How to start your defense in foreclosure cases

Periodically I publish a sample response letter to people who have submitted a registration form for our free review service. This provides an updated template review of our current strategies and approaches to winning foreclosure cases. The following is a recent email I sent out to a homeowner who has just been served with summons and complaint.


I know that you are reporting that you purchased your property in 2006 from Countrywide home loans. This is a common semantic error. You did not purchase your property from Countrywide Home Loans. Based upon the additional reporting in your registration statement you received your first home loan from an investment bank who used Countrywide Home Loans as an “originator” with neither the investment bank nor Countrywide having any intent of being responsible for compliance with federal and state lending laws. You purchased the home from someone else.

Since you have been served with a Summons and complaint, you are absolutely required to respond within the specified time set forth on the summons. In most States that is 20 days. It is not a good idea to do it yourself if you can possibly afford an attorney, even if the attorney is not particularly well-versed in the modern era of foreclosures. And even if you can’t afford to retain an attorney you should spend whatever money you need to do in order to at least consult with the attorney before you file anything. Your first filing should not contain any admissions, even if you think some of the allegations against you might be true. What appears to be true is generally not true in the context of mortgages and foreclosures since the year 2000.

The investment banks tried to pass off MERS as an actual mortgagee. They failed. MERS is a company whose sole purpose is to provide a technology platform for securitization players to create the illusion of a chain of title. This company officially disclaims on its website and in every contract with every vendor or servicer or Bank any interest in your debt, note or mortgage. It never handles any money. No payments are ever received or dispersed by MERS. 

The word “nominee” is barely defined anywhere and can mean several things. In this context it only means that the company is an agent for someone else. An agent does not possess any greater powers then the principal who is being represented by the agent. 

In your case, the principal is whoever was named as “the lender.” But that is only a label and in most cases, probably including yours, it is not an accurate description of the company that is designated as the Lender. In your case the designated lender did not lend you any money and could neither gain or lose money from you making any payments. Therefore the money you received from the apparent loan was not the result of a payment by the designated lender to you. It was actually the result of a diversion of funds by an investment Bank pursuing a securitization scheme in which the loan account was retired in a concealed manner. At no point, in all probability, did the designated lender have any legal right, title or interest to any part of your debt, note or mortgage.

And despite appearances to the contrary, no payment to Countrywide was ever deposited by them in an account controlled by Countrywide. 

The same type of analysis is appropriate for Shellpoint. Although it is designated by unknown parties (i.e., investment banks posing as Master Servicer) as a servicer, it does not perform servicing functions. Instead, it merely accesses information contained on a central repository, probably at Black Knight, where automated processes simulate the servicing of loans. 

Attacking Shellpoint means attacking its authority and any witness or document designated by the lawyers on behalf of Shell point. The witnesses don’t actually know anything and the documents are not the documents of Shellpoint, which means that Shellpoint is not a competent Witness and therefore both the testimony and the documents should not be admitted into evidence. 

Most laymen and inexperienced trial lawyers miss the possibility that the entire account has been completely retired and no longer exists. This is particularly relevant to claims of servicing. If there is no debt or loan account, then there is no creditor. Then while you think there must be a creditor, legally none exists if they don’t claim ownership of the debt.

Therefore nobody can claim “servicer” status because a “servicer” is an agent of a principal. The only principal that has any right to appoint the servicer is the creditor. Since there is no creditor there can be no servicer. And don’t worry about someone being cheated out of money if you don’t pay. The investors are getting paid regardless of what you do and the investment banks received so much money from securitization of data about your loan that it was unnecessary to maintain the account at all. That is why there is no loan account. It has been paid in full many times over. 

The mistake often made by both lay people and inexperienced trial lawyers is that trial law permits a witness (always from the servicer) to simply say that they are familiar with the systems and practices of their employer and that the entries on the report were made at or near the time of each transaction. In truth they have no idea whether that is true. So in practice if you haven’t knocked out this evidence during the discovery process in litigation, you must knock it out after it has been admitted by the trial judge. Sometimes you are able to prevent the admission of the testimony or document by raising a timely objection. search objections must be specific and founded in legal precedent.

If I understand your current status correctly, you have time to craft a credible defense narrative and to follow through on it in a process of legal Discovery, motions to compel, motions for sanctions and a motion in limine before any trial even begins. We can help with that process if we are needed.

We are needed if you cannot find an attorney who understands the basic process of securitization as it was actually practiced on Wall Street. In a nutshell, securitization occurred only as to deriving its value from data about the loan rather than ownership of the loan. But it is presented as though the loan itself was securitized. This is a lie. And because it is a lie, there is no valid claim to enforce the debt, note or mortgage. 

