How To Tell The Judge “NO” and MAYBE Not Have Him/Her Get Pissed Off

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Did you take a loan?  Did you sign that note?

Editor’s Comment:  The question from the bench is always the same and either  pro se litigant or the attorney is too skittish to take a stand. The question is something like “Did you take a loan?” And the answer could be “Judge I have taken lots of loans,  but I never took any money from these people or any of the their predecessors. I deny the loan, I deny the debt, I deny the default. I deny the note, I deny the mortgage. I deny their right to collection or enforcement of the note or mortgage because I never did any business with them.” If they want to plead and prove otherwise, let them. [This of course ONLY applies to loans that are subject to claims of securitization, which we all know now were routinely ignored by the investment banker just as the assignments into the non-existent pools were routinely ignored, just as the attempt to get a foreclosure judge to rule that an investor without knowing anything about these proceedings is about to get stuck with a bad loan in which there is no value, improperly originated, and never properly assigned or delivered years after the 90 day cutoff period expired.]

The other questions is “Is that your signature on the note? Is that your signature on the mortgage (or Deed of Trust)?” And your answer could be “I don’t know which documents have my actual signature or which ones have been Photoshopped. Therefore I deny and demand they prove that this was my signature on that document. I do know that if they procured my signature on any document it was by trickery, deceit and fraud.” If they want to plead and prove otherwise, let them. But all you are going to see is paper. You will never see a financial transaction between me and them or any of their affiliates or predecessors because no such transaction ever took place.

If the Judge or anyone else asks you anymore questions, and frankly if you are bold enough, if you are asked any questions, your answer could be, “Judge, this is not an evidentiary hearing. If an allegation is being made against me I have a right to know who is making the allegation and what they are accusing me of doing.  Then you have a right to your answers once I have examined the books of records of all servicers — not just the ones that they want to show you, and all depositories wherein documents were supposedly stored. You will not find any record of any kind in which I entered into a financial transaction, loan or otherwise, with these people or any of their predecessors.

CONTRIBUTION: Many payments were made to the creditor that advanced you money. You must remember that they did not advance you money through the securitization chain but instead advanced you money directly from an escrow account, a Superfund, that commingled the money of all investors without regard to REMICS, trusts or any of those niceties and the people to whom the note was made payable and for which the mortgage secured an interest in your property never consummated any financial transaction with you. If they made a payment to the creditors (investors in parternship with each other at the time of the funding) THEN the money received by the agents of the those investors should have been credited against the money owed to those creditors. And part of that allocation should have been applied against the balance due on your loan, meaning your loan balance, unsecured, would be correspondingly reduced or eliminated. End of mortgage, no matter how you approach it. The obligation that originally gave rise to the supposedly secured debt has been satisfied either in part or more likely entirely. 

That leaves a new debt replacing the old debt, which is undocumented and unsecured — and a creditor with an action for contribution because they were obviously a co-obligor. If they say they are not the co-obligor then they are saying the PSA doesn’t apply. If the PSA doesn’t apply then they are not the authorized the servicer or whoever they are pretending to be because there was not actual securitization process.

I’ve been writing about this for years specifically in relation to payments by the servicer and assignments to the servicer or to the REMIC which would in fact extinguish the old debt and originate a new obligation that was neither memorialized by a promissory note from the borrower (because it had been extinguished) nor of course a mortgage or Deed of Trust that secured the extinguished note.

The new obligation may arise between the original borrower and the Assignee or between the original borrower and the payee (where the servicer continued to make payments) but only if the contributor could establish that portion of the claim to which they were entitled.  In other words, an assignment of the entire obligation to a co-obligor would extinguish the entire obligation.  The partial payment by a co-obligor would extinguish the old obligation only to the extent of the payment.  

The problem with getting traction on this is obvious.  It is a frontal assault on the obligation itself leaving the original creditor (if there ever was one) without a claim or with a partial claim, in the event of a partial payment giving rise to an action for contribution. This is only a problem though to the extent that you are asking the court to extinguish an existing obligation between you and the actual creditor — and the only way you can know that is by getting full and complete discovery from the Master Servicer and the Creditor. It’s only a problem if it looks like you are trying to  get out of the debt altogether instead of just attacking the the fact that the new debt could not possibly be recorded.

