NJ Appellate Court Decision Goes to Achilles Heel of “Securitizers”

“In order to have standing to foreclose a mortgage, a party ‘must own or control the underlying debt.'”

New Jersey litigants need look no further. In fact, in every other state of the U.S. you will find the same decisions each quoting from several other to the same effect. Courts across the country have usually confused the issue and accepted the allegation of ownership as proof of ownership. This court answers that as well:

To establish such ownership or control, Plaintiff must present properly authenticated evidence that it is the holder of the note or a non-holder in possession with rights of the holder.”

So what is a holder, such that the party has established “ownership or control of the underlying debt.” That is the issue that has been blurred by the banks.

The banks focus on the state statutes (UCC) enabling a holder to enforce without ever establishing that the party owns or controls the underlying debt. If you think about it that is nonsense. But that one thing, more than anything else, is responsible for millions of wrongful foreclosures. 

see NJ Decision On POA and MERS

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Here are some basic black letter rules, quoted in the NJ case, that have been followed for centuries:

  1. A holder must possess the original note.
  2. Transfer of possession must be “authenticated by an affidavit or certification based upon personal knowledge.”
  3. A party relying upon power of attorney or other document must produce the authenticated original of that document.
  4. Using the words “as attorney in fact” means nothing unless the party is able to produce a witness who, in their own personal knowledge, knows and states that the POA is in writing and has not been revoked.
  5. That witness must be able to lay the factual foundation and authentication for introduction of the Power of Attorney or any other such document.
  6. Without such foundation and authentication, any testimony or documents proffered by virtue of the POA cannot be admitted into evidence and for purposes of the case then, such statements or documents do not exist.
  7. A party who claims a legal relationship with another party and who relies upon it for proffering evidence must provide evidence of the legal relationship.
  8. A Power of Attorney must be in writing, duly signed and acknowledged as set forth in state statutes. Oral Powers of Attorney cannot be used to circumvent the requirement that interests in real property (including mortgages) must be in writing.
  9. A party seeking to enforce a note must be able to establish, though competent evidence, the location and the previous locations of the note in order to establish possession and the right to enforce, respectively.
  10. Certifications must be based upon personal knowledge and not general familiarity.
  11. If testimony is offered based upon a “review” of records, the records must be present or the witness must identify those records and how the witness acquired personal knowledge of their content.
  12. Assignments of mortgage must be authenticated by a person who has personal knowledge of the assignment (and the circumstances in which the assignment occurred). Otherwise the assignment is hearsay and must be excluded from evidence unless otherwise admitted for different reasons. Hearsay statements in assignments cannot be admitted into evidence and for purposes of the case then, such statements do not exist.
  13. The fact that an assignment or other document exists as an original or a copy does not mean that what is written on it can be admitted into evidence. But without a proper objection, the document can be admitted into evidence as proof of the matters asserted therein.
  14. A document signed by an agent or “nominee” like MERS after the demise of the principal is void because the power of attorney expires upon expiration of the principal. If the originator no longer exists, MERS is not authorized to act on behalf of the originator.

7 Responses

  1. You know whats bad when I look on zillow.com and it says bank took ownership of this home for one dollar.Whats really bad is to think what that family went through that lived in that house.The fake sevicer held that familes heads underwater for years and nobody helped them,no lawyer,no judge, no government.Just get out but please give us a mod please,no just get out on the street,get out.We the fake servicer are going to take your home we have no rights to you home just get out now,but our credit is destroyed,because the fake servicer destroyed it, we dont care says the court just get out but please help us NO.So bad its like a form of ethnic cleansing.I know because my fake bank servicer did it to my family. We all worried for years it was so bad,until i found this lawyer that was able to get me a fake mod.So bad whats going on in this great honest country.These fraudsters get to get rich from all the hell that they are putting these families through.Just sick .

  2. Can you offer support for #14?

    Thank you,

    Tim Collins

    Sent from my iPhone 206.919.6005


  3. Most of what is in this post is factually and legally incorrect, which shows a lack of knowledge of the subject matter. Like the comment: “A party seeking to enforce a note must be able to establish, though competent evidence, the location and the previous locations of the note in order to establish possession and the right to enforce, respectively.”

    “A holder of the Note is entitled to enforce it. If the Creditor can prove that it is in possession of the Note endorsed in blank, then as a holder it is entitled to enforce the Note. The Creditor is not required to prove the details of each transfer in the chain of title.” MESINA v. CITIBANK, NA, Bankr. Court, D. New Jersey 2012

  4. Where does Freddie Mac involve in all this shell game. They are no where on any NOI or NOD paperwork presented to the court for foreclosure. Yet they say they are holder. Owner. And investor when we lookup property on their website. And there is also a Freddie Mac trust in there as well.

  5. ““In order to have standing to foreclose a mortgage, a party ‘must own or control the underlying debt.’”

    However, keep in mind the party does not need to prove ownership or control of the debt to file for foreclosure – they only need to allege it to be true! If you don’t challenge and make them prove it – the court will admit their allegation as fact and then you are stuck.

    Perhaps if you can beat them on proof – and the case gets tossed, you might have a case for malicious prosecution etc.

  6. hello all, just got in mail a letter from a servicer, with notice of servcer change, on a mortgage that has been paid in full, so if that doesnt say all. fraud still going on. selling notes that have been paid for already, many many times . and still selling them making money on your name and property with out your knowledge. or permission.

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