All of this is very confusing to homeowners who are not in the business of investment banking, securities, securitization and trial law. As a result they are often lured into admitting that the debt exists even though it has already been retired not only by payment from external sources but by actual accounting entry in which the receivable asset describing your debt has been eliminated from the books and records of all companies have anything to do with the origination, administration, collection or enforcement of your loan.

While you have taken several administrative steps that I have suggested, I do not know if they were the right steps or asked the right questions. That is something that I need to look at. 

I think it is most probable that you would benefit from the preliminary document review premium, since you will be looking to create a credible defense narrative, from which you will launch your Discovery demands and motions for enforcement of discovery. As part of that package, I order a 2 owner foreclosure title search that provides me with a report and copies of all the relevant documents that have been filed in the county records where deeds and mortgages are recorded for your property. In addition, the package provides for up to 60 Minutes of consultation between me and you and hopefully an attorney. 

The consultation can be split into two consultations of 30 minutes each. The consultations are recorded and a copy of the recording is forwarded to you for transcriptions or use in any manner that you wish. In preparation for the consultation, I review not only the title record but also correspondence, notices and our proprietary data record on the securitization players.

Bank of New York Mellon has absolutely no interest in your loan. It is also another designee or nominee. It performs no activities of a trustee of a trust and it has no direct interest in your loan. it receives a fee for pretending that it has an interest in your loan. Investment Banks would rather use the name of an established banking institution as the claimant in foreclosures than the name of a trust which doesn’t exist and even if it did exist, could not possibly own any right, title or interest in your debt, note or mortgage.

You can always get new and important information regarding mortgages, foreclosures, eviction and wrongful foreclosure lawsuits at

While we ALWAYS urge homeowners to retain local counsel, most people find it helpful to secure our services in order to be able to present a coherent summary and analysis of their case to a prospective or existing lawyer. Most lawyers are not acquainted with even basic concepts in investment underwriting and therefore miss basic elements of a successful defense narrative. Many lawyers will refuse to accept any engagement in which the prospective client seems disorganized — especially in foreclosure defense.

You should consult with local counsel and be aware that most lawyers have very little knowledge of Wall Street finance and may miss important tactics and strategies that have proven effective in court, even with judges who were inclined to rule in favor of foreclosure mills who claimed to be representing a creditor. 
You have indicated your preferences as to the services you wish to order from us. Please review the following and then click on the applicable links below.
What is presented here is based upon my 45 years of litigation experience and a career on Wall Street in investment banking. I have secured judgments on behalf of homeowners in which the judges explicitly ruled on facts that had been previously presumed to be different. The findings of fact and conclusions of law entered by the judge in those cases resulted in the dismissal of the Foreclosure claim — but there is no assurance that this will happen in your case. Anyone who assures you of a successful conclusion in court is not being truthful with you.
What is important to winning is one simple thing: you and your lawyer must drop the thought that you truly understand the complex process of securitization and at least be open to the possibility that there is no claim for restitution of the debt — despite all appearances to the contrary. 

Paper instruments are not real, in a legal sense, unless they reflect or memorialize something that happened in the real world. Conveyances of interests in mortgages or deed of trusts without also transferring the underlying debt are a legal nullity in all jurisdictions. 

In your case, I am virtually certain that anyone who paid value did not receive ownership of your debt and anyone who received a paper instrument asserting a transfer of the mortgage did not pay value. That means none of them have a claim because none of them can assert that their receipt of payments from you or a foreclosure will result in paying down the debt.  Nor can they assert injury from nonpayment if they don’t own the debt.  

Based upon what you have reported in your registration statement I have virtually no doubt that the parties involved in collection, processing and enforcement of your loan have never paid value for the debt, which is to say that under the laws of most states means that they don’t own the debt.

And under the laws of all states that adopted Article 9 §203 of the Uniform Commercial Code (all 50 states) a condition precedent to enforcement of the mortgage is that the claimant must have paid value for the debt. Such payment is often presumed from the apparent facial validity of (a) the original loan documentation and (b) transfer and apparent delivery of the promissory note and mortgage or deed of trust. 

It is easy to get confused on this point. The fact that someone has paid value does not mean that they paid value for the debt. In order for a sale of the debt to take place, the payment of value is only one part of it. The payment of value must be to the owner of the debt. The banks take advantage of the fact that nobody has thought this through completely. They create paperwork making it look like the debt has been sold. In actuality in most cases no value was paid. But even where there was some consideration paid to somebody, it wasn’t paid to anyone who owned your debt and who could claim financial injury resulting from your action or inaction (nonpayment). It was paid to some intermediary who claimed to be representing someone who also didn’t own the debt. So you have value paid but not in exchange for a legal conveyance of ownership of your debt. Collection by such a party represents pure profit — not restitution for an unpaid debt. 