Complicating issues include establishment of a party as a co-obligor and perhaps even more so, the fact that the promissory note does not actually describe the financial transaction, as we have discussed.  Since the originator of the note did not actually consummate a financial transaction with the borrower, the note is either void or voidable for lack of consideration.  

Further complications arise when the borrower makes payment on the note thus “ratifying” the terms expressed in the note.  But this only occurs because the borrower was the only one at the closing table who did not know the payee, lender and beneficiary were all naked nominees who neither control nor their finances involved in the financial transaction between the borrower and the actual source of funds. 

If the would-be forecloser wants to rely on the PSA then they must accept the WHOLE PSA, which means that a loan in default does not qualify to be assigned, even if in proper form and the trustee or manager of the “pool” has no authority to accept it.  If the Judge in foreclosure court says the trustee or manager MUST accept it then he is adjudicating the rights of investors who explicitly agreed to advance money for performing loans that would be put in a  pool within 90 days to satisfy the requirements of the Internal Revenue Code and the provisions of the PSA which merely recite the REMIC provisions of the IRC.  They can’t have it both ways. They can’t say that those provisions don’t apply to the assignment and say that the OTHER PSA provisions giving them the right to service the loans and manage the portfolio also apply.

The fact that the borrower made a payment to a servicer under directions from a representative within the false securitization scheme should not give rise to an obligation to continue such payments; this is because the obligation arose with the actual financial transaction that was consummated between the borrower and the source of funds.  The source of funds was a stranger to the documentation that the borrower signed.  Since the actual handling of the money involved an escrow Superfund (or at least it appears that this is the case) we do not know if the “lender” is or could be identified from the larger group of investors whose money was intermingled and combined into a single escrow account.

The problem with the relationship of loans in “the pool” is that there doesn’t appear to have been a pool in which such a relationship could exist.  The co-mingling of funds in the accounts held by the investment banker might make all of the investors general partners in a common law general partnership.  We have found NO EVIDENCE OF SEPARATE ACCOUNTS for the individual REMICS. And the investment banker, sub-servicer and  Master servicer are fighting us tooth and nail in discovery requests to get that information. IF they had a legitimate claim, they would have produced it as exhibits to their own pleading. Instead they are trying to hide those facts and including the flow of funds starting from before the actual origination of the loan. Too many cases, we see Ginny or Fannie report ownership of a loan that has not even closed in the false sense , much less in the true sense where the borrower and lender are properly disclosed and the terms of repayment are known by both sides of the transaction.

However, this wouldn’t be the first time that we were correct and the judge did not follow the law.  It is for that reason that I have largely abandoned the argument about contribution and I have now started writing about the fact that if the assignment of the note was in fact an assignment of the obligation, the assignment was merely one element out of three required for a valid contract (offer, acceptance, consideration).   And while many people have now picked up on the fact that the trustee of the pool did not have the right to accept a loan which has been declared in default years after the cut off period expired, I have been going a little further suggesting that the state and federal judges are making decisions adverse to the investors by forcing them to accept a loan that they obviously wanted to avoid, and the acceptance of which would violate the terms under which they loaned the money.  

This is a tricky area to navigate because on the one hand you’re saying that the loan never made it into the pool but on the other you’re saying maybe it did get into the pool but if the only vehicle by which it made entry into the pool was a judicial order declaring in effect that the loan became part of the pool and therefore the entity representing the pool had a right to foreclosure, that order would constitute a judicial determination of the rights of investors who did not receive any notice of the proceeding nor any opportunity to be represented or heard before such an order could be entered.  These are difficult waters to navigate.  

Considerable thought should be given as to which strategy will be used.  There is an old adage that basically says you have approximately 30 seconds to get the judge’s attention (at most) and perhaps 5 minutes to make your point (at most).  Thus if you’re going to proceed along any of the tracks stated or discussed in this email you must be prepared to be limited to a ruling on that track alone.  If you have 20 other tracks that you think have validity, then make sure they are in the record by way of pleadings, affidavits and a memorandum of law before the hearing in which you raise one of the above defenses.  It is a good idea to bring up defenses for which the other side is unprepared and which the judge has not yet heard.  It diminishes the appearance of making a decision that will affect 5 million other mortgages.  Ultimately though the decision is between you and your lawyer.

