Affiliate, shall be effective unless such assignment or transfer shall have been recorded in the Register by the Lender Agent as provided in this Section. (c) The Register shall be available for inspection by the Borrowers or any Lender (but in each case only as to its relevant portion of the Register), at any reasonable time and from time to time upon reasonable prior notice. Section 2.03. Borrowing Procedures . (a) By delivering a Borrower Funding Request to the Lender Agent on or before 11:00 a.m. (New York City time) on any Business Day, the Borrowers may from time to time irrevocably request, on the Initial Funding Date (in the case of the initial Revolving Loan) or one Business Day prior to any subsequent Funding Date (in the case of subsequent Revolving Loans), that Revolving Loans be made in an aggregate minimum amount of $50,000,000 and an integral multiple of $1,000,000 (or the remaining unused portion of the Revolving Loans available to be advanced hereunder); provided that (i) the amount of the initial Revolving Loans requested pursuant to the initial Borrower Funding Request shall be not be less than $100,000,000, (ii) after the Initial Funding Date, the aggregate amount of Revolving Loans requested for Funding Dates in any period of ten (10) consecutive Business Days may not exceed $500,000,000 and (iii) the amount of Revolving Loans requested pursuant to any Borrower Funding Request (including the initial Borrower Funding Request) shall not, immediately after giving effect to the advance of such Revolving Loans, be greater than the difference between (A) the Available Amount minus (B) the Outstanding Aggregate Loan Amount. On the terms and subject to the conditions of this Agreement, the Revolving Loans to be made with respect to any Borrower Funding Request shall be made on the Business Day specified in such Borrower Funding Request. On or before 1:00 p.m., New York City time, on such Business Day, each Lender shall deposit with the Lender Agent same day funds in an amount equal to such Lender’ s Pro Rata Share of the requested Revolving Loans. Such deposit will be made to an account which the Lender Agent shall specify from time to time by notice to the Lenders. To the extent funds are received from the Lenders, the Lender Agent shall make such funds available to the Borrowers by wire transfer to the accounts the Borrowers shall have specified in their Borrower Funding Request. No Lender’ s obligation to make any Revolving Loan shall be affected by any other Lender’ s failure to make any Revolving Loan. (b) [Reserved]. (c) On or prior to the first Business Day preceding any Funding Date (if the related Funding Date is after the Monthly Settlement Date), and as a condition to the advance of any Revolving Loans relating to such Funding Date, the Borrowers shall deliver to the Lender Agent an Interim Borrowing Base Report. Loan Agreement


    (d) By delivering a Borrower Funding Request, the Borrowers represent and warrant to each Lender that, after giving effect to the making of the requested Revolving Loans thereunder, all conditions precedent to such Revolving Loan specified in Section 5.02 have been satisfied and all statements in clauses (b) , (c) , (d) , (e) and (f) of Schedule 5.02 are true and correct. Section 2.04. Borrowing Base . (a) On or prior to the Initial Funding Date, the Borrowers shall deliver to the Lender Agent and the Valuation Agent the Initial Collateral Value Report and the other components of the initial Monthly Collateral Report. (b) After the Initial Funding Date, the Borrowers shall deliver to the Lender Agent and the Valuation Agent an updated Monthly Collateral Report no less frequently than once per calendar month and no later than the tenth Business Day of each calendar month (commencing with June 2008). Each Collateral Value Report and each Collateral Value Certificate delivered by the Borrowers shall be effective (subject to Sections 2.04(c) and (d) below) until such time as the Borrowers shall deliver a subsequent Collateral Value Report and Collateral Value Certificate. For purposes of preparing each Collateral Value Report, the Borrowers shall calculate the Collateral Value of the Primary Collateral described in the related Electronic File in accordance with Schedule 2.04 ; provided that prior to the European Reporting Date, the Borrowers may use reasonable estimates, based on available data (including the amount of collections on European Reporting Assets held in European SPV Accounts) in determining the Collateral Value of European Reporting Assets for inclusion in any Collateral Value Report. (c) If requested to do so by the Lender Agent, within two Business Days after receipt of a Collateral Value Report and Collateral Value Certificate pursuant to Section 2.04(a) or (b) , as the case may be, together with the related Electronic Files, the Valuation Agent shall, to the extent such Collateral Value calculation relies on market value rather than Carrying Value, verify the Collateral Value for the Primary Collateral and shall notify the Lender Agent and the Borrowers of the amount of such Collateral Value. (d) Within three Business Days after receipt of a Collateral Value Report and Collateral Value Certificate pursuant to Section 2.04(a) or (b) , the Lender Agent shall determine (taking into account any information provided by the Valuation Agent pursuant to Section 2.04(c) ) the Borrowing Base and notify the Lenders and the Borrowers of such determination. Such determination shall be effective as of the Business Day specified in such written notice from the Lender Agent (or, if no effective date is specified in such written notice, the next Business Day following delivery of such written notice) and such Borrowing Base shall remain in effect (as adjusted by any European Collateral Value Adjustment) until the next determination or redetermination of the Borrowing Base in accordance with this Agreement. (e) Notwithstanding anything herein the contrary, in the event that the Borrowers fail to furnish any component of the Monthly Collateral Report, any European Collateral Value Adjustment or any Interim Borrowing Base Report in accordance with this Section 2.04 , the Lender Agent may designate the Borrowing Base from time to time thereafter Loan Agreement


    at an amount as determined by the Lender Agent in its sole and absolute discretion until each of the Lender Agent and the Valuation Agent shall have received all reports, certificates and files required to be delivered by this Section 2.04 , whereupon the Lender Agent shall designate a new Borrowing Base in accordance with the general procedures outlined in this Section 2.04 . (f) The Borrowers shall deliver Interim Borrowing Base Reports as required pursuant to Section 2.03(c) and the Lender Agent shall calculate the Adjusted Borrowing Base with respect to each Interim Borrowing Base Report. (g) To the extent that the Borrowers estimate the Collateral Value of European Reporting Assets in any Collateral Value Report, the Borrowers shall calculate the Collateral Value of such European Reporting Assets in accordance with Schedule 2.04 and furnish a supplemental Collateral Value Report as adjusted to reflect such calculation (such adjustment, a ” European Collateral Value Adjustment” ) within 5 Business Days of the delivery of the related Collateral Value Report. Section 2.05. Interest . Interest shall accrue on each Loan for each day during a related Interest Period at a rate equal to (a) the sum of (x) the applicable LIBOR Rate for such Interest Period and (y) the Applicable Margin, divided by (b) 360 days. Interest shall be payable (i) in arrears with respect to each Interest Period through the final day of each Interest Period (regardless of whether such day is a Business Day), such amount to be payable on the first Business Day following the end of such Interest Period, (ii) on the applicable Loan Repayment Date, (iii) on the date of payment or prepayment, in whole or in part, of principal outstanding on any Loan with respect to the principal amount so paid or prepaid, or (iv) on that portion of Loans the maturity of which is accelerated pursuant to Section 8.02 , immediately upon such acceleration. The Lender Agent shall determine the LIBOR Rate for each Loan prior to the beginning of each Interest Period, as set forth in the definition of ” LIBOR Rate.” The Lender Agent shall also calculate the amount of interest and, if applicable, any Breakage Costs or other amounts due to be paid by the Borrowers from time to time hereunder (including in connection with any prepayment or repayment of Loans permitted hereunder) and shall provide a written statement thereof to the Borrowers at least two Business Days prior to the due date of such payment (or the relevant repayment or prepayment after having received a notice thereof); provided that failure to provide such statements on a timely basis shall not relieve the Borrowers of the obligation to pay any interest and principal due on the applicable payment date (based upon their good faith calculation of the amount due, such amount to be promptly reconciled after receipt of a subsequent statement from the Lender Agent) and other such amounts hereunder promptly upon receipt of such statement. Section 2.06. Fees . On the Closing Date, the Borrowers, jointly and severally, shall pay to the Lender Agent the upfront fee specified in the Fee Letter, which fee shall be fully earned upon receipt and non refundable. Section 2.07. Alternate Rate of Interest; Increased Costs . (a) If, prior to the commencement of any Interest Period, the Lender Agent determines (which determination shall be conclusive absent manifest error) (i) that adequate and reasonable means do not exist for ascertaining the LIBOR Rate for such Interest Period; or (ii) Loan Agreement


