US Bank “Owner Trustee” v Lopez;

The case shows that we are all continuing to be held under an umbrella that is blocking the sunlight. I’m happy that Lopez won the appeal. But the court still is not putting the pieces together.

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see USB Owner Trustee v Lopez

The very first sentence of the opinion shows that the Court is not scrutinizing the pleadings. The lawyers in the action proclaim the foreclosure is brought by U.S. Bank as “owner trustee.” So is USB the owner or the trustee for a trust that is the owner of the debt, note and mortgage — remembering that it needs to be all three.

The right to sue on a note does not confer, automatically, the right to foreclose on the mortgage.  In fact, the apparent ownership of the mortgage by way of an assignment does not confer the right to foreclose. See Article 9 UCC. The debt must be conveyed to the assignee of the mortgage or the successor to the note.

Here the lawyers state that U.S. Bank is a possessor with rights of a holder in order to invoke the status of a holder in due course without specifically pleading that exalted status. What is right in front of the court is a supposed trust that may or may not exist whose sole purpose was to BUY loans. By pleading “possessor with rights of a holder” there is a tacit information that the sale of the debt never took place.

In plain language that means that while pieces of paper were circulated with various apparent endorsements and assignments, the debt never moved. So somewhere out there the owner of the debt, the obligee of the debt, is getting screwed and the homeowner is the pawn in the game wherein the owner of the debt gets screwed.

This case should have resulted in a dismissal with prejudice. Instead the court bent over backwards to find a reason to vacate the foreclosure judgment on grounds of noncompliance with state law. Now the lawyers can come back again claiming the existence of a nonexistent trust that owns nothing, does nothing, and is never identified, as is required for all pleadings on behalf of a business entity, as having been organized and existing under the laws of the state of [____________].

Under trust law in virtually all states, no trust is actually created nor does it exist unless money and property is entrusted, by a trustor or settlor, to the named Trustee to hold for the benefit of beneficiaries. None of that happened. And in most cases the investors who bought “certificates” are expressly barred from asserting any interest in the debt, note or mortgage of any “underlying” mortgage loan.


16 Responses

  1. Kalifornia – the very bottom tranche, or one of them, was not a pass through tranche, never securitized, and only held by the Depositor and/or Servicer. Loans, as reported in default, get subordinated to that bottom tranche. Nothing is then passed through from the servicer to the named trustee on behalf of the security investors. Fees are accrued to the debt buyer, on whose behalf the servicer continues to act – even though the loan – which was never validly placed in the trust – is now removed from the trust. It is called a derivative contract. Fiduciary trustee is gone.

    The questions to ask are 1) How much has the servicer advanced to the trustee on behalf of the security investors? For how long? 2) Is the servicer acting on behalf of any derivative contract debt buyer, and if so, how much did the debt buyer purchase the collection rights for? 3) On whose balance sheet was the loan originally placed? And, did the loan ever go back to that balance sheet once the pass through of servicer advances was stopped by the servicer to the trustee? If not, why not? 4) How can the trust, or the trustee on behalf of the trust investors, even claim to be the creditor under the FDCPA, when no cash pass through is ever passed to those security investors? 5) Since the debt buyer “investor” is not a pass through security investor, who are they? What is their name, and, is that the party the servicer goes to when a loan modification is requested?

    Ian – yes. I know the courts don’t want to hear. I loathe the word “Deadbeats.” No one is a Deadbeat. Courts will make up any excuse not to hear. This was the government’s responsibility to fix. Loan mods were supposed to go through — with a valid contract. That was their way to “humor” the homeowners. This did not happen. Interest rates are rising. There will be more defaults. Hope the government gets it right this time.

    When peoples lives are destroyed, and I have seen many lives destroyed, those people have a right to know who is did this to them — even if it can’t save their home. There should be no more hiding. Show the face, at least to return some dignity to the people. .

  2. @ ANON

    “… the servicer, by owned non-securitized tranche, continues to service for the contract debt buyers – who are not security investors for the trust but, rather contract holders.”

    Respectfully, how can there exist such an object as a “non-securitized tranche” when the origination transaction purportedly created a whole loan (which was subsequently pooled and tranched through a securitization conduit)?

