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The Krieger Files goes live tomorrow at 9 a.m. Eastern Time on LibertyNewsRadio.com. Dave’s guest is Alex Newman, videocaster, author and writer for The New American magazine!
Upcoming on The Krieger Files: Exclusive interview with Jeff Thigpen, Register of Deeds for Guilford County, North Carolina … on the trashing of land records by MERS and the banks … ICE … and how servicers have gotten clever in filing assignments and other fraudulent documents and Thigpen’s personal war against them! Every foreclosure victim needs to hear this segment!
I was having a conversation with one of my team into the wee hours last night about these supposed Notes that are filed with courts around the country, claiming to be certified copies and signed off on with some anonymous initials. This is what judges rely on when they grant foreclosure on someone’s home.
How do they get away with it?
Because no one is thinking about the Negotiable Instruments section of the Uniform Commercial Code!
Section 3-501 et seq clearly talks about this. Every state has it in its codes under UCC.
Scenario #1:
You are in a deed of trust state (non-judicial). In order to stop the sale of your home, you have to file a lawsuit. Once you are “noticed”, usually by certified mail and then in the real property records with a Notice of Default and Election to Sell, you have so much time to respond.
This is where the QWR comes in. This is also where the DVL comes in. Pre-litigation discovery!
No servicer (who the two foregoing letters go to) will let you see the original note because they don’t have it. If the loan was securitized, the note and deed of trust were shredded when they were uploaded into the MERS System®, so the best you’ll get is a “copy” of the Note you signed.
So you’re preparing a draft of a lawsuit, asking for an injunction to stay the sale, eh? You’ll have to have some sort of discovery in the works, but wait! Doing this in court is time-consuming and expensive, which is why I like QWR’s and DVL’s. You send them to the servicer’s QWR address (specifically) … don’t send them to the servicer’s regular address (they have an address specifically for QWR’s) unless you want your requests to be ignored. It’s like getting the evidence in advance without discovery.
Scenario #2:
You are in a mortgage state (judicial). You’ve already received a Notice of Intent to Accelerate the Note.
This gives you “x” number of days to respond, because the mortgage loan servicer that is behind the scenes “doing the dirty” has retained the law firm to prosecute the foreclosure. While the QWR and DVL is a great way to slow down the progress of opposing counsel, you need to pay attention to the local court docket.
Once you’ve been served with Notice about being sued, understand that state and local court rules apply. You have “x” number of days in which to respond. Check the land records for the filing of the Notice of Lis Pendens because that’s the document that most attorneys claim just slandered title.
Normally, you check the copy of the summons and complaint to foreclose for the most damning information. You discover the Note attached with a stamp on it that says, “Certified Copy of” or something similar, signed off on with some title company executive’s initials. The first mistake is to ignore it.
The Copy and the UCC
To put it in simple terms … take a check, make it payable to yourself … now make a photocopy of that check (both sides), so the check looks as if it’s been copied (this is what the servicers do). Then take the copy of your check to your local bank and tell the teller you need to cash the check. What do you think the teller would say?
“Sorry, I can’t cash a copy of the check, I have to have the original.” Duh. She might even hit the silent alarm and you’ll be in leg irons in short order for attempting to forge a check. Copies don’t work. That’s part of a UCC term called “presentment”. You either have the original or you don’t. Why don’t attorneys simply explain to a judge this very scenario about taking a copy of a check to a bank and trying to endorse the copy and present it to a teller to cash and then wonder why the cops were called. Hello?
Just a thought.
Don’t you just love the days of technology gone by? The servicers are also very good at creating notes out of thin air too. If you suspect this is happening, you’ll have to cough up the funds to pay a forensic note examiner to look at your note and testify that it is a forgery.
Endorsements
This is another subject that fools a lot of people. Many times, the servicer will come into court through their attorneys and attempt to demonstrate the note has an indorsement-in-blank on it, which turns it into “bearer paper”, meaning that anyone who has the original with this on it can cash it. Did you get that?
You can’t cash copies … no matter what! Endorsements can be forged. Rubber stamps can be ordered to spec. Research into the stamps becomes necessary. Research into WHO put the stamps on the note is also necessary.
THIS CASE COULD NOT HAVE COME AT A BETTER TIME … LIKE NOW!
Here we go again … another case in federal appeals court … another recognized attempt by a homeowner that failed when applied to the Spokeo v. Robins case handed down by the United States Supreme Court, 578 U.S. 330 (2016). See the case below:
While the case specifically denotes cases applicable to the Fair Credit Reporting Act, it has been judicially recognized in all 50 states as being the benchmark for proof of injury and raises the bar for such.