    that the LIBOR Rate for such Interest Period will not adequately and fairly reflect the cost to any Lender of making or maintaining its Loans; or (iii) that, after notice from an affected Lender, it has become unlawful for such Lender to honor its obligation to make or maintain Loans hereunder using the LIBOR Rate, then the Lender Agent shall give notice thereof to the Borrowers by telephone, facsimile, or other electronic means as promptly as practicable thereafter and, commencing with the Interest Period immediately following the Interest Period during which such notice is provided to the Borrowers until the Lender Agent notifies the Borrowers that the circumstances giving rise to such notice no longer exist, all Loans shall bear interest at a rate per annum equal to the Applicable Margin plus the rate per annum that the Lender Agent determines in its reasonable discretion adequately reflects the cost to the Lenders of making or maintaining the Loans for such Interest Period. (b) The Borrowers jointly and severally agree to reimburse each Lender for any increase in the cost to such Lender of, or any reduction in the amount of any sum receivable by such Lender in respect of, such Lender’ s Commitments and the making, continuing, maintaining or conversion of Loans hereunder that arise in connection with any change in, or the introduction, adoption, effectiveness, interpretation, reinterpretation or phase in after the Closing Date of, any law or regulation, directive, guideline, decision or request (whether or not having the force of law) of any Governmental Authority; provided , however , that any such changes with respect to increased capital costs and taxes shall be governed by the terms of Sections 2.07(c) and 3.02 , respectively. For the purposes of this Section 2.07(b) , taxes shall include all present or future taxes, fees, levies, imposts, deductions, duties, withholdings, assessments or other charges imposed by any Governmental Authority, including any interest, additions to tax or penalties applicable thereto. Each affected Lender shall promptly notify the Lender Agent and the Borrowers in writing of the occurrence of any such event, stating the reasons therefor and the additional amount required fully to compensate such Lender for such increased cost or reduced amount. Such additional amounts shall be payable jointly and severally by the Borrowers directly to such Lender within ten (10) days of its receipt of such notice, and such notice shall, in the absence of manifest error, be conclusive and binding on the Borrowers. (c) If any change in, or the introduction, adoption, effectiveness, interpretation, reinterpretation or phase in of, any law or regulation, directive, guideline, decision or request (whether or not having the force of law) of any Governmental Authority affects or would affect the amount of capital required or expected to be maintained by any Lender or any Person controlling such Lender, and such Lender determines (in good faith but in its sole and absolute discretion) that the rate of return on its or such controlling Person’ s capital as a consequence of the Commitments or the Loans made by such Lender is reduced to a level below that which such Lender or such controlling Person could have achieved but for the occurrence of any such circumstance, then upon notice from time to time by such Lender to the Borrowers (with a copy to the Lender Agent), the Borrowers shall within ten (10) days following receipt of such notice jointly and severally pay directly to such Lender additional amounts sufficient to compensate such Lender or such controlling Person for such reduction in rate of return. A statement of such Lender as to any such additional amount or amounts shall, in the absence of manifest error, be conclusive and binding on the Borrowers. In determining such amount, such Lender may use any method of averaging and attribution that it (acting reasonably) shall deem applicable. Loan Agreement


    (d) Failure or delay on the part of any Lender to demand compensation pursuant to this Section 2.07 shall not constitute a waiver of such Lender’ s right to demand such compensation, provided that the Borrowers shall not be required to compensate a L
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  2. All these rescission discussions puzzle me.
    I could and did afford my payments, but I know contracts and I would NEVER send a notice of rescission to someone I did not owe; who was not a lender to me; who was not assigned beneficiary status; when the one I would like to send rescission to has dissolved their corporation.
    I am still outside the remedy because courts want business banks want property, and I want to tell someone who refuses to hear me that the thief lacked standing to steal
    I did not lose the home. I know where it is. Its not lost its at the same location it was when I purchased it.
    It was stolen from me by unknown persons using a business, some paper, men with guns, and more paper to say someone else who will pay the extortion can live in it; barring me from going near it or I’d suffer great harm and put pic slander.

    Trespass Unwanted, Creator, Corporeal, Life, Free, Independent, State, In Jure Proprio, Jure Divino

  3. Sounds easy
    The thieves post fake foreclosures in nonjudicial states and want people who never needed to be in court; to go to defend their right to property in 21 days why not get them to give up their deceptive gains in 20 days.
    …,good for the gander.
    Trespass Unwanted, Creator, Corporeal, Life, Free, Independent, State, In jure proprio, Jure divino

  4. The cheek. The nerve. The you know what. Those guys m.o. as designed was wholly dependent on mers alleged poss of the note and the alleged unity of the note and dot in mers and yet they fought like hell and swore otherwise to a state department in the Nebraska case if not others. So over here in foreclosureland, the poss of the note meant X but over there to avoid licensing, it means nothing.
    So I guess when mers swore no interest in the note in Nebraska, that was the time they were telling the truth (but as they were by design concurrently relying on their possession as unity in order to foreclose). If mers had no interest in the note, then what good was its poss of an instrument it had no interest in? That has got to be one of the things
    behind the Consent Order for whatever it’s worth to the millions of Americans who lost their homes by way of that turned-out-to-be-bs m.o.
    MERS has to go. Before they do or within time to sue them, I’d like to see them explain their sworn testimony to Nebraska while concurrently relying on the notes to foreclose since the people who were devastated by that m.o. have hopefully managed to pick up at least some of the pieces and won’t be trying to nail them. If we don’t get in front of this latest train, we’ll be joining those people. I still wonder if Arnold just wanted to go sailing or if he decided he wasn’t someone who could
    participate in MERS’ stuff. If it’s the latter, bet they clamped his mouth shut but good.

  5. So, wow. Pre-Consent Order, the m.o. was that the note and dot would be unified in the ben, MERS (the mechanics of which I explained as spelled out in the mmsp agreement) to foreclose. What’s changed is that they’re not being (allegedly) unified in the lender. Instead of MERS alleging its poss of the note means anything (unity), it’s now the note holder who gets the unity by way of the ben’s assignment of the dot.
    The collateral instrument is what’s now moved instead of the note, going the other direction.
    Time for some more Cole Porter.
    If I could ever explain why they wanted a nominee in the deal and not an agent, I can’t this minute. Think it’s got to do with bk remoteness, and I think fwiw we were on this a couple years ago. I think I can at least say this: if mers is an agent of the depositor, and thus the depositor is the true ben, there might be no bk remoteness for the benefit of the trusts. If it’s even ‘might not be’ that wasn’t good enough.
    It had to be certain and I think that had to do with the potential of a
    bk, voluntary or involuntary, by the seller to the trust.

