TRID may be another easy win for Homeowners

since loss mitigation is a statutory condition precedent to foreclosure, there is a failure to comply with the condition that requires loss mitigation exhaustion before pursuing foreclosure, the steamrolling of homeowners is not just wrong, it is also a breach of statutory duty for which the homeowner can seek injunctive relief, damages, and attorney fees.

TILA-RESPA integrated disclosures (TRID) is a series of guidelines that dictate what information mortgage lenders need to provide to borrowers and when they must provide it. TRID rules also regulate what fees lenders can charge and how these fees can change as the mortgage matures.

But it also contains the requirements for review and processing of loss-mitigation applications, resulting in charging excess fees without explanation and failure to credit surplus proceeds from the foreclosure sale.

Once you accept that you might be wrong, then you can move on to whether the forces aligned against you are also wrong. But first, you must discard the errors of your own ideas about the transaction in which you obtained money. It is at that point that several things emerge. And Homeowners are starting to pick fights with “servicers” rather than waiting for them to arrive and others are going back and contesting foreclosure sales for breach of statutory duties.

START HERE:

  • When you apply for loss mitigation you are tacitly admitting that the address you are sending your application to belongs to parties who are entitled to receive it. This is almost always untrue.
  • By addressing the application to the designated company whose name is used by FINTECH as a “servicer” you are admitting that they have the power to consider the loss mitigation application. They don’t.
  • And to put a finer point on it they don’t consider it. Nobody does.
  • This means that reports back to the homeowner are false. It was not considered because neither the named “servicer” nor FINTECH had any power to consider it nor did they do so.

So if you want to use the TRID strategy, you must first accept their authority, submit the required documents and then sue them for deceit and breach of statutory duty. You might also want to demand the return of everything you submitted since they were not entitled to receive it.

I also think that the Administrative Strategy (QWR+DVL+CFPB complaint+AG Complaint —see links below) is an essential condition precedent for the homeowner to be able to sue. It should be timed such that the homeowner can honestly say that they accepted the representation of authority in good faith and then concluded afterward that no such authority existed.

This opens the door to a simple lawsuit under TRID, which is really a breach of TILA. And since loss mitigation is a statutory condition precedent to foreclosure, there is a failure to comply with the condition that requires loss mitigation exhaustion before pursuing foreclosure, the steamrolling of homeowners is not just wrong, it is also a breach of statutory duty for which the homeowner can seek injunctive relief, damages, and attorney fees.

The basis of the lawsuit is simple.

  • The homeowner received an invitation to participate in a loss mitigation program from someone who had neither the power nor intention to consider it.
  • Subsequent reports issued under the letterhead of the designated company that was an alleged servicer were erroneous and false.
  • No consideration was given to loss mitigation.
  • The “servicer” possesses no record of seeking or obtaining instructions from any creditor nor any company or person that possesses the authority to act for a creditor who maintains an unpaid loan account due from the homeowner.
  • Therefore foreclosure should not be allowed or should not have been allowed.

In order to pursue this strategy with gusto, you need to accept the fact that the entire securitization infrastructure might be a ruse. It is. You don’t need to prove that it is a ruse. You only need to kneecap those who rely on that infrastructure to obtain windfall profits.

The only way to defeat you is if they get you to admit that the parties with whom you’re corresponding are legally authorized to represent a real creditor. If you reject that and make them provide corroborating evidence they’ll fail because such evidence does not exist.

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DID YOU LIKE THIS ARTICLE?
Nobody paid me to write this. I am self-funded, supported only by donations. My mission is to stop foreclosures and other collection efforts against homeowners and consumers without proof of loss. If you want to support this effort please click on this link and donate as much as you feel you can afford.

Please Donate to Support Neil Garfield’s Efforts to Stop Foreclosure Fraud.
CLICK TO DONATE

Neil F Garfield, MBA, JD, 75, is a Florida licensed trial and appellate attorney since 1977. He has received multiple academic and achievement awards in business, accounting and law. He is a former investment banker, securities broker, securities analyst, and financial analyst.
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FREE REVIEW: Don’t wait, Act NOW!

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. You will receive an email response from Mr. Garfield  usually within 24 hours. In  the meanwhile you can order any of the following:

Click Here for Preliminary Document Review (PDR) [Basic, Plus, Premium) includes 30 minute recorded CONSULT). Includes title search under PDR Plus and PDR Premium.

Click here for 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. Suggestions for discovery demands are included.
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CLICK HERE TO ORDER CONSULT (not necessary if you order PDR)
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CLICK HERE TO ORDER CASE ANALYSIS 
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FORECLOSURE DEFENSE IS NOT SIMPLE. THERE IS NO GUARANTEE OF A FAVORABLE RESULT. THE COMMENTS ON THIS BLOG AND ELSEWHERE ARE BASED ON THE ABILITY OF A HOMEOWNER TO WIN THE CASE NOT MERELY SETTLE IT. OTHER LAWYERS HAVE STRATEGIES DIRECTED AT SETTLEMENT OR MODIFICATION. THE FORECLOSURE MILLS WILL DO EVERYTHING POSSIBLE TO WEAR YOU DOWN AND UNDERMINE YOUR CONFIDENCE. ALL EVIDENCE SHOWS THAT NO MEANINGFUL SETTLEMENT OCCURS UNTIL THE 11TH HOUR OF LITIGATION.

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

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

Please visit www.lendinglies.com for more information.

FCRA Might Be Fertile Ground for Individual and Class Actions Especially under CFPB Rules

if the CRC does not perform the investigation or performs it incorrectly, you can sue them.

In a world where the ability to access credit matters more than the ability to access savings, nothing could be more important than these provisions under the Fair Credit Reporting Act (FCRA).

Anyone who read the book or saw the film “The Firm” knows that it is often a boring statute that can take down the worst offenders. It was mail fraud in that story. For more information ask the descendants of Al Capone who died in prison of syphilis after being convicted of income tax evasion. Both bad guys were guilty of murder and mayhem. But what put them away was overbilling clients and evasion of income tax liability and payments respectively.

The Consumer Financial Protection Board is doing a deep dive into both debt collection and reporting under the FCRA (Fair Credit Reporting Act). Apparently, someone woke up to the fact that reporting “agencies” (none of them are governmental) are indeed required to perform both due diligence and an investigation when the “debtor” challenges a negative credit report.

I know. It is boring. But you might get more interested when you consider the importance of these provisions. Or to put a finer point on it, you SHOULD be more interested. Most of the value of your home could end up as equity — i.e., the value you can trade on or borrow.

The investment banks need to make sure that programs like the one I created (AMGAR) never get off the ground. That means making it nearly impossible for any legitimate lender to issue a commitment to refinance the so-called loan with the usual customary standard condition — that it gets the priority position for its lien on the subject property securing the new loan transaction with the homeowner. 

This means that the old “lender” or “successor lender” must actually assert and provide confirmation that it is actually the owner of the receivable allegedly due from the homeowner. Up until now, that standard requirement has been ignored and the marketplace has been coercing homeowners to accept title insurance as a substitute for title. Hint: They’re not the same thing. 

The way this “policy” has been enforced is to prevent the homeowner from seeking hard money or other lenders. There is no better way than negative credit reporting. A bad credit report blocks almost any source of funds for the usual homeowner. So the inability of the “old creditor” to confirm the existence of the loan account never becomes an issue.

But there is a mechanism by which homeowners can defeat this strategy that supports false claims for administration, collection, and enforcement of claims and payments from homeowners. The mechanism is contained in 15 U.S.C. § 1681i(a)(1)(A).

see cfpb_supervisory-highlights_issue-26_2022-04

Here is the quote from the latest CFPB bulletin. Remember that the fact that it is boring does not mean that it won’t provide you with tangible benefits that could change the whole trajectory of your life.

2.2.1 CRC duty to conduct reasonable reinvestigation of disputed information The FCRA requires that a CRC must conduct a reasonable reinvestigation of disputed information to determine if the disputed information is inaccurate whenever the completeness or accuracy of any item of information contained in a consumer’s file is disputed by the consumer and the consumer notifies the CRC directly, or indirectly through a reseller, of such dispute.8 In several reviews of CRCs, examiners found that CRCs failed to conduct reasonable investigations of disputes in multiple ways. Examiners also found that rather than resolving disputes consistent with the investigation conducted by the furnisher, which in many instances would have required correcting inaccurate derogatory information and replacing it with accurate positive information, CRCs simply deleted thousands of disputed tradelines. Examiners also found that CRCs failed to conduct reasonable dispute investigations when they failed to review and consider all relevant information submitted by the consumer in support of their disputes. After identification of these issues, CRCs were directed to cease violating the FCRA’s dispute investigation requirements. [e.s.]

In practice what this means for consumers of all types who partake of the twisted financial products offered under cover of false labels is that if you submit a contest to the credit reporting company (CRC) with an appropriate summary and exhibits and state the nature of the contest and the reasons for it, the CRC must conduct a deliberate investigation to determine whether or not it is true.

And if the CRC does not perform the investigation or performs it incorrectly, you can sue them.

If the “furnisher” (usually a company that has been designated as a “Servicer”) is unable to establish the accuracy of the report the furnisher must withdraw it or the CRC must take it down. That action alone lends corroboration to the defense narrative in foreclosure.

The allegation can then be made that the putative “servicer” and “Creditor” are unable to corroborate their claims for rights to administer, collect and enforce the alleged underlying obligation — despite being contractually bound to do so (FCRA, and bound by the statutory duty to do so (FCRA, FDCOA, RESPA).

So how boring is it when you consider that the place of “creditor” and the fact of “loan account” has been eliminated by Wall Street investment banking strategies? Do you still feel like paying them anyway? Or would you like to know how they are really making money, regardless of whether you pay or not?

PRACTICE HINT: THIS IS ONE EXAMPLE OF WHY HOMEOWNERS SHOULD OBTAIN A FORENSIC INVESTIGATION REPORT AS SOON AS POSSIBLE. BEING “CURRENT” IS BOTH IRRELEVANT AND POTENTIALLY DAMAGING IF YOU ARE PAYING ON A NON-EXISTING DEBT FOR THE BENEFIT OF A NONEXISTENT CREDITOR.

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DID YOU LIKE THIS ARTICLE?
Nobody paid me to write this. I am self-funded, supported only by donations. My mission is to stop foreclosures and other collection efforts against homeowners and consumers without proof of loss. If you want to support this effort please click on this link and donate as much as you feel you can afford.

Please Donate to Support Neil Garfield’s Efforts to Stop Foreclosure Fraud.
CLICK TO DONATE

Neil F Garfield, MBA, JD, 75, is a Florida licensed trial and appellate attorney since 1977. He has received multiple academic and achievement awards in business, accounting and law. He is a former investment banker, securities broker, securities analyst, and financial analyst.
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FREE REVIEW: Don’t wait, Act NOW!

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. You will receive an email response from Mr. Garfield  usually within 24 hours. In  the meanwhile you can order any of the following:

Click Here for Preliminary Document Review (PDR) [Basic, Plus, Premium) includes 30 minute recorded CONSULT). Includes title search under PDR Plus and PDR Premium.

Click here for 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. Suggestions for discovery demands are included.
*
CLICK HERE TO ORDER CONSULT (not necessary if you order PDR)
*
CLICK HERE TO ORDER CASE ANALYSIS 
*

FORECLOSURE DEFENSE IS NOT SIMPLE. THERE IS NO GUARANTEE OF A FAVORABLE RESULT. THE COMMENTS ON THIS BLOG AND ELSEWHERE ARE BASED ON THE ABILITY OF A HOMEOWNER TO WIN THE CASE NOT MERELY SETTLE IT. OTHER LAWYERS HAVE STRATEGIES DIRECTED AT SETTLEMENT OR MODIFICATION. THE FORECLOSURE MILLS WILL DO EVERYTHING POSSIBLE TO WEAR YOU DOWN AND UNDERMINE YOUR CONFIDENCE. ALL EVIDENCE SHOWS THAT NO MEANINGFUL SETTLEMENT OCCURS UNTIL THE 11TH HOUR OF LITIGATION.

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

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

Please visit www.lendinglies.com for more information.

Interpleader Might Be Useful in Revealing the Absence of Any Unpaid Loan Account

One of my constant comment contributors recently informed me and others that she was trying a new tack. She writes “My attorneys are making a demand that any refi money be placed with the Court and that the judge decides who he wants to pay.”

This is very close to an Interpleader action which is virtually unknown amongst laypeople and many lawyers. In an interpleader action, a party says to the court I have this asset and there are two conflicting claims to get it from me. In its purest form, the Interpleader says that he doesn’t care who gets the asset. In a more advanced form, the interpleader might say that he does have an interest in making sure that the asset goes to A rather than B.

The point of all this is that a homeowner could turn the tables on companies who are masquerading as “servicers” (basically all companies who claim to be servicers). [NOTE: YOUR SERVICER IS A FINTECH COMPANY NOT THE COMPANY THAT IS CLAIMING TO BE A SERVICER).

The homeowner’s contract is NOT with the company claiming to be a servicer. The homeowner’s contract was with an alleged lender and then the successor to the originally named “lender” or pretender lender. This point is almost always missed by both homeowners and their lawyers. It leads the homeowner into a black hole.

In order for a company to become a successor to the “lender”, the new company must pay value for ownership of the underlying obligation, the legal debt, the note, and the mortgage (note that each of those has its own set of rules). In the world of securitization, no such sale ever occurs.

And that is why I have been declaring for 16 years that with respect to homeowner obligations, there is no securitization. No sale=no securitization. And that means there is no succession. No succession means no creditor even if money exchanged hands for reasons other than the purchase of the underlying obligation. 

So people are trying shortcuts to quickly end the claim for administration, collection, and enforcement of the promise to make installment payments issued by the homeowner. If it was that easy the entire securitization myth would have exploded 20 years ago.

Attempting to put the refi proceeds into escrow rather than pay the “servicer” can ONLY work if you have a funded lender who conditions payment on the absolute assurance that the new lender will be getting first priority position as mortgagee or beneficiary under a deed of trust.

The typical answer is that there is a title insurance policy to protect against any problems. But the new lender replies that it refuses to fund the deal unless it receives both insurable and actual title free from any possibility of litigation over the issue of the validity or priority over the lien. The new lender position is best expressed in a letter of commitment. This is the AMGAR strategy that I have promoted since 2008. It works but only for people who are willing and able to invest money in the strategy.

If it is a situation in which there is a real new loan from an institutional lender, they will never go along with the plan to highlight these conditions because they are all heavily invested in the securitization illusion. While there is the possibility that a quick surprise suit against the escrow agent could theoretically work contemporaneously with the “closing” it is doubtful that this strategy would work in the real world.

That is a strategy that has been tried in a few iterations and failed.

But it is still possible it could work. It is called Interpleader. But in order for it to work, you need a disinterested third party willing to do it. I think that the disinterested party ought to be a receiver for the asset.

