Processing Fees are more than illegal — by adding them to balance due, the default letter is defective.

This is simple logic. If illegal processing fees were greedily added to the “loan accounts” falsely asserted to exist, then the amount demanded from “borrowers” was incorrect. That would make the statements sent to borrowers part of a fraudulent scheme through US Mails which would be mail fraud. And it would make the notices of delinquency and notice of default and notices of default defective and perhaps fatally defective because they were seeking to enforce an amount not due. And it would make foreclosure judgments and sales based upon such demands potentially voidable.

see https://spotonflorida.com/southeast-florida/1835819/ocwen-phh-corp-pay-125-million-settlement.html

CLICK HERE ORDER ADMINISTRATIVE STRATEGY, ANALYSIS AND NARRATIVE. This could be all you need to preserve your objections and defenses to administration, collection or enforcement of your obligation.

You know Ocwen. It’s that company that stays in business by the largess of large financial institutions that buy its stock on the open market. Investment bankers use the Company to shield themselves and their own company from potentially trillions of dollars in liability — and possibly prison. It is the company that pretends to be the “servicer” of your loan — which you readily accept because (a) someone needs to do it and (b) nobody else is saying they are “servicing” your loan.

But in reality it is not your servicer because of some technical problems – like the absence of a loan account and the absence of anyone who claims to own your loan account. Only such a company that owned your debt could give authority to a third party to administer, collect or enforce your debt or loan account. Ocwen never received that authority from anyone because in most cases (nearly all) no such creditor exists. (see previous blog articles as to how this highly counterintuitive result is created and exploited by investment banks).

And there is another sticky problem because Ocwen doesn’t actually “service” your loan payments — Black Knight does that, hidden behind the curtains that Goldman Sachs calls “layering” or laddering.” So in the musical chairs presentation of servicers, for enforcement, and Ocwen is designated by Black Knight to come forward as “servicer”, it does so as a witness once removed from the actual entity that collected payments on behalf of a loan account that doesn’t exist.

In plain language the entire process of “boarding” is a charade. The prior company that was designated as “servicer” is simply dropped from the letterhead of notices and statements generated by Black Knight, and Ocwen’s name is inserted instead. “Boarding” comprises a new login name and password to the Black Knight systems.

Ocwen/PHH (after merger) have never made a profit and never will. It is a publicly traded business entity that is waiting to be thrown under the bus. When the s–t hits the fan, and it becomes widely known and accepted that there are no loan accounts and there is nothing to administer, collect or enforce, the plan is to have Ocwen, and companies like Ocwen to take the heat, leaving the investment banks free from blame or liability for civil or criminal infractions. At least that is the plan. But if the government ever breaks free of the control by Wall Street — and clawback of money siphoned from our economy becomes a priority —then it won’t be difficult to pierce through the corporate veils of Ocwen like companies to seize assets held here and abroad.

So it should come as no surprise that such people would add on such things as “processing” or “convenience” fees when there is no processing and there is no convenience. Ocwen has now agreed to pay money because it received a slap on the wrist. But like the hundreds of preceding settlements, nobody is asking about the effect of the illegal practices on the presumed loan accounts, even if they existed.

This is simple logic. If illegal processing fees were greedily added to the “loan accounts” falsely asserted to exist, then the amount demanded from “borrowers” was incorrect. That would make the statements sent to borrowers part of a fraudulent scheme through US Mails which would be mail fraud. And it would make the notices of delinquency and notice of default and notices of default defective and perhaps fatally defective because they were seeking to enforce an amount not due. And it would make foreclosure judgments and sales based upon such demands potentially voidable.

But nobody talks about that because it is the unstated sub silentio policy to uphold the securitization infrastructure that does not exist, to wit: no loan was sold and no loan was securitized. That is impossible because for securitization to be real the loan must be sold to investors. There was never any such sale.

*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.*

FREE REVIEW:

If you want to submit your registration form click on the following link and give us as much information as you can. 

CLICK HERE FOR REGISTRATION FORM. It is free, with no obligation and we keep all information private. The information you provide is not used for any purpose except for providing services you order or request from us. In the meanwhile you can order any of the following:

CLICK HERE ORDER ADMINISTRATIVE STRATEGY, ANALYSIS AND NARRATIVE. This could be all you need to preserve your objections and defenses to administration, collection or enforcement of your obligation.

*CLICK HERE TO ORDER TERA – not necessary if you order PDR PREMIUM.

*CLICK HERE TO ORDER CONSULT (not necessary if you order PDR)

*CLICK HERE TO ORDER CASE ANALYSIS 

*CLICK HERE TO ORDER PRELIMINARY DOCUMENT REVIEW (PDR) (PDR PLUS or BASIC includes 30 minute recorded CONSULT)

*FORECLOSURE DEFENSE IS NOT SIMPLE. THERE IS NO GUARANTEE OF A FAVORABLE RESULT. 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. 
  • Yes you DO need a lawyer. 

*Please visit www.lendinglies.com for more information.

Ice in the Winter: Government backed loan foreclosures suspended through the end of the year. Nice! If only the foreclosures were valid to begin with!

see https://www.cnn.com/2020/08/27/success/freddie-fannie-foreclosure-eviction-moratorium-extended/index.html

There was time that mainstream reporting was investigating whether the loans were valid and whether their enforcement was valid. Published news reports, court decisions and massive settlements all pointed to huge inconsistencies between the positions that investment banks took with the investors, the courts and with borrowers.

Millions of documents were fabricated for purposes of enforcement of a debt account that did not exist. After foreclosure the debt account again receded into vapor. Reporters were getting close.

Then, all of a sudden, somebody pulled the plug and investigative reporting dried up leaving homeowners and their lawyers without the information they needed to successfully defend against illegal foreclosures based upon nonexistent loan accounts. Litigating against a designee instead of an actual creditor was likened to fighting with a ghost.

And now we have moratoriums and suspensions of enforcement for political and practical reasons. The effect is to bottleneck what will be a torrent of foreclosures and evictions based upon nonexistent claims in many cases by naming nonexistent claimants.

This is the time to start administrative strategy in advance of the end of moratoriums so homeowners and their lawyers have the ammunition and the footprints in the sand to prove that they are entitled to an inference that is in direct conflict with the presumption the banks want the courts to apply — that the possession of the note is all you need to foreclose on a mortgage.

The problem lies in the rules not the substance of the law. In the Uniform Commercial Code adopted by all U.S. jurisdictions, possession of the note is practically all you need to enforce a promissory note — as long as the note is a negotiable instrument. So the note is enforceable even by strangers to the underlying obligation.

But a mortgage is not a note nor any other kind of negotiable instrument. And enforcement of the mortgage or deed of trust falls under a very direct, clear unambiguous statement that in order to foreclose on the security instrument (mortgage) there was must be a creditor who has paid value for the underlying debt — Article 9 §203 UCC.

The problem is in pre-approved p[leading forms from the Supreme Court of each state. They allow for pleading based upon allegation of “holder” status without requiring a plain statement of ultimate facts asserting that the claimant paid value for the underlying debt. Thus mortgages are being enforced on the false standard of enforcement of notes.

This is not mere technical “theory” as some have alleged. I note that none of my critics have advanced the “theory” that anyone in the chain of prospective enforcers of the mortgage has ever paid value or currently possesses a loan account created on their books and records by virtue of an actual transaction in the real world in which the company paid value for the underlying debt and now carries the loan as an asset receivable.

None of those parties ever did pay value in exchange for a legal or equitable ownership of the underlying debt because they were all getting their money from a parallel securitizations scheme that concealed the fact that the “loan” was paid off contemporaneously with origination or acquisition using investor funds from investors who neither wanted nor received equitable or legal ownership of any loan.

A holder is not necessarily a party who padi value for the underlying debt. This is no small matter. Because state law in all jurisdictions requires as a condition precedent to any enforcement action, that the claimant have already apdi value for the underlying debt, and thus claim injury from alleged nonpayment. You can’t claim injury if you didn’t own the loan. That Is a contradiction in terms.

So what is needed is (1) remind the trial court that the pre approved forms are just guidelines and (2) petition the Supreme Court in each state to change the pleading forms such that there must be an express statement of ultimate fact asserting payment for the underlying debt by the claimant who received a conveyance of ownership of that debt.

*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.*

FREE REVIEW:

If you want to submit your registration form click on the following link and give us as much information as you can. CLICK HERE FOR REGISTRATION FORM. It is free, with no obligation and we keep all information private. The information you provide is not used for any purpose except for providing services you order or request from us.In the meanwhile you can order any of the following:

*CLICK HERE TO ORDER TERA – not necessary if you order PDR PREMIUM.

*CLICK HERE TO ORDER CONSULT (not necessary if you order PDR)

*CLICK HERE TO ORDER CASE ANALYSIS 

*CLICK HERE TO ORDER PRELIMINARY DOCUMENT REVIEW (PDR) (PDR PLUS or BASIC includes 30 minute recorded CONSULT)

*FORECLOSURE DEFENSE IS NOT SIMPLE. THERE IS NO GUARANTEE OF A FAVORABLE RESULT. 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 it is also true that challenging the “servicers” and other claimants before they seek enforcement can delay action by them for as much as 12 years or more. 
  • Yes you DO need a lawyer. 

*Please visit www.lendinglies.com for more information.

Good advice on how to detect mortgage rescue scams on Motley Fool

https://www.fool.com/the-ascent/mortgages/articles/how-spot-foreclosure-scam/

Anyone who suggests that you don’t hire an investigator or don’t hire a lawyer is trying to fool you on the facts or the law.

RED Flags

  • You are guaranteed a halt to the foreclosure process or a loan modification, regardless of your circumstances.
  • You are told not to contact your lender, a housing counselor, or an attorney. 
  • You are asked to pay upfront for the services they offer.
  • You are instructed to make your monthly mortgage payments to them rather than your mortgage lender while they work it out. 
  • They offer to pay cash for your home (at a much lower selling price than comparable homes). 
  • You are pressured to sign papers before you have had a chance to study them. 

If you think about it this is exactly what the banks did when they signed you up for a loan that was actually an invitation to disaster.

Editor’s Note: I don’t agree that forensic audits can’t help. That is ridiculous. Someone needs to set up the facts so the lawyer knows what to litigate.

I suspect that the banks are getting more worried about forensic investigations, which are drilling down on false statements, false documents, for resurrecting a loan account that was actually retired in the real world contemporaneously with the origination or acquisition of the loan.

Anyone who suggests that you don’t hire an investigator or don’t hire a lawyer is trying to fool you on the facts or the law.

The Farce of Wilmington Trust — a name without a body

As most people who have litigated in cases where Wilmington trust ids named it is a front or curtain behind which multiple players hide while they play games making the terrain as difficult as possible to navigate. That is to say, there is no claimant and there is no debt and nobody takes responsibility or admits to anything and disclaims any knowledge or duty to know the accuracy of what anyone says about any loan, debt, note, mortgage, obligation or anything else.

