In reviewing thousands of cases personally and reviewing the work done by dozens of other forensic reviewers, I have not found a single instance in any homeowner transaction where, at the time of the claim, the implied loan account was either alleged to exist or did exist.
The entire case always rests upon legal arument that the lawyers need not prove the claim as long as they have the fabricated, false documentation that the homeowner cannot prove is false or fabricated.
This inverts constitutional due process. If you say you have a claim they you must prove it before the opposition is required to do anything — unless of course the opposition fails to do anything to challenge the false claim.
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The problem is that most people link things that happen within a short time frame. So even rats will become “superstitious” in experiments encouraging them to push a lever to get a food pellet. They keep pushing the food pellet even though the lever does nothing.
And that brings us to the problem at hand. The fact that securities are issued more or less contemporaneously with transactions originated with homeowners leads nearly everyone to believe that the securities were somehow related to the transactions with the homeowners.
This superstition has morphed into financial, accounting, and judicial doctrine. The issuance of securities- or even just the claim that such securities exist — is sufficient to call a transaction “securitized.”
At least that is what the financial media, judicial doctrines, and even bookkeeping and accounting practices would tell you. But in the context of superstition about “securitization,” there is no instance where any implied or alleged debt has ever been sold to any investor in whole or in part.
The key is to challenge that premise. If the lawyer is saying he has a client with a claim, the response should be “show us the client and the claim on the books and records of the client — and not some report from a third party claiming to be a “payment history.”
But this is not rocket science. If an asset is securitized, that means, by definition (not subject to interpretation or debate), there was a sale of the asset. The asset is sold in pieces to investors. Without that SALE, no securitization did or could have occurred. But now, thanks to using the word “securitized,” everyone thinks that is what happened with homeowner transactions.
But I can state with absolute certainty that no such sale ever occurred. In fact, as a former investment banker who was literally in the room when these plans were first discussed, I can assert with absolute certainty that no such sale was intended. This was not a mistake.
It was an opportunity to sell lots of “private contracts” that they would call “Securities” and puff the sale with talk of the contracts being “mortgage-backed.”
By stacking the sales of derivatives upon the foundation of those IOUs (certificates aka private contracts under 1998-1999 laws), the Wall Street actors generated about $1200 for each $20 underwriting fee that they would ordinarily have earned. Hence there was more than enough money to pay pizza delivery guys to switch careers and sell fabricated and faulty transactions to homeowners, paying them as much as $1 million in some cases — as long they kept their mouths shut.
And as a lawyer for over 45 years, I can state with absolute certainty that the absence of such a sale undermines all present claims regarding the administration, collection, or enforcement of such transactions. All basic theories in accounting, editing, and the law require that a thing (res) must be real to be recognized as a transaction — not merely claimed or announced.
The only thing holding such claims together is the superstitious belief that the announcement of “securitization” is sufficient to make it the truth of the matter asserted.
The key to winning a foreclosure defense is to (1) not accept or admit that the labels used by your opposition are true and (2) challenge the opposition to produce any evidence that the claimant is actually making or possessing a claim against the homeowner.
If the party designated as mortgagee or beneficiary under a deed of trust, has a record of payment for ownership and purchase of the loan account, then the homeowner loses.
In reviewing thousands of cases personally and reviewing the work done by dozens of other forensic reviewers, I have not found a single instance in any homeowner transaction where, at the time of the claim, the implied loan account was either alleged to exist or did exist.
The bottom line is that homeowners lose because they do not contest or because they admit the truth of the matter against them and try to litigate against that “truth.”
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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 14 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).
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