  • The homeowner pays the receiver the monthly payments along with instructions that say to pay the creditor if there is one and if there is an unpaid loan account.
  • The receiver asks the current servicer if it is an authorized agent of a creditor (and to please give the name and contact information so the receiver can confirm it) — i.e., someone who owns an unpaid loan account due from the homeowner.
  • The “servicer” demands payment. The receiver says he. she or it cannot pay until the conditions are met: a creditor with ownership of the loan account. There is substantial law going back centuries that nobody is under an obligation to make payments to a party who is not owed the money.
  • The “servicer” serves notice of default.
  • The receiver files an interpleader action that says he/she it is holding money to pay to the creditor, but the original creditor is not in the chain anymore and there is a new party, a self-proclaimed “servicer”, who refuses to provide adequate assurance that it is the authorized agent of a creditor.
  • The interpleader deposits the money into the court registry and exits. It remains a party until the judges’ order is to pay this one or that one.
Then both sides must plead to show how they are entitled to the money. The homeowner says he/she either wants the money back and he/she wants to terminate the receivership because there is no known creditor and there is no unpaid loan account on the books of any person or entity.
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The “servicer” (who is now a party, possibly along with a Bank that is a trustee for an alleged REMIC trust) is stuck with the same script in a different context, where it will most likely fail.
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The plus side of this strategy is that it allows for discovery demands but it shifts the focus from whether the homeowner paid anything to whether there is a creditor who is entitled to collect.
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WARNING TO ALL HOMEOWNERS: WITH THE HUGE SPIKE IN FORECLOSURES AND EVICTIONS HAS COME THE TORRENT OF SCAMS. DO NOT PAY ANY MONEY UPFRONT TO ANYONE OTHER THAN A LAWYER AND DON’T DO THAT UNLESS YOU KNOW THE LAWYER’S PLAN TO HELP YOU. DO NOT EXECUTE ANY DEEDS OR INSTITUTE ANY LEGAL PROCEEDINGS OR ANY STRATEGY THAT PROMISES AN EARLY END TO THE ISSUES. THE END MAY BE SATISFACTORY IF PERFORMED CORRECTLY BUT IT WON’T BE QUICK.
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IF THE PLAN OR STRATEGY COMES FROM SOMEONE WHO IS NOT A LAWYER IT IS PROBABLY EITHER WRONG OR A SCAM.
====================
DID YOU LIKE THIS ARTICLE?
Nobody paid me to write this. I am self-funded, supported only by donations. My mission is to stop foreclosures and other collection efforts against homeowners and consumers without proof of loss. If you want to support this effort please click on this link and donate as much as you feel you can afford.Please Donate to Support Neil Garfield’s Efforts to Stop Foreclosure Fraud.
CLICK TO DONATENeil F Garfield, MBA, JD, 75, is a Florida licensed trial and appellate attorney since 1977. He has received multiple academic and achievement awards in business, accounting and law. He is a former investment banker, securities broker, securities analyst, and financial analyst.
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FREE REVIEW: Don’t wait, Act NOW!

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. You will receive an email response from Mr. Garfield  usually within 24 hours. In  the meanwhile you can order any of the following:

Click Here for Preliminary Document Review (PDR) [Basic, Plus, Premium) includes 30 minute recorded CONSULT). Includes title search under PDR Plus and PDR Premium.

Click here for 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. Suggestions for discovery demands are included.
*
CLICK HERE TO ORDER CONSULT (not necessary if you order PDR)
*
CLICK HERE TO ORDER CASE ANALYSIS 
*

FORECLOSURE DEFENSE IS NOT SIMPLE. THERE IS NO GUARANTEE OF A FAVORABLE RESULT. THE COMMENTS ON THIS BLOG AND ELSEWHERE ARE BASED ON THE ABILITY OF A HOMEOWNER TO WIN THE CASE NOT MERELY SETTLE IT. OTHER LAWYERS HAVE STRATEGIES DIRECTED AT SETTLEMENT OR MODIFICATION. THE FORECLOSURE MILLS WILL DO EVERYTHING POSSIBLE TO WEAR YOU DOWN AND UNDERMINE YOUR CONFIDENCE. ALL EVIDENCE SHOWS THAT NO MEANINGFUL SETTLEMENT OCCURS UNTIL THE 11TH HOUR OF LITIGATION.

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

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

Please visit www.lendinglies.com for more information.

Notices To and From Servicer Might Mean Nothing at All

In homeowner finance, ALL claims start with notices from third parties with whom the homeowner has previously had no communication. My suggestion is that homeowners start challenging those letters, statements, and notices as soon as they arrive. Such challenges make “tracks in the sand” for later use in litigation.

But the real issue arises repeatedly because the condition precedent to foreclosure about which there is no dispute is that first there must be a declaration of default. And in the world of securitization, there is no creditor, loan account, or any loss or ven risk of loss arising from a homeowner failing or refusing to make a scheduled payment.

A declaration of default usually comes from a disinterested third party who does not represent an existing creditor who maintains an unpaid loan account receivable on its accounting ledgers reflecting real-world transactions in which it paid value. The equivalent legal value of that is you sending a notice of default to your neighbor when you figure out he or she did not make a payment to the utility company. The notice was sent but it has no legal effect. it is called a legal nullity.

So the question arises about what happens when you send a QWRT or DIVL to the company that was named as a servicer. the first thing that comes to mind for me, is that merely sending the QWR or DVL might be construed as a tacit admission that the company really is a servicer.

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This logically leads to the presupposition that since it is a servicer it is really performing real servicing duties. And that logically leads to the factual conclusion that it is legally and rightfully acting on behalf of a true creditor. And since a true creditor obviously loses money when a homeowner does not make a scheduled payment, it follows that the default can and should be issued.

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The problem with this analysis is that it leads inexorably to the conclusion that you should not respond to fakers. But since the players are claiming rights of administration, collection, and enforcement, they DO appear to fall under protections for consumers relating to those activities. But that still leaves open the issue of whether the named “servicer” is the only one who should receive the DVL and QWR.

That is the question I answered as follows:

Theoretically notice to the servicer is a notice to all under the regulations. The problem is that the company named as a servicer does not do the servicing. That is one of the subjects that is never discussed.

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The company named as servicer probably does have some apparent agency or other authority to present the named Trustee of the REMIC trust. But since that trustee never has the right, power, justification or excuse to administer any affairs regarding the alleged loan account (which does not exist) giving them notice arguably is a failure to give notice to anyone who is real party interest. But it IS notice to everyone who is engaged in apparent debt collection activity even if there is no debt.

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So sending the QWR to all who are “interested” (in a conspiracy to defraud) is probably a good way to go. The real problem is that the laws do not cover this scenario. A legal question is whether the extensive protections for consumers even apply to a company whose name is being used (with consent) to simply put a face on a scheme in which money is illegally collected without any right, justification or excuse? Anyone receiving the QWR is basically put on notice that they may be part of a future lawsuit.
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The countervailing argument is that some of the proceeds are eventually used to pay off some of the money due to investors (the rest coming from sales of new certificates). But that argument fails because the investors who became “holders” of certificates are merely the payee on an IOU issued by an investment bank in a transaction wherein the investors waive any right, title, or interest to any homeowner payment, debt, note, or mortgage.
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The bottom line for all this is whether there can be any legal collection activity without a creditor, a loan account or any risk of loss. Even the investors get paid the debt from the investment banker regardless of whether or not a homeowner misses a scheduled payment.
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===============
DID YOU LIKE THIS ARTICLE?
Nobody paid me to write this. I am self-funded, supported only by donations. My mission is to stop foreclosures and other collection efforts against homeowners and consumers without proof of loss. If you want to support this effort please click on this link and donate as much as you feel you can afford.

Please Donate to Support Neil Garfield’s Efforts to Stop Foreclosure Fraud.
CLICK TO DONATE

Neil F Garfield, MBA, JD, 75, is a Florida licensed trial and appellate attorney since 1977. He has received multiple academic and achievement awards in business, accounting and law. He is a former investment banker, securities broker, securities analyst, and financial analyst.
*
FREE REVIEW: Don’t wait, Act NOW!

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. You will receive an email response from Mr. Garfield  usually within 24 hours. In  the meanwhile you can order any of the following:

Click Here for Preliminary Document Review (PDR) [Basic, Plus, Premium) includes 30 minute recorded CONSULT). Includes title search under PDR Plus and PDR Premium.

Click here for 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. Suggestions for discovery demands are included.
*
CLICK HERE TO ORDER CONSULT (not necessary if you order PDR)
*
CLICK HERE TO ORDER CASE ANALYSIS 
*

FORECLOSURE DEFENSE IS NOT SIMPLE. THERE IS NO GUARANTEE OF A FAVORABLE RESULT. THE COMMENTS ON THIS BLOG AND ELSEWHERE ARE BASED ON THE ABILITY OF A HOMEOWNER TO WIN THE CASE NOT MERELY SETTLE IT. OTHER LAWYERS HAVE STRATEGIES DIRECTED AT SETTLEMENT OR MODIFICATION. THE FORECLOSURE MILLS WILL DO EVERYTHING POSSIBLE TO WEAR YOU DOWN AND UNDERMINE YOUR CONFIDENCE. ALL EVIDENCE SHOWS THAT NO MEANINGFUL SETTLEMENT OCCURS UNTIL THE 11TH HOUR OF LITIGATION.

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

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

Please visit www.lendinglies.com for more information.

How Evidence Works for and Against the Consumer/Homeowner

(Once again, because of minor medical issues I decline to do the Neil Garfield Show. I offer this instead)
It is easy to get lost in the weeds. Don’t make up your own words or definitions because your definitions have no relevance to your case. Do hold the accusing side to their words and to the legally accepted definitions of those words as contained in statutes and cases.

But above all, start at the beginning — a rookie mistake made by nearly all young litigators and pro se litigants who skip over the gold to pick up a few pieces of copper.  They exclaim “How could I lose, I have the copper!” And all the court wanted was the gold.

This post is inspired by the factual findings of several of my most generous contributors, and a hat tip to summer chic. Just because you hear a word or term don’t think you know what it means or the context in which it is issued. That is what litigation is all about. 

So first I will repeat what Aristotle said. First, define your terms. I personally know what Fiserv did as a payment processor when it served to intercept and process transactions from POS and ATM devices. I know what it did when it effectively acted as Gateway for intercept processors, including itself.

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Payment processing in all of its forms consists of three distinct nodes: receipt of money, data processing (recording the receipt and disbursement of money) and the actual disbursement of money. In that sense, Fiserv has always been a servicer.

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So it is easy to see why the investment banks trusted FiServ to handle those functions rather than anyone else. And they did. After the Tylor Bean débâcle, they would never let a company actually perform servicing functions because that would leave open the door to stealing.
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It was Black Knight who set up the lockbox arrangements (contracts) but FiServ who actually did the grunt work — receiving, accounting, and disbursing $MONEY$. Except that they didn’t really do disbursing.
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Because the act of depositing the money was a disbursement. They would take a $1,000 check from Homeowner Smith and deposit it into a bank account that was owned and controlled by XYZ Capital Finance, Inc. which was either a subsidiary of the investment bank or a conduit for outflow to offshore accounts. The named “servicer” never saw or even expected to receive that money.
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The reason why I am commenting on this is that this is extraordinarily important to the defense narrative for consumers. The ONLY party who may sue is one who has suffered financial injury “proximately” caused by the conduct of the party against whom he has filed suit.
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I have argued for 16 years that the homeowner deserves to win. But people take that as meaningless drivel from a defense lawyer who will always say that his criminal client is innocent. So try this: you can win and why should you not? If you were facing jail would you really so blithely accept the “inevitable”?
  • If the homeowner fails to make a payment that appears on some schedule and Goldman Sachs loses money because they’re betting that he would make the payment, the injury suffered by Goldman Sachs is NOT LEGALLY caused by the failure of the homeowner to make a payment. GS cannot sue the homeowner for that. That bet is the same as betting on a horserace. You can’t sue the owner for losing or throwing the race.
  • If an investor IS getting paid regardless of whether the homeowner makes a payment or not, then they can claim no injury from the “failure” to make a scheduled payment.
    • The investor who purchased a certificate is simply betting that the investment bank that issued the certificate will make the payments or cause payments to be made according to the terms of the contract that is the certificate — not according to any contract with the homeowner. The certificate parties are investor vs investment bank — not investor vs homeowner.
  • If an investor has no legal claim to receive payments from homeowners nor to administer, collect or enforce any alleged loan account the investor has no claim whatsoever against the homeowner — for the simple reason that the investor has chosen to have no relationship whatsoever with the homeowner in order to avoid liability for lending and servicing errors, mistakes or violations of statutes passed by the Federal and State governments — of which there were tens of millions of cases resulting in hundreds of billions in settlements, so far.
  • If an investment bank was counting on receiving a scheduled payment from a homeowner but had no right to receive it, it may not under current law in any U.S. jurisdiction recover money from the homeowner nor force the sale of the homeowner’s property.
  • If the investment bank had no legal right, title or interest to the underlying obligation, debt, note or mortgage (deed of trust) issued by the homeowner, then it had no right to administer, collect or enforce any payment set forth on any schedule — nor grant the authority to do so to someone else.
    • One may not grant rights that do not belong to the grantor. If I promise to give you my jet, you will not get the jet simply because I don’t have a jet. And if you know I don’t have a jet you have no claim for my failure to deliver it.
  • If a company is named as servicer then unless FiServ is doing the work for that “servicer” company (under contract), then the work done by FiServ is the work of Fiserv, and only Fiserv employees and representatives can testify about what was done and what their records contain.
    • Any report issued by them or based upon FiServ data must be established by foundation testimony from the records custodian of FiServ and not some robowitness employed by the company who was named as a servicer but was not performing the basic servicing functions.
    • Any such report and testimony of the “representative of the named “servicer” are irrelevant, lacking in competence, foundation, or materiality.
    • Such testimony is rank hearsay clearly excludable in every court in every U.S. jurisdiction — but only if a timely and proper objection is raised within the context of a coherent defense narrative.
    • This is because the only thing that a robowitness can really say is that “I received this report and my boss says it is a report from my employer who I have been told by someone (I don’t remember who) is a servicer of an unpaid loan account due from the homeowner to the Greatest Bank of All Time, N.A., not on its own behalf but on behalf of the Indecipherable Trust 200x-04 ALRT-A pass-through certificates, not on its own behalf but on behalf of the holders of those certificates, about whom I know nothing.” 
      • “I know nothing about the content of any servicing agreement between my employer and any creditor who has paid value or otherwise has a right, title, or interest in receiving money from the collection of payments, principal, or interest from homeowners. “
    • In truth, the report is entirely printed out from data received exclusively from FiServ data processing servers and storage servers which are owned, operated and maintained by FiServ which provides services (“servicing”) to and for the exclusive benefit of investment bankers who have no legal right to administer, collect or enforce any debt.
    • In truth, when the robowitness says he or she is familiar with the records of his or her employer what they really mean is that they’re familiar with a script and know absolutely nothing about the operations of their employer because their employer does not want them to know anything. (This is how many such witnesses are “blown up” on the witness stand by hundreds of lawyers across the country.)
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So for purposes of this discussion, a payment processor is a company that processes payments — i.e., something that is actually happening and something that they are a direct party to witness the actual occurrence of actual events and recording them. A “servicer” is a company that services payments from the homeowner and accounts for its actions by recording data on its own records regarding said receipt.
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If they have not done that, then they’re not a servicer in the conventional use of the word, even though the statutory definition for purposes of statutory liability to consumers is much broader. That statutory definition (augmented by regulation X) does not mean that they received any payments nor recorded any such receipt.
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Use of that statutory definition as a basis for misleading the court about the role of the company named as servicer and the origin of the information will eventually become, in fairly short order, the subject of a series of actions by state bar associations, the FTC and the CFPB. Insurers of lawyers have already inserted sufficient cover language to deny coverage for intentional misdeeds. Since the company named as “servicer” is not “servicing” any unpaid loan account receivable (which it will be revealed does not exist) they have no right to testify about it, much less the balance or record of payments.
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This is all true and but it is NOT a sign of judicial corruption to point out instances in which these particular facts are either ignored or denied by the person sitting on the bench. Their job as judges is to rule on what is brought in front of them — not what might have been brought nor what should not have been brought if there had only been an objection. The truth is that in most cases I have received I would have ruled the same way as the judge frequently accused of corruption.