The case in chief is Foster v. PNC Bank, N.A. and wouldn’t you know it … Spokeo got tossed in for good measure because the homeowner (Foster) relied solely on his affidavit and couldn’t prove causation. See the case below:
To get to the nuts and bolts of Spokeo and how it was applied to this case, see pages 10-11 of the Foster ruling.
Page 11 of the Foster ruling clearly identifies that Foster lacks standing because the injury he is trying to prove happened is not fairly traceable and under Spokeo, it has to be an actual injury-in-fact! There’s no getting around this if you want Article III standing to pursue such a case.
It looks as if this case could have been done pro se. Most pro se cases fail because of 3 reasons: (1) lack of understanding and application of the Federal Rules of Civil Procedure; (2) lack of understanding of how case law should be applied; and (3) evidence based on emotion and not facts supported by evidence. Once you clearly read this case, you might understand why the author of this post thinks that way.
NOW … Why can’t Spokeo be applied to foreclosure cases?
Why can’t homeowners make the bank or REMIC Trust prove it suffered a concrete injury-in-fact under Spokeo? That question posits multiple answers because there is specific contract law involved.
Based on paralegal-level research, bringing any kind of claim against a creditor should be entertained BEFORE the real problems begin (like getting a notice of default). This author blames homeowners for not constantly checking their public land records for suspect documents, especially in the cases of REMIC trusts, wherein third-party document mills generally crank out manufactured documents that attempt to memorialize when a particular loan (mortgage or deed of trust and note) was actually conveyed into a REMIC trust pool. Sadly, most of the documents creep their way into the public record just before the foreclosure starts. And no one finds that just a little suspicious?
Even more unfortunate, because of the way the deck is stacked in court, judges don’t like giving homeowners free houses just because they come running and screaming into court with a two-dozen (or 200) page complaint, filled with emotion, conjecture and nothing concrete to back it up with, or, in the alternative, attempt to use all that wasted space to try to educate a judge towards their point of view with no attached exhibits or any other evidentiary process to back it up. This author has seen this in hundreds of cases he has reviewed, even by attorneys who thought they were good foreclosure mill attorneys (they miss stuff too)!
The key here, especially in REMIC trust cases (most of which are formed in New York or Delaware), there are commonalities that typically get overlooked and case law can and should be applied whenever possible to support whatever argument is being made. Unfortunately, many pro se litigants miss that opportunity and just continue to rant because they think they were unfairly treated by their mortgage loan servicer, who is the real party behind the foreclosure … not the closed REMIC. What? The REMIC was closed? When?
Does anyone bother to read the REMIC’s 424(b)(5) Prospectus and attempt to tie information into their cases? This author hasn’t seen much evidence of that lately because attorneys dealing in foreclosures believe the judge doesn’t care what happened to the loan if it went into a REMIC trust. This is where knowing how to pick your battles makes all the sense in the world. The Prospectus analysis in of itself can be extremely daunting and time consuming, unless you know where to look. Then you have to apply what you’ve discovered to your discovery to make sure what you think you know can stick in a court of law. It’s called securitization failure.
The bottom line however, is whether the REMIC settled with its investors at any point in time in its history or whether the mortgage loan servicer actually performed under the Prospectus agreement and made the payments of principal and interest as identified under the ADVANCES section of the REMIC’s own governing regulations. If the payments were made by the servicer (whether the Borrower paid them or not) … then who has suffered actual Article III concrete injury-in-fact under Spokeo. There’s the rub.
If the servicer has been paying the certificate holders and the action is being brought on behalf of the certificate holders based on borrower default … how’s that possible? The servicer has paid the monthly payments to the certificate holders, so where’s the concrete injury-in-fact? The borrower isn’t in default if this is happening, are they? Who brings that up in court? Who asks the court to determine an injury-in-fact? Hmmm.
Because the bank is trying to foreclose, the courts automatically assume they own the loan; otherwise, why would they be filing a foreclosure action in the first place?
There’s the other rub. If the case involves a REMIC trust, this author believes with a certainty that the mortgage loan servicer is playing “lender” and claiming it has the right to foreclose when it can’t prove actual concrete injury-in-fact based on contract law because it doesn’t have a contract with the homeowner. Yet, bank’s attorneys come into court and misrepresent those facts all the time in an attempt to create standing for a fictitious plaintiff (one that no longer exists in most cases).
