For those “refinancing” transctions, homeowners might literally, morally and legally owe nothing.

Posted on September 22, 2022 by Neil Garfield

the lawyer representing you might consider forcing the issue and asking whether the claimant is asserting HDC status. Or the lawyer might assert to the judge that the presumptions the lawyer from the foreclosure mill wants the court to use in considering the arguments of the case are the equivalent of treating the claimant as having HDC status. (And if not, why not?)

Practically all cases presented to me in the last several years have been the product of paperwork executed by the homeowner as part of an alleged transaction that was sold and labeled as “refinancing.”

This is true even in “closings” that supposedly took place recently. An offer is quickly made to refinance the “loan.” The entire scenario is usually a ruse. The flurry of musical chairs, changes in apparent “servicers,” and changes in apparent “lenders” or successor lenders,” creates a cloud that obfuscates the simple truth. The paperwork is merely a snowstorm. There is no transaction.

The names used by the actors in this scenario are widely used as vehicles for laundering servicing rights and then used as laundering title to the alleged lien.

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Both serve only one purpose: to obscure the real actors’ identities and roles. That, in turn, results in obscuring the loan balance as reflected on the books and records of the company that has been designated as the claimant/creditor (successor “lender”). They need to obscure the “loan balance” because there is no “loan” and there is no “balance.”

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All of this means that you are stuck playing in a field where none of the actors with whom you have any contact know the placement of the musical chairs. They are only following instructions, which is the source of their claim for plausible deniability when they are accused of fraud or negligent misrepresentation (or litigation immunity for the lawyers).
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The reason for this complexity is very simple: there is no loan account and no claim. The refinancing was a ruse. No money was transferred to anyone in consideration for the execution of the new “loan” documents.
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But your issuance of those documents served as the basis, foundation, for the issuance and sale of a brand new tree of unregulated securities )certificates) which in turn served as the apparent foundation for the issuance of derivatives and hedge products betting on the performance of the certificates either on the open market or in substance — substance meaning the actual payment to investors who bought the certificates.
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The bottom line, in my opinion, is that you received zero consideration for the act of execution of the new note and deed of trust to the latest “originator.”
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The argument from the opposition is that the prior “lender” gave up its claim as a result of the “refinancing” transaction. But that is pure myth, since the prior party received no money in exchange for anything because it never owned (or at least did not own at the time of the “refinancing”) any interest in the underlying obligation as required by §9-203 UCC as adopted verbatim by Colorado statutes.
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They will never assert the status of a holder in due course of the promissory note because the elements of that legal status are payment of value for the note in good faith and without knowledge of any defenses of the “maker” (also designated as “Borrower”) of the note. HDC status is best for the possessor of a note because it avoids all borrower defenses except two — fraud and lack of consideration. You have both of those.
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Thus the lawyer representing you might consider forcing the issue and asking whether the claimant is asserting HDC status. Or the lawyer might assert to the judge that the presumptions the lawyer from the foreclosure mill wants the court to use in considering the arguments of the case are the equivalent of treating the claimant as having HDC status.
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Therefore, it is incumbent on the court and the homeowner to establish that consideration as paid in good faith and without knowledge of the maker’s defenses. The opposition can’t do that because nothing was paid. And if they can’t do that, there is no obligation or claim that the property owners (You) are legally obligated to satisfy because they are not in fact owed anything. Under such a scenario, there is no justiciable controversy and no authority (jurisdiction) of the court to hear the case.
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I am working on the wording of the template QWR and DVL so that it complies with the statute and does not sound like a legal argument they can ignore.
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Neil F Garfield, MBA, JD, 75, is a Florida licensed trial and appellate attorney since 1977. He has received multiple academic and achievement awards in business, accounting and law. He is a former investment banker, securities broker, securities analyst, and financial analyst.
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FORECLOSURE DEFENSE IS NOT SIMPLE. THERE IS NO GUARANTEE OF A FAVORABLE RESULT. THE COMMENTS ON THIS BLOG AND ELSEWHERE ARE BASED ON THE ABILITY OF A HOMEOWNER TO WIN THE CASE NOT MERELY SETTLE IT. OTHER LAWYERS HAVE STRATEGIES DIRECTED AT SETTLEMENT OR MODIFICATION. THE FORECLOSURE MILLS WILL DO EVERYTHING POSSIBLE TO WEAR YOU DOWN AND UNDERMINE YOUR CONFIDENCE. ALL EVIDENCE SHOWS THAT NO MEANINGFUL SETTLEMENT OCCURS UNTIL THE 11TH HOUR OF LITIGATION.

But challenging the “servicers” and other claimants before they seek enforcement can delay action by them for as much as 12 years or more. In addition, although currently rare, it can also result in your homestead being free and clear of any mortgage lien that you contested. (No Guarantee).

Yes you DO need a lawyer.
If you wish to retain me as a legal consultant please write to me at neilfgarfield@hotmail.com.

Please visit www.lendinglies.com for more information.

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