  6. neidermeyer, I’m stumped by your plan since imo you weren’t entitled to new disclosures when you modified….?
    “my discovery demands that were not just ignored but spat upon by the plaintiff gives me the bona-fides to claim equitable tolling.” I agree that it might. But it might be held that the proper course was to do something about it (failure to comply with discovery), like a mtn to compel and then for contempt or like that. I think you’re going to have to work at justifying tolling, unfortunately. How about as an alternative to a justification for not filing a mtn to compel (if you didn’t)? Otherwise you’re saying that failure to provide (even warranted) discovery tolls and I’m just not so sure about that. The discovery violation isn’t a basis
    to toll that I know of, UNless what wasn’t provided to you wasn’t previously provided to you in the loan transaction and so made it impossible for you to know (“shouldn’t have”) of the violation, but then, isn’t that admitting for better or worse you don’t know that one exists?
    If you say in an affidavit that they didn’t give it to you, then they should be compelled to prove they did.
    If you’re in a position to yet file a mtn to compel, I’d try that first. If not, then imo as I said you need to justify how the failure to produce tolled the sol. lay opinions

  7. E. ToLLe you’re a kick…yes, I don’t get IT, whatever IT is.

    Flea spittle, oh I get it, have 3 beautiful pups….grand they are, flea spittle and all.

    And I guess the hyenas that are referenced frequently are a mere gesture in vain to insult the bloggers’; however, anyone who knows hyenas understands clearly: they function as a team or pack however one would like to define a collaboration of work and effort, they “share” the fruits of this endeavor so all can share the spoils….unlike certain “published” winners.

    And last time I checked one does not need to be altruistic, bright or decent to make the front page of Times Person of the Year (didn’t Saddam and Hitler make it?), I think many assholes have been there.

    We’ll just have to trudge along, in our menial, insufficient mental state, without the benefit of all the precedent-setting judicial rulings, being logged and talked about from the Supreme Court down, by Ms. Ohio, black-belt…Bruce Lee understudy…kicking ass to those who dare question her winning play book “Justice for Dummies”…coming next month to a bookstore near you!

  8. @ johngault ,

    Now I’m wondering … I’m on track to do something I definitely do not want to do , accept a permanent mod… What I’m thinking now is to make the last “trial” payment and more or less concurrently escrow further payments at the court and file rescission noting the lack of disclosure in the “perm mod” packet, conditioning acceptance on disclosure. AFAIK my discovery demands that were not just ignored but spat upon by the plaintiff gives me the bona-fides to claim equitable tolling.

  9. Ian, yes I know the alphabet problem, but those guys, since if they say so something IS, could yet have as or pretend mers is their nominee on / for notes.
    The assignments all include a sale and transfer of the notes from MERS. Is it not inescapable then that mers is purporting to sell and assign the note either by way of some nominee agreement we know zero about or in their own right? I hadn’t thought of MERS (I think – there’s so much to remember and try to keep straight) as that
    bk remote entity before, prob because it’s not or wasn’t in their mmsp agreement. But I don’t know what all the Consent Order changed, other than no more f/cs in their name. A few years ago, these bums didn’t allege an assignment from mers to the trusts. WHAT made them think they could start now?) Isn’t that true that no assgts were done from mers to the trusts til recently (not rhetorical question)? Let’s say mers is a nominee for its members.
    If it’s a nominee, it’s possible, with no other issues, an assignment would be the proper vehicle to move the dot to someone else. But I still think if mers were the ben as the agent of the lender(s) then an assgt is not the proper vehicle since if mers is an agent, the lender is already the ben, and what would be required is a noticed abandonment of that agency or something like that. You wouldn’t pay your own agent for your property or interest, would you? There’s consideration recited in these assignments; one party is purporting to sell and assign to a different party.
    The diff imo between an agent in a contract and a nominee in a contract is that in the former, the agent IS a placeholder and a nominee isn’t. A nominee IS appointed by someone else, but not as that someone else’s agent. And that makes all the difference. MERS as recited in the dot is a nominee (THAT’S what it says) and not an agent (and imo that was the intent – and it jives with their f/c m.o. of old to the extent art III applies and possession of a note means anything, at least that was their tacit claim. Just a reminder – the mo. was that the servicer’s employee aka mers’ officer would have poss of the note in order to f/c in mers name. Therefore, to them, there was unity of the note (by its possession by their straw officer and the nominee beneficiary in the formerly bifurcated deal.* Mers claimed that this alleged unification of the note and the dot by the nominee, a third party, entitled them to foreclose. The reliance, again was 1) actually being the ben in the dot and 2) poss of a bearer note or at least poss of the note. The Consent Order imo changed that and imo it’s because mere possessionof a note, esp an unendorsed one, still doesn’t make mers the lender / creditor.
    The borrower is informed that a third party, MERS, is the ben in the dot
    (“acting SOLELY as nominee, think is the wording, btw). So, okay, imo that’s established. He’s actually made a third party his ben – that’s what he is being informed of and said to agree to, for what that’s worth. Taking that as true, it does bifurcate the note and dot UNLESS another document establishes that the nominee is the agent of the ben. One may be a nominee and also an agent. But the agency isn’t established and can’t be established by the dot since the lender doesn’t sign it. It must be established in something the lender signs. But they did not, I tell you, want agency. I forget why this mintue, but it’s because it would mess them up over here but cause a problem over there. What the membership agreement does imo is make MERS the nominee in the dot for MERSCorp’ members, not their agent. I think it’s all bogus because unless the mmsp agreement establishes agency, which it doesn’t, it presents an original bifurcation, which in and of itself is messed because the borrower has his entire agreement with two sep and distinct parties. I really can’t articulate the so what of that this minute, but feel there is one and I believe it was one of the things recognized and which resulted in the Consent Order. At any rate, courts like NV, which partially recognize this, say that “unification” (note and dot sold and assigned to same party) solves the problem. What the NV SC actually says is that mers isn’t the ben, but goes on to prescribe a wholly unfounded relationship between the ben and mers. (At least in the case I read the relationship was wholly unfounded and was nothing more imo than an unwarranted (no evidence whatsoever was even asked for that I know of) presumption). My position is that mers doesn’t need to be an agent to assign the dot (looking past the matter of orig bifurcation) because it IS the ben and therefore has the beneficial interest in the dot (unless it’s also the agent). MERS and the ben could establish agency to the extent it existed at the time of the loan, but as far as I know, they haven’t, can’t, won’t . Mers IS assigning the dot in its own right (to the extent the orig bifurcation doesn’t queer the whole deal), but the note is another matter. The MDL in AZ, for instance, must have addressed some of this (nominee, agent, and so on), but I don’t know what arguments had been made and considered regarding bifurcation when the court found none. Maybe it, like the NV SC imo, was able to make agency out of whole cloth.
    Because nothing about mers’ relationship is in public record per se, one can’t be charged with knowledge of jack about them. I wouldn’t say anything I think I know unless I believed it would help me. Let them open that door and be ready.
    I would just ask how it is that mers the dot nominee is able to sell and assign my note (if the note is established) in concert with asking for a more definitive statement as to the basis of their claim – the assgt, the UCC, hdc yes or no. Exactly what, as the attorney partially did in that case last week. I didn’t say this well, but hopefully I’ve conveyed what I mean. What you’re after is for them to prove the transaction (allegedly occurring as a current event) reflected in the assignment. I would also rely on the language in the note about who may enforce, but so far, don’t know that anyone’s onboard that one (if not, got me why not). Actually, the assignment may meet the definition of transfer, I think, because it’s a sale and assignment, but any assgt and subsequent ones needs to explain how it is that the dot nominee is
    purporting to do that as to the note. The reason the dot doesn’t say that mers may assign the dot is because it doesn’t have to – because mers IS the ben.
    lay opinions

  10. Poppy, you don’t get it…..Christine is a published winner! A JD Genius, well, without the JD part (although you wouldn’t know that by reading her posts). Her brilliant piece of attack-law is now THE standard offense tactic in every single law office from coast to coast. How did they all make it this far without her? They’ve been able to get rid of all of those heavy books that took up so much space in their conference rooms. I’d bet she makes Time’s Person of the Year, especially now that Hillary screwed the server pooch!

