Looking for a Lawyer to Beat the Banks?

Probably 50% of the inquiries that I receive on a daily basis involve request for the services of a local attorney that I would recommend. And the premise of each request is that I supply them with somebody who understands the nature of securitization and why my analysis often leads to a victory for the homeowner (no guarantees). They are asking the wrong questions.

The Homeowner needs ANY lawyer WITH trial experience who is open to considering the fact that the other side cannot prove that the loan account exists on the books of any company as an asset. Once the lawyer accepts that one possibility I can guide them to victory — if they are willing to do the work.

Again no guarantees. there is no such thing as a slam dunk in court. Anything can happen. All I can report is that more than 2/3 of the time, we are successful at forcing the banks to back off their unfounded claims. In most cases where that happens they offer a settlement that requires the homeowner to shut up (non disclosure agreement).

You should all be aware that the investment banks are experimenting with fabricating the illusion of transactions in which it appears as though somebody paid value for the underlying obligation. This is a tacit admission that nobody has yet paid value for the underlying obligation.

In one such case I know that Wilmington Trust was used. They produced evidence of a wire transfer. Of course they did not file it with the court, since that would probably be subornation of perjury. I know it was fabricated because they said they had paid hundreds of thousands of dollars for ownership of the subject loan account. There was nobody to pay because nobody, prior to the alleged purchase transaction, owned the subject loan account.

This experiment by the banks could lead them into deep dark trouble with every conceivable regulator and law-enforcement agency unless the transaction is real. A wire transfer receipt can be easily fabricated. The information on the proffered received should be confirmed through an independent source, like the Federal Reserve.

The reason they’re doing it or considering doing it in the future it is that by alleging payment, they could claim status of a Holder in Due Course (HDC). Under Article 3 of the Uniform Commercial Code this would entitle them to enforce despite the fact that the maker of the note might have a variety of meritorious defense is against the payee. If they were to achieve HDC status those claims by the homeowner would be limited to the the original party who was designated as “lender.”

So far, I have not seen any such allegation or assertion in court. It appears that they are only using the strategy to convince opposing counsel for the homeowner that the transaction was real.

If they’re claiming status as Holder in Due Course, their burden of proof would include

(a) proof of purchase by payment of value,

(b) action in good faith and

(c) without knowledge of borrower defenses.

So far they have succeeded in being treated as having HDC status even though they don’t qualify because most judges are lawyers who slept through UCC classes in law school. The truth is they can’t prove any of the elements of a holder in due course.

In addition, you should carefully check to see who sent it and who actually received the alleged wire transfer. It is very easy to set up what appears to be a payment if the recipient is controlled by the sender and the money ends back where it started.

*Neil F Garfield, MBA, JD, 73, is a Florida licensed trial attorney since 1977. He has received multiple academic and achievement awards in business and law. He is a former investment banker, securities broker, securities analyst, and financial analyst.*

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4 Responses

  1. There is not one lawyer in New Jersey that fits that. Take your money and sit on their hands, won’t stand up to these corrupt judges. They all are corrupt. Including the foreclosure department.
    So, if you have one I like to know who the he’ll they are.

  2. beauduke — think 7 years is the limit.

  3. I have a situation just like this. Supposed lender claimed to have wire the funds to refi but the document from the title company lists the entity sending the funds as “NA” . Because this was over ten years ago, both the receiving bank and the title company say that there are no further records on the transaction. So the Federal Reserve could delve into this and hopefully determine who really sent the wire transfer?

  4. one does not have to be a HIDC to enforce the terms of the note.

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