So here is the wording from one contract I found involving Wilmington:

It is expressly understood and agreed by the parties hereto that (a) this Amendment is executed and delivered by Wilmington Trust, National Association, not individually or personally, but solely as Owner Trustee of the Issuer under the Trust Agreement, in the exercise of the powers and authority conferred and vested in it, (b) each of the representations, undertakings and agreements herein made on the part of the Issuer is made and intended not as a personal representation, undertaking and agreement by Wilmington Trust, National Association but is made and intended for the purpose of binding only the Issuer, (c) nothing herein contained shall be construed as creating any liability on Wilmington Trust, National Association, individually or personally, to perform any covenant either expressed or implied contained herein, all such liability, if any, being expressly waived by the parties hereto and by any Person claiming by, through or under the parties hereto, (d) Wilmington Trust, National Association has made no investigation as to the accuracy or completeness of any representations or warranties made by the Issuer in this Amendment and (e) under no circumstances shall Wilmington Trust, National Association be personally liable for the payment of any indebtedness or expenses of the Issuer or be liable for the breach or failure of any obligation, representation, warranty or covenant made or undertaken by the Issuer under this Amendment or the other Transaction Documents.

Tonight! The evidence of wrongdoing! Bill Paatalo shows us the many ways in which securitization claims started by Lehman Brothers are a scam. 3pm PDT 6PM EDT

Thursdays LIVE! Click in to the WEST COAST Neil Garfield Show

with Charles Marshall and Bill Paatalo

Or call in at (347) 850-1260, 6pm Eastern Thursdays

See Bill Paatalo’s Blog post of August 21 re how the Lehman Brothers BK of 2014 served as conduit for enabling Bill himself to do a deep-dive analysis of a database of almost 100,000 loans spread over approximately 250 securitized trust transactions associated with one RMBS Protocol.

https://bpinvestigativeagency.com/lehman-brothers-rmbs-claim-protocol-reveals-the-likely-theft-of-89526-homes/

His analysis took place in what was a sample auditing of securitized mortgages ordered by the BK Court. This auditing exposed a litany of defects, misrepresentations, inflated appraisals, falsely reported income, failure to provide original notes, etc.

Bill will then touch on some related mortgage fraud topics, while Charles Marshall will address some of the latest Covid-19 impacts on mortgage borrowers.

EDITOR’S NOTE: Keep in mind that Lehman never securitized the debt, note or mortgage. They securitized data about the debt. Bill’s evidence shows us what happens when they try to resurrect a debt account that has long since been retired. There is no person or entity that maintains a current account record showing ownership of anyone’s loan as an asset receivable — from transactions initiated by or acquired by Lehman. All claims of succession from Lehman are false because Lehman (including subsidiaries) never owned the debt.

In Discovery you should ask for the entry on the general ledger of any entity claiming to be the owner of the debt. That is what is necessary to establish the loan receivable account that is the only legal basis for claiming nonpayment and injury from nonpayment. There is no such loan account receivable. And THAT Is because if there was one, the owner would be a successor lender liable for violation of statutory and common doctrines regarding lending, servicing and fair dealing.

PRACTICE NOTE: Even if such claims are barred by statute of limitations they can still ordinarily be raised and proven as affirmative defenses. One of the interesting due process arguments available then is that in non judicial states the homeowner is barred from making judicial claims that would otherwise be available.

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.

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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 www.livinglies.me


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.
YOU MUST TAKE ACTION IN ORDER TO PREVENT ANY FURTHER ACTION AGAINST YOU OR YOUR PROPERTY. 
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. 


ONLY A COURT ORDER ISSUED BY A STATE OR FEDERAL COURT CAN STOP A FORECLOSURE SALE OR EVICTION. CONSULT WITH LOCAL COUNSEL ON ALL MATTERS.


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, www.freeconference.com. 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 www.box.com. 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. 
IT IS A GOOD IDEA TO KEEP OR CREATE A JOURNAL THAT YOU CAN SHARE WITH ME, BY UPLOADING IT AS A WORD OR PDF DOCUMENT TO YOUR FOLDER ON BOX.COM


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 TERA
CLICK HERE TO ORDER CONSULT (not necessary if you order PDR)
CLICK HERE TO ORDER CASE ANALYSIS (not yet)
CLICK HERE TO ORDER PRELIMINARY DOCUMENT REVIEW (PDR PREMIUM)
FORECLOSURE DEFENSE IS NOT SIMPLE. THERE IS NO GUARANTEE OF A FAVORABLE RESULT. 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. 
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 www.lendinglies.com for more information.

Depression, Anxiety, Shame in a World of COVID, Foreclosures, Evictions — and Stress Like We Have Never Seen Before.

Just about everyone I speak with — and there are lots of them from all walks of life in and out of the legal world — have said out loud that they are suffering from mental and emotional distress derived from the year 2020 — call it whatever you want. I am no exception. Sometimes I find it difficult to maintain focus and make decisions. Sometimes I feel a weight on my mind and heart that I never felt before.

People just try to tough it out as though that is somehow better or bolder or more brave than seeking help. That is why I am writing this article. Because people facing foreclosure and eviction do the same thing — they tend to do nothing about it until the last minute when their options are narrowed. I’m no psychologist but I think the reason for both is that people are trying to bury feelings of shame. That is exactly what the banks are counting on in order to further their illegal scheme of foreclosures.

I think all of us are suffering from a low grade depression that existed before the pandemic. 2020 just made it worse. I reluctantly learned that self-reliance in such circumstances is like pounding a nail with a shoe. it might get the job done after considerable time and ruining the shoe — but a hammer would have been a far superior tool and will yield a far superior outcome.

So after receiving an increasing number of calls that started out with the issue of mental or emotional distress, I decided to reach out to the mental health community. To many people this has somehow become a partisan issue so there are competing camps of “belief.” It is frustrating to me and some homeowners that I am not equipped or trained to deal with such issues effectively. Faced with intense pressure and coercion from “servicers” and “trustees” most homeowners find it very challenging to even understand what is happening or why.

I did find that some highly trained therapists were moving away from traditional practice and offering telehealth across the country with a focus on COVID induced depression and anxiety. In fact, as a result of my inquiry, I was hired to create a new company devoted to doing exactly that (just the legal paperwork). I like the people there and I highly recommend them— 25+ years of experience across wide spectrums of demographics etc.

Their goal is to provide assistance in developing better coping mechanisms in just a few sessions. If you are interested go to www.kamvirtual.com. If you can, pass the word around, I would like to see them succeed. Their hearts and minds are in the right place. 

Or find a local therapist. My opinion is that in the context of the pandemic, most mental health providers do not maintain offices where social distancing and sanitizing is even possible. So my suggestion is to find someone who provides telehealth services. It is not the same as in person sessions but it is far superior to toughing it out on your own. With the right therapist, a few sessions should be able to help most people achieve a better balance.

This all comes down to what I have been saying for 14 years — if you know there is an issue, address it as soon as possible — or, as some people say “nip it in the bud.” It makes things a lot easier for me to counsel you on legal matters if you are not using your time with me to vent about your personal problems. I am not qualified to help with that.

One thing I know is that people who are clear-headed about their mortgage problems come to me early or as soon as they have a problem — and there is a lot I can do to help them reach a satisfactory result. The people who are most burdened with distress try to put it out of their mind — until they finally contact me and tell me the sale is tomorrow and ask what I can do. I can help them, but the odds of achieving a satisfactory result when the dust settles is greatly diminished for the people who wait until the last minute.

*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.*

FREE REVIEW:

If you want to submit your registration form click on the following link and give us as much information as you can. CLICK HERE FOR REGISTRATION FORM. It is free, with no obligation and we keep all information private. The information you provide is not used for any purpose except for providing services you order or request from us.In the meanwhile you can order any of the following:

*CLICK HERE TO ORDER TERA – not necessary if you order PDR PREMIUM.

*CLICK HERE TO ORDER CONSULT (not necessary if you order PDR)

*CLICK HERE TO ORDER CASE ANALYSIS 

*CLICK HERE TO ORDER PRELIMINARY DOCUMENT REVIEW (PDR) (PDR PLUS or BASIC includes 30 minute recorded CONSULT)

*FORECLOSURE DEFENSE IS NOT SIMPLE. THERE IS NO GUARANTEE OF A FAVORABLE RESULT. 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 it is also true that challenging the “servicers” and other claimants before they seek enforcement can delay action by them for as much as 12 years or more. 
  • Yes, you DO need a lawyer.

*Please visit www.lendinglies.com for more information.

VA has no direct information about your mortgage loan — and neither does anyone else.


— And neither does Fannie or Freddie or Ginny.

THE BOTTOM LINE IS THAT NONE OF THE DOCUMENTS OR RECORDS ARE REAL OR ADMISSIBLE IN EVIDENCE — BUT THAT IS ONLY TRUE IF YOU CHALLENGE THEM PROPERLY.

And from our research here and contributions from very persistent readers of the blog, it seems absolutely certain that servicers have no direct information either.

When the first claims of securitization popped up on the radar in the late 1990’s, it was assumed that Wall Street was doing what it always does — which is what it is supposed to do. Convert assets into securities and then sell the securities. That is the foundation of capitalism. Nobody thought to ask whether that was actually happening.

In reality they were creating assets out of data about loans rather than the loans themselves. They never bought, sold or securitized any loans, but almost everyone thinks they did.

The actual promissory notes were regularly and nearly universally destroyed because those original documents could later conflict with whatever digital files had been produced, using scans and annotations of scans for the purpose of creating the illusion that the debt had been purchased first from the homeowner and then from the originator up until it “arrived” at the X Bank as trustee for the registered holders of certificates of ABCDE, Inc Mortgage backed certificates series 2006-A1. That arrival in all cases is entirely faked.

And the reason they do it is to hide the fact that the actual underlying debt, note and mortgage have been retired in the actual securitization process in which data was converted to securities which were sold , thus paying off all the players without ever allocating the proceeds of such sales to the loan account because there was no loan account. From the outside it sounds stupidly counterintuitive which is another word for unbelievable. from the inside of Wall Street it was pure genius.

They got to sell securities issued under a fictitious name of a trust, keep the money and then sell securities based upon the performance of the first securities’ sale and never have any risk of loss from any loan or group of loans. The problem was that if they had no loss they had had no injury and no court in any jurisdiction was going to let them enforce a claim unless they could produce an injured party. But there isn’t one. So they had to invent an injured party for purposes of enforcement. And unfortunately the courts were all too willing to believe it.

While the paperwork showed such transfers there were no actual transfers because nobody owned the loan, debt, note or mortgage. there were only indicia of ownership created by self serving documentation created to make it look like the underlying debt, note and mortgage had all been sold up the line with each “successor” being a buyer and the former “owner” being the “seller.”

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.

So all of those “transfers” did NOT happen in the legal world. But if the paper instruments are facially valid, the transfers are presumed to have happened because that is how our system works. That presumption is rebuttable and there is no better way to rebut the presumption than to ask the attorneys and the opposing claimant, in lay language, “OK, did it happen or not?”

If the answer is “No” the case is over judgment for homeowner. If the answer is yes, case over, judgment for claimant. If the answer we are not telling you because it would divulge proprietary data or trade secrets, the answer is that they refuse to answer and therefore you are entitled to an inference that the event did NOT happen. This IS the truth in virtually all claims of securitization relating to residential loans.

In nearly all “mortgage loan” cases, I am virtually certain that anyone who paid value did not receive ownership of the 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.  

So back to the current state of affairs. When the scheme first erupted with the first wave of foreclosures in the years 2000-2004 it became apparent that a central repository of data was necessary. The need became apparent when more than one foreclosure was filed contemporaneously with the others, each with different claimants who were asserting through lawyers (under litigation privilege) that they were the “holder” of the promissory note, the original of which was in their possession.

At first these double foreclosures were not noticed because in nearly all cases, the homeowners simply cleaned up , left their keys on the kitchen counter and left the house because they “knew” they were in “default” (but did not know the loan account no longer existed). So the foreclosures went through, the sales of the property occurred and in most cases the registrars for public records never noticed that there were two foreclosure sales on the same property with title issued to two different “lenders.”