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Once the homeowner has effectively admitted that there is an unpaid loan account receivable exists (without any information), admits that the third party company is a servicer (without any information), and admits that the bank named is the trustee of a trust (without any information), and admits that the trust owns an unpaid loan due from that homeowner or even argues about which trust owns the loan, what choice do I have as a judge but to rule that those facts are, for purposes of the case in front of me, the facts of the case?
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Litigation is about offense and defense. The purpose of defense is NOT to let the evidence in or to find ways to get it out. It is not to prove that the lawyers or anyone else are corrupt, evil, or belongs in jail. Once you make that allegation and can’t legally prove it, you will lose all credibility on the main point — defense. And that will cost you the opportunity to make a ton of money on wrongful foreclosure.
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Nobody paid me to write this. I am self-funded, supported only by donations. My mission is to stop foreclosures and other collection efforts against homeowners and consumers without proof of loss. If you want to support this effort please click on this link and donate as much as you feel you can afford.

Please Donate to Support Neil Garfield’s Efforts to Stop Foreclosure Fraud.
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Neil F Garfield, MBA, JD, 75, is a Florida licensed trial and appellate attorney since 1977. He has received multiple academic and achievement awards in business, accounting and law. He is a former investment banker, securities broker, securities analyst, and financial analyst.
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FORECLOSURE DEFENSE IS NOT SIMPLE. THERE IS NO GUARANTEE OF A FAVORABLE RESULT. THE FORECLOSURE MILLS WILL DO EVERYTHING POSSIBLE TO WEAR YOU DOWN AND UNDERMINE YOUR CONFIDENCE. ALL EVIDENCE SHOWS THAT NO MEANINGFUL SETTLEMENT OCCURS UNTIL THE 11TH HOUR OF LITIGATION.

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

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

Please visit www.lendinglies.com for more information.

Why the UCC Matters in Foreclosure Cases

The problem as illustrated by many scholarly articles and articles on this blog is that courts are given to treat plaintiffs and claimants as holders in due course without anyone asking them to do so.

The first thing you need to know about Foreclosure is that it is only about money. If you have the money and you pay it, there is no claim — or at least no claim against you. You might have a claim against a “debt collector” seeking to enforce a nonexistent debt for a nonexistent claimant.

The second thing to remember is that, by definition, foreclosure is a lawsuit or claim based upon enforcement of the mortgage or deed of trust. The promissory note is usually introduced as evidence of the existence of the obligation and the duty to make scheduled payments. But enforcement of the note alone can only result in a monetary judgment that could be discharged in bankruptcy.

According to the law in every U.S. jurisdiction (adopting 9-203 UCC) the mortgage or deed of trust can only be foreclosed to satisfy an unpaid existing obligation owed by the homeowner to the named claimant. Lawyers and judges have adopted various strategies to allow foreclosures when they are only based upon the enforcement rights of a holder of a promissory note and often without regard to whether the claimant is a legal “holder.”

In fact, most courts treat the claimant as though it had established its exalted status of a holder in due course — without anyone asserting that status. And the common failure to object to such treatment is the principal reason why homeowners fail to successfully defend foreclosure actions based upon a nonexistent loan account and often even a nonexistent claimant.

In 2007, the Fordham Law review published an article entitled “Will the real holder in due course please stand up?” I republished that article later on this blog. The answer to the question, in cases where foreclosure was claimed as a legal remedy by some alleged REMIC trust structure, was that there was no holder in due course.

You’ll be surprised to learn that there have been many cases where a credible offer to pay the claim has been declined if it required confirmation from the named Plaintiff or claimant.

This is standard industry practice in circumstances where a prior “loan” is being been financed or paid off through sale or other means. Many states have laws specifically requiring that the payoff information includes such information and assurances — in order to prevent a payoff to a party with no claim. It is basic common sense and basic law to assure continuous clear title to the property free from claims of clouded or unmarketable title.

In each case where I have been involved, opposing counsel basically took the position that they didn’t want the money they wanted the foreclosure. And in each case, the judge was surprised by that position.

But most homeowners are not in a position to make a credible offer to pay off the entire amount as demanded. Those who can make that offer are utilizing the AMGAR strategy that I developed 16 years ago.

Those who cannot make that offer must litigate to make the same point — that in the final analysis (trial) the attorney for the named claimant will be unable to proffer credible evidence of the existence, ownership, and authority to administer, collect or enforce any debt.

Instead, they will proffer fabricated documents and argue that the judge should apply legal presumptions to conclude that an obligation exists, the named claimant owns it and the homeowner is in breach of a duty to make scheduled payments.

In reverse logic, the foreclosure lawyer simply takes an uncontested fact (usually) and bootstraps it into a case that the judge thinks is real. And what nearly everyone forgets is that the absence of a scheduled payment, even after making such payments, is not evidence of default nor a license to declare a default unless the payment was actually legally required to be paid to the party seeking to collect it.

If you skip a car payment I have no business, right or justification in declaring that to be a default. But current law is hazy on the subject of what happens if I do declare the default and then bring a claim based upon my declaration of default and my claim that I represent the loan company.

In a 2016 article just brought to my attention that was published by Franklin Pierce School of Law of New Hampshire University, a lawyer in Miami published an article about the nonconforming use of the UCC to support nonconforming claims. At the time of publication, he was associated with a Florida law firm representing lenders. 14 U.N.H. L. REV. 267 (2016), available at http://scholars.unh.edu/unh_lr/vol14/iss2/2. 

See

The Non-Uniform Commercial Code: The Creeping, Problematic Application of Article 9 to Determine Outcomes in Foreclosure Cases

Morgan L. Weinstein

Senior Attorney at Van Ness Law Firm, PLC, Miami, FL

The Non-Uniform Commercial Code_ The Creeping Problematic Applic

Weinstein makes a clear presentation of fact and law with respect to the application of UCC Article 3 (notes) and Article 9 (Security instruments, mortgages deeds of trust etc.).

Keep in mind here that a holder in due course (HDC) is ONLY one who has paid value for the ownership of the note in good faith and without knowledge of the maker’s defenses. In plain language, the HDC can enforce even though there are potentially many defenses that would be available to the maker of the note if the claimant was merely an alleged “holder.”

In every instance where a REMIC trust structure is alleged, there is only an allegation or assertion that the “trustee” or trust is a holder, not a holder in due course. Earlier (2001-2005) assertions of HDC status were removed from the script.

Also, keep in mind that a legal holder of a note has two attributes: POSSESSION and RIGHT TO ENFORCE. The latter is overlooked. The only party with the power to grant the right to enforce is ultimately the creditor who owns the underlying obligation.

So the claimant attempting to enforce a note may file a complaint (and win a judgment if there is no contest) based upon the technical allegation that it is a “holder”. But it still loses at trial or summary judgment if it fails to respond to discovery requests asking for the source of its authority to enforce (given that they are not a holder in due course).

The problem as illustrated by many scholarly articles and articles on this blog is that courts are given to treat plaintiffs and claimants as holders in due course without anyone asking them to do so. Although I have seen many transcripts in which the lawyer Argues that his “client” is a holder in due course without any reference to payment of value in exchange for ownership of the debt, note or mortgage.

Such “misstatements” are protected under the doctrine of litigation immunity unless you can prove that the lawyer speaking absolutely had knowledge that he or she was lying when the statement was made.

He begins with a discussion of negotiability:

Negotiability presents the possibility of a transferee taking a position that is better than the transferor.The Uniform Commercial Code defines a number of different possible parties to a negotiation. There are three general positions that a transferee can occupy in a transfer under a negotiable instrument: the transferee can occupy a better position, a same position, or a worse position, with each position being relative to the transferor. [e.s.]

Typically, lenders in foreclosure actions occupy the same or worse position, given their frequent status as a “holder,”rather than the better position of a “holder in due course.”

Under Article 3, a “holder in due course” occupies a privileged position.Specifically, a holder in due course is insulated from numerous defenses to the right to enforce an instrument. A holder in due course is susceptible only to the “real defenses” of a borrower or other interested party.The real defenses include claims of infancy, essential fraud, insolvency, duress, incapacity, or illegality.Though there is an assumption of good faith in Article 3 dealings,a holder in due course is still protected from many defenses to the right to enforce.

 

Weinstein makes the following point, though:

it is generally understood that a note-holder may foreclose a mortgage, and a plaintiff need only establish entitlement to enforce the note in order to demonstrate its ability to foreclose the incidental mortgage; such a plaintiff need not demonstrate ownership of the note.

Although he correctly states the current status of legal consensus, this statement overlooks the issue presented above — that the right to enforce emanates solely and ultimately from the creditor owning the underlying obligation. Otherwise, the whole concept is meaningless.

The prima facie case of the claimant need not prove that line of authority and grants but the defense can undermine and eliminate the prima facie case if it can be shown that the claimant has not received such authorization or that the claimant cannot produce evidence of such authorization in discovery and even under court order in the discovery process.

Thus whether one relies on Article 3 or Article 9 the UCC result is the same: there is no remedy of foreclosure for a party who has not paid value for the underlying obligation or at the very least can show the foreclosure sale will be used to pay the creditor owning the underlying obligation thus reducing the alleged loan balance.

This goes to the root of foreclosure. Nobody in the courts would agree that anyone with knowledge of the original transaction with a homeowner should be allowed to enforce a contract to which he she or it was not a party. And if the proceeds of a foreclosure sale are not intended to decrease the loan account receivable of a creditor who paid value, then there can and should be no foreclosure or any other claim for that matter.

As far as I can determine, contrary to the belief of most lawyers and judges, there is no single instance where the forced sale of residential property in which the claimant was an alleged REMIC trustee, for an alleged REMIC trust resulted in payment to anyone who was owed the money. In fact, there is no single instance in which the alleged REMIC trustee or the alleged REMIC trust even received one single penny at any time.

My conclusion: all alleged REMIC trust structures are basically trade names (fictitious names) for the investment bank. None of them ever see a penny of payments received from homeowners or their homes.

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DID YOU LIKE THIS ARTICLE?
Nobody paid me to write this. I am self-funded, supported only by donations. My mission is to stop foreclosures and other collection efforts against homeowners and consumers without proof of loss. If you want to support this effort please click on this link and donate as much as you feel you can afford.

Please Donate to Support Neil Garfield’s Efforts to Stop Foreclosure Fraud.
CLICK TO DONATE

Neil F Garfield, MBA, JD, 75, is a Florida licensed trial and appellate attorney since 1977. He has received multiple academic and achievement awards in business, accounting and law. He is a former investment banker, securities broker, securities analyst, and financial analyst.
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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. You will receive an email response from Mr. Garfield  usually within 24 hours. In  the meanwhile you can order any of the following:

Click Here for Preliminary Document Review (PDR) [Basic, Plus, Premium) includes 30 minute recorded CONSULT). Includes title search under PDR Plus and PDR Premium.

Click here for 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. Suggestions for discovery demands are included.
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CLICK HERE TO ORDER CONSULT (not necessary if you order PDR)
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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.

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

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

Please visit www.lendinglies.com for more information.

 

How Those Refi’s Were Turned Into Gold by the Investment Banks

Most people cannot conceive of why they should have been paid more at the purported “Closing” of their transaction than what they received or what they think was paid on their behalf.

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But the bottom line is that in most cases, whether the transaction involved a resale of the home or “refinancing,” only a fraction of the money you thought was transacted was actually present. It’s not just that they should have been paid more — it is that the homeowner did not receive the money he or she promised to pay back. This fact is part of a pattern of active concealment directed by investment bankers that starts with the initial transaction and continues right up to and including the foreclosure sale and eviction.

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In short, you issued notes and mortgages for far more than any money paid to or on your behalf. You didn’t owe the money but they got you to promise to pay it anyway. This is a joke and a bonus for investment bankers — but it is a loss for the homeowner.

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Instead, each new transaction left the previous one intact and started a new securitization infrastructure. So a home that was subject to an initial securitization claim could end up with as many as 8 securitization infrastructures —- all with sales to investors for far more than anything paid to or on behalf of the homeowner. And each securitization infrastructure led to sales of around $12 in securities for $1 of apparent money that was asserted to have been transacted with the homeowner.

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Do the math. A single transaction falsely labeled as a mortgage loan can produce up to $96 for each dollar originally paid to or on behalf of the homeowner. Don’t you think you should have been told about that? It turns out that the question is fully answered in the Federal Truth in Lending Act.

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And the answer is yes, you should have been told that because the purpose of the Act was to prevent virtual “creditors” from being substituted for actual creditors who were responsible for compliance with lending laws, rules and regulations. Event table-funded loans were declared against public policy — but this is much worse. It takes an essential component out of the transaction falsely labeled as a loan.”

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If you believe the transaction consisted at least partly of “paying off” an old lien, then you DO want the outgoing wire transfer or other means of payment. If the prior and new lien were funded by direction from the same investment bank it would be unusual for that portion have to have been sent to the old “lender” because it is long out of the picture. But it is still common because the investment banks don’t want to alert the closing agent that the deal was a scam. So they direct a wire transfer to a certain depository account bearing the name “Ocwen Servicing” or some such thing that is actually controlled by the common underwriting investment bank.

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So if you ever get those wire transfer receipts, you want to trace down the ownership of the depository account. For example, Goldman Sachs (or any other investment bank) can open an account named “Ocwen”. It is still a Goldman Sachs account and they can go out and buy groceries with whatever is in the account.
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But to the outside world — the homeowner and the closing agent — they would swear that Ocwen was involved. And they would be 100% wrong. Ocwen for its part has no record of the transaction because it was not their money and they take no legal action against the use of their name because they are part of the game.
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So the bottom line is that there was no payoff of the old lien and no cancellation of the note or underlying obligation asserted by fake “representatives” of a nonexistent creditor owning a nonexistent loan account receivable. If there was an existing loan account receivable that would make one of those thinly capitalized nonentities the owner of the right, title, and interest to payments, balance, and interest — something the investment banks would never permit.

THREADING THE NEEDLE: IT IS WHAT THEY DON’T SAY THAT REVEALS THE TRUTH — AND YOU CAN USE IT!

So talk about splitting hairs — here is a statement from a company that is claimed by third parties to be the servicer of a “loan.” Note that the parties making the claim do NOT swear that PennyMac is servicing claims to administer, collect and enforce for them, but rather for some unknown creditor or some other entity that does NOT make such a claim. Think about that. Here is the quote:

PennyMac, who, as the loan servicer, is authorized to accept payments for your loan.