This article was prompted by a very reasoned argument presented by CA Attorney Dan Hanacek:

Even In the Event the Court Finds the “Assignment” Valid, the Assigning of the Note to a Co-Obligor Makes it Functus Officio

“It has long been established in California that the assignment of a joint and several debt to one of the co-obligors extinguishes that debt.” (Gordon v. Wansey (1862) 21 Cal. 77, 79.) “The assignment amounts to payment and consequently the evidence of that debt, i.e., the note or judgment, becomes functus officio (of no further effect)”-and precludes any further action on the note itself. Any action would not be on the note itself, but rather one for contribution. (Id.; Quality Wash Group V, Ltd. V. Hallak (1996) 50 Cal.App.4th 1687, 1700; Civ. Code §1432.) In the instant case, even if the alleged assignment is seen to be valid, then a co-obligor was assigned the note and the debt has been extinguished.

Note: the trustee of the securitized trust is a co-obligor.

Note: Fannie Mae, Freddie Mac and Ginnie Mae are co-obligors.

Note: the servicer is almost always a co-obligor.

Questions for Neil:

Have they extinguished this debt by endorsing it and/or assigning it to the transaction parties?

Does this only apply in CA?  I cannot believe that this would be the case.

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Objections and Preserving Your Rights on Appeal: From, Whose Lien Is It Anyway? by Neil F Garfield

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Editor’s Comment:

Foreclosure cases are won or lost on procedure more than on the merits of the case offered by either side. Lawyer and especially pro se litigants tend to use the right of appeal, as though it was a vehicle for entertaining evidence, objections or motions that should have been made. These make up a large percentage of the 85% of cases that are affirmed on appeal.[1]

The appellate court rarely has even the power to consider affidavits or other evidence that was not proffered and which does not show up on the record on appeal sent by the clerk of the court on the “trial” level. The appellate court is limited to what DID happen and not what SHOULD have happened. If the matter was properly raised in the lower court, then the matter may be considered by the appellate court. If not, then they must simply state that the grounds for appeal were not properly preserved for appeal and affirm the decision of the lower court Judge.

In foreclosure cases, most of the objections that should be made are known in advance and quite probably should be brought or offered as a motion in limine before the actual hearing, so that the complete focus of the court is on the issue that  would be presented by opposing counsel  and the objections raised by the borrower homeowner. In those cases, where the objections are known in advance, you should not only state that you have an objection, but the state the reasons for your objection and include a memorandum of law on the point, complete with copies of the most relevant cases.

Most of the errors that I see on the trial court level amounts to denial of due process in that the Court refuses to hear the merits or to allow the parties to conduct discovery. If that is the case in your case, you should mention it even though it is “fundamental error” that the appellate court could hear even without raising the objection contemporaneously with the subject of your objection.

This assures (along with the transcription from a court reporter) that everything about that objection was stated, presented and denied, if such is the case. It might also alert the Judge that you are ready to make such an appeal. If the objection is procedural relating to whether a proper foundation has been laid for the introduction of evidence, or whether the Court is accepting the proffer of counsel without any evidence in the record to support it, then you must make that point clearly and with support from citations in your own state. If the court refuses to hear the objections in limine then you still have the matters raised as part of the court record but you must raise the objection in the hearing or you might well have waived them unless your main point (ill advised) is that the court abused its discretion in denying the motion in limine without hearing it on the merits.

In every case I have seen reversed on appeal, there was something in the record that contradicted or nothing in the record that supported the position taken on appeal.

There are no magic words or bullets on objections. What is necessary is that you state it, without rambling on tangent subjects, with sufficient specificity so that the appellate court will understand in a flash what your objection related to, and what grounds and what law upon which you were relying. Do not combine objections. If you have more than one then state that you have 2 or more objections and proceed with the first.

The mistake I see in appeals and trial proceedings is that the attorney for the homeowner borrower remains silent while opposing counsel states facts that are not in the record (because there has not been an adversary proceeding and that you deny those facts, as they are in issue between the two sides). In many cases the Judge takes silence as a concession that the facts are true as stated and that your defense relates to something other than contesting the facts being proffered by opposing counsel.