Then something happened. First, the registrars for title did start noticing undoubtedly under pressure from member of the public who were beginning to notice and under pressure from people who were trying to buy property that had been twice foreclosed (which was “real”?)

And then another thing happened. A judge was nearing foreclosure cases on a rocket docket and approved the foreclosure on a certain property that happened to be a few doors down from where he lived. A week later, he was looking at a new foreclosure in which the same property was being foreclosed by someone else. Because the property was one he knew, the conflict was immediately apparent to him. He ordered the first one cancelled and the second one dismissed. the case was subsequently settled.

MERS had beene staglished as a sham conduit and adata cetner for fake transfers of the loan paperwork. It’s establ;ishment corroborates the fact that it never takes any interest in the ownership of the debt, note, mortgage or opaymetns to or from any homeowner — which means in legalese that it is nothing and shoudl be ignored. While teh banks were able to lift MERS tot eh status of a party who could receive and grant title to the mortgages, it has always been problematic. But they managed to salvage it as a central repotiory for infomration tha t has often bene treated as an accpetable alternative to laws requiring public reocrds fo alls cuh transfers.

But MERS was not the place to centralize the actual conduct of enforcement proceedings because its records were potentially open to inspection, discovery and investigation. Since the banks were intent on committing perjury and other felonies by creating executing and recording false documents, they needed a central repository of information which (a) directed the destruction of original documentation (b) created copies of the original documentation with what changes were necessary for enforcement and (c) resolved conflicts such that multiple foreclosures of the same property would never happen again.

Since they were not buying and selling debts, notes, mortgages and loans, they were dealing with pure data, invented by Wall Street and massaged into something that looked like assets that could be sold as securities. The falsification of documents occurred at Lender Processing Systems (now Black Knight) which operated DOCX, whose president went to prison. See Lorraine Brown.

Since the entire enterprise was based upon illegal practices and weaponizing legal procedures under false pretenses, the Wall Street banks were essentially hiring people to perform illegal tasks. While they could protect them to some extent by compartmentalization — where nobody actually knows the whole process — the fact remained that anyone employed in this scheme was potentially subject to civil and criminal penalties. This required certain types of people, including around 10,000 convicted felons in Florida alone tasked with selling loan products. This was not a case of borrowers looking for loans, this was money looking for borrowers.

From origination to “servicing” to anything else, the people employed were willing to endure or promote moral hazard. So Wall Street made sure that the none of them had actual access to any money that was banks expected to be paid to the banks. In order to prevent theft of money the banks were stealing from investors and homeowners the created an age old system in which they hired “bookkeepers” (i.e., “servicer”) who were actually just nominees, rotated them so nobody got too comfortable thinking they could skim money, and directed all actual monetary transactions to be conducted through a central repository (usually Black Knight).

Black Knight became that central repository, and the only place where transactions with homeowners were handled through lockbox contracts, and where data was posted (usually through automation) to fictitious loan accounts that were not owned by anybody. Black Knight works for the Wall Street banks. But the bookkeepers were sent out to pretend to be servicing loans and to assert that they are servicing on behalf of the anmed claimant who (a) did not exist and (b) never legally owned any underlying debt, note or mortgage.

“Servicers” access only certain restricted data through login crednetials on Black Knight servers. A change of servicers only means that someone new has a login credentials of a username and password (same as MERS). The data, like the debt never actually moves. But lots of time, energy and money is devoted to create the illusion of the movement of data.

Enter the GSE’s, VA, etc. who are all managed by bureaucrats who don’t have single clue about any of the above facts. they simply rely on information received from the bookkeepers (servicers) who just a front for Black Knight behind which the Wall Street banks are hiding.

So what exactly is owned or guaranteed by these behemoth entities that are being played like personal fiddles of Wall street banks. It seems nobody knows and that everyone is relying upon information from shadow intermediaries (like Black Knight) to come to a conclusion. In other words, it means whatever Wall Street says it means. And THAT means that Wall Street is regulating government instead of the other way around.

All in favor of changing that, say “Aye!”

From “summer chic” —

“I want to share information re VA involvement in this scheme and how Black Knight/Fidelity  controls and operates our public offices.

Elle asked how this system works, here are some answers from  VA, but I think other GSE are similar. See links and document attached, it explains how this system works, at least from GSE side. Maybe Neil will post in on his blog, with more details.

Why I think its important? It provides format how loans are entered into GSE system and how Services do it. It can really help with discovery when you know exactly for  which document you are looking for;  who was the entry company; and when it happened.

In short, GSEs  (at least on lower levels) have no idea who are creditors or owners or investors. In fact, they know even less than borrowers.

They only communicate with “Servicers” via “servicing”  systems implemented by Black Knight/Fidelity from at least 2008.

In reality, I think they do not communicate with Servicers either, only can see someone’s input into their database. Everything is happening behind closed by BK curtains.
GSE have no ability to control or monitor any loans, they only rely on the data provide to them by Mr. Foley and Big Banks mob.

Fannie, Freddie and Ginnie do not buy, sell or assign anything from or to anyone. This data is entered in BK-operated system by other parties (their employees). GSEs can only see this data.

Maybe GSE’s employees get instructions from top management to assign a group of loans as a “sale of non-performing loans” to someone – but the actual sale did not occur. Read instruction manual, I found it yesterday and did not review in details yet.

BK  simply delete or disable this field on the system as “sold” – and reactivate or re-enter when they need it “to reassign” – by BK.

But GSE  pay Banks  money from our tax dollars and dump “non-performing loans” to private hedge funds with the click of a keyboard.

On August 4, 2020 I received two (2) identical  letters  of default from VA who informed me that my “mortgage company” reported to them my loan as “defaulted” and VA recommended me to contact my Servicer PennyMac to request for forbearance. The letter further said that my mortgage company is responsible for servicing of my loan.

VA further said that I can contact them at email provided to assist me to “understand” options I have available.

First, PennyMac is not my mortgage company. I never had any loans with PennyMac or any other agreements. I from day  one knew they are thieves.
Second, PennyMac is not my Servicer because they don’t have any information or proof of ownership of my loan and even cannot explain whom they servicing. After October 31st 2019 PennyMac is not even a member of Black Knight whose systems VA uses.

Without access to Black Knight’s database PennyMac cannot make any entries or report any changes.

So, I used the email to contact VA respresentative who is assigned to my loan and requested disclosures who is my creditor and whom PennyMac is servicing.

VA tech responded that VA letters were sent automatically (!) by VA who uses a shared system (VALERI, who utilizes servicing bureaus Mortgage Servicing Platform (MSP), Sagent (whose CEO is former BK/LPS/ServiceLink CEO) and former CEO is Fiserv (owned by Fidelity, as you see below)  and Servicers Web Portal SWP) which was created in 2008 by Fidelity.

Note that in 2009 VA used Fiserv/Fidelity as  their main servicing bureau. Later they switch to MSP/Sagent (Black Knight/Fidelity)
In 2020 Sagent apponted Dan Sogorka (LPS/ServiceLink CEO)  as their President to replace Bret Leech (former Fiserv CEO)

In other words, Black Knight sends letters of default, probably from different clouts of data (2 letters)  while PennyMac  “approve” forbearance without access to BK system.

In reality, my Black Knight uses PennyMac’s name in their system to defraud VA and Ginnie Mae and receive “servicer advances” under PennyMac’s name, after which they will send PM into a bankruptcy since PennyMac has nothing to do with GSE’s databases.

Big Banks need to keep PennyMac alive and appear as a Servicer until a bailout and foreclosures wave  – after which  it will be destroyed .

When I asked VA tech whom PennyMac is servicing and are owners/investors in this Trust – he responded that VA only has contact with Servicers, not with  other third parties . In other words, VA does not know who are investors and owners of the debt.

Which is very strange for any person with common sense because  GSEs cover missed payments to someone whom they do not even know.

I asked VA tech to contact PennyMac and ask whom they are servicing and who is the creditor.

Lets see which lie PM is going to supply this time.
I hope it helps.

Here is a link to another brochure

The VA Loan Electronic Reporting Interface (VALERI) is a web-based system that supports VA employees and servicers operating inthe new regulatory environment. As a VA loan servicer, you are required to report certain events to VA according to 38 CFR 36.4817.There are two methods of reporting events to VA. The first method is via a direct connection to VA (typically for servicers that use a service bureau such as Fidelity MSP or Fiserv-Mortgageserv). The second method is to report all loan servicing events through theVALERI Servicer Web Portal (SWP). This method is used if you do not have a direct connection to VA.This document has been developed to provide you as a VALERI Servicer Web Portal user, with guidance on how to manage your loan portfolio using the SWP. This is a quick reference guide only. Please refer to the VALERI Servicer Guide for in depth information on event definitions, reporting timeframes, data elements, and post-audit documents.This document describes how to:ƒLog into the SWP.ƒAssociate loans in VALERI to your company.ƒReport necessary events on “Day One.”ƒReport events in the SWP after “Day One.”ƒAccess VALERI reports.
https://www.benefits.va.gov/HOMELOANS/documents/docs/valeri_swp_users_quick_reference_guide.pdf

*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.*

FREE REVIEW:

If you want to submit your registration form click on the following link and give us as much information as you can. CLICK HERE FOR REGISTRATION FORM. It is free, with no obligation and we keep all information private. The information you provide is not used for any purpose except for providing services you order or request from us.In the meanwhile you can order any of the following:

*CLICK HERE TO ORDER TERA – not necessary if you order PDR PREMIUM.

*CLICK HERE TO ORDER CONSULT (not necessary if you order PDR)

*CLICK HERE TO ORDER CASE ANALYSIS 

*CLICK HERE TO ORDER PRELIMINARY DOCUMENT REVIEW (PDR) (PDR PLUS or BASIC includes 30 minute recorded CONSULT)

*FORECLOSURE DEFENSE IS NOT SIMPLE. THERE IS NO GUARANTEE OF A FAVORABLE RESULT. 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 it is also true that challenging the “servicers” and other claimants before they seek enforcement can delay action by them for as much as 12 years or more. 

*Please visit www.lendinglies.com for more information.


Discovery in foreclosure cases: Who has cyber insurance?

You might have to fight for it, but if you ask nicely, firmly and persistently this one question might lay bare the realities of the whole “who’s on first?” routine of Abbott and Costello, as adapted by Wall Street investment banks.

Cyber insurance is a specific type of insurance that guards against losses or claims arising out of hacks or breaches of computer security. Anyone in banking, lending, servicing or finance maintaining original secure data would be required by other vendors and customers to have cyber insurance, because no system is 100% secure.

A recent birdie came to visit me in a dream. She told me that ONLY the party responsible for the secure server would be able to qualify for that insurance although others could be third party beneficiaries.

She also said that in most cases the insured is Black Knight — not Ocwen, Bayview, SPS, SLS, or any other name you might have heard used or represented as servicer. And she said that there is another insurance policy that covers the lock box operated by Black Knight which specifically identifies borrower payments.

In my dream, she thought I might be interested. I am.

If the “servicer” whom we all love to hate is not actually receiving payments from borrowers and some third party vendor is in total control of those payments, then a few things are true.