    Those purported “contracts” purchased by “debt buyers” appear to manifest post-origination, on the securitization-conduit side of the events, and would be only some tranche(s) of “pass-through contract(s)” — seemingly far removed from, and unrelated to, the allegedly secured origination transaction.

    So then, what are the necessarily penetrating interrogatory questions to reach the forensic accounting(s) — the money trail(s)?

  3. ANON – great explanation. I don’t believe that any complaint centered around the accounting issues is going to bear fruit. Judges I believe are all basically the same, and they all have this preconceived response to anything other than “ this borrower is a freeloading deadbeat loser who is just trying to get…….. a free house! Haven’t seen that phrase lately, but it is blatantly obvious that the courts don’t understand even secured debt( mortgages/DOT) as opposed to unsecured debt(credit cards). Let alone trustees, bankruptcy remote entities , tranches, deivstives, default debt buyers etc. The fact that less than 1% of court rulings favorable to borrowers is ever published is very telling. The powers that be are trying real hard to keep the entire Ponzi Scheme afloat, and I don’t believe that accounting issues are going to make a difference. Although by rights , they certainly should result in courts dismissing the servicers suits.

  4. Mark Bowen is correct . Assuming the securiitzations are valid, which we know they were not, a trust owns nothing. A trust is a non-entity.with the fiduciary trustee as the legal owner and holder on behalf of investors for the pass-through of current cash flows. However, if the servicer stops advancing payments, which is usually done very quickly upon reported default, the fiduciary trustee’s role for that loan ceases. The servicer, who likely owns one of few non-securitized tranches, however, continues to service for contract derivative debt buyer. The derivative being the means that the loan is “swapped out” of the trust. The loan should go back on balance sheet to be charged off, but, of course, we know there was never any on balance sheet loan to begin with – so collection rights go right to the debt buyer.

    So when the parties say the trust owns the loan. This is false. A trust never owns anything unless is separately incorporated. Upon reported default, the servicer, by owned non-securitized tranche, continues to service for the contract debt buyers – who are not security investors for the trust but, rather contract holders. And, when it is said that the trustee owns the loan, this is also false after default is reported, because the trustee is no longer acting in a fiduciary capacity for the security investors, but rather, by agreements under the PSA, that includes a capacity for administrator of the default security – now owned by the contract debt buyer — who can change many times. That debt buyer — who you can never contact, will immediately add fees and interest making it impossible to ever recover , unless there is a really good loan modification — which will never show valid chain of title. .

    I am told this is beyond the comprehension of courts. But, it is a violation of law not to identify the true creditor debt buyer. The only way to discover this is if the court allows discovery, and the right questions are asked. Accounting is the key. .

  5. (continuing…)

    “In the FAC, Hacker referred to himself as the “owner” of the property but did not substantiate this claim by attaching the grant deed or otherwise bringing it to the court’s attention. Although he claimed ownership of the property via a grant deed in his declaration attached to the July 12, 2014 opposition and attached copies of it to two RJN’s, the trial court gave no indication that it had considered this alleged documentary support for Hacker’s ostensible ownership of the property. Instead, the trial court focused on Hacker’s failure in the FAC to establish that he was the owner of the property or the borrower of the note securing the property. In addressing Hacker’s claim that he obtained an “[a]ssignment of [r]ights” from the Chaissionses, the court observed that “ ‘an estate in real property . . . can be transferred only by deed or by operation of law’ ” and “ ‘[t]itle passes by deed and not by assignment of the deed to the assignee.’ ”

    To the extent that the trial court confined its analysis to the allegations in the FAC, the sustention of the demurrers as to all causes of action was logical; Hacker failed there to plead an ownership interest in the property sufficient to confer standing. However, our analysis does not stop there. We must determine whether the trial court’s denial of leave to amend fell within the court’s reasonable discretion.”

  6. (continuing…)

    “It appears the trial court misconstrued the nature of Hacker’s challenge to the August 21, 2008 assignment. Hacker did not allege that the parties violated the terms of the PSA nor did he challenge any aspect of the securitization process whereby the original mortgage owned by Option One was transferred to the Option One Trust pursuant to the June 1, 2006 PSA. To the contrary, Hacker has consistently maintained his position that the Option One Trust maintained its ownership of the loan from that date forward.

