Case Compilation Where Claims of Ownership Were Dismissed

I don’t know how I missed this but compiled a list of cases in which the banks lost. (See below) The basis on which they lost was simply the finding that the alleged Trust or Plaintiff did not own the debt, note or mortgage. This is the same as the San Francisco study that found that at least 65% of all foreclosures were initiated by “strangers to the transaction.”

The issue confronting lawyers is that at trial, the Judges are assuming and presuming things that are not true. And the facts are counter-intuitive, leaving the lawyer with no answer to the question “Well if the originator didn’t fund the loan, who did?” and the corollary question “Well if the Trust doesn’t own the loan, who does?”

Such questions shift the burden of proof to the one party who knows nothing — the homeowner. It is much more difficult to fight with opposing counsel and the Judge at trial than a major aggressive push in discovery. Judges frequently start out leaning towards the bank, but once it is pointed out that discovery is a much broader process than trial, many lawyers are punching through the fog. Arguments about presumptions during discovery should be turned on their head — that all such presumptions are rebuttable.

And one last point — for nearly ten years I have been cautioning lawyers and homeowners not to admit things they know nothing about. None of you actually have the facts and none of you has the requisite knowledge (except in rare cases) about the money trial. People complain about “bad” decisions and accuse the court of bias. But in most cases where the borrower loses it is because facts that are untrue or unproven are accepted as true.

If you look closely at rulings where an opinion has been published, notice that the ruling is based upon facts that were admitted by the homeowner that never should have been admitted. This is a common error. The truth is that the homeowner doesn’t know the money trail but they assume that there is a money trail because to assume otherwise leaves the court in a fog. Once you assume that the borrower really did get a loan from the originator and once you assume that the party initiating the foreclosure purchased the loan, the paperwork arguments lose virtually all of their strength.

So unless you actually know the money trail and unless you know that it supports the paper trail, don’t admit it. Here is a brief checklist of things that should not be admitted unless you know they are in fact true:

  • The originator was the lender.
  • The loan was funded by the originator
  • The note and mortgage were properly released from the closing by the closing agent
  • The mortgage or deed of trust was properly recorded (NOT if it was void, which is uttering a false instrument)
  • The note and mortgage are valid documents arising from a consummated loan contract between the homeowner and the originator.
  • The originator owned the debt, note or mortgage.
  • An assignment from the originator gave rise to rights to enforce the note and mortgage.
  • Someone purchased the debt, the loan contract, the note and mortgage by paying money to the originator (in almost all cases this is not true).
  • The property is encumbered by a valid security instrument (the mortgage or deed of trust)
  • The substitution of trustee was valid
  • The notice of default was valid (not if the issuer of the notice was an unauthroized servicer)
  • The party issuing the substitution of trustee and/or notice of default was a proper beneficiary under a deed of trust
  • In the forced sale of the property, the successful bidder was a real creditor who could submit a credit bid instead of cash.
  • The REMIC Trust exists
  • The REMIC Trust ever existed in the real world — i.e., that it conducted any business, maintained a bank account or otherwise purchased assets that were managed by the trustee
  • The REMIC Trust owns the debt, note, loan contract or mortgage
  • The servicer is authorized (simple logic: if the loan is NOT in the Trust then the servicer CAN’T be authorized by a Trustee of Trust that doesn’t own the loan.
  • The Trustee on the Deed of Trust (nonjudicial states) is the substituted Trustee (in reality if the substitution of trustee was void or invalid then the original Trustee is still the Trustee on the deed of Trust)
  • The named Trustee is the Trustee or authorized agent for the certificate holders of the REMIC Trust
  • The payment history submitted by the latest servicer is correct (go back and look at prior payment histories from the servicers’ predecessors)




Judge Buford Slams Mers for Its Own Confusion


Judge Buford in Bankruptcy Court has no problem seeing the real issues. Here he is again stating that MERS has no standing and that MERS is confused as to whether it is acting in is own behalf or as agent for the note holder. He further makes it clear that the loan is not secured by the real property where MERS is the “nominee.” Since MERS admits, indeed advertises it will never make a claim to ownership of the note (otherwise nobody would use their service) there is absolutely no basis under law or equity in any court where it should be allowed to foreclose.