  1. The named servicer is not employing anyone who is making entries on the books and records at or near the time of a transaction.
  2. The named servicer (Ocwen for example) is merely witness to entries made by people and technology operated, owned, controlled and maintained by a third party (Black Knight fka Lender Processing Systems for example).
  3. The named servicer would therefore have no knowledge or control over who received money from borrower payments after they were received under the lockbox contract. This means that servicer records and testimony about boarding loans when “servicers” are changed are pure fiction.
  4. Records from such a named servicer would therefore be inadmissible as hearsay on hearsay and lacking in legal foundation and competence.
  5. If the named servicer does not carry Cyber insurance then it has no data to insure. Ordinarily you must have an insurable interest in order to be the insured under any insurance policy.
  6. If a third party vendor has the cyber insurance then that is the real servicer — who is most likely functioning under contract with one or more investment banks.
  7. If the named servicer does not carry lock box insurance, then it has no receipts to protect. Ordinarily you must have an insurable interest in order to be the insured under any insurance policy.
  8. If a third party vendor has the lockbox insurance then that who is receiving payments. And only their records are admissible in evidence as proof of payment history.
  9. If the named servicer is only claiming to represent a REMIC trust and the actuals service is working for the investment bank, this creates an obvious inference that the real party in interest in the litigation is the investment bank and into the trust.
  10. If the trustee named in the REMIC trust does not maintain insurance that covers losses from mishandling funds for investors, then the trustee is not handling funds for investors.
  11. If the trustee is not handling funds for investors then neither is the trust who can only act through the trustee.

So the questions in discovery would be directed the existence of insurance, the name of the insured or beneficiary, and the subject matter insured.

*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.*

FREE REVIEW:

If you want to submit your registration form click on the following link and give us as much information as you can. CLICK HERE FOR REGISTRATION FORM. It is free, with no obligation and we keep all information private. The information you provide is not used for any purpose except for providing services you order or request from us.In the meanwhile you can order any of the following:

*CLICK HERE TO ORDER TERA – not necessary if you order PDR PREMIUM.

*CLICK HERE TO ORDER CONSULT (not necessary if you order PDR)

*CLICK HERE TO ORDER CASE ANALYSIS 

*CLICK HERE TO ORDER PRELIMINARY DOCUMENT REVIEW (PDR) (PDR PLUS or BASIC includes 30 minute recorded CONSULT)

*FORECLOSURE DEFENSE IS NOT SIMPLE. THERE IS NO GUARANTEE OF A FAVORABLE RESULT. 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 it is also true that challenging the “servicers” and other claimants before they seek enforcement can delay action by them for as much as 12 years or more. 

*Please visit www.lendinglies.com for more information.

Tonight! Feels Like Old Times: The Coming Crash and What to Do About It! 6PM EDT 3PM PDT

Thursdays LIVE! Click in to the Neil Garfield Show

Tonight’s Show Hosted by Neil Garfield, Esq.

Call in at (347) 850-1260, 6pm Eastern Thursdays

Just like 2008, people are not making payments for rent or mortgage in record numbers and most of them are not covered in any formal agreement with anyone, much less anyone authorized to offer forbearance or modification or settlement.

When the moratoriums are declared over, the crash will start and I promise you it will be worse than anything we have ever seen before. So don’t wait until the last minute. Start preparing. Even where the homeowner has not won (yet) I have cases where a payment has not been made in over 12 years. This isn’t luck. It is time, effort and money and most of all moving proactively.

And just like 2007-2008 when many analysts including myself were calling out to take action to avoid a crash, nobody is listening. 

And just like 2006-present, millions of homeowners and tenants are going to get screwed again by Wall Street banks as they continue to siphon off our wealth, our lives and our future.  

So I am working hard on creating a better defense narrative for homeowners who are being coerced and intimidating into giving up their equity, their homes, their lifestyle just so more Wall Street executives can take home more bonuses. 

So here is the latest in my never-ending quest to write the best possible narrative for the defense. I start with the underlying premise that if you don’t give the court an alternative to simply denying enforcement then the judge is sign to look for ways to rule for the party seeking foreclosure. 

Fact #1: There is not a single case in which there has ever been proof of payment for the debt. In most cases there is not even any direct or implied allegation that such is the case. It is always presumed to have occurred.

Fact #2: In the context of transactions with homeowners labelled residential home mortgages, second mortgages and HELOCs, most — nearly all of them — involve no payment to the homeowner from anyone who receives any right, any title or any interest in any obligation of any homeowner. 

Fact #3: No person or company maintains any account in which it claims legal ownership of the underlying debt.

Fact #4: Foreclosures involve the naming of a designated or nominated creditor — not a real creditor.

All hell is sure to break loose once the moratorium ends at the end of August since we have near record unemployment and, according to CoreLogic, 7.3% of mortgages were delinquent in May compared to only 3.6% last year.

see http://www.chicagonow.com/getting-real/2020/08/pandemic-may-have-halted-foreclosures-but-delinquencies-still-rise/

The time for action is now before the fight starts. You want to be the one who is put at the bottom of the stack — not on top.

*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.*

FREE REVIEW:

If you want to submit your registration form click on the following link and give us as much information as you can. CLICK HERE FOR REGISTRATION FORM. It is free, with no obligation and we keep all information private. The information you provide is not used for any purpose except for providing services you order or request from us.In the meanwhile you can order any of the following:

*CLICK HERE TO ORDER TERA – not necessary if you order PDR PREMIUM.

*CLICK HERE TO ORDER CONSULT (not necessary if you order PDR)

*CLICK HERE TO ORDER CASE ANALYSIS 

*CLICK HERE TO ORDER PRELIMINARY DOCUMENT REVIEW (PDR) (PDR PLUS or BASIC includes 30 minute recorded CONSULT)

*FORECLOSURE DEFENSE IS NOT SIMPLE. THERE IS NO GUARANTEE OF A FAVORABLE RESULT. 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 it is also true that challenging the “servicers” and other claimants before they seek enforcement can delay action by them for as much as 12 years or more. 

*Please visit www.lendinglies.com for more information.

USPS is a Constitutional Imperative: Adding Banking to Post Office Services is Only a Good Idea if it Helps Community Banks and Credit Unions — not if it helps the megabanks gain even more control over our lives

As with most political debates we are being presented with a false choice.

We either give up the post office or make it profitable. Really?

Maybe if we focused our attention on the service that the post office provides and made it more likely to be even more indispensable to our lives, we would also find ways to offset the expense of this service in addition to taxes. The current political decision to knee cap the post office isn’t helping matters. We need it for lots of reasons and privatizing or monetizing essential services makes money the object instead of the service. 

The Post Office is a governmental service. The conversation about the post office has lately been all about what it costs to produce this service. Whether it is self sustaining or not is irrelevant. We depend on it. We expect it as citizens. We don’t expect the military to be self sustaining. We don’t expect Medicaid to be self sustaining. Why single out this long standing governmental service as a target for converting it into a business model?

There is only one explanation — it is serving the the ambitions of someone who will profit from its extinction.

This is like the privatization of prisons. It converted the service to money. With money as the object, private prison companies obviously were incentivized to lobby to make more things that people do illegal and punishable with prison time.

Presto we had crime bills that put more people in U.S. prisons per capita than any other country on earth — costing the states and federal government hundreds of billions of dollars to put away people who were found guilty of possession of some illegal substance. Each prisoner costs $30,000 per year on average. Politicians fly under cover of law and order, but they are actually conserving nothing and simply responding to campaign contributions from people who want to get more rich by receiving taxpayer money for something that ought not to exist at all.

The recent suggestion of making the post office into a banking institution or a vehicle for banking institutions to offer services is a false choice. Like privatizing other essential government services it seeks to convert the  essential service into money. The service will thus suffer and along with it everyone who depends on it for sending and receive communications, voting, prescriptions, packages etc.

Most people do not know that if you send something by US Postal Service it is legally presumed to have been received. Private carriers enjoy no such presumption because, simply stated, they have not proved they are worthy of that presumption. But the USPS has done so since the first Postmaster was installed in 1775. Do we really want to screw around with that? It IS dependable and any suggestions that it is not, are just now arising after nearly 250 years because someone is afraid of losing an election if all the ballots are counted.

Bottom Line: USPS was not started (pursuant to specific mention in the US Constitution) because it would or could be a profit center. It was started as  an essential trusted governmental service that enhanced trust in government to provide that service. It credentialized the new US government and gave it credibility and strength. So whatever it costs, we need it as much as we need the military. 

The current banking suggestion has some merit — only if it enhances the strength and competition in the marketplace by community banks and credit unions. Contrary to another popular myth that is pushed by the mega banks, the smallest bank has access to all of the technology and backbones for electronic funds transfer as the largest. There is no difference.

If using the postal service offices as extended branches capable of providing services to community banks and credit unions is the result, then competition will re-enter the marketplace and control by the mega banks will decline. This could have the effect of allowing real securitization of debt to be explored rather the the current fake and fraudulent scheme. 

Here is another idea I recently heard from a postal employee. The current service of Certified Mail Return Receipt Requested could be digitized with the same fee because of its intrinsic value. That would reduce the cost of the service to nearly zero and probably increase demand for the service producing more net revenue for the post office.

But what we should NOT be doing is providing the mega banks with yet another vehicle to control the financial  marketplace which in turn cedes control over the economy and thus society and government. That needs to stop and there is no better place to start that resistance than the preservation of the constitutional imperative of the US Postal Service.

Beware of Financial Rescue Scams Including Modifications

The offer of modification is actually inviting you to formally join the securitization process without getting paid for it.

I write often about the illegality of the Wall Street schemes that have defrauded investors and homeowners out of their money and investments. But there is also another aspect to this.

The coming Tidal Wave of evictions and foreclosures is going to produce a tidal wave of scams that deprive homeowners and tenants of what little income or assets they have left.

Some of the scams are very close to legitimate business propositions. There is nothing wrong with a risk sharing agreement in which an investor gives consideration to the homeowner in exchange for petitioner patient in the title will proceeds arising from the sale or refinancing from the house. And the consideration could be funding the defense of the property – or even making an offer to pay off the balance as demanded, provided the claimant show proof of payment which in turn would show proof of ownership of the underlying debt.

There are plenty of legitimate business propositions that could be profitable and successful for both the homeowner and the investor/rescuer. In some of them, homeowners might be required to pay rent to the investor. There is nothing illegal about that.

But mostly, homeowners are going to be approached by disreputable people who are simply out to make a buck and neither intend any beneficial outcome for the homeowner nor do they have any credentials, training or education which they could employ for the benefit of the homeowner.

As I have previously written on these pages, the form in which the scams are presented varies because, like the banks, they use labels to hide what they are really doing. But the substance is always the same.

Since the goal is money, and they probably know they need to hit and run, they going to demand money in one form or another to be transferred from the homeowner to the “rescuer” sooner rather than later.

In addition, they may ask for quitclaim deed, the execution of which is detrimental to the interests of the homeowner. By the execution of a quitclaim deed, the homeowner might lose standing to challenge the investment banks when they seek to administer, collect or enforce the homeowner transaction that gave rise to the appearance of a “loan” transaction.

So if someone asked for money or deed upfront, the proposal is probably part of a scam. An excellent way of determining whether the proposal is part of the scam is to simply read and hear what they are promising. In order to close the deal scam artist will promise things or results that will never be delivered.

Any qualified professional will tell you that when you are entering into a dispute, if anyone promises or guarantees a specific result, they are lying to you. So if someone guarantees you a result, the proposal is probably part of a scam.

In addition remember that if it seems too good to be true, then it is not true and it is not good. Scammers will tell you what you want to hear and you will want to believe it because it is what you want to hear.