    Unfortunately for us, being the unclean and all, we’re not allowed to peruse her pages of wisdom….something about pearls and swine or something, but maybe more due to the fact that no one knows the name of her suit. Is it Christine v. Bad Guys? No…tried it. Enraged v. Bankster Stooges? No again…I’ve tried thousands of pseudonyms v. bank aliases to no avail.

    Her claim that her case is all over the internet….well, so are the selfies of my neighbors teenaged daughter (no, I haven’t seen them…well, not all of them). I even caught a glimpse of my grandmother at Woodstock sans tie-dyed top and all! Not good! Dry heaves and still a bad taste in my mouth!

    We’ll just have to struggle onward, drowning in the flea spittle she somehow knows we’re addicted to. Our loss.

  11. Demeaning people and efforts to claim something that already belongs to you are mean and fruitless, IMHO. It appears a lot of effort is being generated by a few to carry on conversations that are a basic right-freedom of all citizens and wholly diminish the content of “information only”, not directives of logistical navigation in the judicial system. Let no one give advisement of “wins” when they are only related to that case. One size does not fit all and Neil is not giving legal advise like some here…..anyone can find the information Neil posts. ” let the buyer beware” folks….be very, very wary. There are many cases posted on legal publications, it means little. Blowing one’s own horn about “MY” success is a mere tack at credibility. And why is the question….so, if you follow MY path, you will be like me and have grand success? I think not! From my front seat the circus it would appear the attacks are being poised at getting Neil shut down….if we all leave?

    As for the comment about “start the fight first”….I differ. Plaintiff must prove claims and acquire paperwork to assert their claim. The flip side: defendants have to work procedure, use counter-claims and defenses. The case content/context matters. Everything is relative to the case presented. Just an observation….and just for the mere point: the lawyers keep doing the same things over and over, sloppy at much of it, it’s working for them so far!

  12. John Gault- re MERS as bk remote entity- all the PSAs state that there have to be 2 “true sales” of the note before it is deposited into the trust. This would be the A>B>C>D process. I don’t believe that inserting MERS into the mix as a nominee satisfies this requirement. Google “the alphabet problem” and it should come up.

  13. The issue and final word ofvthe Supreme Court
    As this post rightfully points out :

    “operationally, to comply with the pleadings timeframe, the statute would be inconsistent with the established rules to commence legal action set forth in the Federal Rules of Civil Procedure for establishing times for responsive pleadings.
    A reasonable interpretation of Section 1635, therefore, is that the notice to a creditor triggers rescission, and the default procedures of Section 1635(b) follow automatically in due course from that notice, without requiring the initiation of a court proceeding”.

  14. You know how the party who transfers the loans to a trust is supposed to be bk remote? Someone pointed out the other day that the employee and debt-less “MERS” is that bk remote party.

  15. I make reference to rule 17 and to the injury req for jurisdiction.
    Turns out “no damage” is also an affirmative defense. I don’t know after seeing that this recoupment deal may not apply to a non-j because it’s allegedly not an action how affirmative defenses may be utilized by anyone facing a non-j, either, since the homeowner would have to be the (alleged) plaintiff in a court. Bah! Anyone? A boatload of aff defenses:


  16. neidermeyer, fwiw, I’m really glad you asked that question because if you hadn’t, I doubt I would have ever realized that the reason (or one of them) that there are no new disclosures on modifications is so that no new RoR is created. Well, that’s what I believe, anyway. I guess they could have written it so that the new disclosures didn’t create a new right of rescission, but that wouldn’t work, either, l and s imo. So I was barking up the wrong tree any time I posited new disclosures should be made (that was primarily borne of a belief the cost of money in mods today is higher than the original terms, which it prob is). I still think they ‘should’ have to do new disclosures, but I think that really would mess up the intent of tila because the right of rescission is pretty dramatic, presumably beneficial (when legislated) to the borrower and a bummer for lenders.
    I’ve linked material about defenses and counter-claims being available to make after their ‘normal’ sol is up. That appears to include damages from tila violations. Maybe. If it’s JUDICIAL foreclosure.
    If that’s true, this is crazy: if one is being foreclosed on judicially, one may assert claims and defenses in recoupment. But if your bum is after you non-judicially, you may not have that SAME RIGHTsince courts may or will call you the plaintiff in court. That’s just not right; it discriminates because only one set of peoples can receive the benefit of this doctrine. That just strikes me as unconstitutional. Laws should
    apply to everyone equally. I only have one case (I think) wherein it was
    determined that the borrower who goes to court is the defendant, not the plaintiff. The banksters hang their hats on a popular belief that a non-j is not an “action” since there’s no court involved. Grrrrr

    I just read that damages (not rescission – damages) for tila violations have a one year sol.
    This very informative article discusses rescission, damages, and


    It says CA but the principles are likely the same as to non-j anywhere.

  17. david belanger (@revolutionnow1), on March 17, 2015 at 11:18 am said:
    hey christine, you still haven’t provided any cases you say you won.???? how come????

    Again, David, I don’t have to. My case is all over the internet and has made the rounds of serious law firms nationwide, who have since successfully applied it. It would be of no use for you or any LL. user and abuser: my case works on the attack, exactly as it was meant to. LL is strictly defense-oriented, especially geared toward peons with still a few bucks to profit from and no clue on what to do to win.

    With all due respect, David, I owe you nothing. Whatsoever. Even as a veteran who fought in wars my country never declared, on far away soils nowhere near threatening it. Can’t claim “constitutional law” for foreclosure while ignoring “constitutional law” when it’s about invading countries and overthrowing financially inconvenient governments, can we now?

    Can’t have it both ways. Volunteer to die for the banks while expecting citizens to get you out of your poor choice for a bank? Banks are banks. You opted to bow down and die for them. Get yourself back up and fight them.

    Sorry, pal. No game in the pity party.

  18. John,
    Loan app. income fraud. Never received loan app. at closing. After finally getting copies from title and lender, the title final copy is dated a month prior to closing. In lender file, the same page was removed. I’m sure it would easily be argued as an error. No evidence.

    However, there was the class action investor lawsuit which the employees said what was going on. There was the SEC charging the CEOs for accounting and stated income fraud. But both cases were settled out of court. For the borrower, I assume cases settled out court can’t be used. Correct.

    If there was someone looking for evidence from the borrower why don’t they simply go ask the broker to demonstrate how the loan got approved.

  19. Florida has this, for instance (but I can’t believe it says it only applies to loans under 300k). I found it at yahoo with a search of “florida revised statutes predatory lending”, so that’s a phrase to use inserting one’s own state….it’s somewhere to start.

    “The penalty for violating the requirements of the Florida Fair Lending Act is the forfeiture of any interest to be collected under the terms of a loan. The lender can only collect the principal of the loan without any interest. The exception to this penalty, however, is any bona fide error made by the lender that is corrected within 60 days of receiving notice from the borrower. Bona fide errors include clerical or calculation mistakes, computer malfunction and printing errors. If the lender was acting in good faith, but failed to comply with the law because of a bona fide error, the penalty will not be applied.”