The appellate court might agree, particularly if you are not clear in immediately identifying the fact that there was a real transaction in which money exchanged hands and then another event which involved the signing of papers but in which there was no actual transaction. The fact that the borrower believed the papers to be true while everyone else knew they were not, cannot now be used to further the fraud upon your client.

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[1] It has been pointed out by some bankruptcy court judges that out of the three possibilities for appeal of a bankruptcy court ruling, petitioners and their counsel usually bypass the appeal laterally to the sitting District Court Judge charged with hearing civil cases with Federal jurisdiction and with hearing appeals from decisions made in the bankruptcy court. Sources tell us that the percentage of reversals and remand is possibly as high as 50% when brought to the District Judge rather than the BAP or Circuit Court of Appeals.

Florida Judge Forced to Recuse Himself as Conflicts of Interests Start to Emerge

Editor’s Note: The problem is not just a Judge who received favorable treatment from the lender in a foreclosure action. It is the highly politicized environment of elected and even appointed judges who received, directly or indirectly some form of “generosity” from the financial services sector or whose perception is fundamentally flawed by the constant drumbeat of disinformation from Wall Street Banks.

Research your Judge. Get as much information as possible to determine if there is cause for a reasonable person to believe that the Judge’s decision might be influenced by something other than the facts of the case or the law to be applied.

Businessweek
Judge in Countrywide Case Removed Over Claim of Discount Loan

Feb. 5 (Bloomberg) — A Florida judge was ordered to remove himself from a foreclosure proceeding by Bank of America Corp.’s Countrywide unit after the homeowner claimed the judge received a discount loan from an affiliate of the mortgage lender.

Circuit Judge Hugh Carithers in Jacksonville, Florida, must enter a recusal order and ask Chief Circuit Judge Donald Moran to pick a replacement, a district court of appeals ruled today.

Joseph W. Mines Jr., who is representing himself in the foreclosure proceeding, alleged the judge had received favorable interest rates not available to the public in his own dealings with a lender affiliated with Countrywide, court records show. Mines’s home was just about to be sold when he filed his claim seeking the judge’s removal, according to the case docket.

“This court finds these facts, taken as true as they must be, would prompt a reasonably prudent person to fear that he or she would not obtain a fair and impartial hearing,” the appeals court in Tallahassee, Florida, said its ruling.

Pat Ryan, a courtroom clerk for Carithers, said she hadn’t seen the ruling and couldn’t comment. Directory assistance had no phone listing for Joseph Mines in Jacksonville.

The case is Countrywide v. Mines, 2007-CA-6852, Fourth Judicial Circuit Court of Florida (Jacksonville).

–With assistance from Doris Bloodsworth in Orlando, Florida. Editors: Peter Blumberg, Michael Hytha

To contact the reporter on this story: Cary O’Reilly in Washington at +1-202-624-1859 or caryoreilly@bloomberg.net.

http://opinions.1dca.org/written/opinions2010/02-05-2010/09-5669.pdf

Mortgage Meltdown and Foreclosure Defense

Good comment, which I edited slightly for readability:

 

  • Hey Jose, run your case by the trustee who more than likely will not do a thing; 
  • request for leave to file the case in C Court, not to worry about the lender, 
  • he will remove to Fed Court. 
Lost Note, fight it long, hard and strong! They must produce the original copy,  do not accept less; also, make them produce payment history and history of charges;  they have committed fraud, so, you have the one up! They sold you a bag of C_ _ _  here…the property at any price was more than likely overvalued by the lenders appraiser and  the unsustainable market conditions for which all we innocent, were lead to slaughter  by government lies, i.e., housing markets are sustainable and growth is sustainable, both lies!  Investigate your judge and his rulings and get a membership to pacer to track your case because clerical errors do happen and no one but you, is responsible for your case under bap!  Check out your judges rulings, look for similar trustees to always be presenting their cases,  if there is justice financial disclosure information about the judges, gov courts pensions  and retirement accounts etc., and, as to if they contain any of the mortgage hedge funds.  Go to your judges hearings to see how he rules and for whom he rules; check out the judges  former partners and law firms prior to them becoming a judge, look to see if they represented  any of your creditors or most of your creditors or your lender, servicer, title company etc.  My most important advise to you is not to lie during your bk, before or after….about anything…. in, leading up to, after or during your bankruptcy, sounds like you are upper middle class  so do not hide any…assets as with your charges of mortgage fraud, they will be seeking  a smoking gun….and the gun will get turned on you the accuser first!  You will not have to hide your assets as most of your assets are protected  as long as you do your schedules correctly.  Your case appears to be an asset recovery case and the courts should either allow you time  to pursue your legal claims or, have the trustee litigate your claims for you,  noting you could be in an area that is devoid of these corrupt bankruptcy rings,  just be on guard at all times and follow behind your public servants, the judges and trustees  as the are human and can be mislead!