So as a yardstick to measure such proposals consider this blog. I will tell you that current law forbids enforcement of your debt, note or mortgage. But I also tell you that (a) in order to defend you must enter the process of litigation and administrative contests and (b) the odds are stacked against you because judges have it in their mind they are saving the financial system form collapse. While I say that a majority of the people who follow my advice win their cases or achieve a successful result, that also means that in a substantial minority of cases, people lose and are forced to leave their homes after spending money on the defense. I can guarantee that current law means that homeowners SHOULD win but I can’t guarantee that they WILL win.

MODIFICATION IS A SCAM

Lastly, one of the scams that will be proposed to you is an offer of modification from what appears to be the “servicer” of your “loan”. In most cases this is offering you ice in the winter. You should consult an accountant or other financial expert to determine the value of the offer of modification. But more than that you need to realize that the offer of modification is actually inviting you to formally join the securitization process.

Modifications actually formalize the illegal practices conducted by the investment banks. Since they have retired the actual loan accounts, there are no actual creditors who can legally make a claim.

The banks have been getting away with designating parties to act as though they were creditors even though they are not. They know this is a very weak spot in their strategy. So they offer agreements that are entitled “modifications” which do virtually nothing to change the terms and conditions of the loan, although some incentives might be offered to reduce the homeowner to sign the agreement.

The real purpose of the agreement is to get the homeowner to agree that the use of the designee, like the company pretending to be the “servicer”, is perfectly acceptable to the homeowner. In so doing, the homeowner has essentially waived all potential defenses that could arise under the Uniform Commercial Code or under common law. The requirement that claimant must have financial injury in order to bring a claim will also have been waived unintentionally by the homeowner, who will then be sued or coerced into making payments that are not due. This also sets the stage for the declaration of default by a non-creditor which can then be enforced by the contract of “modification”.

It is obvious that the proposal for modification is coming from someone who has no authority or powers to propose or enter into any agreement that affects your homeowner transaction (“loan”) in any way. Yet for purely practical reasons it may well be in your interest to agree. Depending upon your financial circumstances and your appetite for risk you might want the entire ordeal to simply end and modification might be an effective way out of it.

But remember though you do have some bargaining control that is not apparent. And although the agreement is not actually a legally binding instrument for a variety of reasons it no doubt will be treated as binding by the courts and will be codified into legitimacy by the coming resets of state legislatures.

*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.*

FREE REVIEW:

If you want to submit your registration form click on the following link and give us as much information as you can. CLICK HERE FOR REGISTRATION FORM. It is free, with no obligation and we keep all information private. The information you provide is not used for any purpose except for providing services you order or request from us.In the meanwhile you can order any of the following:

*CLICK HERE TO ORDER TERA – not necessary if you order PDR PREMIUM.

*CLICK HERE TO ORDER CONSULT (not necessary if you order PDR)

*CLICK HERE TO ORDER CASE ANALYSIS 

*CLICK HERE TO ORDER PRELIMINARY DOCUMENT REVIEW (PDR) (PDR PLUS or BASIC includes 30 minute recorded CONSULT)

*FORECLOSURE DEFENSE IS NOT SIMPLE. THERE IS NO GUARANTEE OF A FAVORABLE RESULT. 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.

*Please visit www.lendinglies.com for more information.

How to deal with ORPHAN LOANS Created by False Claims of Securitization of Debt

I know this is technical and even boring. But if you want to understand where tens of trillions of dollars went in 2008 and how it is about to happen again, you must read this.
The bottom line is that homeowners, falsely believing that they are in default, are actually stepping away from compensation that is due to them from investment banks that initiated the securitization schemes, without which the banks would not have made any loans.
Equally true is that if homeowners knew the real facts they would have either sought other sources of financing or they would have received far greater consideration and incentives for entering into a doomed deal.
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In actuality the whole purpose was to produce ORPHAN LOANS and they succeeded, even though it was never legal or equitable by any standard.

Start with the Glass-Steagal Act of 1932.
There were four essential provisions: this act established the separation of commercial and investment banking activities and prevented securities firms and investment banks from taking deposits. It prohibited federal reserve member banks from:
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1. Dealing and non-governmental securities for customers
2. Investing in non-investment-grade securities for themselves
3. Underwriting or distributing nongovernmental securities
4. Affiliated or sharing employees with companies involved in such activities.
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The major investment banks had all started to violate the provisions of the act in 1983, when the concept of securitization of debt took hold. The unregulated sale of “certificates” a/k/a “mortgage bonds” was nothing more than a certificate of deposit creating an unsecured liability for the investment bank since it was both underwriter and issuer doing business under the name of a nonexistent trust.
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When the concept was expanded to residential loan transactions, investment banks knew that they were in substance taking deposits from customers without any restrictions on the use of those deposits.
As they often do, the investment banks began a major lobbying effort to ratify their illegal acts. This culminated in the 1999 Graham Leach Biley act which repealed the above provisions.
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The fate of banking, securities brokerage and underwriting, lending and borrowing was sealed when the major investment firms, calling themselves “banks,” were formally permitted to convert to commercial banks — despite their consistent track record of illegal behavior.
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This permission, achieved over a weekend during the 2008-2009 crisis essential legalized the previously illegal solicitation of deposits from investors who were purchasing certificates of deposit that were entitled certificates of entitlement issued by the investment brokerages. The result was a distribution of all risk of loss to the victims of the securitization scheme.
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Predictably, the risks associated with the activities that were banned in the Glass-Steagall act were not only legalized, but expanded. This resulted in the 2008 crash and continues to undermine the US economy and the economies of most nations around the world.
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The plan was presented as the securitization of residential loan obligations. But in actuality no such securitization ever occurred.
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Although the investment banks had received revenue equal to multiples of the amount of each homeowner transaction, they were not selling the debt and the buyers of the securities that were issued were not buying the debt.
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While some fund managers rejected the plan, the investment banks were able to influence most fund managers to purchase the securities that were issued, leaving the investors with an unsecured discretionary promise of a variable stream of income.
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The impact of this plan will be felt for generations. In order to sell the plan the investment banks needed to create the illusion that it was the debt that was being securitized and not just information about the debt or the performance of the debt. But in order to quell the objections of fund managers, and to maximize the profits of each investment bank book runner, the plan was constructed such that at the conclusion of each securitization cycle, there was no creditor who had established ownership of any loan account, directly or indirectly.
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*This had the side benefit of having the proceeds of insurance and hedge contracts payable to the investment firm rather than the investors or borrowers. See AIG bailout windfall to Goldman Sachs.
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For purposes of enforcement of the homeowner transaction, the investment banks needed to establish an infrastructure in which the securitization of the debt would be presumed by the courts based upon established rules of evidence arising from the facial validity of documents.
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The infrastructure established by the investment banks included private data collection, aggregation and reporting contrary to both public policy and state law regarding the transfer of interests in real property – especially conveyances of ownership of mortgages and deeds of trust.
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The infrastructure included the creation, control or acquisition of companies that would act in strict compliance with policy established by the investment banks. It also included the establishment, control, acquisition and outsourcing of companies that will willing to create documents that enhanced the illusion of the securitization of debt. All such documents were fabricated and contained false statements, to wit: they memorialize transactions that had never occurred in the real world.
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Currently the administration, collection and enforcement of promissory notes issued by homeowners is conducted for profit and not for restitution of an unpaid debt. The fact that this result is counterintuitive to the assumptions employed in the courtroom makes it easier for the investment banks to achieve a profit rather than a remedy for anyone who paid value to capitalize the scheme.
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The investment banks have invested heavily in a public relations campaigns spanning all types of media. The central myth propagated by that campaign is that the success of a homeowner in a foreclosure proceeding would result in a windfall “free house.”
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Nearly all homeowners, attorneys, judges, regulators and legislators have come to believe the myth of the “free house.”
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But in fact, as with nearly all facts about the plan purporting to securitize residential debt, the situation is exactly opposite to what is commonly assumed and even legally presumed in the courtroom.
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By selling securities that derived their perceived value from the existence rather than the ownership of residential debt, investment banks were able to achieve what had been heretofore impossible, to wit: they received total amounts of unrestricted deposits and proceeds of sales of “private contracts” that are commonly called derivatives; the sales resulted in net revenue, frequently untaxed, equal on average to 12 times the amount of any homeowner transaction.
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Hence the investment bank was receiving undisclosed (and concealed) compensation for origination or acquisition of the loan in the amount of $12 for each one dollar that was paid to the homeowner.
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Because the transaction with investors did not involve the sale of the debt, and even the origination of the homeowner transaction did not involve the purchase of the note or the mortgage or the underlying obligation by anyone who had provided the funding for the transaction, each of the parties was able to maintain the legal position that they were not subject to the federal Truth in Lending Act nor any state law governing lending or servicing practices.
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In fact, the investment banks had created the appearance of the loan transaction that resulted in the absence of the creditor or lender that could be subject to public policy or legislative restrictions on lending practices.
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After the statute of limitations on claims arising from lending laws, the banks took a different stance in pursuing foreclosures and collection. They portrayed themselves as lenders or successor lenders acting indirectly through intermediaries such as trustees, trusts, servicers or attorneys in fact.
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Misapprehension of the securitization process is widespread and even almost universal. This has resulted in the bias or assumption that the proceeds of forfeiture of residential homesteads through the process of judicial or nonjudicial foreclosure will eventually result in payment to a creditor who paid value for the underlying obligation and who was therefore an injured party proximately caused by the nonpayment of the homeowner.
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To the extent that such an assumption relates to investors who purchased certificates in the name of a nonexistent or barely existent trust, the assumption of fact is erroneous, to wit: investors continue to get paid regardless of the performance on any individual loan. They get paid by the investment bank partly from funds from a “reserve fund” which is vaguely described in the prospectus for the sale of the “certificates.”
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The reserve fund consists entirely of deposits made by investors. The deposits consist of both purchases of the trust certificates issued in the name of a single putative trust and from purchases of the trust certificates issued in the name of multiple other putative trusts.
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The inclusion of the proceeds of sales of derivatives issued by investment banks using the name of multiple putative trusts has caused some financial experts to referred to the scheme as simply another Ponzi scheme. The purpose of this article is not to justify or support that description.
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The point of this article is to merely demonstrate that the assumption that the investors are not getting paid as a result of nonpayment by homeowners is false.
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Investors neither paid for nor received any conveyance, legally or equitably, of any right, title or interest in any debt, note or mortgage issued by any homeowner. They do not get paid on the basis of any term or condition contained in any promise made by any homeowner to anyone.
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The payments received by investors are first, based upon discretion of the investment bank and second, funded from wide ranging business activities that only partially include the unauthorized and illegal administration, collection and enforcement of notes and mortgages.
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To the extent that the assumption in court is that the investment bank will receive the proceeds of a foreclosure sale, this assumption is true. *
Further complicating understanding of the convoluted nature of the securitization scheme is the fact that it is in fact the investment bank that issues the funding for the origination or acquisition of virtually all homeowner transactions. Since they are doing it with deposits made by investors, it may be fairly stated that they are in substance the lender or the successor lender (in the case of the acquisition of the loan).
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However, after detailed analysis by multiple financial experts, it is quite clear that while the transaction with the homeowner may have resulted in a general ledger entry on the books of record of the investment bank, the existence of the transaction on those records was at best fleeting. In most cases the transaction on the trading desk of the manager for collateralized debt obligations occurred contemporaneous or even before the homeowner transaction was consummated. At the very latest, the transaction was off the books of the investment bank within 30 days.
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This left an orphan debt — no person or business entity maintained a ledger account in which ownership of the debt was reported. 
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The homeowner transactions were primarily consummated through the use of a sham intermediary under the guise of a “warehouse lending” agreement. While the title of the document may refer to warehouse lending, and some of the terms of the document are similar to those found in a warehouse lending agreement, these agreements are actually a replacement for the actual agreements that were initially drafted on behalf of the investment banks.
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Those agreements were entitled “Purchase and Assumption Agreement”. Under the terms of those agreements the intermediary for the investment bank was contracting with a company that would serve, for a fee, as the “originator” of the transaction. Such an originator had no legal right, title or interest to any money or any claim related to any transaction with the homeowner.
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All payments from homeowners were either forwarded to a lockbox or diverted to a lockbox that was maintained and controlled by yet another third party intermediary whose contractual obligations are owed to the investment banks.
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Neither originators nor services ever actually see the the money paid by homeowners in their own bank accounts. The usual lockbox arrangement is with Black Knight, formerly Lender Processing Services (LPS) formerly operator of DOCX who produced tens of thousands of false, fabricated and fraudulent  documents in the pursuit of unlawful foreclosures.
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This leaves us with the question of the legal status of the promise made by the homeowner to pay money. The promise in most cases was obviously made to a party that was not entitled to receive any money either legally or equitably. Equitably they had no right to receive any money from the homeowner because they had not given the homeowner anything of value. Legally, they were not entitled to the money because the underlying debt was not owed to them.
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This is often overlooked when in court the parties accept the allegations as proof. Pleadings allows a claimant to say almost anything. But in the proof the claimant must still show that the claim is owned by them or if it is just seeking judgment on the note alone then they must show that they are pursuing the claim on behalf of a creditor who paid value for the ownership of the underlying debt.
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And in all events there was no sale of the homeowner’s obligation to anyone at any time during the securitization cycle – nor is any asserted or alleged in any subsequent documentation or even pleading with any court. 
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The absence of such allegations is contrary to normal pleading practices and should be corrected by the highest court of each state in establishing baselines for pleading foreclosures. A simple requirement that someone declare, under penalty of perjury, that they have ac dual personal knowledge of the status and ownership of the underlying debt and that the allegations in the complaint fairly represent the ownership of the debt and injury to the Plaintiff, would in effect eliminate virtually all foreclosures.
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The sale of the debt is currently presumed to have occurred by virtue of the legal presumptions arising from the apparent facial validity of fabricated assignments of mortgage or fabricated endorsements of the note.
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The legal analysis is simple. It is well established law that the authority to enforce a mortgage, note or obligation must come from a party who has paid value for the underlying obligation in exchange for ownership of that obligation. If no such creditor exists, then no authority can be granted.
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Given the above analysis, one might be tempted to conclude that the homeowner should be able to rescind the transaction entirely as being violative of public policy, public law and centuries of common law doctrines. But the problem with that conclusion is that the investment banks have created an infrastructure in which dozens of bona fide purchasers for value have engaged in various contracts predicated on the existence of (but not the ownership) of each homeowner transaction.
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Most courts have attempted to “punt” the issue by ignoring fatal deficiencies in the allegations in the prima facie case of anyone claiming a right to administer, collect or enforce a homeowner obligation. Many even go so far as to deny discovery on any issue which might defeat the assumptions of the court and the legal presumptions being employed by the court arising from the facial validity of fabricated, false, forged backdated instruments.
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The only remaining construction is through reformation of the contract to allow for a mere designee, rather than a creditor, to pursue administration, collection and enforcement of the homeowner obligation. The obvious procedural problem is that nobody has asked for this.
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The inescapable truth is that securitization necessarily involves two contracts, but the court system has been focussed on only one of them — the loan agreement. The securitization contract is considered as irrelevant despite the fact that in most cases the claimant is alleging securitization as the basis for standing. 
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With the facts laid bare is entirely clear that neither the securitization contract nor the loan contract could have ever existed without the other. It is equally clear that the loan contract results in a product that retires the underlying debt from the books of any and all creditors.
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The securitization contract conscripts the homeowner into a highly complex financial transaction about which he or she knows nothing and never consented and which undermines the loan contract by providing incentive for the “lender” to violate lending laws, inflate appraisals and approve toxic transactions because they are betting against viability.
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The parties involved in “lending” are consistently violating both public policy and public law rather than conforming to the basic requirements of the Truth in Lending Act that requires a “lender” to be responsible for the viability of the “loan.” But without a lender, no such party exists and the risks to the homeowner are increased exponentially.
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The net result is that the homeowner is drafted into two transactions producing an immediate loss along with probability future losses. Homeowners receive no compensation or consideration for assuming such risks because (a) they are concealed and (b) they had no opportunity to bargain for incentives or compensation.