But they have done exactly that. So now that we know all those foreclosures were done illegally not for some procedural reason, but because MERS is not a creditor, what does that do to the hundreds of thousands of foreclosure sales that took place using MERS as “nominee” as the base of the chain. The answer, as anyone with knowledge of property law will tell you, is that the foreclosure sale is void, not voidable.

That in turn means that whoever owned it before the “sale” still owns it. Which of course means in most cases that there are hundreds of thousands of people who were homeowners that still own the property that was “foreclosed.” It also means, if the house is empty that they have the right to re-enter it. So you see, it is on this simple fact and basic black letter law that the entire foreclosure mess is proved to be an illusion. There is no mess. There is just a lot of paper that doesn’t mean anything.

If a Judge signed an order setting the sale date (as opposed to lifting the stay) THEN it is highly probable that in order to regain possession of the house you would need to file a quiet title action and quite possibly an action for damages.


Exemption Express Website Unveiled

Lawyer John R. Bates of New Philadelphia, Ohio, has published a new website,ExemptionsExpress.Com, which is a phenominal resource for consumer bankruptcy attorneys. He has spent hours and hours compiling the exemption laws for all 50 states.

“Exemptions are the lists of the kinds and values of property that is legally beyond the reach of creditors or the bankruptcy trustee,” according to Cathy Moran. “The debtor in bankruptcy keeps the exempt property. What property may be exempted is determined by state and federal statutes, and varies from state to state.”

Bates says the purpose of this website is to assist the attorney for an individual debtor:

  1. To determine what exemptions (federal, state, or both) are available to that debtor;
  2. To determine what, if any, territorial limitations there may be on use of those exemptions; and
  3. To provide statutory and case law in support of those determinations.

Knowing the exemption laws of other states became a necessity for consumer bankruptcy attorneys with the enactment of the Bankruptcy Abuse Prevention and Consumer Protection Act (BAPCPA). The so-called reform of bankruptcy law attempts to prevent debtors from moving to another state to take advantage of more liberal exemption laws in the new state. Look back and waiting periods were created before the debtor can claim his new state’s exemptions when filing for bankruptcy relief.

WARNING: Exemption law is very complicated. Debtors should not try to interpret exemption laws for themselves without advice from an experienced consumer bankruptcy attorney. Mistakes in exemption planning and declaration can cause debtors to lose property.

Foreclosure Offense and Defense: Cash for Keys Offers, Pitfalls and Opportunities

In response to email from one of our readers who was presented with a “get out” notice and an offer to pay him $1,000 to do so peaceably, which was then later stated to be “negotiable (meaning they would pay more if asked), I wrote:

Sounds like you are on the right track. I am glad to hear you are still there.

If you are inclined to accept the offer, ask for more money. It can’t hurt.

Otherwise, you might want to ask for a copy of any document he has that names him as having authority to make the offer. He could be a scammer that will take the keys from you, make everything look all fine and dandy and then strip the house down right through the walls to the wiring and plumbing.

Then the lender comes in and files suit against you or worse files a criminal complaint against you for trashing the place.

While you are at it, you might want to ask for copies of the assignment or sale documents with which GMAC allegedly bought the mortgage and note. If you really press the point hard, you might get them or even better, you might not get them in which case they might back off completely, or they might negotiate something much more favorable to you.

In many cases, these purchases are not well-documented or they can’t find the documents. It is worth pushing this point.

If they don’t produce the documents you can make the allegation in your petition for BK that the liability is contingent and that your “asset” — the house is a contingent asset as well because it looks like GMAC took title under false pretenses. If things break your way you could end up with the house back and possibly without the mortgage if you announce your rescission due to failure to properly make disclosures in the TILA estimates and loan closing documents.

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