    Read more : http://www.ehow.com/list_6137806_predatory-lending-laws-florida.html

    Note: this is sort of a trap, imo. The reward is awesome – no interest on your loan. But if you elect to go this route and doing so constitutes an “election of remedies” for whatnot, you might lose any other remedy for the same violations, like tila ones. I don’t know because I don’t and because this particular article isn’t sufficiently detailed to define what constitutes a violation of the FFLA. In addition to finding other info like this, I’d try to find some case law on it. But seriously, no interest. That’s pretty attractive.
    This stands imo as another reason that the successor to the note
    can’t achieve what UCC 3 has in mind as to HDC. Someone else’s
    violations can find him with no right to payment of interest, assuming successor liability applies to this act as it does with tila. I don’t really know because I haven’t wanted to roll up my sleeves and really take on the UCC for fear it’s a career, but it seems to me like this successsor liability stuff should defeat these notes being negotiable instruments (when the language in the note is imo wrongly ignored). If a successor buys a note, he may have a cause of action for any damage he incurs as a result of the liability he’s stuck with. It may be about that “without recourse” as to that, though, i.e., he may have no recourse against the note-seller for his successor liability. I don’t know. (Should, but I don’t.)
    Not sure we care, as long as successor liability applies.

    This act is problematic imo because of a potential pi$$ing match about
    whether or not the lender made a clerical error / acted in good faith when that “clerical error” was made. Yeah, like name one person who’s qualified to make that determination that WE KNOW OF. It’s an add’l
    bar to pose. First one has to establish the violation, then it appears one has to support that it wasn’t a “clerical error” and acted in good faith.
    But it’s possible that a true expert could demonstrate how it couldn’t have been a clerical error, at least.

  20. hey, david! It’s truncated…..where’s the rest of it?

  21. david, that info you posted is some of the best we’ve had here. It isn’t limited to rescission under tila. It speaks to causes of action for other
    infractions, unjust enrichment being one of them. I’m cutting and pasting it.

  22. david, that discovery rule stuff is good info. If there’s nothing else reliable, than I would rely on it as to the “should’ve known” re: tila violations in seeking to rescind after three years. And maybe this discovery rule is the very one for that reliance, come to think of it, because I don’t know what else might or should. It IS probably this discovery rule. imo.

  23. steve: “If the requirement was to contact the AG, don’t you think the DA would have said that. See what a Merry – Go – Round this becomes.”

    yes, I certainly do. That’s why one MUST scour his state laws to see who gets the job of dealing with predatory lenders and what private causes of action a law might create. It doesn’t surprise me that a d.a. wouldn’t know if it’s an ag who’s to do something when that’s the case. The stinking ag’s don’t seem to know what their job includes. Find the statutes in your state. Unfortunately, one also needs to find the versions of those statutes in effect at the time of the predatory lending or whatever (since the new ones may reflect bankster-lobbying).
    Btw, what was your evidence of whatever it was you wanted someone to do something about if you care to say?

  24. I understand your observations John. It’s also not my intention to bring on personal attacks through statements, it’s a waste of time.

    I do believe the entire crisis was baffle them with BS and keep them guessing. By the time they figure anything out it will all be over.

    You stated contacting the AG on a predatory loan and not the DA. I have to question that since I took my title received closing docs to the DA. They made copies and noted the loan app. missing. Afterwards they sent letter stating lack of evidence. If the requirement was to contact the AG, don’t you think the DA would have said that. See what a Merry – Go – Round this becomes.

  25. steve: “Personally, I would never make that assumption without an investigation of the entire loan process between all parties involved. I would never categorize everyone on the whole and pass judgement. However, that’s exactly how this crisis worked.”

    I don’t mind that anyone disagrees with me ever. I think I’m pretty laid- back generally, even with those gunning for me for whatever the heck reason since I’m just one more reader here. But I DON’T cotton to being misquoted and no one wants to be misunderstood (except the banksters)! I said “to the extent” people knew they shouldn’t and did anyway, which is not a generalization nor does it imply that most borrowers did what I said. It’s limited to the people who didn’t get hoodwinked, who knew what they were doing, knew they couldn’t make those payments, and signed on for them, anyway. If you took it or it could be read as an assignation against you personally or as to borrowers in general, it doesn’t say that, wasn’t meant to be taken that way, but I’m sorry TO THE EXTENT you took it personally or missed what I actually said! Other than that, I pretty much mean what I said, including that it was the lender’s JOB not to let people who, as you said, were temporarily insane or even if not, do something they shouldn’t.

  26. The more I think about it, fwiw, the more i think that’s what it was, with the bottom line being that tila did not intend to and doesn’t create a new ROR, EVEN if the actual cost of the loan becomes higher by the modification (which I don’t think they thought would be the case). It’s like they said “you got your shot at rescission on the one and only disclosures you’re getting”. I can’t say that I think this is totally unfair or at least wasn’t when crafted. It IS bothersome that the alleged mods being done today likely result in a higher cost of the money, but if they were legitimate mods (and not the new loans we suspect) and even if they had a balloon 20 years down the road, it’s still giving the borrower a way to stay in his home and mol kick the problem down the road when he’s got a little more room to breathe. TILA didn’t contemplate the predatory lending, including inflated appraisals, and so on going on today nor the rest of this bs, so I think their reasoning was justified in not mandating new disclosures and allowing for a new ROR (my opinion only, of course). But to the extent that it’s the disclosure of
    the a.p.r. and the other disclosures in the form which give the borrower an idea of what he’s getting into, people don’t know what they’re getting into by the same standard of “knowing” used in the original loan, and I have little doubt what one is getting into just now is a higher cost loan mod. There’s another reason that might be in the act for no new disclosures, also, and that might have to do with the unlicensed loan status of the current “lender”. Anyone interested, try the first page of this which discusses who is subject to Reg Z


    “Regulation Z (12 CFR 226) implements the Truth in Lending Act (15
    (15 USC 1601 et seq.), which was enacted in 1968 as title I of the
    Consumer Credit Protection Act (Pub. L. 90-321)”. Below that tells us who is subject to Reg Z. (won’t copy right to paste here)

  27. John,
    “So 5 years after you got a sh&t-pie loan, you start thinking you got a sh&t-pie loan.”

    No, in 2008 we got announcement we may have a sh&t pile loan and to contact the lender. We had to fight to expose it. We had to Occupy and tea party – protest. We had to expose the 2004 FBI mortgage fraud epidemic warning. We had the Financial inquiry Commission. The CFPB was created. We had numerous foreclosure websites, articles, documentaries, speakers along with William Black’s exposing the liars loans + control fraud. We had to protest until Obama created the mortgage fraud task force. Remember Holder treated mortgage fraud as a low priority. And don’t forget Lanny Breuer-


    After all that and all these years I’d be surprised if you found a statue left.

    John – ‘ I think it’s pretty clear where I stand personally about all this bs, but to the extent people got loans which they understood and further understood they couldn’t pay them and got them anyway because they got on the speculation train, they helped create this mess. ‘

    Personally, I would never make that assumption without an investigation of the entire loan process between all parties involved. I would never categorize everyone on the whole and pass judgement. However, that’s exactly how this crisis worked.

  28. neidermeyer: “Can it be argued that signing a “loan mod” restarts the 3 year clock… if it’s a “mod” then by definition it’s still the original loan but with modified terms. The same problems exist with the mod , no new money is usually advanced but the lender remains hidden by the servicer… would a rescission at that point unwind the mod or the entire loan back to the original closing? It would almost have to be the entire thing as the original document no longer is in effect.”

    well, that’s an interesting first question, but I think the answer to a mod restarting the clock is ‘no’. But then you’ve got a second question.
    But I’d ask like this: Could one rescind the (original) loan after modification? On that, maybe yes because no new disclosures are given on the mod, so as far as tila is concerned, it’s the same loan.
    I say this because I believe they can’t have it both ways. They can’t say you don’t get new disclosures and then try to make you fight after a mod about what you’re rescinding. You’re being compelled, I guess is right, to rely on the original disclosures in modifying a loan, so then wouldn’t it be appropriate and fair to say one’s rescission is based on the one and only loan and its disclosures in existence? I think it’s ridiculous to not get new disclosures on an alleged mod, but since that’s the way it is, then like I said, I don’t believe they can have it both ways. I can’t think of any justification for the mod to restart the tila clock given these facts. There’s purpose behind no new disclosures at mod,
    but I can’t put my finger on it just now. Or if I can, it’s because the rescission relates back to the original loan terms because tila did not mean to create a new right of rescission with a mod. For one thing, a legitimate modification when considered by the drafters of tila would’ve been seen as a benefit to the borrower and a new right of rescission would be or could be detrimental to the lender. They could have perceived the latter as a reason for not modifying.
    The really stinky part of this is that it may be that the modification contemplated by the tila crafters bears no resemblance to the one made. In fact, the a.p.r. etc could be higher. Having a balloon payment, for instance, (from memory only) greatly impacts an a.p.r. It may be that tila didn’t contemplate a higher cost of money in the mod or if it did, it was ‘defeated’ by the presumption of benefit (anyway) to the borrower and the detriment to the lender in a new ROR.