Yep, none of this seems fair, does it? But, as any good paralegal can tell you, all of our collective work is research and if you don’t take the time to do it, you can’t prove anything and your case is dead in the water before you even get started.
Then there’s the other faux pas … suing everything under the sun because they’re identified with the REMIC. Example: MERS. Big waste of time. MERS is owned by the same company that owns the NYSE. Where do you think you fit into that financial scheme of things. MERS has more money than any pro se or attorney-supported litigant out there and will outspend you and give you nothing. Besides, from a paralegal’s standpoint, it adds well more to the costs of processing a case because of service issues, actual service of process, filing responses and memorandums for every single defendant named. So what if MERS was used to electronically facilitate the transfer of securitized mortgage loans. Case law on MERS is so diverse and scattered among the states and federal circuits even the U.S. Supreme Court won’t entertain looking at MERS-related cases 99.9% of the time.
Declaratory Relief Actions
This is why this author likes declaratory relief actions. While these types of actions are discretionary at the federal level, state court judges will normally entertain them. You’re asking for a determination on a question, not a final ruling. To get to the final ruling, you have to have your questions answered, enough to prove your allegations contained a factual basis, as determined by the court. This paralegal and consultant always sees better results when dec relief actions come early and go after specific targets and not just a bunch of ballyhoo on paper. Since most judges are being ordered to clear dockets, does your case really belong in foreclosure court where all the judge sees you as is a deadbeat? Or would it be better if you were in a county court of law where the judge wasn’t occupied with foreclosure as the main issue? This author has seen successes with the latter of the two modes.
Yet homeowners wait until everything is “around their ankles” before they act. The author blames this on the lack of legal education. Spokeo (since its 2016 ruling), has been wielded like a two-edged sword, mostly in favor of the lenders. In closing, this means one would have to spend serious time doing research and digging up the facts to build an actual case. Spokeo is law. Spokeo is not emotion. People would do themselves a big favor by studying the law, especially tort law. Prosser and Keeton on Torts, 5th Edition would be a great start.
The author is also nationally-syndicated talk show host on The Power Hour.
(Op-Ed) — The author of this post is a paralegal that serves as a title consultant to trial attorneys in foreclosure matters and thus, this article is not intended to render legal advice, nor to be construed as such. It is intended for educational purposes only and is not guaranteed to produce any given legal outcome.
The author of this post will try to keep things simple without passing judgment.
There is no doubt here that we are collectively living in troubled times. The rash of foreclosures continues now that the eviction moratoriums have been lifted for the most part. Those who did not undertake a loan modification or request a forbearance (that was actually granted) are probably feeling the sting of communication by the mortgage loan servicers in their mailing out of late notices on unpaid and delinquent mortgage loans.
According to the terms of the mortgage or deed of trust (depending on which “state” you’re in), there is a specific section on Default. Understand that it’s the mortgage loan servicer’s obligation to collect the mortgage loan debt and route payments to the “lender”, no matter WHO that lender might be.
The problem with defaults, loan modifications and the like is that so many of the loans out there today are securitized through the MERS® System. Since the MERS® System was taken over by the same company that owns the New York Stock Exchange, the information coming out of this entity is scarce to non-existent.
Generally, if you miss a payment, the servicer is going to notify you by certified mail. You may have to sign for the letter. The biggest mistake that homeowners make is ignoring these letters, when in fact, this could be the very start of a long, drawn-out process where you can obtain a lot of useful and vital information that your attorney could use in a foreclosure defense posture, without having to pay gobs in legal fees.
What is a QWR?
That process is called a Qualified Written Request (QWR) under RESPA (the Real Estate Settlement Procedures Act) § 6. You can easily research this section of the law and discover that RESPA allows you to send a QWR to the servicer’s bona fide QWR address and ask the servicer to send you specific information, which is discussed below.
The author is going to include a sample QWR from the National Consumer Law Center; however, it comes with a caveat. If you want to delay the foreclosure while gathering evidence, it is suggested by many attorneys that you only request two or three documents at a time and just keep the requests coming. As soon as you get the set of documents you asked for, have another letter drafted, ready to go with another 3 to 4 document requests under the same set of statutes. This prolongs the servicer taking any action against you, while you set out to discover (rather than go through objectionable discovery in court against the servicer who’s trying to steal your home) all of the documents necessary to build a sustainable case.
Several homeowners this author has talked to have utilized QWR’s to stop foreclosures. It was only when their attorneys told them it wasn’t doing any good to continue sending them … and the homeowners quit sending QWRs … that all of a sudden, the servicers foreclosed on them.