And here is the analysis of that statement:

  • PennyMac IS authorized, although not by anyone who is legally entitled to act as grantor in such authorization.

  • And it is authorized to accept payments — but it doesn’t. And nobody who does “accept” payments is working for PennyMac. PennyMac is not a FINTECH, Lockbox, or processing center for payments made by homeowners nor the recipient or processing centers for the money proceeds from foreclosure sales or sales of REO property. 

  • And notice that it says “accept” payments rather than “receive” payments. I can be authorized to accept your payment but unless I actually receive it my authorization, even if valid, is irrelevant and lacks foundation.

    • And so if you make a payment and direct it to me at an address that is a mail processing center that sends the payments for processing at a lockbox or FINTECH company, the accounting for those receipts can only be performed by people who in their ordinary course of business actually collect and account for receipts.

      • The “Payment History” proffered in the name of such a “servicer” for the payment is also irrelevant and lacks foundation. They’re merely producing a report generated by someone else.

      • In addition, the Payment History proffered in court is not an acceptable or legally admissible substitute for the ledger showing the loan account receivable (see below).

      • This Payment History from such a servicer is neither acceptable evidence or admissible evidence of payments nor of the balance of the loan account receivable owed to a specific creditor who paid value for the underlying obligation. 

    • The Payment History could only be admitted into evidence if there was live testimony from someone with personal knowledge of the ordinary course of business of the company that entered the data and reproduced the report — keeping in mind that this does not include the company named or claimed to be the “servicer.”

    • But the failure to make such objections and challenges invariably results in admission of the report into evidence, which in turn, establishes the existence of the loan account receivable, the right of the servicer to account for the payment history, establish the default etc. 

  • PennyMac IS a “loan servicer” only because the regulations were meant to include anyone who participates in the administration, collection of enforcement of claims arising from alleged loan accounts. But if the loan accounts don’t exist, then they are not a loan servicer under any construction of the term. 

  • And notice they don’t actually say what would ordinarily be said by either the loan officer as a lender or the officer in charge of administration, collection or enforcement of a loan at a servicer who receives, processes accounts for and disburses funds to creditors, i.e., 

    • “You have a loan account receivable arising from your transaction on the __ day of ___, 20__. XYZ has acquired all rights, title and interest to the underlying obligation. the legal debt, note and recorded mortgage.

    • By law, you owe XYZ that money.

    • We have been appointed to serve the interests of XYZ and empowered by XYZ to administer, collect and enforce the right to collect payments of interest and principal as provided by your promissory note and the recorded mortgage.

    • A copy of that authorization, signed by an authorized officer of XYZ is attached or has already been provided to you.

    • Attached is a copy of the XYZ ledger on which your loan account appears showing the balance, payments, and disbursements from inception to the present.”

    • YOU WILL HEVER, EVER SEE SUCH A LETTER OR STATEMENT NOW — BUT THIS WORDING IS TAKEN FROM HUNDREDS OF EXEMPLARS DATING BACK TO THE EARLY 1990s AND EARLIER. 

    • Why don’t they say that — especially when they used to say it and that wording was literally invented by the financial industry? The answer is very simple., they don’t say because they can’t say it without exposing themselves to criminal and civil liability.
    • But they can imply it or have their lawyers argue false factual and legal premises in court with immunity. What is the fix for this gigantic scam? It would be the government doing its job which after over 20 years is a lost cause.
    • That means that homeowners need to invest their time, money, and energy into defeating these false foreclosure claims. And that generally means that groups of homeowners must come up with a way to finance the challenge for each individual homeowner. 
DID YOU LIKE THIS ARTICLE?

Nobody paid me to write this. I am self-funded, supported only by donations. My mission is to stop foreclosures and other collection efforts against homeowners and consumers without proof of loss. If you want to support this effort please click on this link and donate as much as you feel you can afford.
NOTE: It is unlikely that anyone without legal training will understand the legal significance of the points raised in this article. The obvious answer is to show it to your lawyer.
Please Donate to Support Neil Garfield’s Efforts to Stop Foreclosure Fraud.

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Neil F Garfield, MBA, JD, 74, is a Florida licensed trial and appellate attorney since 1977. He has received multiple academic and achievement awards in business, accounting and law. He is a former investment banker, securities broker, securities analyst, and financial analyst.
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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. You will receive an email response from Mr. Garfield  usually within 24 hours. In  the meanwhile you can order any of the following:
CLICK HERE TO 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. Suggestions for discovery demands are included.
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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.
  • 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.
  • If you wish to retain me as a legal consultant please write to me at neilfgarfield@hotmail.com.
Please visit www.lendinglies.com for more information.

Why I Think Homeowners Are Entitled to Receive a Second Payment From Investment Banks

All homeowners who think they have a mortgage loan have received one payment at a “closing” — or a payment allegedly made on their behalf. For reasons explained elsewhere on this blog, such payments on their behalf are mostly fictional where the underlying investment bank is the same “director” of funds.
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The significance is that a second tree springs up in which the scheme described below is duplicated — with little or no cost to the investment banks. Each time the myth of “refinancing” is employed a new securitization tree springs up with dozens if not hundreds of branches.
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The purpose of this article is to explain my view that homeowners are entitled to share in the revenues and profits generated by securitization schemes — and why I think that now is the time to demand it in litigation.
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This claim has been filed early in the course of the mortgage meltdown. In one case the Federal judge held onto it for 14 months before finally ruling that the complaint should be dismissed. It led to my deposition being taken for 6 straight days, 9am-5PM as an expert witness. I was having heart problems at that time and they were clearly trying to wear me down. I did not relent. I did get some stents shortly afterward. 16 banks and 16 law firms each took their turn beating me up.
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I think we have reached a different era in which these claims should be pressed again. We know a lot more than we did in 2007-2008. Subsequent events proved the basic points, to wit: that the paper trail did not match up to reality, which is why the paper trail consists entirely of false, fabricated, forged, backdated, and robosigned documents.
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1. Homeowners enter into transactions that appear to be loans to purchase or refinance property at market value. Even if the transactions were actual loans, the determination of market value was legally the responsibility of the lender under TILA. Market value never increased, but prices were grossly inflated because Wall Street flooded the market with money that appeared to be cheap.
  • By lowering the apparent monthly cost, they made the actual price appear to be irrelevant — which is part of the essential element of deception.
  • The common homeowner relied upon the appraisals that were required by investment banks to be inflated in order to complete the loan transaction or the illusion of a loan transaction.
  • The only way securities brokerage firms (investment banks) could sell more and more unregulated securities is if more and more deals were signed by unsuspecting homeowners.
  • Thus the transaction enabled the homeowner to purchase or refinance a home under the mistaken belief that the home had a market value in excess of the principal amount of the “loan.”
  • All such “loans” were bad, from a market perspective.
  • It meant that the homeowners took an immediate loss because market prices were stratospherically higher than market values (i.e., indicating a high known probability that prices would fall precipitously).
  • It also meant that if there was a lender, it also was taking an immediate loss because it could not report the value of the loan at face value since the loan principal was far in excess of the value of the collateral.
  • In addition, all such loans were bad because the impact of this phenomenon was to create an immediate incentive to default on the scheduled “loan” payments apparently due from homeowners.
  • The obvious conclusion is that for everyone except the homeowner, this was not a loan transaction.
2. The transaction was not a loan. If it was a loan, nobody would have been party to it. There was no lending intent. there was no profit incentive to engage in lending under the circumstances described above. Like the “new economy” of the 1990s, the entire housing market consisted of the myth of a new force that would permanently push housing prices ever higher.
  • So what homeowners are missing out on is claiming a share of a pie that almost everyone else got paid.
  • The paper (document) deal basically has the homeowner execute a document allowing for a virtual creditor without a loan account balance in order to create, issue, and sell unregulated securities, regardless of what the homeowner intended and regardless of what the homeowner believed.
  • Because of the undisclosed structure of the deal, the “seller” was able to recover all money paid to the homeowner contemporaneously with the “closing” of the paper transaction. This is true even though nobody made credit entries to a nonexistent loan account.
  • Neither the loan account nor any of its components (underlying obligation, legal debt, note or mortgage) was ever sold in a financial transaction in the real world.
  • This accounts for the ability of the investment banks to conduct multiple virtual sales of hedge instruments or interests in the performance data for the virtual loan.
  • This enabled the investment bank to convert the usual 15% underwriting fee to at least a 1200% profit plus whatever they could get from homeowners in monthly payments and foreclosures.
  • With exception of the homeowner, every person and every business entity that was recruited to participate in the selling scheme to homeowners got paid extra exorbitant fees for their participation.
  • Those were fees that would never have been paid and could never have been paid but for the absurd profits from the so-called securitization scheme.
  • The homeowner provided a service that is undeniable: the homeowner accepted the concept of a virtual creditor even though no such allowance existed under any laws, rules or regulations thus enabling these fees and “trading profits” to be generated without any offsetting entry to any nonexistent loan account.
  • If homeowners had been given the opportunity to negotiate terms for their acceptance of a transaction in which there was no lender, no compliance with TILA, and no stake by a lender in the success of the transaction, homeowners would have had the opportunity to bargain for better terms and competition in the industry would have resulted in better terms (a share of the pie) being offered.
  • We already know that incentives were offered to pay closing costs, the first few months of the “loan” etc. Homeowners occupied a special place in the securitization scheme.
  • Without the cooperation of homeowners, there was no securitization scheme. Other players could have been replaced but not homeowners.
  • So their share of the pie would have been substantial if they had the opportunity (i.e., if there was disclosure) to bargain and better terms would have been offered if there was disclosure and transparency as required by law.
  • In my opinion, there are two benchmarks that should be used to determine how much the homeowner should have been paid: (1) the amount the homeowner received at closing, making such payment a fee and (2) 15% of the total revenue generated from the scheme in e exchange for the issuance of the paper documents (note and mortgage).
    • These two benchmarks overlap. But what it basically comes down to is that each homeowner should have received the benefit of the real bargain: around 15% of the total revenue from that deal which means that in a typical $200,000 loan, with at least $2.4 million generated in fees and trading profits, the homeowner should have received at least $360,000.
    • The $200,000 “loan” might survive upon proper reformation reflecting all the elements of the real deal, but there is still an extra $160,000 that was due to the homeowner at the time of signing.
    • Right now that $360,000 is being shared with dozens of people and companies involved in the securitization scheme and dozens of companies involved in virtual foreclosure schemes — i.e., foreclosures in which lawyers acting under litigation immunity argue or imply that a loan account exists and that they represent the party who owns it.
    • The only reason why homeowners are excluded from that is that it would reduce the size of bonuses received by the existing players, most of whom are doing nothing other than lending their name to a virtual scheme.
    • I said in 2007  that homeowners did not really owe any money to anyone from these paper transactions and that in fact, it was the reverse — homeowners are the ones who are owed money by the investment banks, plus interest from the date of closing.

I think the failure of homeowners to aggressively pursue this line of practical and legal reasoning is largely responsible for the continued drain (anchor) on the U.S. economy, which is still suffering from the unfortunate decisions of multiple administrations to save and increase the profits of investment banks at the cost to and detriment of common homeowners.

Wilmington Entities in Foreclosure

The “Wilmington” name shows up with what appears to be increasing frequency in foreclosures. The bottom line, in my opinion, is that whenever the “Wilmington” name appears in foreclosure cases, it is an attempt to launder title such that the lawyers who prosecute the foreclosure process can reasonably imply that he or she is representing a creditor who is one or more of the following — none of which are true in any respect, in my opinion, and no evidence has ever been produced to support these premises:
  1. it is a holder in due course of a promissory note,
  2. It has paid value for the underlying obligation due from a homeowner to the “client” that the foreclosure lawyer asserts is making the claim
  3. it is a successor lender
  4. it is part of a trust, implying that there are beneficiaries or investors on whose behalf the client/claimant appears
  5. it maintains a trust account in which a loan officer maintains a loan account receivable payable by the homeowner to the trust or trustee
  6. it has a relationship in which some company is a servicer — i.e.e, a company claiming to process payments, accounting entries, and disbursements to and from homeowners and investors or beneficiaries.
  7. the remedy (forced sale in foreclosure) will produce money proceeds that will be paid to the Wilmington entity whose trust officer will credit (reduce) the amount supposedly due from the homeowner — as reflected on the trust account containing the loan account receivable relating to the homeowner.
In reviewing hundreds of “Wilmington” cases I have not seen a single instance in which any of the above premises are true. All of the cases rely upon the invocation and court acceptance of the application of legal presumptions under the evidence code arising from the apparent facial validity of fabricated, false, forged, back-dated, and robosigned documentation. Not all “Wilmington” names are part of false securitization schemes. Wilmington IS the name of a city. Careful analysis is required.
This is an incomplete history of known Wilmington names that have been successfully used/abused in invoking the foreclosure process:
  • Wilmington Financial” is a name that does not appear to be legal business entity registered or organized in any jurisdiction — but our investigation is not complete. The use of this name as a “fictitious name” — i.e., the name under which a legal business does business is common. It is listed as a financial consultant on the internet.
  • “Wilmington Trust” is or at least was a registered legal business entity whose common shares were traded on the New York Stock Exchange (WL).
    • Wilmington Trust is one of the top 10 largest American institutions by fiduciary assets. Wilmington Trust was a provider of international corporate and institutional services, investment management, and private banking. It was acquired in 2011 by M&T Bank.
    • M&T Bank Corporation is an American bank holding company headquartered in Buffalo, New York. It operates 780 branches in New York, New Jersey, Pennsylvania, Maryland, Delaware, Virginia, West Virginia, Washington, D.C., and Connecticut. It is not known whether the Wilmington Trust entity has survived the acquisition in any way indicating that there are operations.
    • In 2018 and 2019 several executives of Wilmington trust were convicted and sentenced to prison for issuing misleading reports about the status and ownership of various loan accounts — both residential and commercial. As with Wilmington Financial, the use of the name continues but more as a corporate veil for asserting claims of rights to administer, collect and enforce loan accounts.
    • There is no evidence and no assertion by any officer of of those entities that any loans, loan accounts or obligations were ever acquired by Wilmington Trust nor were any acquired by M&T Bank.
  • “Wilmington Savings Fund Society” is a Federal Savings Bank that primarily operates under the name of “Christiana Trust” which is now listed as a subsidiary of Wilmington Savings Fund Society but was previously advanced by lawyers pursuing foreclosure as a legal entity. Christiana Trust is neither a trust nor a subsidiary as far as we have been able to determine. It is a veil for pursuing claims without liability for pursuing false claims.
  • WSFS Bank” WSFS Financial Corporation is a financial services company. Its primary subsidiary, WSFS Bank, a federal savings bank, is the largest and longest-standing locally managed bank and trust company headquartered in Delaware and the Greater Delaware Valley. Christiana Trust Company of DE is a Delaware limited purpose trust company that offers Delaware Advantage trust services, including directed trusts, asset protection trusts and dynasty trusts.
  • Cypress Capital Management is a registered investment advisor with a primary market segment of high net worth individuals offering a balanced investment style focused on current income and preservation of capital.
  • Powdermill Financial Solutions is for ultra-high net worth families, entrepreneurs and corporate executives.
  • WSFS Institutional Services, a division of WSFS Bank, offers owner and indenture trustee services for asset-backed securities, indenture trustee for corporate debt issuances, administrative and collateral agent for the leveraged loan market, as well as custody, escrow, verification agent and independent director services.
    • WSFS Wealth Investments provides insurance and brokerage products primarily to WSFS Bank’s retail banking clients.
    • West Capital Management offers fee-only and fully-customized investment, tax, and estate planning strategies to high-net-worth individuals and institutions.
    • WSFS Mortgage, a division of WSFS Bank, is listed as a mortgage lender providing a wide range of mortgage programs in the Delaware Valley and nationally. Arrow Land Transfer is a related title insurance agent serving communities in Delaware, Pennsylvania and New Jersey.
  • WSFS Financial Corporation” WILMINGTON, Del., Nov. 02, 2017 (GLOBE NEWSWIRE) — WSFS Financial Corporation (NASDAQ:WSFS), today announced the formation of a new trust company, Christiana Trust Company of Delaware. The new trust company will be a wholly-owned subsidiary of WSFS Financial Corporation and will supplement the existing WSFS Wealth businesses, including; WSFS Wealth InvestmentsCypress Capital ManagementWest Capital Management, Powdermill Financial Solutions and Christiana Trust, which is a division of WSFS Bank.
  • Wilmington Finance” is listed as a mortgage company. The Company underwrites and sells mortgages. SECTOR. Financials. INDUSTRY. Financial Services. SUB-INDUSTRY. Incorporated in 1994.
  • Wilmington Financial Group, Inc.” is listed as a financial consultant that may have some connection to one or more of the above entities
Your case needs research, analysis, and strategic analysis.
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Neil F Garfield, MBA, JD, 74, is a Florida licensed trial and appellate attorney since 1977. He has received multiple academic and achievement awards in business, accounting and law. He is a former investment banker, securities broker, securities analyst, and financial analyst.
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FORECLOSURE DEFENSE IS NOT SIMPLE. THERE IS NO GUARANTEE OF A FAVORABLE RESULT. THE 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.
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Destroying, Hiding or Fabricating Evidence: Doctrines Regarding Spoliation of Evidence

The latest issue of the Florida Bar journal contains several interesting articles. One of them is entitled “Spoliation of Evidence and Non-party witnesses.” The author is Gary M Glassman, who is the attorney for Daytona Beach.