 

FORECLOSURE DEFENSE: A COMMENT WORTH REPEATING

we received the following comment which I think is very good for people to read. I edited it slightly to make it more readable. The original is in the comments below this post.

Jose; You have one year from the date of rescission notice to file a lawsuit in the courts to enforce the rescission but, if you are under foreclosure now, you must move fast!

If you have received the notice of sale, you must consult your local court law library for the laws, talking with the law clerks who should be able point you to your local laws.

Then contact the courts and notify them immediately of your intent to defend against the action and at that time, present the complaint onto the court as your defense or file the complaint as soon and as quick as you can.

I am not a lawyer but am suing my lender for mortgage loan document forgery and mortgage fraud, the dirty rotten sobs have perpetrated against my once very good credit. RESPA & TILA laws are very complex, you really should try to find an honest lawyer, though, we have had no luck here in Maryland because most are corrupt or work for the creditor behind your back or want to lend you the same creditors money or, if they are not currently working for the creditor, they will be by the time it is all over so be careful if the lawyer takes your case and then does nothing, this is what they do, the corrupt lawyer usually will fleece you for every penny you have so you then have no….money and then, after he strips you of the money, he allow the trustee to sell the property or, encourages you to refinance, never assisting you with the RESA and TILA lawsuit, or, this is what has happened to us! Be careful of corrupt bankruptcy judges and trustees if you are thinking about going this way. [Editor’s Note: We have received dozens of stories just like this emailed to us] rather than posted in comments. People are paranoid about being targeted!]

 

There is a more sophisticated consumer scam known as the bankruptcy foreclosure scam wherein your lawyer, the bk trustee and judge conspire to steal your property and force you into a life of high cost credit! How the scam works, you innocently find one of these corrupt lawyers for whom most practicing bk in our area are dirty, rotten and corrupt sobs because they must join the corrupt thing known as the “bankruptcy club”,(do your research, this is a club of corrupt judges, trustees and outside lawyers who serve victims up to these clubs); the would be consumer lawyer generally lends money for your….lender with the lawyer failing to ever tell the consumer they have a conflict of interest.

Once the corrupt lawyer files the stay for you the victim, he then does nothing…..tells you nothing, does not assist with the schedules, files nothing but begins to work with the corrupt trustee wherein they both collude together to harm you under the courts eyes with the corrupt judge presiding over the whole thing but, essentially, they collude to have the case dismissed making you out to be the villain so they have scared you in the judicial eyes of all courts. If you make to the 341 meeting, you are then met by the corrupt trustee who also, without you knowing, works for your same lender or most of your creditors, and this corrupt trustee ignores your TILA and RESPA claims; and, the screwed up BK draconic laws, essentially allow him to ignore your claims; he will have no part of litigating your claim and will shut you up but quick!

The lender now has you where he wants you, in the bk club…..with the judge being placed there to hear a particular lender/investment banks cases exclusively.

The corrupt judge, then works in tandem with your lawyer who is to first get you to refi the loan in order to cause you to waive your legal recourses; should you have figured out what is going on, and refuse the refi, then the lender seeks the lift stay, your lawyer may appoint himself as special counsel to the trustee, to make sure you are silenced, and then the judge orders the property sold; be very, very, very careful because you are dealing with the mafia and consumers and honest lawyers have been killed! If you are already there, or in bk and this is happening, motion to dismiss your case and file lawsuit in your circuit court; the courts cannot force a discharge on you. Good luck, Best R, k

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