Why send a QWR?
Sending the servicer (at their official QWR address, not their main address) a QWR is a great way to get information from the lender’s mortgage loan servicer. Nine times out of ten, it’s the mortgage loan servicer that retains the law firm to foreclose and it’s the mortgage loan servicer whose employees falsify the assignments they use to create standing to steal your home.
Secondly, when asking intially, the following documents are key to asking for follow-up questions:
An unredacted copy of the mortgage or deed of trust
A copy of the note, showing all indorsements and allonges proving custody of the note
A copy of the complete pay history of the loan, including escrows
Do NOT ask for the original note because it’s highly likely the servicer doesn’t have it. If your loan was securitized, it’s also highly likely, given what Judge Jennifer Bailey in Florida was told by the Florida Mortgage Bankers Association (in 2009), that your note was shredded after it was uploaded into the MERS® System.
For those of you doubting Thomases out there, read page 4 of the foregoing letter to the judge … understand that the word “eliminated” is just what it is. The banks got rid of the original loan paperwork because they converted the note into a security. They converted a debt instrument into an equity instrument, which makes no sense at all. The foregoing letter was included as an exhibit in the Osceola County Forensic Examination conducted by the author and his team and attorney Allen D. West, Esq., released to the Clerk of the Circuit Court of Osceola County, Florida on December 30, 2014. Since then, subsequent Clerks have kept the examination report on the county’s website.
This is why asking to see the original note is ludicrous because it doesn’t exist in its purest form.
This is why you want to identify WHO the players are in your chain of title and compare what you get from the mortgage loan servicer’s collateral file with all of the other evidence you are able to obtain from a QWR versus the actual discovery within an expensive lawsuit (right out of the gate).
Day 91
Don’t be fooled by mortgage loan servicers whose employees ask you to be 90 days late on your mortgage loan before they’ll grant you a loan modification. On Day 91, the mortgage loan servicer and the trustee will file for insurance claims on the REMIC and get paid in full for the missing mortgage loan payments not made by the borrowers. If the investors in the REMIC are made whole with a payout by the insurance carriers, then who’s in default? The REMIC has no standing to pursue a foreclosure!
Once you’ve been able to ascertain the “players” in the sandbox, it will make things a lot simpler to identify the culprits and pursue some serious litigation against them.
Listen to Dave Krieger on The Power Hour, 11 a.m. – 1 p.m., Monday – Friday (Central Time) and don’t forget to watch his speech, streaming live on The Power Hour (thepowerhour.com) on Saturday, May 14, 2022, live from Clay Clark’s Reawaken America Tour at the Carolina Opry in Myrtle Beach, South Carolina at 11:15 a.m. Eastern Time.
(BREAKING NEWS) — The author of this post posits the following information for educational purposes only and any information contained herein should not be construed to be the rendering of legal advice. For legal advice, you should consult with an attorney that has won several foreclosure cases. NOTE: There are a lot of attorneys out there that think they can defeat a foreclosure; however, these people simply see a monthly annuity and have figured out a way to stall the inevitable.
Years ago, when this author wrote Clouded Titles (his second work, which followed The Credit Restoration Primer, now in its 5th edition), now in its Mayday Edition, he set up an alert in his Google system settings to detect any reference to the phrase Mortgage Electronic Registration Systems, Inc.
The reason for this is because back in 2007, while doing research on chains of title in his local land records, he discovered the widespread appearance of this electronic database throughout his local public record and this was the start of a 2-year quest into researching the sum, substance and function of what most in the legal profession refer to as MERS. After filling up 4 file drawers full of printed material from various articles, court cases and public records (including his own public record filings), this author decided that since there were no actual books out there describing the chicanery on Wall Street and how MERS was involved in it all, that the public needed to know the truth … and this is how Clouded Titles was born.
Thanks to the “alerts” set up in the Google search system, this author is able to monitor perceived upticks in the foreclosure markets, based on what is happening throughout the U.S. and the notices posted in various newspapers’ legal sections throughout the country.
What the author of this post has also noticed is that because the economy is stagnating, people are without incomes. As a result, the propensity to commit crimes against property by filing documents that purport to transfer title into the name of the perpetrator so the property could be listed and sold through nefarious means is also on the rise. Once the property is sold, the foreclosure starts. The author has seen evidence of an uptick in this area as well.