Your objective is simple: to reveal that the party named as plaintiff or claimant is not the owner of the debt. Your secondary objective, not necessarily required, is to prove that the named claimant doesn’t have the authority to represent anyone who does own your debt.  On your way to doing that you will probably undermine any claim of authority from the self-appointed servicer.

The path of the money trail is very convoluted and you do not need to track it. But by assuming certain deficiencies in the position of your opposition you can demand discovery on precisely those things that they can’t answer and which are entirely relevant and essential to their claim, to wit: the ownership, agency and authority over the loan. Foremost amongst those questions are those relating to any transaction in the real world in which money exchanged hands in exchange for ownership of the debt. I am virtually certain that you won’t find any.

BUT such payment and ownership is often presumed from the apparent facial validity of (a) the original loan documentation and (b) transfer and apparent delivery of the promissory note and mortgage or deed of trust. You must rebut that presumption.

My interpretation of all that, based upon case decisions, applicable statutes, rules and regulations is that the following must be true in order for a foreclosure to be a valid exercise of legal rights that belong to a creditor:

  1. The foreclosure is initiated on behalf of a creditor — i.e., one who has paid value for the debt in exchange for legal ownership of the debt. 
  2. The forced sale of the property will result in a paydown of a legal debt owed to a disclosed creditor.
  3. If a servicer is involved their authority to collect, process or enforce the debt must have come from the creditor who paid value for the debt in exchange for legal ownership of the debt. 
  4. Proper notice and demand for the correct amount due must have been delivered on behalf of the creditor and received by the borrower.
  5. The creditor must be sufficiently identified so as to comply with ordinary rules and practices governing the requirements of legal pleading. 

I don’t think any of the above elements apply to your case. I think your foreclosure was most likely a ruse. The problem for you, like other homeowners, is that all of the above elements are assumed by the court based upon fabricated documents that are forged, back-dated and robosigned. On their face, these false documents may be facially valid. And courts are required to basically take everything at face value unless challenged. 

Thus you might think that you are faced with “proving” a negative. The burden is not on you to prove a claim of fraud or anything else — unless you want to file one for declaratory, injunctive and supplemental relief. 
We believe the correct strategy is to undermine the ability of the foreclosure mill to prove a claim for enforcement of the underlying debt. This is generally accomplished in discovery. But discovery is only available at certain times during the pendency of a lawsuit. If there is no lawsuit then you might need to create one. 

 By revealing to the court the unwillingness of the claimant’s attorneys to answer simple questions about the status of the debt they say they are enforcing and the presumed agency relationships among them, the case often turns against the claimant and its attorneys if you have aggressively pursued discovery with follow up motions to compel, motions for sanctions and motions in limine. The case turns in favor of the borrower many times because the litigation changes to a conflict between the foreclosure mill and the court and away from the named claimant and the borrower. 


Failure to challenge the foreclosure in a court of competent jurisdiction will ordinarily result in a sale of your property. This means that if you are served with process you have only a certain number of days to respond or else your property might be sold even though you have valid defenses.

A quick, cursory review has been done to create this email. Nothing contained herein should be considered definitive and you should not use this email as a substitute for getting advice from a lawyer who is licensed to practice law in the jurisdiction in which the property is located and has performed the necessary review to issue a legal opinion.

I am not offering any services that involve actively representing you or filing documents for you in court. My services are strictly offered in support for your local counsel and/or for your own use if you proceed pro se, which we advise against. 


In order to help you I need information and I need to analyze that information perhaps doing some additional research and investigation of my own. You should seek the services of legal counsel if only to get their advice on local procedure and substantive law. The best way to find a lawyer is to be able to present that lawyer with a summary of your situation in a form that can be reviewed in just a few minutes. You should have a clear-cut set of goals that are realistic in the context of millions of foreclosures that were successfully completed as a result of default by the homeowner (failure to defend) or ineffectual defense.
Let’s take it one step at a time.  Consult with local legal counsel before making any decisions.
So if you want me to get started, here is what you need to do: 
1. You already submitted a registration an intake form. If you want to submit a new registration form CLICK HERE. NOT NEEDED

2. If you already have a forensic report that includes a full title report with copies of all documents recorded in the chain of title, I will want to see that as part of my review of your case. 

3. If you don’t have such a report you need to order one. We do that with our TERA report (see below). II suggest you order the PDR PREMIUM — you don’t need to order the TERA unless you need a written report. Remember that a report is not automatically admissible evidence and must be subject to live foundation  testimony before its introduction as evidence except when an affidavit is used in motion practice. 

4. In order to give you guidance on strategy and tactics, subject to opinion of local counsel, I will need to review court filings, notices, correspondence and statements. That is our Preliminary Document Review (PDR) — see below.

5. The PDR includes a phone consultation with me for either 30 minutes (PDR BASIC and PDR PLUS) or 60 minutes (PDR PREMIUM). 

