It is not correct to say that anything was securitized. Issuing securities does not mean the securitization of an asset occurred. The purchase of an option is not securitization of an asset even though the option is a new “security.”
I am currently in a spirited debate with a good faith reader who is struggling to reconcile her knowledge of the securities business with the apparent structure that is advertised by Wall Street in which securitization of loans has been the mantra, even if completely untrue.
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She asks how I could conclude that the receivables from homeowners were not securitized?
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The answer is simply that the parties involved did not treat the purchase of any security as the securitization of an asset. In plain language, if they had securitized a loan receivable, then the loan receivable account would exist as an asset on the accounting record of some creditor. No such thing exists.
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Only an investment banker understands where it went but the courts seem determined to think they know. So the challenge to homeowners facing foreclosure is to disabuse the judge of their bias, which can be done only after aggressive and very persistent efforts to enforce proper and timely discovery requests.
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In fact, the reverse of “lending” is what was always intended. No owner of any security, derivative, certificate or hedge product ever made that purchase of a security with the intent of owning or controlling any payment, debt, note, or mortgage from any homeowner. No such owner of any security ever failed to receive payments as a result of some homeowner not making a scheduled payment (which is probably not due to anyone — but that is another story).
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And the reason I am so adamant about it is that without missing any payment that was due to them from the homeowner, they have no claim to enforce the payment and no valid claim that they were injured. And without an existing loan account receivable (i.e., not the “payment history”) there can be no creditor/claimant/beneficiary.
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This deprives the court of jurisdiction to hear a case that is merely an attempt to weaponize the foreclosure process and change then legislative intent regarding mortgages and foreclosure, to wit: that the forced sale of homestead property is strictly focused on getting money to a distressed creditor who had paid value for the underlying obligation as required by Article 9 §203 UCC adopted by all U.S. jurisdictions verbatim.
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It is not the receivables that were securitized. That is the point. If the receivables were securitized then the enforcement actions would be valid and legal. Nobody who ever bought a certificate or derivative ever bought a share of receivables.
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You could argue that was their intent but in their effort to avoid the trials and tribulations of violations of lending laws and servicing laws, and to avoid losses due to bankruptcy of the originator, they made sure that their investment was based on willingness and the ability of the investment bank to make payments to them for the certificates. No payments were due on the other derivatives — except in the sense any option has a payoff if you guess right.
But controlling the scheme was the point. So each time they invented another layer of securitization, they increased their revenues from the receipt of securities that were sold — securities that were mere bets on what discretionary reports from the investment bank would say.
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But challenging the “servicers” and other claimants before they seek enforcement can delay action by them for as much as 12 years or more.
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Yes you DO need a lawyer.
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If you wish to retain me as a legal consultant please write to me at neilfgarfield@hotmail.com.
Filed under: foreclosure |
Thank you ANON! Neil, Bill Paatalo, and everyone on here have helped me gain the knowledge necessary to fight for my family. We have won one case, and we are prayerfully on the way to final victory. We could not have done it without Neil’s blog, Bill’s investigation, and everyone’s contribution on this site. I wish some of my friends could have held on long enough to unearth the truth in their fake foreclosures.
All glory to God!!!
Thank you Neil for this post. Very informative. Thank you.
And to StillFighting – (God bless you – know you have been here a long time) — they purchased “collection rights” — and no one tells you that. That is all there is. So FDCPA — as to non-friendly debt collection servicer (and claimed loan being claimed “NOT” being in default when transferred to non-friendly debt collector IS FALSE.) And, yes, the ROI is foreclosure. Fake – of course. They have no way around it – but foreclosure. And Neil is correct — fight it. And, he does know how. He gets the accounting. Thanks. Hope Neil can do – mass scale. See below post. I am happy coming to fruition. FAKE ACCOUNTING. FAKE Securitization. FAKE foreclosure. God Bless — we need it.
This is completely correct Neil. Minor details – To your statement – “Bottom Line: It is not correct to say that anything was securitized. Issuing securities does not mean the securitization of an asset occurred. The purchase of an option is not securitization of an asset even though the option is a new security.” — THIS IS CORRECT. What happens is that the fake “pool” — provides cash FLOW transfer from paying homeowners to fake security investors (even for those who missed) – who have NO legal right to cash flows (and never acquired valid rights) BECAUSE nothing was validly securitized. All that occurred is transfer of debt collection claimed rights that were NEVER recorded as an accounts receivable. It does not matter that no one loses money when payment not made – BECAUSE — there was no right to collect payments under a “Mortgage” accounts/notes receivable to begin with. You are correct — no receivables securitized, and without securitization of receivables – you have no securitization. And, it is irrelevant as to whether or not any “security” is considered a “security.” It is the securitization that matters – without account receivable – there can be no securitization. So — “trust’ and “trustee” – take a hike. And, judges – take a 101 Accounting class. Thanks.
I believe that the multiple falsified Assignments are done to create layers of false ownership, and make homeowners and Courts believe that the Assignments are true.
In a real world situation, why would a financial institution purchase a non-performing Mortgage or Note? Do they believe that they will make a return on their investment when they foreclose and sell the house?