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In conclusion, the myth of the windfall free house, accepted so widely even by the homeowners themselves, overlooks the fact that they were due compensation and consideration that they never received. While the amount of the consideration due to any specific homeowner might vary and be subject to resolution in a court of equity, it seems clear that the the appropriate amount of such consideration — especially after a period of time in which statutory interest is attached — might be equal to or greater than the amount demanded in foreclosure.
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But neither one could be legally collected unless the two contracts — loan and securitization — were reformed into one contract allowing for the appointment of a designee creditor rather than the usual and legal requirement of an actual creditor.
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In 2006, when I predicted not only the collapse, but also the order of firms that would collapse, I stated that the only way to avoid the coming catastrophe was to force all stakeholders to the table to share the risks of the miadventure since there was plenty of blame to go around. My pleas were ignored.
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I renew them again with this article because the next round (2020-2021) might be worse than 2008-2009. And the precise vehicle for forcing all parties to the table to share all of the risks is employment of the equitable doctrine of reformation, which has been in existence for centuries. Like 12 years ago, failure to do so is at our peril.
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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.
*

FREE REVIEW:

If you want to submit your registration form click on the following link and give us as much information as you can. CLICK HERE FOR REGISTRATION FORM. It is free, with no obligation and we keep all information private. The information you provide is not used for any purpose except for providing services you order or request from us.
In the meanwhile you can order any of the following:
*
CLICK HERE TO ORDER TERA – not necessary if you order PDR PREMIUM.
*
CLICK HERE TO ORDER CONSULT (not necessary if you order PDR)
*
*
CLICK HERE TO ORDER PRELIMINARY DOCUMENT REVIEW (PDR) (PDR PLUS or BASIC includes 30 minute recorded CONSULT)
*
FORECLOSURE DEFENSE IS NOT SIMPLE. THERE IS NO GUARANTEE OF A FAVORABLE RESULT. 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.
*
Please visit www.lendinglies.com for more information.

Tonight! How and Why Foreclosure Documents Are False and Fabricated. 3pm PDT 6PM EDT!

Thursdays LIVE! Click in to the WEST COAST Neil Garfield Show

with Charles Marshall and Bill Paatalo

Or call in at (347) 850-1260, 6pm Eastern Thursdays

Bill Paatalo will post on his Blog today details on what he and host Charles Marshall will cover on the Neil Garfield Show today: First, a revisit to the LSF9 Master Participation Trust, with the use of a Pennsylvania case to highlight how this ‘Trust’ is used to create legitimacy for a fake Bank of America merger.

Second, Bill exposes significant document and notary fraud re a New Jersey bankruptcy case, and via an Idaho notary whose commission was suspended a few years ago, and may have been revoked.

see https://bpinvestigativeagency.com/for-banks-its-just-business-for-arnoldo-ortiz-its-a-prison-sentence/

see https://bpinvestigativeagency.com/lsf9-master-participation-trust-falsely-claims-merger-in-pennsylvania-court/

Neil’s Remarks:  This is an important show because it drills down on the details of bank fraud at the highest levels, permeating down to ground level and emerging as false claims for restitution for a nonexistent unpaid debt.

The question in the front of every judge’s mind is “So what?” The only answer that will move them is a bold statement that currently nobody whole ever paid value in the securitization scheme ever suffers a loss from nonpayment by a homeowner and that foreclosures are therefore being conducted for profit. Any notion that investors are getting paid is wrong.
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As complex as securitization appears to be, the proof is simple. Can the foreclosure mill identify anyone who maintains an accounting record showing the subject debt as an asset? the answer is no because that is the way securitization works when you don’t securitize the debt and instead securitize data about the debt. Somehow we must get the point across that the vast pornographic profits generated by this type of securitization paid off the debt several times and that is why nobody claims it as an asset.
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I think that a potentially important point is the reason for the fabrication of documents containing false statements. I have come to the conclusion that the reason is that the debt does not exist on the records of any company. therefore, they needed to create the illusion that the debt exists in order to enforce it. I think that the appearance of fabricated documents on an unprecedented scale resulting in hundreds of billions of dollars in settlements is evidence, even if it is not conclusive evidence, that the debt does not exist without Reformation.
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Reformation is actually the net result of the behavior over the banks over the last two decades. They have managed to successfully convince judges to allow for a designated creditor in lieu of an actual creditor. there is no Doctrine under law that supports such allowance. but there could be a contract imposed on all stakeholders, given the events that have already occurred. That contract would impute acknowledgement and consent to the homeowner for the designation of a nominee to serve as creditor in actions for enforcement. It would also require the imposition of legal responsibility and liability on the designee and the designator to conform and comply with applicable statutes — except as otherwise provided by the reformed contract.
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The contract would also require that the homeowner receive consideration for such consent, especially in view of the unknown risks that the homeowner is deemed to have accepted. Hence the immediate loss from an inflated appraisal should be offset by compensation to the homeowner for being inducted into a securitization scheme. The higher risks of dealing with a designated or nominee lender rather than a real lender, would also give rise to compensation. And the undisclosed compensation of the investment bank and related affiliates would also be measured and applied as a yardstick for determining the amount of compensation that should have been paid to the homeowner.
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In such a contract, the homeowner would be deemed to have assumed the risk of an inflated appraisal and incentives of the “lender” do undermine the viability of the loan. This is all contrary to public policy and law as set forth in the federal truth in lending statute State statutes which specifically Place responsibility on the lender for the accuracy of the appraisal and the viability of the loan. but since rescission may be off the table because of the existence of multiple third-party contracts in the securitization infrastructure, the only potential alternative, in my view, is Reformation.
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My analysis leads me to conclude that despite all appearances to the contrary, the substance of what happened inevitably leads to the conclusion that there were two contracts and not one. (1) Loan Contract and (2) Securitization Contract. Neither one is enforceable unless conjoined with the other in Reformation. and the reason goes back to my initial statement above.
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If the debt was never sold then securitization of the debt never occurred. All documents to the contrary are false. and if the end result is that there is no creditor at the end of the day who maintains an entry on the books of account in which they record a transaction in which they are acquired legal ownership over the underlying debt, then the banks have created a transaction which is not recognized by law — a loan without a lender.
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And if the initial loan documents designated a non lender as payee under the note and mortgagee under the mortgage, then the initial documents were void and should never have been recorded. Any instrument created after the apparent closing that was used to create the legal presumption that the ownership of the debt, note and mortgage had been transferred would therefore be equally void. You can’t transfer a debt that has been retired and possibly extinguished.
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I think we must travel in this direction because I don’t believe any court or any legislature is going to willingly undermine the securitization infrastructure even if it is defective. And I don’t believe they will undermine the loan contract without providing for an alternative for enforcement.

How to ask the right questions in discovery

Discovery is part law, part art, and part intuition. The lawyer must generate questions that can be used, by themselves, to bring certain issues in front of the judge either because the opponent answered the questions or because they didn’t answer.