6. From what I already know you will get the best guidance by (a) ordering the TERA (or providing its equivalent) and (b) ordering the PDR including the CONSULT (see below). 

7.It would be wise to order the PDR PREMIUM The Preliminary  Document Review (PDR) includes a 60 minute consultation with me. It is recorded and a copy of the audio file is provided to you when we receive it from our conference bridge, Most clients have it transcribed or ask us to order transcription at a cost of around $135 for each 30 minute segment — or they transcribe it themselves. Some get a friend who knows how to transcribe. 

8. The way you get your documents to us is by uploading them by invitation to our ftp server account on You will get that invitation and instructions once you order a PDR. You’ll be able to use that folder to show anyone what is in it — but only by your providing them with the link. Otherwise it is very secure which is why I use it, along with governmental agencies, law enforcement and hundreds of law firms. 

9. AFTER we have done at least preliminary analysis and AFTER we have spoken with you, we can agree on the scope and cost of engagement for us to write the narrative for your strategy and prospective tactics in court. 

10. THEN I send you an email retainer agreement containing the scope of the engagement and the pricing and costs.

11. If you agree to the terms of the email retainer agreement, THEN I will bill you for the retainer payable as we have previously agreed. 

12.Upon payment of the non refundable retainer we commence work on drafting your narrative, pleading, discovery or other scope of engagement. 

In the meanwhile you can order any of the following
CLICK HERE TO ORDER CONSULT (not necessary if you order PDR)
You should consult with local counsel and be aware that most lawyers have very little knowledge of Wall Street finance and may miss important tactics and strategies that have proven effective in court, even with judges who were inclined to rule in favor of foreclosure mills who claimed to be representing a creditor. 
Please visit for more information.

5 Responses

  1. UCC Article 9 does not apply to real estate mortgages.

    Official Comment From the NYUCC Goldbook 2015

    “1. Source. This Article supersedes former UCC Article 9. It provides a comprehensive scheme for the regulation of security interests in personal property and fixtures.”

    I don’t know how much clearer this could be that Article 9 does not apply to real estate mortgages. And nobody is as disappointed as I am that this is not the case.

    Further, there is no requirement that a plaintiff must own either the loan/debt or note before the plaintiff is entitled to enforce the note and mortgage. Payment of value for the note is not required to make one a Holder entitled to enforce the note. Payment of value is only required to qualify the Holder as a Holder in Due Course. If the plaintiff did not pay value for the note, the plaintiff is still a Holder and can enforce it. Even one who is not in possession of the note can still be entitled to enforce it. This is all Black Letter law found in Article 3.

  2. NG says: “And under the laws of all states that adopted Article 9 §203 of the Uniform Commercial Code (all 50 states) a condition precedent to enforcement of the mortgage is that the claimant must have paid value for the debt.”

    I done a little research on this. Turns out that this does not appear to be the case at all as far as negotiable instruments and foreclosures are concerned. Entering into a contract and obtaining a security interest in the asset requires payment of value for the debt IF it is a contract and not a negotiable instrument. Article 3 involves enforcement of negotiable instruments and states throughout that a holder of a neg. instrument (a mortgage note) or even a nonholder in possession with rights to enforce the note, can do so. and a real estate mortgage follows the note. There is absolutely no requirement that value must have been paid for the note in order to be able to enforce it. Example: I lend you money to purchase real estate and take back a mortgage. I then gift the note to my brother in blank or specifically indorse it to him. Because he didn’t pay value for the note, he is not a holder in due course, but he can still enforce the note and the mortgage. He may be subject to 3-306 defenses (failure of delivery and failure of consideration paid to the borrower), but those are easily disproven. This same ownership as a necessity to enforcing the note argument as been tossed out by the courts that have heard it. Here’s an outstanding example with analysis: Deutsche Bank v. Slotke found here:,33

  3. The account has been charged so many fees that every Servicer just keeps adding them on top of each other. Duplicates of fees. I request accounting of. Yet the questions of the debt collector attorney fees and charges are never answered by them or Servicer. No one cares. The looting just continues. Where does the Monopoly money comes from?? I have no idea. Ask Jay Powell or Steve Mnuchin.

    And keys not even get into where, who, how and why regarding the quarterly payments of property taxes !!!

    They pretend to charge. We pretend to pay. (Play on an Old Russian joke).

  4. Neil and Friends,

    We see how the fraudulent lenders, banks, financial institutions, and “Servicers” get paid in this scheme. But… how do the lawyers and law firms get paid in this scheme? Someone has to be paying their fees. Doesn’t it make them culpable in the fraud too? Shouldn’t they face charges of conspiring with the others to defraud homeowners and the Court?

  5. i still don’t get this ucc 9-203(b) stuff. can anyone here explain it to me?

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