The major points of the article that I think are relevant to Foreclosure Defense litigation are that (A) spoliation has a very broad meaning and (B) the refusal to produce documents that are relevant to the case at Bar raises an inference in favor of the homeowner, and might even give rise to a cause of action for damages.

Foreclosure lawyers have long relied on the fact that they could stonewall request for information and then use fabricated documentation containing false information with impunity. But a proper document request during an open discovery period can itself be the subject of an affirmative defense or even a claim for damage to the homeowner’s ability to defend.

This enhances the relevance of having previously sent a qualified written request and a debt validation letter, together with a complaint to the CFPB and the state attorney general.

In judicial states, I think that it is possible and even probable that the court would sustain an affirmative defense consisting of both fabrication and spoliation. Combined with an action for damages under the FDCPA (potentially as a counterclaim) the homeowner could claim the inference that the missing documents would show that the exhibits to the complaint are false and fabricated. There is some pretty clear law in both Florida and California supporting this proposition.

In non-judicial states where the homeowner must initiate judicial action, one of the claim should be spoliation, along with fabrication.

The other point is the duty to preserve evidence. It is clear that a party that is used may not destroy or hide evidence and must produce such evidence when requested to do so in formal discovery.

One of the tactics employed by the banks is to hide information about the identity and last known address of relevant third parties like the “employees” or “independent contractors” who supposedly executed the documents upon which the entire foreclosure case rests.

Third parties have no absolute duty to maintain documents in their possession unless they know that the documents in their possession are relevant to pending legal claims and defenses. So the answer is that you want to give them notice and the best way to give them notice is with a subpoena duces tecum. This could include such companies as Black Knight and CoreLogic — not just individuals.

Asking for such information and not getting an answer is evidence of spoliation. Finding the “signor” with a private investigator is often very productive. In many cases, they deny ever signing anything. And they’re probably telling the truth.

The failure to provide such information is part of the doctrines utilized in claims o spoliation and the inability of the responding party to provide a satisfactory explanation for failing to produce the records raises, in and of itself, an inference that those records would show that the discovery requests establish a negative inference as to authenticity and validity of those documents — but, in my opinion, only if the discovery request is accompanied by requests for admissions that carefully track the request to produce which carefully tracks the interrogatories.

The bottom line is that spoliation is a recognized foundation for asserting that the opposing party has either acted or refused to act in a way that interferes with the ability of the homeowner to prove affirmative defenses or claims which resulted in substantial prejudice to the homeowner. This has not been previously applied to Foreclosure litigation. But I can think of no other area of litigation in which fabrication and spoliation are more relevant.

PRACTICE HINT: There is a significant difference — and  often overlooked —between the “entity” named as Plaintiff (or beneficiary in nonjudicial states) and the entity named or claimed to be a “servicer.”

In the context of this article, one should not assume that a mere request to produce is sufficient. The request to produce only has legal effect against, for example, U.S. Bank, N.A. if it is named as Plaintiff trustee in a judicial foreclosure or beneficiary trustee in a nonjudicial case. First, the request to U.S. Bank should be directed solely at records kept by U.S. Bank in its role of administering the affairs of a trust account in which there is a loan account receivable due from the homeowner. Second, the “servicer” should receive a subpoena duces tecum asking for the same records. All too often the “records” are “produced” by the “servicer” which is a response from a third party and not the claimant as plaintiff or beneficiary. 

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Neil F Garfield, MBA, JD, 74, is a Florida licensed trial and appellate attorney since 1977. He has received multiple academic and achievement awards in business, accounting and law. He is a former investment banker, securities broker, securities analyst, and financial analyst.
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CLICK HERE TO 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. Suggestions for discovery demands are included.
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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.
  • 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.
  • If you wish to retain me as a legal consultant please write to me at neilfgarfield@hotmail.com.
Please visit www.lendinglies.com for more information.

 

Stop Using the Labels: Homeowners Lose Foreclosure Cases When They Refer to the “Servicer”

You need to challenge the status of the company claiming to be a servicer by finding out what functions they really perform.

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I know I have contributed to the problem, but I think it’s time to stop using the labels that are promoted by the banks.

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Companies that are claimed to be the “servicer”, by all accounts, do not perform any functions normally attributed to that label. This it is against the interests of the homeowner or the lawyer representing the homeowner to accept the use of the term unless there is foundation testimony as to the actual functions performed by the company rather than the presumptions arising from the label “servicer.”

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The actual receipt and distribution of funds, and the bookkeeping and accounting therefor, is performed by third-party vendors (FINTECH) who have absolutely no contractual or other duties owed to the company named as the “servicer.” That makes the “report” presented in court as a “payment history” both fictional and pure hearsay that cannot be admitted into evidence — unless the homeowner waives that objection. 

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The FINTECH companies also have absolutely no contractual or other duty owed to the named claimant. And the named claimant (Plaintiff or beneficiary) does NOT receive any payment from either the “servicer” or the FINTECH companies — including the money proceeds of foreclosure sales. That is entirely fiction. AND that is why every attempt to obtain corroboration through QWR, DVL or legal discovery is stonewalled. There is no corroboration.

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Each foreclosure produces money proceeds that go into the pocket of an investment bank as either general revenue or “return of capital” against the fictitious double-entry bookkeeping account. In plain language, the money is NEVER used to reduce a loan account because there is no loan account. That is why you can’t get the loan account even in discovery and even if you sue under the FDCPA. But that fact alone gives the homeowner the upper hand.

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You need not understand or believe this presentation. But if you want to win your case, you need to assume that this is true and act accordingly.

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By accepting the label of “servicer” you are also tacitly and unintentionally accepting the “payment history” as an exception to the hearsay rule and an acceptable substitution for the testimony and proffer of the records of the known and named claimant. Once you have done that, you have lost. You need to challenge the status of the company claiming to be a servicer by finding out what functions they really perform.
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But the payment history is nothing of the sort. It is a report on a report prepared by an undisclosed FINTECH company from data that has been “massaged” as instructed by an investment bank. It is NOT a simple report of the condition of the loan account.
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Want proof? Show me one “payment history” that contains the beginning entry starting the loan account and showing the current balance as owned by the named claimant. It doesn’t exist. Show me one payment history that shows disbursement of funds received from anyone to any creditors. It doesn’t exist.
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So if there is no presentation of disbursements to creditors, how would the court ever accept the idea that the company received any money? How could the court ever assume that the company could account for the receipt of money it never actually received?
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The answer is obvious even to people with accounting or legal knowledge. You would have no record of receiving money that was never received. And that is because nobody would enter any data in any record of any company saying that they personally received the payment as an employee of the company claiming to be the servicer. Making such an entry would be a lie and presenting it in court would be perjury.
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The other part is the assumption that the company that is claimed to be the “servicer” is somehow working for the named claimant, or is the agent for the named claimant.
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This is exactly the trap that the banks have set. This is sleight of hand maneuvering.
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By distracting the homeowner and the attorney for the homeowner to the question of the authority of the servicer, the argument shifts away from whether the “servicer” is performing any of the normal duties attributed to the servicer and away from the issue of whether the existence of a trustee or trust is even relevant since the trust does not own the underlying obligation as required by UCC 9-203.
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I write this primarily for the benefit of attorneys. Only an attorney will recognize the importance of these issues.
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Please Donate to Support Neil Garfield’s Efforts to Stop Foreclosure Fraud.

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Neil F Garfield, MBA, JD, 74, is a Florida licensed trial and appellate attorney since 1977. He has received multiple academic and achievement awards in business, accounting and law. He is a former investment banker, securities broker, securities analyst, and financial analyst.
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CLICK HERE TO 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. Suggestions for discovery demands are included.
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CLICK HERE TO ORDER TERA – not necessary if you order PDR PREMIUM.
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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.
  • 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.
  • If you wish to retain me as a legal consultant please write to me at neilfgarfield@hotmail.com.
Please visit www.lendinglies.com for more information.

Why You Need to Perform Investigation of Real Facts in the Real World

I state with great confidence that among those homeowners who perform and achieve a slam dunk win over the foreclosure lawyers, the great majority enjoy that victory because they did the investigation and hired a lawyer who knew what to do with the information (as opposed to slinging it at the judge and expecting the judge to make sense of it).

Question received from one of the readers of this blog: “I’m trying to understand how a house in NJ.  Is alleged to be notarized in Florida and recorded by a company in Idaho (whose Name of course, is not even in business any longer).”

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SImple answer — none of that happened. I don’t know your case but in all probability, Black Knight fabricated a false document on instructions from a central source controlled by an investment bank. An investigation will reveal whether that statement is applicable in your case. I am willing to bet $100 that it IS true.

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CoreLogic and/or other vendors (probably affiliates of Black Knight) affixed the signature, the notary signature, the notary stamp, and where necessary for local recording rules the signatures of witnesses electronically using direct electronic signature or mechanical pen.

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The name of the company or person was selected by an algorithm based on instructions from the same source. It does not matter that the company is not in business because inserting ANY name makes the document look like it is facially valid. But the document can be challenged as NOT being facially valid because ti is a matter of public record that the corporation’s charter expired, was dissolved or that the company went bankrupt.

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The content of the instrument is false since it most probably states that it is an assignment or an allonge. The rule adopted by all states, and supported by centuries of precedent in statutes and case law, is that a transfer of the mortgage or deed of trust is ineffective (i.e. a “legal nullity”) unless the underlying obligation is also transferred from the same grantor to the same grantee. The fact that someone or some company is named as a transferee does not make them the status of a legal grantee.

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Some people, like Chic, have gone to the trouble of investigating the musical chair scenario that emerges from the use of false or dead-end addresses for what appears to be major businesses, enterprises or even banks that are Federally or state-chartered.
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They have discovered and taken pictures of the locations in which the companies were asserted to exist — although often not directly — by implication from return addresses. Nobody ever says that the letter is coming from the company on the letterhead or that there is any warranty or even assertion of title in such documents.
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It is all implied so that the perpetrators can later claim plausible deniability, to wit: we didn’t do it. That was done by some outsource vendor of Joe’s Documents, LLC and we knew nothing about it. Joe has a recurring source of residual income because he has agreed to let his company name and address to be used even though the address is a loading docket licensed to a private investigator.
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The moral of the story for homeowners is that unless you are in this for entertainment purposes only, you need to act on your suspicions and hire private investigators like Bill Paatalo to actually locate the signors and notaries, track down the supposed addresses, and confirm by fact — not opinion — that the document could not have executed by the party named as grantor and that the grantee was not a legal entity.
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This isn’t divorce court where lawyers makeup facts and hurl accusations. This is a real court where the judge is bound by the evidence. Your opinion is not evidence.
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But I state with great confidence that among those homeowners who perform and achieve a slam dunk win over the foreclosure lawyers, the great majority enjoy that victory because they did the investigation and hired a lawyer who knew what to do with the information (as opposed to slinging it at the judge and expecting the judge to make sense of it).
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See below for an example of allegations that can be made after an effective investigation. Most people have neither time nor the skills necessary to perform such investigations. That is why you need a licensed private investigator to come up with real facts revealing the fake story used as part of a false national narrative with false labels on documents, persons, and business entities that may or may not even exist as registered business entities in any jurisdiction. Yes this is boring work but it is what usually makes the difference between winning and losing.
***
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Nobody paid me to write this. I am self-funded, supported only by donations. My mission is to stop foreclosures and other collection efforts against homeowners and consumers without proof of loss. If you want to support this effort please click on this link and donate as much as you feel you can afford.
Please Donate to Support Neil Garfield’s Efforts to Stop Foreclosure Fraud.

CLICK TO DONATE

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Neil F Garfield, MBA, JD, 74, is a Florida licensed trial and appellate attorney since 1977. He has received multiple academic and achievement awards in business, accounting and law. He is a former investment banker, securities broker, securities analyst, and financial analyst.
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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 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. Suggestions for discovery demands are included.
*
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.
  • 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.
  • If you wish to retain me as a legal consultant please write to me at neilfgarfield@hotmail.com.
Please visit www.lendinglies.com for more information.
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Here are a few examples of investigation that yielded some interesting results:
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The purported “Ocwen Loan Servicing” address traces back to an industrial concrete-block windowless warehouse building with truck docks, of 14,233 sq. ft., internally a self-storage unit building operated by “Security Connections, Inc.” and crafted, as are all other “Ocwen” locations, as blind alleys intended to obfuscate and confuse, leading to dead-ends.

  1. The true picture of 240 Technology Drive, Idaho Falls, showing an industrial warehouse, is incorporated herein:

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The falsified and fraudulent papers crafted as purported “Assignments” and filed on the Stamford Land Records are and were designed by the actors for the purpose of obfuscation and slander of title, and contain inherent false statements such as the claim that Deutsche Bank maintains offices at “1661 Worthington Road, Suite 100, West Palm Beach, Florida,” when if act it does not, and never has.