    Hacker argues the subsequent assignment of the DOT on August 21, 2008 is void, not merely voidable. Throughout the FAC and the second amended complaint, Hacker claimed that the August 21, 2008 assignment by AHMSI to the Soundview Trust, which was conducted on behalf of Option One, was void because Option One had already sold the Chaissionses’ loan to the Option One Trust. Option One could not have conveyed the Chaissionses’ loan to the Soundview Trust because it no longer had any beneficial interest in the Chaissionses’ loan to convey. This contention is not a challenge to the terms of the PSA.”

  7. @ ALL

    Certified for Publication 5/9/18 (order attached)

    Hacker v. Homeward Residential, Inc. 4/10/18 CA2/1

    …for claims arising from an allegedly void assignment of the deed of trust (DOT) on real property located at 1713-1717 Stearns Drive in Los Angeles, California (the property), and a failed short sale agreement. The trial court sustained the demurrer by Homeward, Deutsche Bank, Western Progressive, Ocwen, Wells Fargo, Power Default, Brandy Berns, and Vicki Pospisil to all causes of action; and the court sustained the demurrer by Sand Canyon to the third through eighth causes of action.

    The trial court also denied Hacker’s request for leave to amend. On appeal, he contends he can amend his pleading to allege causes of action for wrongful foreclosure, fraud, slander of title, declaratory relief, unfair business practices, and cancellation of instruments against Homeward, Deutsche Bank, Western Progressive, Ocwen, Wells Fargo, Power Default, Brandy Berns, Vicki Pospisil, and Sand Canyon.1

    We find that the trial court abused its discretion in denying leave to amend. We therefore reverse.”

  8. I’ve heard that a trust owns nothing because it is not a legal person, or entity, like a corporation or LLC, etc. The Trustee owns and holds assets “in trust” for the beneficiaries of the Trust. If this is true then saying that the trust doesn’t exist is itself a misrepresentation if the Trustee is the owner for the benefit of “certificate holders” where trust is implied. This is all irrelevant in my opinion if the evidence consists of fabricated and, therefore, forged documents which is what we should all be investigating. There shouldn’t be a forensic document examiner in this country that isn’t scrambling to keep up with his/her case load.

  9. Bankster said it was a “non-holder in possession of the note with rights of a holder:” As to these notes, there’s no such thing. They aren’t entitled to enforce it, here only paying attn to the note, because they didn’t establish that they 1) took the note by transfer (for value, in good faith, and without notice of its dishonor (default) and 2) were entitled to payment, the two expressed conditions in the note.
    Btw, reaching way back to study days, HUD doesn’t endorse notes to trusts. If anyone, and that’s a BIG if, HUD would endorse a note to the Issuer of the certificates. It’s the Issuer who is the ben of the gov’t guarantee or insurance. I might be a tad off-center on this, but generally that’s the drift of the govt’s VA guarantee / FHA insurance, best I can remember.

  10. A trust owns nothing. If the securitization is valid, the certificate investors only own cash pass through for loans by which the trustee is the legal holder on their behalf. Derivatives to the trust are not securities by the trust securitization. They remove default loans from securitization. DERIVATIVES are contracts with debt buyers whose name is concealed. The trustee no longer has a role. However, the trustee could also be the derivative contract administrator. In that case, they are no longer the legal holder. . .

  11. Any new news about Bank of New York Mellon acting as Trustee for CWABS ?

  12. This is my case as well. The collateral never moved, the debits and credits did.Transfer of a defaulted debt without notice of defect cannot create “holder in due course” status.

  13. Reblogged this on Deadly Clear and commented:
    When are we collectively going to stand up and assert these were never meant to be traditional mortgages?! These faux mortgage documents are intent to defraud the homeowners, shareholders and pension beneficiaries rather than legally inform the homeowners they were participating in a securities scheme. There are no laws governing quasi-securities transactions with no disclosure.

  14. US Bank is committing fraud on the court, too.

  15. Thank you Neil

  16. US Bank is asserting half-truths, misnomers , verbal inaccuracies
    And terminological inexactitudes.

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