    „„Limitations period. The statute of limitations is:
    „„three years for claims that sound in tort (Mass. Gen Laws ch.
    260, § 2A (2012) and Cambridge Literary Props., Ltd. v. W.
    Goebel Porzellenfabrik G.m.b.H. & Co. Kg., 448 F. Supp. 2d
    244, 262-64 (D. Mass. 2006) (applying three-year limitation
    where plaintiff’s unjust enrichment claim was premised on
    alleged conversion, not breach of contract)); and
    „„six years for contract-based claims (Mass. Gen. Laws ch.
    260, § 2 (2012) and Micromuse, Inc. v. Micromuse, PLC,
    304 F. Supp. 2d 202, 209 (D. Mass. 2004) (applying sixyear
    limitation to plaintiff’s unjust enrichment claim based
    on same underlying facts as claims for breach of contract
    and breach of implied covenant of good faith and fair
    „„Accrual date. The limitations period accrues:
    „„for tort-based claims, at the time of the plaintiff’s injury or,
    where the factual basis for the cause of action is inherently
    unknowable at the time of the injury, when the plaintiff knew
    or in the exercise of reasonable diligence should have known
    the factual basis for the cause of action (Cambridge, 448 F.
    Supp. 2d at 263); and
    „„for contract-based claims, at the time the contract is
    breached or, where the wrong is inherently unknowable,
    when a reasonably prudent person would become aware
    that he or she has been harmed (Micromuse, 304 F. Supp.
    2d at 209-10).

    Massachusetts has special rules and exceptions that may toll
    or otherwise affect any of the statutes of limitations described
    previously. Depending on the cause of action and facts of the
    case, one or more of the following rules may affect the running
    of the statute of limitations

    Discovery Rule
    Massachusetts has adopted the discovery rule in circumstances
    “where the plaintiff did not know or could not reasonably have
    known that he or she may have been harmed by the conduct
    of another.” Under the discovery rule, the statue of limitations
    does not begin to run until “the plaintiff discovers, or reasonably
    should have discovered, ‘that [he] has been harmed or may
    have been harmed by the defendant’s conduct.'” (Koe v. Mercer,
    876 N.E.2d 831, 835-36 (Mass. 2007) (quoting Bowen, 557
    N.E.2d at 741).) In addition, “[t]he plaintiff need not know the
    full extent of the injury before the statute starts to run” (Bowen,
    557 N.E.2d at 741).
    The discovery rule has been applied in various contexts, including
    claims for tort, breach of contract and Chapter 93A violations
    (Szymanski v. Boston Mut. Life Ins. Co., 778 N.E.2d. 16, 20-21
    (Mass. App. Ct. 2002), Bowen, 557 N.E.2d at 741 and Prescott,
    769 F. Supp. at 408).
    Fraudulent Concealment Rule
    Under Chapter 260, Section 12 of the Massachusetts General
    Laws, when a defendant fraudulently conceals a cause of
    action from the knowledge of a plaintiff, the statute of limitations
    is tolled for the period before the plaintiff’s discovery of the
    cause of action (Demoulas, 677 N.E.2d at 174). Fraudulent
    concealment occurs when the defendant either:

  30. I know for a fact that at least one state’s statutes charge the attorney general with prosecuting violation of its anti-predatory lending statutes
    (that was some years ago and I haven’t looked to see if the banksters
    got that changed).
    That particular statute didn’t provide a private right of action far as I recall, but it did compel the ag to get off his heiny and do something. I really don’t know what private rights of action exist for predatory lending (outside tila), which is why I suggested the sleuth work for anyone who thinks she got a predatory loan because surely there must be one.

    Anyone who found predatory lending in his loan might want to look up a petition for a writ of mandamus. I think that’s the correct vehicle, but may have to ask an attorney if you can find one who’ll give you procedural advice. If that’s the wrong petition, find out what might be the proper one to compel someone like an ag to do what the law says she’s to do. I’m directing this to anyone who asked an ag for help
    in regard to predatory lending and didn’t get it. I have zero idea of any time constraints. But ag’s, just like anyone else, have to do what they’re supposed to do. I don’t believe there’s any discretion once an act they’re charged with prosecuting has been established.
    If predatory lending statutes are on a state’s books, then it’s against the law to make predatory loans. But these aren’t taken up with cops or
    the district attorney. The law says they’re to be prosecuted by ag’s
    instead. You call the cops when your home is burgled or someone steals your kid’s bike (and it goes to the d.a.’s office to prosecute). But you call the ag for predatory lending. And imo it’s deriliction of duty for the ag to ignore homeowners’ entreaties for help. Deriliction of duty could be the foundation for a writ of mandamus. Keep in mind this is being advanced by a non-attorney, i.e., me, which is to repeat that while I think the proper vehicle is a pet for a writ of mandamus, I don’t state that as a fact. RESEARCH if you want to go to the mat.

  31. Anyone who asked a borrower to sign a blank loan application was committing a crime. Pretty sure it’s a crime, not just a lending ‘violation’
    (such as a tila violation) that might not ‘rise’ to crime.
    ” Simply put, predatory lending becomes a crime in California when the lender manages the loan transaction to extract the maximum value for itself without regard for the borrower’s ability to repay the loan.”
    I don’t vouch for this necessarily, but it’s likely instructive:


    So 5 years after you got a sh&t-pie loan, you start thinking you got a sh&t-pie loan. What to do about it – is there something other than tila violations, say? If you suspect you were the victim of predatory lending, you might start scouring the internet to get, first of all, a handle on what constitutes predatory lending, including a search of your state’s statutes about predatory lending – predatory lending is a crime I’m going to hazard in all states. Then try to find out any “so whats” and any time constraints and exceptions to time constraints. By exceptions I mean like tila has an exception to the 3 yr right of rescission because it says 3 years from the time of the violation OR from the time the borrower ‘should have known’ of the violation. I think it’s pretty clear where I stand personally about all this bs, but to the extent people got loans which they understood and further understood they couldn’t pay them and got them anyway because they got on the speculation train, they helped create this mess. But I still blame the lenders because it was their legal and professional mandate, as I’ve said, to NOT make loans to those they knew didn’t qualify. Their legal and professional
    mandates essentially charged them with not helping someone be an idiot.

  32. John,
    1. ‘ what’s a “principal purchase”? ‘

    I’m mean principal loan, no refinance involved.

    2.’ steve – I said “He can abandon the loan application with that company at any time up until he closes (he closes by executing all the loan documents- note, etc).’

    I wrote 5,000 deposit check. Borrower can cancel but loses deposit to seller. A risk involved correct?

    3. ‘ But unscrupulous lenders quoted pie in the sky, showed those pie in the sky figures on the initial disclosures, but then socked it to the borrower at closing. It’s called bait and switch.’

    My understanding of the term ‘Bait and Switch’ originally was the loan application but I see you refer to it as switching cost disclosures.