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William Erbey subsequently re-incorporated Ocwen Mortgage Servicing, Inc., his latest vehicle for mortgage fraud and abuse,  in the British Virgin Islands, claiming a registration address of Waterfront Center, Suite A, 72 Kronprindsens Gade, PO Box 305304, St. Thomas VGB.  That address comes back to the “Trident Trust Company,” a Virgin Islands “brass plate” corporation accommodation address provider, wherein a brass plate screwed onto the door is sufficient to establish corporate existence.  The actual address used by Ocwen in its representations to the public and the courts sources back to a tourist souvenir knick-knack stall located at the foot of the cruise ship dock in the British Virgin Islands.  The souvenir stall is currently boarded up.

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The “588 Assignment” represents that Mortgage Electronic had a place of business at 3300 SW 34th Avenue, Suite 101, Ocala, Florida.  In reality, Mortgage Electronic did not have any business address at that location, and the representation was a falsity.

  1. The signature undertaking on the “588 Assignment” represents that it was signed by one “Paige Helen” as Vice President of “Mortgage Electronic as Nominee for NetBank.”  Despite this representation, the notarial undertaking declares that Paige Helen was in reality an employee of “IndyMac Bank, FSB.”

Tonight! Q&A on Prelitigation Strategies — QWR, DVL and Complaints to CFPB and State AG 6PM EST 3PM PST

Thursdays LIVE! Click into the Neil Garfield Show

Tonight’s Show Hosted by Neil Garfield, Esq.

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

As a follow-up to our FREE presentation CLE webinar on Prelitigation Strategies and Practices, we offer an open mike Q&A on tonight’s show. Please think about your questions in advance and refrain from long monologues about your case.

As an introduction let me state the obvious premise of this work: If as a consumer you have executed a promissory note and mortgage (or deed of trust) and you think that there is a loan account receivable somewhere that is owned and maintained by some lender or creditor, you are most likely incorrect.

Most homeowners make the mistake of thinking that the QWR and DVL are simply “form letters.” If that were the case, we would provide you with the template and you could send it out yourself. And back in the old days (pre-1995) that would be entirely appropriate for settling any disputes regarding the proper allocation of payments or any other issues.

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The statutory foundation for the creation of the QWR and the DVL was designed to resolve potential disputes between the debtor and the creditor.
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Today, the situation is different. We already know that there is no valid claim against the homeowner and that there is no valid claimant. We also already know that any company that is claimed to be a “servicer” neither has any legal authority to act as such (from anyone) nor does it perform any functions that are normally attributed to a company claiming to be a servicer.
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So while the legislative intent for providing consumer remedies in RESPA and the FDCPA was designed to resolve disputes, the procedures contained within those statutes are now used by homeowners to start a dispute — because, without a history of disputing the claims made to administer, collect or enforce any alleged obligation due from the homeowner, it is much harder to mount an effective defense.
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So the idea behind the sending of a QWR and DVL is to identify specific issues that you already know will not be answered — which gives you the right to file a lawsuit for violation of RESPA and FDCPA. In order to do that effectively, the homeowner needs to distill the case analysis down to the points that are relevant to those statutes. Although this is not exactly the same as preparing a lawsuit, the drafting of the QWR and DVL requires research, investigation, and very careful wording.
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Some homeowners have been able to do it themselves, but most are unable to do so because they lack the experience, knowledge, and resources to present direct questions concerning the existence of the loan account receivable, the status of the account, the ownership, and the authority to administer, collect or enforce any monetary obligations arising from the alleged existence of the account.
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Most of this is confusing to homeowners because they have never been to law school, received any practical training in trial practice nor have most of them ever been involved in any litigation. When most homeowners send the QWR or the DVL and they fail to get a direct answer or proper response that answers the specific questions asked in those letters, they consider the entire effort a failure and a waste of time — when in fact they just had a win. They have established that the parties seeking to make claims about administration, collection, or enforcement of the alleged obligation are unwilling or unable to provide any corroboration of such claims.
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IMPORTANT PRACTICE NOTE: When the QWR or DVL is used as a general discovery device or is used to pontificate about disputed views, it is generally dismissed by both the recipient and any court reviewing it as an unqualified written request under RESPA and not a demand for debt validation under the FDCPA. This is where the homeowners get themselves into trouble. The general attitude is that the “you know what I mean” argument is sufficient. It isn’t.
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“Black Knight”: Banks Are Peddling A False National Narrative of Declining Foreclosures

I’m busy today so I can’t publish my usual long analytical article. But one thing that is constantly staring at me is the fact that the national press and news releases are in basic conflict with local media. And the fact that local media is going out of business isn’t helping.

Black Knight is a company whose size and reputation is entirely based upon preparation, presentation, and use of false documents and information that were forged, robosigned, and back-dated. Those were the days when it was called Lenders Processing Services in which DOCX was used to produce the false documents. Lorraine Browne, President of DOCX took one for the team and was the only person in the entire 2008 crash who went to jail. Neither DOCX nor other divisions of Lender Processing Systems were ever retired.

In fact, Black Knight is now expanded in some sense because it operates as the front for lockbox and electronic payments made in the name of companies claiming to be servicers. Concealed from homeowners is the fact that those payments are never actually received by the company claiming to be a servicer nor disbursed by that company to anyone claiming to be a creditor.

It is all a ruse. There is no creditor because there is no loan account receivable (LAR). There is no loan account receivable because the investment banks are selling what would have been the LAR multiple times without crediting any LAR — hence, no claim, no creditor. But because all of that is confusing, consumers continue to pay on nonexistent accounts that do not in fact exist and were never intended to be maintained. They pay and they are victims of “enforcement” because of a false national narrative about securitization.

Here is the simple truth: there is no securitization of debt. And all claims regarding eh existence of the LAR. and authority to enforce, administer to collect money for the LAR are false. That is not an opinion. It is a fact under current law that nobody can legally collect on a debt that does not exist — even if the named debtor believes the false claim that the LAR exists.

The “Payment History” is almost always accepted as a substitute for a copy of the actual loan account receivable —which until the last 25 years has ALWAYS been a basic staple of anyone who wanted to get a foreclosure judgment or sale — even if it was uncontested. If you didn’t produce that, along with an affidavit or testimony from an officer of the actual creditor or lender, you could not get the judgment or the sale. I personally witnessed myself and many other lawyers going to court with part of the foreclosure file missing and being told that the motion for summary judgment was denied — without any appearance or opposition from the homeowner. (I didn’t always represent the consumer).

But is the consortium of financial technology companies (FINTECH) including Black Knight that produces a report that is labeled as a “Payment History” because it is the FINTECH companies working for the investment banks that process that data. The report is pure hearsay that is not admissible in court but because homeowners and lawyers fail to test the report, they fail to reveal the fact that the “servicer” never was party to any transaction that it would then enter as data on its own bank accounts, accounting ledgers and books of record. None of that happened.

So the report is admitted as an exception to the hearsay rule thus allowing companies like Black Knight to carry water for the investment banks who want to collect money from payments of homeowners or on the sale of their homes so they can pay out bonuses without any attempt to account for the proceeds as a reduction in any loan account.

So it is in that position that Black Knight became a central repository of data about any transactions that are falsely defined in the national narrative as mortgage loans. That data is at best questionable and obviously false when tested in litigation. And because Black Knight functions almost exclusively at the behest and is subject to the influence and control of investment banks who are book-running securitization schemes, it reports what they tell Black Knight to report.

So you get articles like this:

https://nationalmortgageprofessional.com/news/black-knight-foreclosure-activity-nears-pre-pandemic-low

But lawyers like myself have our phones ringing off the hook now that foreclosures are spiking. And local media outlets that are still in existence, are accurately reporting the sharp spikes in new foreclosures, new evictions, and declarations of default. Both political parties are idiots, believing that foreclosure is no longer an issue. Tell that to the people who are losing their homes to fake creditors who are merely seeking profit. It’s another case of politicians being completely out of touch with realities of events on the ground — because they are listening to sources of information that come ONLY from Wall Street.

To its credit, the Biden Administration is attempting through the new legislation to preserve local media which tends to report facts and actual events rather than the current trend in national media to posit possibilities and then spend all their time analyzing what those possibilities might mean if they ever happened. Most investigative journalism is dead, which is why things have gone so wrong in this country.

Fact check: current events are not talking heads in boxes on TV. They’re real things happening to real people. That is “news.” The rest is pure speculation for purposes of producing revenues from the entertainment value of that speculation. It is now the national pastime to accept such speculation as news. It isn’t.

DID YOU LIKE THIS ARTICLE?

Nobody paid me to write this. I am self-funded, supported only by donations. My mission is to stop foreclosures and other collection efforts against homeowners and consumers without proof of loss. If you want to support this effort please click on this link and donate as much as you feel you can afford.
Please Donate to Support Neil Garfield’s Efforts to Stop Foreclosure Fraud.

CLICK TO DONATE

Click

Neil F Garfield, MBA, JD, 74, is a Florida licensed trial and appellate attorney since 1977. He has received multiple academic and achievement awards in business, accounting and law. He is a former investment banker, securities broker, securities analyst, and financial analyst.
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FREE REVIEW: Don’t wait, Act NOW!

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 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. Suggestions for discovery demands are included.
*
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.
  • 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.
  • If you wish to retain me as a legal consultant please write to me at neilfgarfield@hotmail.com.
Please visit www.lendinglies.com for more information.

 

How Could This Not Be a Loan?

if the investment bank paid the homeowner as an incentive payment rather than as a loan, then there is no debt any more than salary or wages can later be called a loan. The fact that the consumer/homeowner thought or even wished it were otherwise makes no diffeerence. If I pay you money and you think it is a loan but I paid you for services you rendered, the substance of the transction is “fee for services” — not a loan — and there is no legal or ethical or moral obligation to pay it back. 

I think the one idea that sticks in the throat of nearly everyone is the idea that no money was loaned. That idea seems impossible and to many skeptics, it sounds like a snake-oil salesman trying to peddle what people want to hear. People know that they did really buy their home, and the majority of these transactions are refinancing, which means that the old “lender” got paid off, right?

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First of all, let’s agree on at least one thing. Virtually all installment payment agreements are now subject to claims of “securitization.” This means that behind every transaction is an investment bank that is arranging payments, only where necessary, and who is receiving the proceeds of consumer payments plus all of the revenue and profits from the sale and training of unregulated securities.
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If there is one thing missing from most articles analyzing consumer debt, it is the failure to recognize that a handful of investment banks are the center of all of those transactions and they all have reciprocal agreements. Those agreements are mostly in writing but difficult to obtain, and sometimes tacit. You don’t need to look any further than any pooling and servicing agreement to see the world’s largest banks all participating in the same venture. In prior years, this fact alone would’ve been sufficient for antitrust action.

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So here is my effort at explaining it. There are several categories of transactions that occur with homeowners.
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  1.  The homeowner is buying a new home from a developer or contractor.
  2.  The homeowner is buying a home from the existing homeowner.
  3.  The homeowner is buying a home from a party or business entity that asserts ownership after foreclosure on the previous homeowner.
  4. The homeowner is refinancing the new home they purchased from a developer or contractor.
  5. The homeowner is refinancing a home they bought from a prior homeowner.
  6. The homeowner is refinancing a home they bought from a foreclosure buyer.
  7. The homeowner refinances by entering into a forbearance agreement.
  8. The homeowner refinances by entering into a modification agreement.
  9.  Securitization of data and attributes of homeowner’s promise to make scheduled payments — no relevant transaction because there was no sale of the underlying obligation, legal debt, note or mortgage (or deed of trust). Since law requires that sale for enforcement by successors, the foreclosure players fake the documents.
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Let’s define our terms.
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“Homeowner” means in this case someone who is looking to buy a home or who is looking to change their transaction.
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“Refinance” means that the homeowner is a party to some transaction and/or documentation that changes the terms of the homeowner’s prior promise to make scheduled payments.
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“Money source” means the investment bank that (a) borrowed money from a third party bank like Credit Suisse, (b) used the borrowed funds to make payments to or on behalf of the homeowner. (It pays back the loan to its lender (and co-underwriter of certificates) through sales of certificates to investors promising scheduled payments, without maturity, collateral, or a guarantee of payment.)
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1. PURCHASE OF NEW HOME FROM DEVELOPER: generally speaking, this is the only transaction that is in substance but it appears to be in form. Money is actually paid to the developer.
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  • The money trail for this transaction looks something like this: LENDER—>MONEY SOURCE/INVESTMENT BANK—>SUBSIDIARY OR CONTROLLED AFFILIATE OF MONEY SOURCE—>CLOSING AGENT—>DEVELOPER.
  • The paper trail (i.e. contracts) for this transaction looks something like this: MONEY SOURCE/INVESTMENT BANK—>AGGREGATOR (like Countrywide Home Loans)—>(a) Assignment and Assumption Agreement with Originators (like Quicken Loans) and (b) Indemnification Agreement with title insurers—>Mortgage Broker—>Mortgage salesman—>Homeowner execution of promise to pay and collateral for making scheduled payments to Originators.
  • Bottom Line: The homeowner is getting money, courtesy of an investment bank that is NOT intending to make a loan or be governed by any lending laws.
    • The homeowner is making a promise to pay the originator who did not lend any money or make any payments to or on behalf of the homeowner.
    • The only party identified as a lender is the originator who did not make a loan.
    • The only party that arranged for payment disclaims any role of being a lender.
    • The payment made on the homeowner’s behalf was an incentive payment designed to procure the signature of the homeowner on a note and mortgage (or deed of trust).
      • Legally since there was no lending intent by either the named “lender” or the Money Source, there is either no contract at all or no loan, since there was no meeting of the minds.
      • If the transaction is not rescinded the deal needs to be reformed with a court determining what incentive payment the homeowner should have received from the scheme to issue, sell and trade unregulated securities.
      • But if the homeowner tacitly or expressly asserts or agrees or admits it was a loan, then for all purposes in court, it will be treated as a loan not subject to reformation.
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2. PURCHASE OF NEW HOME FROM PRIOR HOMEOWNER: generally speaking most of these transactions do not result in the payment of money to any prior lender. But the excess due to the seller is paid in the same way that money is paid where the homeowner purchases a home from a developer.
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  • Most of such transactions are steered to originators and aggregators who represent the money source (investment bank) who was involved in the financial transaction with the prior homeowner.
  • Because the proceeds of the “new financing” or “purchase money mortgage” would be paid to the same investment bank, no money exchanges hands with respect to the “pay off” of the prior note and mortgage.
  • The confusing point for most lawyers and homeowners is that there is nothing illegal about a bank holding a prior mortgage lien. There is nothing illegal about the same bank doing business with the next owner. And there is nothing illegal about the bank not issuing a check to itself when the owners change.
    • But that is not what is happening. “The bank” does not exist. The money source (investment bank) is not carrying the homeowner’s promise to pay scheduled payments as an asset and therefore is not “the bank.”
    • For legal purposes, the test is simply whether or not the investment bank has suffered a loss as a result of the refusal or failure of the homeowner to make a scheduled payment.
    • Or, phrased differently, the question from the beginning is whether or not the investment bank has the source of money ever excepted any risk of loss arising from the value of a loan account receivable.
    • The answer to both questions is in the negative. In dozens of cases across the country, lawyers have been asked to identify the creditor and have admitted that they cannot do so.
    • The only logical conclusion is that the transaction was never intended to be a loan (with the exception of the homeowner who did intend to get a loan, but did not receive it).
    • The investment banks wanted the homeowner to believe they were getting a loan instead of an incentive payment to execute a promise to make scheduled payments. They did not want the homeowner to know that they were receiving an incentive payment. Disclosure of that fact is an absolute requirement under the law. If they had disclosed the true nature of the transaction, they would have been subject to bargaining and competition.
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3. PURCHASE OF NEW HOME FROM FORECLOSURE BUYER: generally speaking, relative to any current financing arrangement, no money exchanges hands on these deals because and substance, the foreclosure buyer generally is receiving some sort of protection or indemnification from a title company that has been to issue insurance on a transaction that cannot pass the test of marketability or clear title — mostly because of the above factors. The anecdotal evidence on thousands of cases reviewed by me strongly indicates that nearly every foreclosure buyer is in substance a placeholder or nominee for the investment bank. By flipping the paper title, the foreclosure buyer receives a “profit” that is in substance a fee for legitimizing the foreclosure. That profit or fee is funded by the investment bank.
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4. REFINANCING: generally speaking, all transactions that carry the label of “refinancing” are false transactions. Because securitization does not involve the purchase and sale of any underlying obligation, legal debt, note, or mortgage, each such transaction represents a new opportunity to create a new securitization infrastructure using the same transaction. Investment banks use every means of their disposal to encourage “refinancing” since it is the source of most of their new sales of certificates. The only money paid out is the excess, after fees, over the amount previously declared as “principal.” But this “principal” is not carried on the accounting ledger of any company or any person as an asset, nor is there any reserve for bad debt (simply because there is no risk of loss).
  • Forbearance is a form of “refinancing” because it accomplishes a number of things for the investment bank. First, obtain a signature from the homeowner that ratified or admits that the previous paperwork and financial transactions were all valid. Second, it essentially removes the placeholder originator from the paper trail. Third, it installs a new placeholder name and obtains consent from the homeowner. Fourth, it establishes a company claimed to be the servicer as the legitimate recipient of funds or proceeds from homeowner payments or the sale or foreclosure of the collateral (i.e., the home).
  • Modification is the same as forbearance: It introduces new parties under coercion. Homeowners sign these documents with total strangers mostly out of sheer panic. What they’re doing is waiving rights and creating tracks in the sand that are opposite to their financial interest and well-being.
Given all of that, many people ask me why I have consented or approved of a homeowner entering into a new agreement with players who are conducting an illegal scheme. The answer is simple and the investment bankers know the answer: they have the money to make a homeowner’s life miserable and they are not subjected to vigorous enforcement by regulators and law enforcement.
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The entire burden of resisting this massive scheme of “Financial weapons of mass destruction” Falls on each homeowner, one at a time. It takes considerable time, money, and resources to resist.
So when the opportunity comes to settle the matter on favorable terms that reduce the payment, interest rate, and principal, and the homeowner lacks the will or the resources to resist, the only choice left is to settle with the perpetrators who put them in a bad position and who are cheating each homeowner out of their rightful share of the securitizations scheme.
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DID YOU LIKE THIS ARTICLE?