If your point is that your opponent doesn’t own the claim even though they either said or implied that they do own it, then you need to do some investigation first so you can ask the right questions in the right way. If your point is that there are two agreements, one for loan and the other for securitization, the same thing applies. Either way you face an uphill climb as you attempt to persuade a judge who is not an investment banker and doesn’t understands securitization but still thinks he or she understands residential homeowner transactions.

So continuing with our example, you want to show the judge that despite the requirements for legal standing your opponent does not have standing. In order to have standing the claimant must have an injury. Financial injury qualifies and that is what the banks are relying upon when they try to foreclose.

How does one have financial injury? Actual financial damages occur when one actually loses money or permanent value of some property — tangible, intangible, real or personal property all qualify.

By “actual” that means you can count the money that was lost as a direct and proximate result of the action or inaction of the defendant or, in this case, the homeowner.

If the homeowner doesn’t make a payment that had been expected, then several things occur in the law that makes this fairly simple proposition complex.

  1. Does the homeowner owe any money to the party to whom payment was previously being made? If not, then the complaining party had no right to declare, much less enforce the claim of default. The subheading here is counterintuitive — does the debt exist as  an asset owned by any entity, including the claimant? Assuming that the answer to these questions is in the affirmative is an assumption that compromises the entire defense of a foreclosure case. Assuming the answer is no, then discovery will be on the right track.
  2. BUT having previously made payments to the complaining party, the homeowner has been acting against his/her own interest and that is often treated as an implied admission that payment was previously made because the homeowner thought it was due. To take a contrary position now is contradictory and diminishes the credibility of the homeowner who later says that the money is not due.
  3. Was there an agreement under which the homeowner agreed to make the payment? Not so fast. This is more complicated than anything you can imagine because there is no agreement, no matter what was signed or what was even done, unless the agreement is enforceable. In the eyes of the law an unenforceable agreement is no agreement — a legal nullity. And there are very precise elements of a legally enforceable agreement, each of which must be present. this isn’t horseshoes — close is not enough.
  4. Is the claimant a party to the agreement? In the context of loans this is easy if there really was an original lender and a borrower. In the context of securitization, this condition can only be satisfied by the claimant if it purchased the underlying debt for value in exchange for a conveyance of the ownership of the debt. In today’s foreclosures this element is the focal point for most litigation. The claimant always has a conveyance, but never produces any proof of payment for the debt. That makes the conveyance (assignment of mortgage or indorsement of note) void even if it was executed and recorded. It is regarded in all jurisdictions as a legal nullity. If the conveyance was void then the claimant is not a party to the agreement. Litigation is between the bank forces using legal presumptions arising from the apparent facial validity of the conveyance and the actual facts which are absent showing that value was paid for the debt in exchange for the conveyance.
  5. Was there mutual consideration? If not, there is no agreement. In the context of loans this means that the original agreement produced mutuality. In other words, the party that is disclosed as “lender”, pursuant to the provisions of the Truth in lending Act, gave money to the borrower and the borrower took it, in exchange for a promise to repay the money to that party. At least 65% of all loans from the year 2000 to the present were not originated by the party named as “lender” in the “agreement” (note and mortgage). They are table funded loans against public policy. But they are often enforced under the belief that the originator was in privity (agreement) with the source of funds. In the context of securitization, which covers around 95% of all such loans, there was no privity because the source of funds did not want to liable for lending violations (inflated appraisals, nonviable loans etc). The issue is complicated by the fact that the borrower did receive consideration and did make the promise to pay the originator — but neither the note nor the mortgage were supported by consideration from the originator. Any “purchase” from the originator was therefore void, and any conveyance of the mortgage or note from the originator was void unless the grantee had already paid for the underlying debt. In virtually all cases in which securitization claims are present, the grantee has never paid for the debt, nor has it ever possessed the resources to purchase the debt. It is a
    “bankruptcy remote vehicle” which is to say that it is there in name only and possible not even as a legal entity. If you can show that fact or show that the other side refuses to answer properly worded questions about the status and ownership of the debt, then you can raise the inference that the claimant doesn’t possess a claim and therefore lacks standing.

So the questions that should be constructed and posed should center on the following guidelines, for purposes of this illustration:

  1. In which bank account were prior payments received and who controlled that bank account.
  2. On what general ledger of what company is the claimed debt appearing as an asset receivable of that company?
  3. What was the asset account from which the claimant entered a debit to pay for ownership of the debt?
  4. Does the named claimant as beneficiary or Plaintiff own the claimed debt as a result of a transaction on a certain date in which it paid value for the debt to a grantor who owned the debt in exchange for an conveyance of ownership of the debt?
  5. To whom did the servicer forward payments received from the borrower/homeowner?
  6. What person or entity did not receive money as a result of the claimed default?
  7. What is the date on which the named claimant received ownership of the underlying debt?
  8. On what dates has the named claimant issued any payments to third parties whose contractual rights to such payments were in any way related to payments received from the borrower/homeowner?
  9. What is the name and contact information of the officer(s) or employee(s) of the named claimant who is in charge of accounting and finance for the named claimant?
  10. What is the name and contact information of the officer or employee of the named claimant who is the custodian of records relating to the underlying debt, payments received and payments disbursed that were in any way related to the underlying debt, payments made by the borrower/homeowner, or payments received by third parties (possibly investors).
  11. Describe source and the amount of the remuneration and compensation received by the named claimant in connection with the creation, administration, collection or enforcement of the subject underlying debt, note and mortgage.
  12. Describe dates and names of the lockbox contract(s) maintained with third parties for the collection of borrower/homeowner payments relating to the subject loan.
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Don’t use the above as the actual wording of your interrogatories, request for production or request for admission although some cutting and pasting could be used. Check with local counsel before you attempt to enter the legal process of discovery, motions to compel, motions for sanctions and motions in limine.
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This article is not a complete treatise on discovery in foreclosure actions. It is not a substitute for seeking advice from an attorney licensed in the jurisdiction in which your property is located.
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KEEP IN MIND THAT THEY WILL NEVER ANSWER THESE QUESTIONS. DON’T EXPECT ANSWERS. EXPECT THE ABSENCE OF ANSWERS. THEN USE THEIR REFUSAL TO ANSWER AS THE BASIS FOR RAISING INFERENCES AND PRESUMPTIONS AGAINST THEM.
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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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FORECLOSURE DEFENSE IS NOT SIMPLE. THERE IS NO GUARANTEE OF A FAVORABLE RESULT. 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.
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Recusal of Judge in Foreclosure Cases is Tricky

Any judge who has his/her investments or retirement funds tied up in bank shares or worse, certificates from securitizations chemes — directly or indirectly — should not hear such cases. Our analysis and experience in the US shows that when the cases are drilled down to their essential facts, the debt has been retired by the securitization process — a highly counterintuitive result for lawyers and borrowers but not so for investment bankers.

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Until the judiciary is willing to recognize the existence, in the real world, of two agreements, there can be no final resolution of the mess that nearly toppled the world economies. By strictly focusing on the loan agreement they are relying upon an agreement to which the claimant is neither a party nor much less an injured party. They are warding  foreclosures as unwitting accomplices in a scheme for profit since the proceeds never go to anyone who paid value.
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The other contract is the securitization contract which exists in many details but never disclosed to the borrower. The borrower is involuntarily conscripted into both the securitization contract and tricked into the loan contract, which contains elements and terms that are never disclosed to the borrower or the courts.
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Since current “securitization” results in the creation, issuance, sale and trading of securities  that derive their value from data ABOUT the debt (instead of ownership of the debt) the debt is never sold even at origination. This securitization of data and performance of the data results in revenues that are at least 12 times the amount of any transaction with the homeowner.
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And since the investment banks don’t want to be liable for lending violations, they assiduously avoid being the owner of any debt.
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And the certificates they issue to investors convey no ownership of the debt. In fact, in the end, incredibly there is no company or person who maintains the debt on tehri books as  an asset and therefore no person or company who can claim ownership. Accordingly there is no person who can claim injury and therefore no person who can claim a remedy for nonpayment from a borrower who does not owe them any money.
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The real remedy is reformation of the two contracts — loan and securitization — into one which incorporates the unsavory truths about the arrangements without rescinding the whole thing and causing injury to dozens of third parties who bought derivatives based upon the existence of an enforceable loan that produces reliable data.
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In reformation, using quantum meruit and quasi contract doctrines the two fatally deficient contracts would be preserved and revived — with two major differences.
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First, the contract would allow for a certain person to designate a party who could act as a creditor even though they lacked ownership of the debt and even though the designee or nominee did not represent anyone who did own the debt.
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Second, the contract would assure that adequate consideration was paid to the borrower for the additional risks imposed on the borrower that had been concealed. Among other things the absence of any risk of loss to the “lender” removes a component that most borrowers believe is an essential part of their lending agreement.
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In the absence of such reformation the courts must continue with their wink and nod attitude and enforce all but those cases in which the borrower persistently and aggressively litigates the issue. But in all such cases, if they award judgment to the claimants, they are giving profit to the claimants for the sole purpose of propping up the banks and their securitizations schemes.
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Thus for any judge who hears the cases, a negative decision could either eliminate or reduce their investments and retirement benefits significantly.
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A negative decision against the claimant would inevitably result in a conclusion, in the marketplace, that the certificates and derivatives issued by the investment banks were worthless and need to be marked down accordingly.
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It is difficult to imagine any judge tolerating their own financial ruin by making such a decision. Thus whether the above scenario is credible to the reader or not, the consideration of competing issues by a judge whose retirement or investment funds are tied up with the large banks and/or any of their securitization schemes violates both the prohibition against the appearance of impropriety and the actuality of it.

How to Fight Those “Declarations” from False Claimants in Foreclosures

The bottom line is that the loan account was extinguished contemporaneously with the origination or acquisition of the account. There is no loan account claimed as an asset of any company.

The records  of the self-proclaimed servicer are not records of the loan account or the establishment of the loan account on the books of any company. Therefore they are not records of the creditor.

Besides being fabricated those records are irrelevant and inadmissible without foundation testimony and proof that the loan account has been established on the books of some creditor and even then, even that is irrelevant unless that creditor was the named Plaintiff or beneficiary on a deed of trust.

All of this is completely counterintuitive to lawyers and homeowners — but not to investment bankers who continue to profit from each foreclosure without paying one cent to reduce the claimed obligation supposedly due from the homeowner.  And they do this all without ever appearing as a party in court.

Nice work if you can get it.

So here is something I drafted recently in response to a memorandum in opposition to the homeowners’ motion to strike the declarations of the “plaintiff”.