    There was a video years back with FBI waring consumers not to sign the loan app. in blank but I can no longer find it. But here’s a video describing “Bait and Switch Tactics”


    In the video starting at 2:40 he says – the stated income letter was filled out latter by the staff. What’s a stated income letter? Does he mean the loan apps. were altered latter? Isn’t there only five pages to the ‘ Uniform Residential Loan Application ‘

    Everything in the loan app is are typed set. How does a borrower fill out anything by hand?

    4. ‘ A borrower generally signs two loan applications – one at the beginning of loan processing and one before the loan is sent to the loan underwriter for loan approval. ‘

    Yes. Borrower who knows nothing of loans or process leaves taxes and bank statements with broker since the lying broker needs time to go over figures. Borrower signs in blank thinking it isn’t a problem. It says APPLICATION right. Like a job application the borrower thinks it the pre-approval process, not a commitment. The second application is not given to the borrower from title at closing.

    The borrower can’t discover loan app. fraud unit after they go back to title and lender to retrieve copies. The borrower with a pick a pay adjustable could only afford the Neg. payment or interest only payment at best. A full principal and interest would wipe out or go beyond their monthly income of being able to afford the loan.

    With no help from the DOJ or DA offices what options did the borrower have left.

    In my case which I shared with you, It was 64k down – 5k seller deposit – plus 8k in closing cost etc. totaling 77k just to buy a 1962 piece of junk in need of major upgrades which was the cheapest in the neighborhood at the time. If the borrowers were all to blame then I hold the legal right to plea insanity.

  33. It depends what you call a win.

  34. hey christine, you still haven’t provided any cases you say you won.???? how come????

  35. Can it be argued that signing a “loan mod” restarts the 3 year clock… if it’s a “mod” then by definition it’s still the original loan but with modified terms. The same problems exist with the mod , no new money is usually advanced but the lender remains hidden by the servicer… would a rescission at that point unwind the mod or the entire loan back to the original closing? It would almost have to be the entire thing as the original document no longer is in effect.

  36. steve – I said “He can abandon the loan application with that company at any time up until he closes (he closes by executing all the loan documents- note, etc).”
    That’s on a purchase. On an owner occupied refinance, a borrower
    has three days from closing to consider the loan and change his mind for any or no reason. The borrower must be told this in the “Right of Rescission” notice to be given and signed by the borrower at closing along with his other closing docs. Each borrower must be given two
    copies of this notice. This is the same right of rescission which is extended to three years for violations of TILA.

  37. “legal disclosure given notifying the borrower any option to decline the principal purchase.”
    what’s a “principal purchase”? I have no idea what you mean. There’s no 3 day anything about a purchase money loan x any borrower must be given a good faith estimate and a truth in lending disclosure within 3 days of the time a lender “takes credit information”, generally interpretted to mean a loan application. Neither the good faith estimate nor the initial tila disclosure is a commitment by the lender. They’re estimates and everything in them can change from loan app to loan closing. That’s why a borrrower is given a “final” truth in lending statement along with the rest of his closing docs. This one isn’t an estimate. It must reflect the figures shown on the HUD 1 settlement statement signed concurrently. If a borrower doesn’t like the initial estimates, he doesn’t have to take the loan, no matter what stage of processing it’s in. If a borrower doesn’t like the final tila disclosure info, he still doesn’t have to consummate the transaction. He can abandon the loan application with that company at any time up until he closes (he closes by executing all the loan documents- note, etc).
    Sometimes lenders quoted one thing but when the borrower got to closing, he got another, which can happen with market conditions. But
    unscrupulous lenders quoted pie in the sky, showed those pie in the sky figures on the initial disclosures, but then socked it to the borrower at closing. It’s called bait and switch. Unfortunately, far as i know
    bait and switch itself isn’t illegal, even if it should fall under the category of predatory. A borrower generally signs two loan applications – one at the beginning of loan processing and one before the loan is sent to the loan underwriter for loan approval. By and large, the second loan application should match the figures on the HUD settlement stmt, but some of them are estimates, esp in “escrow” states.
    The a.p.r. disclosure is designed to inform the borrower of the true cost of the money he’s borrowing. When it’s calculated correctly, it can’t hide that true cost. One’s note rate may be 5% but if the a.p.r is 6.14%, the 6.14 is the true cost of the money. The bigger the spread between the two, the more fees the borrower was charged for the money.

  38. Still drowning in a flea spittle, huh? Same wheels of the same bus still going “round and round” while moving nowhere near a finishing line. 7 years. One tenth of the average American life… wasted revisiting the same issues ad nauseam and still no wins on this site. Truly edifying on the reasons for the increasingly sorry shape this country finds itself in.

  39. John, you missed the question.

    If a borrower has no 3 day right of rescission and was not given a 3 day notice of right to cancel then what disclosure and at what time during the transaction was any legal disclosure given notifying the borrower any option to decline the principal purchase.

    Was the borrower while waiting for lender approval required to decline with no disclosure of a three day notice since they don’t have the right of recession?

  40. david said “dw, thtas so easy of a question, first you rescind the whole deal, no matter how long its been, 5yr,8yrs,10,15yr who cares…..”

    Imo that stmt could be misleading even if it’s factually true. Anyone sending a notice of rescission which compels the lender to do what it must might be liable if the lender actually does it without justification, I think especially after 3 years. Practically speaking, the lender prob won’t do what it’s supposed to do by that Notice, but if it does, one could be liable if no violation exists.
    It may not be that if and when one ends up in court, the borrower has to be right about the violation relied on to rescind. It may be that he had to believe he was in good faith. I don’t know the facts about that, but no one here likely wants to be the first cautionary tale if it’s that he must be right that a violation exists and the lender rescinded or had to file and did file suit within the 20 days.

  41. steve – no, a 3 day right of rescission is not applicable to a purchase loan.

  42. I am NOT asking whether a principal purchase borrower can or cannot rescind under TILA . I am asking if a principal purchase borrower was required to receive a 3 day notice of cancellation. If so, was the disclosure to come from the mortgage broker or lender? Was title required to provide a copy at closing.

    One can’t rescind under criminal fraud, by only having a letter from the District attorney declining to investigate (lack of evidence without looking). They said in 2009 to go find a lawyer.

    Sorry Mario, I’m sure the CPFB will respond by saying go find a lawyer. Case closed. ….Still worth a shot.

  43. And imho. Its maxd at 3 years from signing
    Under tila it will be under something else thereafter.
    Just my opinion not an attorney.

  44. Agreed that the US Supreme Court decision just leveled the playing field, no prejudice.

  45. David Belanger,

    I agree with you completely, people are over thinking Tila. The only question I have is what happens if it is past the 1 year? I sent my right of recession last Jan. 2014, of course I got nothing. So now it is past the 1 year, what does a person do now? By the way what state are you in.

  46. TILA rescission forces the “lender” to take the burden of proof in the borrower’s loan, establishing that there was no basis for rescission. This article covers the law regarding those legal presumptions AND the effects and mechanics of a TILA rescission.




    dw, thtas so easy of a question, first you rescind the whole deal, no matter how long its been, 5yr,8yrs,10,15yr who cares. point being. that unless the banks file suit, to claim the rescind should not be accepted,and they challange it in court, in the 20 day time frame.
    agian TILA puts the borrower as in control, and if they do not file in 20 days. thats when you have 1yr go to court and file suit to recover all damages, and payments,princple,interest, and they will also have to pay legal , and if they do note file in that 20 day time fram, they lose all defenses. they cant bring up anything to defend themsevles, to anything that you bring into evedents. so thats when you bring in all info that you have found. they have no way to defend against it.