Nobody paid me to write this. I am self-funded, supported only by donations. My mission is to stop foreclosures and other collection efforts against homeowners and consumers without proof of loss. If you want to support this effort please click on this link and donate as much as you feel you can afford.
Please Donate to Support Neil Garfield’s Efforts to Stop Foreclosure Fraud.

CLICK TO DONATE

Click

Neil F Garfield, MBA, JD, 74, is a Florida licensed trial and appellate attorney since 1977. He has received multiple academic and achievement awards in business, accounting and law. He is a former investment banker, securities broker, securities analyst, and financial analyst.
*

FREE REVIEW: Don’t wait, Act NOW!

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 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. Suggestions for discovery demands are included.
*
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.
  • 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.
  • If you wish to retain me as a legal consultant please write to me at neilfgarfield@hotmail.com.
Please visit www.lendinglies.com for more information.

Here is How Wall Street Smoke and Mirrors Works

The idea that some company bearing the label of “servicer” is performing financial functions and accounting on behalf of an investor, a trust, a trustee is completely false from end to end. Such companies do nothing and were never intended to do anything except act as a buffer, in name only, to prevent liability attaching to investment banks who had entered the lending marketplace without any intent to enter the business of lending money for profit. But when the homeowner admits that such labels and narratives are true, the law of the case becomes the false narrative and labels. 

As a matter of policy, prudence, and required risk management, none of the tier 1 companies are permitted to actually perform any financial service or accounting. They do not receive or disburse funds. Therefore they do not originate any data input regarding the receipt or disbursement of money.

First of all, you have to remember that the primary goal of investment banks is to hide the existence and function of one or more investment banks including but not limited to the “book runner.”. All of the entities that perform any financials service or accounting are entities that are contractually bound to intermediaries for the investment banks. (see Tier 2 below).

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All of the entities whose names are used as smokescreens (I.e., placeholders or buffers) are not contractually bound to anyone and are the intended targets to be thrown under the bus when there is an unavoidable accusation of fabricated documents using false information used solely for the purpose of squeezing money or property out of homeowners. (see 50 state settlement for example). (see Tier 1 below).

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But none of the companies performing financial services or accounting has any contractual relationship with the homeowner or the company that has been claimed to be the “servicer.” So the first erroneous assumption is that these functions, even if prepared by third-party vendors, are performed at the behest of the companies that are claimed to be “servicers.” Such companies are in charge of nothing and perform no functions.

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Other than a few people on Wall Street, it simply has not occurred to most people that these functions are performed contractually and solely for the benefit of investment banks on Wall Street — who are never named in litigation by either side even though everything that has occurred has been under the sole discretion and instructions of the investment bank. And the investment bank contrary to popular belief in the false national narrative, are working only for themselves — not investors, trusts, or trustees. Their holy grail has been achieved — the sale of securities without ever having to give up the proceeds to the named issuer. But it is patently illegal and probably criminal.

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The idea that some company bearing the label of “servicer” is performing financial functions and accounting on behalf of an investor, a trust, a trustee is completely false from end to end. Such companies do nothing and were never intended to do anything except act as a buffer, in name only, to prevent liability attaching to investment banks who had entered the lending marketplace without any intent to enter the business of lending money for profit. But when the homeowner admits that such labels and narratives are true, the law of the case becomes the false narrative and labels.

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From the perspective of the investment banks, the money paid out under the label of “loans” was simply a cost of doing business — the business bang the sale of securities. The investment banks had no interest, no risk of loss or any other stake in the outcome of any transaction that was falsely labeled as a loan transaction.

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The banks covered up their activities by increasing apparent complexity in a fairly simple transaction — i.e., one in which someone would debit their cash or other asset account and credit the loan account receivable of a borrower. Such accounting never took place in most instances because none of the parties involved in the falsely labeled “origination” was anything other than a placeholder name through which money could be delivered to a closing agent for disbursement to or on behalf of the homeowner or consumer.
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The investment banks have used the placeholder name function at many levels each of which appears to have facial validity but lacks any connection to transactions in the real world. have spread out the functions.
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There are two categories. The first category (Tier 1) is the one that you see. This is the one that reveals the name of a company that is claimed to have some sort of representative authority. In the real world, it has no such authority and it performs no function. The second category (Tier 2) consists of companies that actually perform functions, but whose existence is concealed from the homeowner and from the Court. As well as almost all of the securitization infrastructures, tier one should be tier 2.
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As a matter of policy, prudence, and required risk management, none of the tier 1 companies are permitted to actually perform any financial service or accounting. They do not receive or disburse funds. Therefore they do not originate any data input regarding the receipt or disbursement of money.
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The tier 2 companies that actually perform the services are contractually bound to the intermediaries for the investment banks. The tier 1 companies who allow their names to be used on the letterhead of correspondence and notices (and payment history reports) have no contractual relationship with the investment banks who are avoiding vicarious liability for the mini intended and unintended violations of lending and servicing laws.
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Companies like CoreLogic, CoreLogic tax, Black Knight, FiServ, etc. are tier 2 businesses whose only allegiance, contractually and equitably, is to the investment banks. They are not controlled in any way by any tier 1 companies (including but not limited to companies claim to be a “servicer”). But they are controlled by the investment banks, who direct every action performed by every tier 2 company including law firms.
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Tier 1 companies are merely names acting as placeholders for the investment banks who distance themselves from the business of collecting and communicating with homeowners and other consumers who consider themselves to be borrowers, even if they are no longer borrowers because their loan account receivable has been retired through the receipt of money by the originators —- all of them. Yes, it is like organized crime but in all honesty, so is almost every capitalist enterprise. The structure though is not what creates the crime, it is the intent and effect that makes it illegal either in violation of civil or criminal laws.
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The purpose of all tier 1 companies is to create a mirage. The resulting illusion is filled in by individual presumptions that are not based on fact but rather based on apparent facial validity derived from fabricated documents containing false information — i.e., reporting or memorializing transactions that never occurred.
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Real transactions are concealed and underreported even to regulatory agencies. Such transactions are never disclosed to consumers and homeowners. In this world of illusions, apparent fascial validity has been Weaponized to create the erroneous presumption that a trust account exists, under the supervision of a trust officer, for a brand-name bank.
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The further presumption is that within that trust account is a loan Account receivable due from a particular homeowner. But in reality, there is no trust account, there is no trust officer, and there is no loan account receivable.
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Because of the complexity required to conceal the illegality of the securitization scheme, no information is offered to any homeowner or regulator that would alert them to the fact that fictitious labels are being attached to nonexistent accounts. And most homeowners and regulators lack the resources to investigate the actual money trail.
*
So they rely upon the paper trail instead and that is the residence of moral hazard. You can say anything on paper, and it tends to be believed even if it would be met with skepticism if spoken aloud. The investment banks completely understand this dynamic and they have weaponized it to the point where they have established a national narrative with false labels resulting in the collection of illicit profits damaging homeowners and all taxpayers supporting federal, state, and local government.
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DID YOU LIKE THIS ARTICLE?

Nobody paid me to write this. I am self-funded, supported only by donations. My mission is to stop foreclosures and other collection efforts against homeowners and consumers without proof of loss. If you want to support this effort please click on this link and donate as much as you feel you can afford.
Please Donate to Support Neil Garfield’s Efforts to Stop Foreclosure Fraud.

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Neil F Garfield, MBA, JD, 74, is a Florida licensed trial and appellate attorney since 1977. He has received multiple academic and achievement awards in business, accounting and law. He is a former investment banker, securities broker, securities analyst, and financial analyst.
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CLICK HERE TO 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. Suggestions for discovery demands are included.
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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.
  • 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.
  • If you wish to retain me as a legal consultant please write to me at neilfgarfield@hotmail.com.
Please visit www.lendinglies.com for more information.

How Likely Is It That a Homeowner Will Win a Foreclosure Case?

The answer to this question depends upon the homeowner — not the judge.
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If the homeowner rigorously, aggressively and persistently seeks enforcement of the rules of civil procedure, the rules of discovery, the rules of evidence and enforcement of court orders, the chances of quite good that the homeowner role reach a very favorable result.
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If the homeowner attempts to make a claim or state and affirmative defense that requires proof of malfeasance by the opposition (or anyone else), probability of failure is extremely high.
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The general consensus has accepted the proposition set forth in the national narrative promulgated by investment banks. Therefore nearly everyone — including the homeowner and the attorney for the homeowner at times — has accepted the label of “loan” as being the equivalent of an existing loan account receivable which obviously is enforceable at law and in equity (foreclosure of the mortgage).
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Having adopted the narrative and fictitious Terminology of Wall Street, everyone has also therefore accepted the labels of “servicer,” “trust,” “trustee,” etc. This in turn has resulted in the acceptance of the production of a “payment history” report in lieu of producing a copy of the loan account receivable. The question of whether or not the lawyers are representing a client who owns a loan account receivable that is due from you is avoided.
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The above summary is the backdrop for all litigation involving Foreclosure in both judicial and non-judicial states. It is so widely accepted by nearly everyone involved, and so often admitted (tacitly or directly) that judges usually regard defenses and claims from homeowners as being technical nuisances instead of a direct attempt at stopping fraud. That is their initial impression and there is nothing that can change that initial impression.
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But after their initial impression, the litigation begins and the judge is constrained to follow the rules of court.
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All of the cases that I have won outright or settled on terms that people might think are ridiculously beneficial to the homeowner has involved a very skeptical judge who change their mind during the course of litigation. I will also say that as a general rule, the older and more experienced judges will tend to be even more biased at the beginning of the case but will strictly apply the rules of court during litigation.
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The key to winning or losing is in the rules of procedure, the rules of discovery, and the rules of evidence. The defense strategy that tends to work most of the time is one in which the lawyer representing the homeowner continually attacks the ability of the foreclosure lawyer to produce any corroborating evidence for the conclusions that are alleged by the foreclosure complaint or presumed from the filing of apparently facially valid documents to support a non-judicial foreclosure.
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As it turns out, an aggressive and persistent strategy based on demonstrating the unwillingness or inability of opposing counsel to comply with the rules of procedure, rules of discovery, the rules of evidence and court will usually successfully reframe the case from the initial erroneous first impression of “bank versus deadbeat homeowner” to “judge versus recalcitrant foreclosure attorney.” When that happens, and it usually does, the judge always wins and the result is favorable to the homeowner.
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The way that lawyers and pro se litigants have undermined the strategy, is by attempting to go further than simply defeating the action against them. They attempt to prove fraud or other malfeasance, despite their inability to produce any evidence that would prove the required legal elements of such claims. In doing so, they shift the burden of proof from the foreclosure attorney to themselves. And they lift the burden of proof on their own claims from simply more likely than not to clear and convincing.
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Since we already know that nobody from the “Dark Side” is going to give you any information that will prove or corroborate anything you want to say, it is a fool’s errand to allege a claim or affirmative defense and that you will never be able to prove. My experience is that these cases can be defeated most of the time if the homeowner sticks with the goal of simply defeating the claim. But as soon as they step out of that lane, they are headed for failure.

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And of course, in order to pursue a successful strategy, you at least need to pretend that you believe that there is no loan account receivable and therefore nothing to enforce. And if you’ve gotten to the point where I am, you will be completely confident that that is true. I have reviewed over 10,000 cases. There has not been one instance in which a loan account receivable was ever produced.
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The substitution of a payment history report generated from third-party vendors has never been a legal substitute for producing the loan account receivable, and an acknowledgment or attestation from an officer of the named claimant that the loan account receivable belongs to (is owned by) that named claimant. In all the cases that I have reviewed no such acknowledgment or attestation has ever been made. All of those functions are produced under the name of a company that is claimed to be a “servicer” but which does nothing in connection with the receipt and disbursement of any money.
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PRACTICE NOTE FOR LAWYERS: The successful argument for legal standing at the commencement of the case is NOT proof of legal standing. And the argument regarding Article 3 (UCC) enforcement of negotiable instruments is not a substitute for normal legal standing required by Article 9-203 for enforcement of security instruments (mortgages and deeds of trust).
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The object is to show that the foreclosure mill is unwilling or unable to produce the loan account receivable or any acknowledgment or attestation or testimony from an officer of the named claimant. You can show that because there is no loan account receivable and there is no officer willing to perjure themselves. there are no trust accounts managed by REMIC trustees, and even if there were, they would not, do not, and could not contain a loan account receivable due from the homeowner.
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The naming of a company as a “servicer” does not mean it handles receipts, disbursements or accounting for any movement of money. Such a company will be presented as the authorized representative of the named claimant but the named claimant never appears in court. Once the foreclosure mill fails or refuses to comply with discovery demands, their claim that the “servicer” is authorized to act for the claimant also fails because it is not relevant. If the named claimant has no ability to support a claim, then the agency of the “servicer” is irrelevant. The claim lacks foundation.
*
DID YOU LIKE THIS ARTICLE?