This is why it’s a good idea to check up on your public records involving your property every 3 months, just like you would check up on your credit reports to make sure they’re accurately being reported. County Clerks are paid to assist you in looking up your records if you don’t know how to do it. Many of the databases are online, so they are easily traceable via the county’s search engine. When you conduct a search, you need to be especially aware of any “assignments” of not only mortgages (or deeds of trust) that have been recorded in the public record that transfer an interest in any loan taken out against the property or to detect the insidious crime of property theft by fraudulent deed transfer.
If you suspect you’ve been “taken” in such a manner, the first thing you should do is to go to the County Clerk’s (Recorder, Register of Deeds, Auditor, etc.) office and obtain a certified copy of the suspect document. The second thing you should do is to take that suspect document to your county sheriff and file a formal criminal complaint against the party or parties allegedly effectuating the transfer.
Part of the problem with fraudulent transfers and assignments however, is that the goings-on behind the scenes within law enforcement appears well above the pay grade of the detectives working in the crimes against property unit. This was evidenced in the follow-up meeting with Osceola County, Florida detectives in 2015 (along with the County Attorney, who was obviously “in on it” with them), who couldn’t find any evidence of wrongdoing in the Report this author spent five months working on … and instead, chose to “shoot the messenger” instead. The County Attorney then proceeded to inquire who the forensic team members were that gleaned the public record looking for suspect documents. The information was not required to be provided under the Open Records Act laws, thus, the County Attorney came away from the meeting empty-handed. The detectives however, wanted to know who certified all of the 17 banker’s boxes of suspect documents delivered to the States’ Attorney in Florida’s 9th Circuit, who saw the files and the report as a “political hot potato” and wanted nothing to do with them. Law enforcement in Osceola County, Florida then began to harass and surveil a known member of the forensic team who lived in the county and who was an outspoken critic of the illicit foreclosures taking place in his county. A family member of the forensic team’s liaison was tasered and arrested as he was walking onto his front porch at 3:00 a.m. after being out with his cousin, was not drunk and was not disrespectful or disorderly against the arresting deputies (who were surveilling the home). The charges were eventually dropped. This is just one scenario that happens when one “tries to do the right thing”.
This presents us with another known problem with law enforcement: corruption. Unless your county sheriff is a “constitutional sheriff”, don’t expect your complaint or any potential investigation to go anywhere, especially after having researched the campaign donors to your local district attorney in the last election. This author would encourage you to research CSPOA.org and become a member and get the information necessary to further your campaign in either getting the sheriff on board or finding ways to get him/her ousted from public office.
This author also reminds you (at this juncture) that county sheriffs are bonded. Without a bond (due to forfeiture), they can’t hold office as a sheriff. This is why counties have Risk Managers. A Risk Manager is another word for “damage control”. This individual gets more crap thrown at them from both consumers and county officials as a result of their positions. This is why it’s become harder to find competent people willing to undertake the honest task of “doing the right thing” and getting consumers the information on who the agent is for the bond, along with their address, phone # and policy number.
If the county’s risk manager refuses to give you that information, send an Open Records Act Request under state statutes and demand the information. Once obtained, you may wish to consider filing a complaint against the bond of the individual that failed to do their constitutional duty to protect your rights under the law.
NOTE: This procedure can also be used against school boards as well (that treat parents like domestic terrorists for speaking out at school board meetings); however, that’s not the subject matter of this article so this author won’t dwell on that scenario at this time.
In closing, a genuine foreclosure has to be treated differently. This author would encourage the use of a Qualified Written Request (QWR) under RESPA § 6. Do not ask for originals of any documents because it’s highly likely they don’t exist. Ask for copies of the note and mortgage (or deed of trust); ask for all information contained in your collateral file; ask for copies of your escrow statements and pay histories. Space out your requests (don’t ask for all of it at once). Request it in two or three certified letters to the servicer’s specific QWR address. You might be surprised to learn that mortgage loan servicer error was responsible for the initiation of the foreclosure to begin with.
NOTE: A QWR is not discovery. A QWR is what this author would be doing if he found out every time that his mortgage loan had been transferred or sold. A QWR response can be used to custom-tailor litigation against the servicer and its employees. Above all, remember that the public record may contain damning information in the form of assignments that can be used to help custom-tailor a QWR request. QWR requests from subsequent servicers can also reveal missing documents that were never transferred to the new servicer in the collateral loan file.
Dave Krieger is a nationally-syndicated talk show host on The Power Hour, heard Monday-Friday from 11:00 a.m. to 1:00 Central Time; on AM and FM stations across the U.S. and on 7.490 mHz on the shortwave band worldwide. He also consults with attorneys and homeowners on foreclosure cases.
Clouded Titles Blog 