  47. If I got any of this right, one of the arguments the banksters are going to be lining up, if they haven’t already, against TILA is that it interferes with commerce. I think that must be an old argument, for whatever that might be worth, which might be something. In order to argue anew that TILA interferes with commerce, they have to first support a proposition that the UCC’s hdc status from article 3 even applies to these notes. We will lose our right to weigh in and make our own arguments against proposed changes to the Act if we don’t stay abreast of any lobbying of theirs. I don’t know how to do that. maybe someone else here does and or maybe NG will do it. We really need to stay on top this one. If nothing else, they’ve already gotten mers in the act and made changes to the UCC and other stuff others here know that I don’t. So if we do stay on top it, we should find their old arguments (I just have to believe these were already made) and at least point out they’ve already been asserted and overruled mol in addition to advancing our own positions. Actually, I wouldn’t know how to find them, but maybe the banksters’
    old arguments are available somewhere. NG?
    There’s no doubt in my mind these guys generally get what they want.
    They’ve certainly eroded the dot as a collateral instrument. Some courts if not new state laws are now letting an agent of the (purported) lender file a NOD, for instance. That’s the same damn thing as the lender doing it, so so much for a dot trustee, i.e. neutral party (and we bid adieu to anyone qualified as a sub trustee long ago). One party to an agreement may PUBLICLY notice what it all by its lonesome has determined is the other party’s default. The fact that this creates a cause of action for the other party if it isn’t true is what’s unduly burdensome, speaking of burdens. “Fixing it” has to be done by unsophisticated and unfunded individuals, and now against a breed still calling themselves humans (or hey, maybe they have a new name for themselves we the unwashed just aren’t aware of).
    A NOD stays on public record forever, even when withdrawn, because it doesn’t disappear; another recorded doc withdraws it. It doesn’t disappear like a wrong ding on one’s credit or a rightful ding on one’s credit which disappears by a time certain)

    Some people might not understand my big trip about the erosion of the dot (if they otherwise cared). It’s created an unconscionable situation where one may lose his home without judicial review on the sole word of the other party to his agreement, and that sure as hell was not the legislative intent in enacting the deed of trust act. It’s what I’ve said it is – a privilege turned into a right by legislation to preclude the time and cost of judicial foreclosure, and they sure as you name it have not only eroded it by deed but have caused its erosion to be supported by
    bs statute.

  48. NG: “and might allow for equitable tolling (this is still in doubt)”
    what’s still in doubt? The act reads “should’ve known”, does it not?
    So it’s not in doubt. What’s in doubt is whether or not anyone alleging a tila violation after the three years can demonstrate that he “shouldn’t have known”.

  49. I am not 100% sure but I think my 100% fee title on a separate grant deed on the “subject property” reflecting EX. A the actual real property exists and still recorded as mine gives me what the courts call “standing” . Right?

    apart from the two other grant deed s I hold of 1/4 &1/2 reflecting the business ex”.A” that the banks been using.

  50. Long after final.default judgment and withdrawal from WF, I filed an appraisal fraud complaint with the cfpb stating their first of many fraudulent acts. When applying in Jan. 2008.faxed a copy of an appraisal I purchased on an earlier loan application. It was for two of three commercial lots sharing only “the address commonly known as” and clearly different sq’ and descriptions. The mia WF broker used an abstract of Exhibit A “an undivided 1/4 one quarter interest in and to the following property”
    Then added this little footnote to defecate my inherited grant deed
    The location of the property or where the property is.
    Aka 000-11-5555
    And 000-11-5556.
    my Appraisal showed only 000-11-5555 but reflected my fee ownership of the different and separate land & buildings. When the cfpb responded they made the bank.respond with a letter stating they used an outside appraisal company within the loan office that conducts all appraisal of New loans. Never have seen this document that exactly reflected an appraisal amount of the one I faxed. Hmmmm. They keep pulling from my gracious spool of rope Each time I get a written statement from them. I just file each declaration motion and notice in my evidence folder that contradicts any thing they reveal and boldly shows the criminal intent of all named WF associates and partners.

  51. NG’s best take out imo: “Consider the fact that the current interpretation of TILA allows for rescission and might allow for equitable tolling (this is still in doubt), the defined elements of negotiable paper might not be present until all possibilities of rescission were obliterated.”

    Now that’s interesting. Boiled down, could it be said that the instrument isn’t negotiable because it’s (at least for three years) subject to rescission? It’s clear tila establishes successor liability. Not sure how to frame this. ‘Because the note may be rescinded, no one takes it free of that potential act (rescission) by the maker at least for three years and the potential is there for longer based on the “should’ve known”.
    If and since there’s successor liability, no one could take one of these
    notes free of the right of rescission. And not just the right of rescission.
    Tila comes with rights of offset to the amt of tender. That right of offset creates a defense to the amt of tender. But that’s really just an incident
    of the rescission. Or is it? It might actually be the biggie. If one rescinds and ABC, the successor creditor, does what it’s supposed to, then by tender, the consumer / borrower would make ABC “whole”.*
    So if it weren’t for the right of offset, a hdc would stand to lose nothing, at least after the dust settled. But the right of offset leaves or could leave the otherwise hdc “short” by virtue of a number of things, starting with the damages relevant to the tila violation.and even wiped out. It’s the fact that it could leave him short (or wiped out) that seems dispositive to me, more so than the right of rescission itself.

    *The additional fact that a successor may be compelled at rescission to write a check himself to return all things of value given for the loan seems a biggie, also, against negotiability.
    So there’s assumption of risk, normally an affirmative defense. But this particular risk voids the note or mandates that it be voided, compels the successor to do something, requires affirmative action on his part, and keeps him exposed to real defenses to the note.
    Negotiability speaks to obligations by the note maker far as I know.
    The borrower isn’t promising to do anything else in the note, but Tila creates both obligation of and potential loss to the lender and its successors. So do these facts render the note non-negotiable IF it’s otherwise a negotiable instrument? As NG points out, it’s something we haven’t looked at. As to these notes and the UCC, I’m still on what’s recited in the note itself as to the party who may enforce – one who has taken by transfer and is entitled to payments. It’s true that in commerce
    the word “holder” is construed to refer to a word found and defined in the UCC, but imo the note creates its own definition. Contracts and agreements MUST be considered before looking at default law. If they had wanted the word to refer to the UCC’s def of the word, they were free to say so, but they chose to give “holder” a particular definition (even as the note could refer to another UCC word,”transfer”). And for all we know, there was purpose in giving the word “holder” its particular definition in the note. After all, this definition would prevent a thief from enforcing, and obviously, that’s a benefit to the lender.

  52. The COC and CPB are a joke.

  53. Correct me if I am wrong. If the note does not contain the right to sell clause, the required quit claim deeds, accurate appraisals, and unable to retain title or environmental insurance on the subject property after a default judgment reforming deed of trust abstract from an undivided 1/4 interest “drafting error,” to 3/4 interest (corporate shares.ex”.A” Location or where the property exists)This contract has not yet consummated under CA Law. So what recorded document can rescind a separate note forged to resemble 1 of my 3 properties (1/4-1/2 & 1) and restore the undisputed real property fee title grant deed to an equitable title after the loan agents signed & recorded 2 notice of default, default judgment,subst.trustee and a withdrawal. But no notice of trustee sale. I am pretty sure they broke every lending,contract,foreclosure,law written. The response they gave me was “they stopped the foreclosure since they cannot obtain insurance on partial ownership loan” ok . Waiting for them to pay the fair share of my property taxes and property insurance. Lol. Then ins.co. can sue them on my behalf.

  54. I cancelled my transaction in a timely manner, they sent me a letter, this was in 2008. A few months ago I asked the CPFB to look into it for me, thus far nothing has occured.

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