Counsel for the named plaintiff is engaging in procedural and substantive strategies of evasion.
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While the action is clearly filed for the benefit of “certificate holders,” counsel continues to refer to the plaintiff as Bank of New York Mellon.
Counsel steadfastly refuses to identify the certificates or the holders.
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In addition, counsel implies a representative capacity on behalf of the “certificate holders” in which the Bank of New York Mellon supposedly has the authority to represent them. As defendant has previously demonstrated to the court, Bank of New York Mellon has consistently rejected any allegation or implication that it served in a representative or fiduciary relationship with certificate holders both in this particular series and in other securitization schemes.
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Counsel for the named plaintiff supposedly appears on the behalf of unidentified holders of unidentified certificates. Or counsel for the named plaintiff is claiming a fictitious representative capacity in which it represents Bank of New York Mellon. But as previously stated by defendant, opposing counsel has no agreement for legal representation between itself and Bank of New York Mellon.
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Instead, it has been retained by a party who is a self-proclaimed “servicer” – Select Portfolio Servicing Inc., and counsel for the named plaintiff asserts that SPS is the “attorney-in-fact” for Bank of New York Mellon.
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However counsel for the named plaintiff has never alleged nor demonstrated that Bank of New York Mellon has ever been party to a transaction in the real world in which it paid value for the underlying debt in exchange for conveyance of ownership of that debt. Accordingly even if SPS is the attorney-in-fact for Bank of New York Mellon, such an assertion is both irrelevant and a distraction from the fact that there is no creditor present in this lawsuit.
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The truth of the matter is that opposing counsel represents neither Bank of New York Mellon nor the certificate holders. Its sole relationship and contact is with SPS, owned by the real player in this action, Credit Suisse — who seeks only profit from the sale of homestead property since the loan account and the underlying debt were retired in the parallel securitization process.
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There is no such debt or loan account and therefore there can be no owner. And if there is no owner of the debt or account then there is no creditor, lender or successor lender. SPS may have some agency with Bank of New York Mellon but that does not create the rights they seek to enforce.
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Counsel for the named plaintiff asserts “the declaration was clearly executed by a person with “personal knowledge” as required by the foreclosure order.” This is not a true statement. Counsel is being disingenuous with the court.
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The declaration was executed by somebody identified as a “document control officer.” The declaration says nothing else about any personal knowledge acquired by the signatory. In fact it does not even define “Document control officer.”
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The declaration itself does not establish the foundation for testimony about the subject loan despite the characterization advanced by opposing counsel. The statement in the declaration is that “SPS holds and maintains all of the business records relating to the servicing of this loan.” There is no statement or allegation or any other evidence in the court file, nor could there be, that the records of SPS include entries that establish the subject debt, note and mortgage as an asset of any entity. That is because no such entity exists and no such loan account presently exists.
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Opposing counsel disingenuously attempts to distract the court by focusing on the familiarity with the record-keeping practices and record-keeping systems of SPS. Such familiarity is irrelevant if the records are not those of the creditor. This is irrelevant if SPS is not an authorized agent of the party who has paid value for the debt in exchange for a conveyance of ownership of the debt. No such allegation or evidence exists except through the use of presumptions related to documents that are not even facially valid.
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Accordingly the opposition filed by opposing counsel is simply another step in the attempt to distract the court from the simple fact that no loan account has ever been established nor has the ownership of such an account been established. Opposing counsel has relied upon innuendo, implication and self-serving inferences to establish facts that do not exist in the real world.
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The declaration of opposing counsel is false. Neither the attorney nor the law firm represents the Bank of New York Mellon. In addition, the attorney falsely alleges “personal knowledge” without specifying how that knowledge was obtained. Like all other documents in this case, the creation of this document is meant to create an illusion based upon a cursory glance at the document rather than an analysis of it.
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The declarations in this case do not survive any credible analysis.
Similarly, the creation and execution of a “limited power of attorney” on March 5, 2020, after the lawsuit was filed and after the motion for summary judgment was filed, is another disingenuous effort to distract the court. The execution of the power of attorney, even if it was valid, is irrelevant if the grantor had nothing to grant. There has yet to be any reference, allegation, exhibit or evidence submitted establishing the identity of any entity that maintains the subject loan account as an asset on its financial statements.
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In conclusion, any reasonable attentive analysis of the documents submitted by opposing counsel reveals the absence of any allegation that counsel represents any party on whose behalf this action was filed, according to the complaint and subsequent filings. Taken individually or collectively, the documents are a smokescreen for the pursuit of profit of a third party (Credit Suisse) rather than restitution for an unpaid debt that no longer exists. 
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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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Tonight! Why There is No Valid Lien in Securitization Cases! PM EDT 3PM PDT

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Tonight’s Show Hosted by Neil Garfield, Esq.

Call in at (347) 850-1260, 6pm Eastern Thursdays

In a nutshell there is no valid lien. But in order to get to that conclusion you have to wade through the weeds and smoke screens that have been carefully constructed by the Wall Street Banks.

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The simple truth is that in most cases the origination of the homeowner transaction was table funded but it was not actually a loan.
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This means that the party with whom the homeowner thought they were dealing with was not a lender because a lender loans money and the investment bank that funded the transaction wanted no part of being a lender even though they were the one paying the money to the homeowner. In common practice and jurisprudence, this may be cause for a variety of defenses and claims, but it does not invalidate the entire transaction — even though it should.
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In the end, securitization results in no lender, no creditor and no loan account on the books of any legal person or entity. The problem that emerges for the Foreclosure Mills is that they must reconstruct, out of thin air, the debt that has already been retired through receipt of revenue from the securitization of data (information) about the loan and not the sale or securitization of the loan itself.
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The problem is that the loan account does not exist. it is not an asset owned by anyone. But in order to enforce the note and mortgage, they must create the illusion that the debt (loan account) does exist because that is what the law requires. So when it comes time to enforce, they have an insurmountable problem which can only be covered over by making false statements and using fabricated documents.
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They accomplish this by creating the illusion of transactions in which the nonexistent loan account is being bought and sold. That is what those assignments and endorsements are all about. When you demand proof of payment they can’t produce it because there was no payment. There was no payment because there was no account.
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My analysis has been consistent since 2006. It has been submitted in court thousands of times without rebuttal of any kind by any lawyer, financial expert or anyone else. If all of this occurs starting with the origination of the homeowner transaction then several things are true:
  1. The mortgage conveyance by the homeowner was void and should not have been executed or recorded because it did not memorialize any transaction in the real world — i.e., the homeowner was fooled into thinking there was a loan from the originator and therefore agreed to sign a note and mortgage payable to the originator, who was merely serving as a fee based servicer in the grand illusion.
  2. No conveyance of an interest in any mortgage or deed of trust is valid unless it also conveys the debt in exchange for payment. That didn’t occur between the homeowner and the originator. Payment was from the investment bank and the conveyance was to the originator who had no contractual relationship with the investment bank.
  3. The absence of a legal conveyance of ownership of the recorded mortgage lien to a party that claims it paid value for the original table-funded transaction, seals the fate of the purported lien, to wit: it was void and is now not subject to correction in a manner that could be recognized by law.
  4. The legal fiction of allowing the mortgage lien to continue is no longer available — unless both the alleged loan agreement and the concealed securitization agreement are combined through a legal process of reformation.
  5. Without reformation, the void mortgage lien is subject to cancellation and expungement from the record of title to the property as shown in public records of the county in which the property is located.
  6. While these are legally sufficient grounds for quiet title, it is my opinion that a pending refinancing deal would add urgency and reality to the claim.
  7. Beyond all reasonable doubt or any doubt for that matter, nobody will ever claim to own the debt and be able  to prove it through the only means legally available to show ownership of the debt: PAYMENT. 
  8. Homeowners are entitled to compensation for being drafted into a complex concealed scheme in which they are key players. 
  9. The concealed securitization contract was also void without reformation because no consideration was paid to the homeowner for being drafted into a securitization scheme in which all the benefits flowed to one side that did not include the homeowner.
  10. The  obligation of the homeowner remains inchoate — sleeping. It can only be awakened by reformation of the homeowner transaction using doctrine of quasi contract and quantum meruit. 
  11. Two things need to be inserted to create an enforceable contract supported by adequate consideration, to wit: (a) a legal fiction in which the homeowner accepts the currently illegal practice of appointing a designee instead of a creditor for enforcement and (b) compensation to the homeowner for accepting this novel arrangement.
  12. Without reformation requested by one or both sides, there can be no legal enforcement. Rescission while technically appropriate is unavailable because of the chain of other contracts emanating from the parallel securitization scheme.
  13. The only other option is to appoint a receiver to liquidate all claims from all stakeholders — a process that may be unwieldy unless performed on the basis of each securitization scheme rather than each loan.

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.

 

How to Analyze A Purported Assignment of Mortgage or Promissory Note

The execution of any document does not by itself create a legal event.
  • First, the document is only valid if it memorializes an actual event.
  • Second, the document is only valid if it complies with the facial requirements set forth by applicable statutes.
  • Third, the document is only legally valid if it complies with the substantive requirements of applicable statutes.
Let’s take a common example.
ABC executes an assignment of mortgage to XYZ.
  • The effect of the execution of the document is zero until it is delivered.
  • Even then the document is a legal nullity if it does not memorialize a transaction in real life.
  • If it recites consideration and if it has been executed in accordance with the facial requirements of statutes, it is facially valid which means, especially upon recording, that it might give rise to certain legal presumptions under The Rules of Evidence in any Court proceeding.
  • Substantive statutes require a contemporaneous sale of the underlying debt in order for the document to be legally valid. Without that the document might exist but it is treated as though it does not exist.
In order for the first requirement to be satisfied, there must be a transaction in real life between real people.
  • Most people mistakenly assume that because ABC executed the assignment in favor of XYZ that ABC owned the mortgage and that XYZ purchased it in a transaction with ABC.
  • In the current context of securitization, this never happens. Accordingly, the assignment of mortgage is void, not merely voidable. It is a legal nullity which means that it must be treated as though it never happened even if it was recorded.
You have to keep in mind that this is all based on contract law.
  • the execution of a document in favor of a grantee may give rise to certain legal presumptions that are used because the presumed facts are almost always true.
  • But in the case of deeds and mortgages and deeds of trust, there is absolutely nothing on the face of a document indicating that the grantee has accepted the assignment or been part of any transaction.
In the context of securitization, ALL of the recitals on the face of the assignment of mortgage consist of false representations of fact made by the grantor.
  • If attorneys for the grantee choose to use the assignment of mortgage as the basis for a claim against the homeowner, and the fraud is later revealed, the grantee still has the option of disclaiming any knowledge or interest in the assignment of mortgage, since it was not party do any contract or any transaction in which the mortgage was sold.
  • This reflects the true logic of “securitization.” There is no sale and there is no contact so nobody is alender and nobody is a creditor and nobody is a servicer. Regulators and the courts have tried to invent doctrines to bridge this gap, but it is a bridge too far.
  • Since nobody can be identified as lender, creditor or servicer when questions of substantive conduct occurs all of the players have at least one layer of protection  by simply claiming that they were simply acting as a third party vendor and that none of them ever made any representations about owning the debt through payment or representing anyone who owned the debt through payment.
The same logic applies to the endorsement of a promissory note.
  • The fact that the endorsement appears may give rise to certain legal presumptions that are used as Rules of Evidence, but all of those are rebuttable by the homeowner.
  • If the presumption is that the party claiming to own the Note has paid for it, and that therefore the delivery of the note along with the endorsement was a transfer of ownership of the underlying debt, the homeowner need only ask questions in Discovery or in a qualified written request or a debt validation letter as to the identity of the transaction and the parties in which payment was made for the debt.
  • In cases that involve securitization you will never get an answer to this.
  • And in cases in which securitization is not apparent, if you don’t get an answer to that, you are probably dealing with concealed claims of securitization.

And remember this above all else: they never say the debt was securitized. they simply let the court assume that to be true. they don’t say it because it never happened.

The argument that this analysis results in a “free house” for the homeowner is intentional misdirection.

  • The homeowner was drafted into securitization scheme in which the player collected vast sums of money far in excess of any transaction with homeowner.
  • None of that money was ever credited to the fictional loan account that was created with when the homeowner was induced to issue the note and mortgage. And nobody owns that fictional loan account. Nor was the homeowner paid any inducement to participate in the concealed securitizations scheme that securitized data rather than debt.
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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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