Nobody paid me to write this. I am self-funded, supported only by donations. My mission is to stop foreclosures and other collection efforts against homeowners and consumers without proof of loss. If you want to support this effort please click on this link and donate as much as you feel you can afford.
Please Donate to Support Neil Garfield’s Efforts to Stop Foreclosure Fraud.

CLICK TO DONATE

Click

Neil F Garfield, MBA, JD, 74, is a Florida licensed trial and appellate attorney since 1977. He has received multiple academic and achievement awards in business, accounting and law. He is a former investment banker, securities broker, securities analyst, and financial analyst.
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FREE REVIEW: Don’t wait, Act NOW!

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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 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. Suggestions for discovery demands are included.
*
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.
  • 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.
  • If you wish to retain me as a legal consultant please write to me at neilfgarfield@hotmail.com.
Please visit www.lendinglies.com for more information.

Unilateral Mistake: Equitable Defenses Explained — How homeowners can get the upper hand and defend against enforcement of contract that is different from the one they knew or intended

Homeowners are missing out on a huge opportunity for economic gain that balances the power between Wall Street and consumers. 

Courts of equity are courts of conscience, which should not be shackled by rigid rules of procedure,[51] and inherent in a court’s equitable powers is the authority to prevent injustice engendered by fraud, accident, or mistake.[52] Florida Bar Journal Novembert/December 2021 “Two, Three or Four Prongs? The Contractual Defense of Unilateral mistake in Florida”

Second, there is a distinction between the equitable remedies of rescission and reformation that may further blur the lines. The Florida Supreme Court and a few others have ruled that reformation is not appropriate except for mutual mistake,[53] but other Florida courts have extended it in the case of unilateral mistake where there is some form of inequitable conduct or inducement by the party seeking to avoid the defense.[54

Rescission should return the parties to status quo ante; reformation calls for a court, looking at the parties’ intent, to “rewrite” the agreement. The latter is more extreme and against the longstanding principle of court hesitancy to rewrite contracts. The Florida courts have long endeavored to refrain from the rewriting of terms in contracts.[55] Apparently, some bad act by the party seeking to enforce an agreement could under more extenuating circumstances, however, convince a court to rewrite a portion of an agreement.[56]

the courts must take their arguments as presented. Our system is adversarial,[58] and even in equity (with perhaps a bit more flexibility), courts are constrained to consider what parties present. It is not the courts’ role to re-craft a party’s arguments. Whether by choice of the parties or steerage by the courts, assertion of fraud in contracts cases is not undertaken lightly; other arguments devoid of accusations of fraud are more palatable. Additionally, to avoid having to address the fraud question, courts may entertain contractual defense arguments based on mutual mistake, unconscionability and possibly even undue influence (which has an inducement feature balanced with the level of susceptibility, but it is not outright “fraud”). Why find a party guilty of fraud, in a civil case, when a court could reach the same result based on a defense other than fraud? [e.s.]

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**** Sign Up for 1 Hour 1 CLE Prelitigation Webinar 11/19/21 4PM Friday****

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THIS ARTICLE APPLIES ONLY TO HOMEOWNER TRANSACTIONS IN WHICH THE SCHEDULED PAYMENTS ARE SUBJECT TO CLAIMS OF SECURITIZATION OF DEBT.

Matthew Marin and Paul Carrier wrote an important article featured in the recent Florida Bar Journal that provides a coherent explanation of contractual defenses that can be applied to contracts claimed to be loans and defenses against enforcement of the note or mortgage. In so doing they remind us of basic principles of what a court can and cannot do — including, I emphasize, the fact that a judge COULD think to himself or herself that an argument or claim or defense could be presented better does not establish the authority to do so. Judges are charged with considering the arguments presented — not the ones that could be presented. And the omission of the ones that could have been presented waives any later attempt to assert them.

This is not up for discussion or debate. It is a basic fact in litigation — one which homeowners have learned (or not) the hard way. Blaming a judge for not doing it is like blaming a dog for failure to fly. Homeowners in my opinion SHOULD be attacking most claims of authority to administer, collect or enforce scheduled payments, and there are plenty of grounds for doing so. In fact, there are good grounds for asking for money in addition to avoiding liability for issuing a promissory note without consideration — and If more homeowners did it the landscape would look totally different. The bottom line is hard for most to accept: the deal was not what it appeared to be.

The grounds for the attack should be largely equitable, but also include legal defenses —- they should be directed at authority (even if the contract was not rescinded, reformed, or set aside in whole or in part) and also on equitable grounds like a unilateral mistake, no meeting of the minds, etc. And as the article points out, validating what I have been saying, alleging fraud makes it far more difficult to plead or prove your point.

So here is the hardest part for homeowners and lawyers for homeowners to understand or even admit.

Nearly all notes and mortgages are issued because of unilateral mistake(s) on the part of the homeowner, induced by investment banks who continue to hide facts that are statutorily required to be disclosed, including but not limited to:

  • They do not know that they are doing business with an undisclosed investment bank doing business through a string of intermediaries.
  • They do not know that the supposed loan transaction is being underwritten for the purpose of justifying sale of unregulated securities and not for purposes of justifying a loan.
  • They do not know that the appraisal is being forced high to justify the contract price and the amount of the “loan”
  •  They do not know that there is an absence of any real party in interest that has a risk of loss — the essential balancing element of all contracts
  • They do not know that the undisclosed revenue for the sale of securities vastly exceeds the amount of their transaction. At the moment they sign, homeowners have triggered revenue that erases all possible risk of loss and eliminates the need to establish a loan account receivable on the books of anyone.
  • They do not know that it is their signature on purported loan documents that creates the illusion of a loan transaction thus triggering the undisclosed sale of securities (without which the “loan” would never have offered, much less occurred.
    • This one fact triggers a series of claims on behalf of homeowners that does not require alleging fraud and keeps the burden of proof manageable (generally preponderance, rather than clear and convincing).
    • Homeowners were not borrowers. They were investors and participants in the sale of unregulated securities. They were entitled to know that and bargain for a fair share of the proceeds. The issuance of the note by the homeowner was based upon a universal error or mistake by all homeowners that they were purchasing a loan product which was not true.
    • In addition, if the transaction was deemed by a court of competent jurisdiction to be a true loan with a “true lender” as set forth in the regulations, then the undisclosed amount of revenue generated from the sale of securities arising from the closing of the transaction with the homeowner is owed back to the homeowner (in full) under the Federal Truth in Lending Act.
      • This element of foreclosure litigation has not been adequately pursued. In judicial states it is an affirmative defense that is not barred by the statute of limitations. In nonjudicial states, the application of the statute of limitations to such claims must be unconstitutional because of unequal treatment based upon choice of procedure. Homeowners should not be barred from using meritorious defenses that are available under the same state’s judicial foreclosure procedure.
  • They do not know that no loan account receivable is created or maintained — thus making modification or workouts rare or impossible
  • They do not know that there is nobody who is legally authorized to administer, collect or enforce the promise they made to make scheduled payments, to wit: the presumed authority to enforce arising from the alleged possession of the alleged original note leads to a false conclusion of fact. Such authority ultimate must come from the party who owns the underlying obligation as contained on their records as a loan account receivable. There is no such loan account receivable.
  • They do not know that the transaction is going to be subject to false claims of servicing
  • They do not know that the “servicing” is not performed by the named “servicer”

The bottom line is that homeowners did not get what they applied for and the investment banks did not pay money to the homeowner or on their behalf because they wanted to loan money. They wanted to sell securities and they needed homeowners to do it. The fact that a homeowner received money and used it to either buy a home or settle a previous financial transaction does NOT make it a loan. A loan is a label for a certain type of contract. There must be a meeting of the minds. In cases where there was no meeting of the minds, there is no contract. And if there was no meeting of the minds because one party to the alleged contract was hiding and did not disclose the real terms as required by laws, rules, and regulations concerning loan contracts make it is imperative that established existing remedies be allowed to homeowners.

PRACTICE NOTE: It seems that a lot of people don’t understand the judicial notice and the insignificance of documents uploaded to the sec.gov site. By filing a registration statement followed by a notice that no further filings are necessary, anyone can upload anything to sec.gov. In effect, it is nothing more than box.com, dropbox, etc.

Lawyers and others involved in false foreclosure claims often upload documents under that cloud and then download those documents from the sec.gov site such that the download shows the sec.gov header.

They then file a motion for judicial notice of the document of a government document even though it was never reviewed accepted, approved nor even a part of a required registration since the sale of “certificates” is not regulated as securities. It is not subject to judicial notice because the document was not an official record of any governmental agency and was never officially registered or recorded.

It does not establish the existence of a trust or the powers of a trustee. Therefore, it cannot serve as the foundation for the claims of the company claiming to be a servicer for that “trust.” It is worthless as to its existence (probably because it is incomplete in the text or exhibits) and it contains only statements of future intent — not a recital of anything that has occurred.

 

DID YOU LIKE THIS ARTICLE?

Nobody paid me to write this. I am self-funded, supported only by donations. My mission is to stop foreclosures and other collection efforts against homeowners and consumers without proof of loss. If you want to support this effort please click on this link and donate as much as you feel you can afford.
Please Donate to Support Neil Garfield’s Efforts to Stop Foreclosure Fraud.

CLICK TO DONATE

Click

Neil F Garfield, MBA, JD, 74, is a Florida licensed trial and appellate attorney since 1977. He has received multiple academic and achievement awards in business, accounting and law. He is a former investment banker, securities broker, securities analyst, and financial analyst.
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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 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. Suggestions for discovery demands are included.
*
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.
  • 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.
  • If you wish to retain me as a legal consultant please write to me at neilfgarfield@hotmail.com.
Please visit www.lendinglies.com for more information.

 

Those letters from the lawyer for the “servicer”: PHH

It is true that someone will execute a release of the lien. What is not true is that they have any authority to do so — nor is it true that PHH has any right to receive any money, whether it is a monthly payment or a payoff.

In fact it is not true that PHH will receive any money. They won’t and they don’t. All payments are  directed through lockbox contracts and FINTECH companies into accounts that may bear the name of a company claiming to be a serrvicer but which are owned by someone else.

This is why I keep successfully annoying opposing counsel about the payment history they wish to introduce as a business record exception to the rule against the use of hearsay evidence.

Since none of the data was entered by anyone employed by the company that is claimed to be the servicer, the payment history is neither a business record that is an exception to the rule against hearsay, nor an acceptable substitute for what has always been required: the accounting ledger showing the history (cradle to grave) of the loan account receivable. In fact, the payment history is not even a partially acceptable substitute for that ledger because it does not reflect payments to creditors.

PHH, Ocwen and Reverse Mortgage Solutions (among others) are all part of the same organization. In a recent dialogue between my client and the lawyer for PHH, he stated that payment to PHH will cause the lien to be released. This got me started thinking about the way he worded that. Normally the lawyer would write something like “Payment to PHH, as agent for XYZ Creditor, will satisfy the debt, note and mortgage. Upon receipt of such payment,m the lien will be released.”

Note that this was a representation from the lawyer not PHH and not any creditor. And the lawyer is protected by a form of immunity as long as he is not intentionally misstating the facts knowing that they’re false. If PHH said that, it could be the basis for a fraud action.  It is true that someone will execute a release of the lien. What is not true is that they have any authority to do so nor is it true that PHH has any right to receive any money, whether it is a monthly payment or a payoff.

It is true that someone will execute a release of the lien. What is not true is that they have any authority to do so nor is it true that PHH has any right to receive any money, whether it is a monthly payment or a payoff.

So this is what I said in a comment to the receipt of an email displaying the comments of the lawyer claiming to represent “somebody” which we presume is a claim to represent PHH which in turn is a claim to represent some company claiming to be a creditor merely because they have some paperwork — and not because they ever entered into any purchase and sale transaction in which they bought the underlying obligation, the legal debt, note or mortgage:

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Of course, what is interesting is that the lawyer is saying that payment to PHH will cause the lien to be released. But it doesn’t say who will release it. It’s leaving the rest to your imagination. Any lien release under this scenario would be executed by a person working for a company that has no legal authority to sign it.

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The way it is set up, the person is authorized by the company he works for, but the company lacks the authority to authorize him to sign it. The company, in turn, claims authority by virtue of some contract or document in which the counterparty grants the company the authority. But the grantor also lacks authority.

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The idea here is to get you to take your eye off the ball. The ball is always the underlying obligation. It is the legal owner of the obligation (i.e., the one who purchased it for value) who has the sole authority to grant powers to anyone else over the administration, collection, and enforcement of the underlying obligation.
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It is only when you take your eye off the ball that these companies get away with claiming the status of “holder” of the note and owner of the mortgage. The holder of the note is defined as a party who has physical possession of the note (or the right to physical possession of the note) together with the authority to enforce it.
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These players have been successfully leveraging the idea that physical possession of the promissory note, or the right to physical possession of the promissory note is all that they need in order to establish the legal presumption that they have the authority to enforce it. That has never been true. But in the absence of a persistent and aggressive challenge from the alleged debtor, these parties have been able to steamroll over all weak objections.
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Further, leveraging one presumption into another, they have been successful in raising the additional presumption that transfer of the note to a “holder” is the legal equivalent of transferring legal title to the underlying obligation, thus satisfying the requirement for enforcement that is contained in Article 9–203 of the Uniform Commercial Code. None of that is true; but all of it seems to be true.
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The bottom line is that they know there is no loan account receivable and therefore no legal owner of the underlying obligation. They have done that intentionally for the benefit of the investment banks that set up this scheme. But it has not been difficult for Wall Street to convince the rest of the world that all of these transactions are, in substance, just what they appear to be. Getting the courts, law enforcement, regulators, and even homeowners and their lawyers to look beyond the appearance has been the principal impediment to defeating the scheme.
DID YOU LIKE THIS ARTICLE?

Nobody paid me to write this. I am self-funded, supported only by donations. My mission is to stop foreclosures and other collection efforts against homeowners and consumers without proof of loss. If you want to support this effort please click on this link and donate as much as you feel you can afford.
Please Donate to Support Neil Garfield’s Efforts to Stop Foreclosure Fraud.

CLICK TO DONATE

Click

Neil F Garfield, MBA, JD, 74, is a Florida licensed trial and appellate attorney since 1977. He has received multiple academic and achievement awards in business, accounting and law. He is a former investment banker, securities broker, securities analyst, and financial analyst.
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FREE REVIEW: Don’t wait, Act NOW!

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 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. Suggestions for discovery demands are included.
*
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.
  • 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.
  • If you wish to retain me as a legal consultant please write to me at neilfgarfield@hotmail.com.
Please visit www.lendinglies.com for more information.
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