Tag Archives: PSA

MERS RULES IN THE FIRST U.S. CIRCUIT COURT OF APPEALS; SCREWS 2 HOMEOWNERS

(BREAKING NEWS – OP-ED) — The attached cases were argued by the same attorney for the homeowners. Different attorneys for the foreclosure mill, pro-bank law firm of K&L Gates argued for the banks.  This is provided for your educational purposes only and to warn you of the dangers of litigating anywhere within the First U.S. Circuit Court of Appeal’s jurisdiction. My opinions of MERS and what it stands for are my own and do not constitute legal advice.  After all, MERS would like to put a bullet in my head. 

Believe it or not, the U.S. Circuit Courts of Appeal are still in operation despite the corona-crisis.  Last Friday, the appellate panel screwed two homeowners in REMIC foreclosure cases.  Worse yet, one case relied on the outcome of the other case to make the ruling finite. When you have to go into this particular federal appellate court, remember who has set more favorable case law here: Mortgage Electronic Registration Systems, Inc. (“MERS”: now owned by the same bunch that owns the New York Stock Exchange).

Here’s the first case, that the appellate panel used to set the standard for the second case:

Dyer v Wells Fargo Bank NA, 1st App Cir No 15-2421 (Apr 17. 2020)

From the outset of this ruling, it looks as if “Dreamhouse” didn’t do the Plaintiff any favors by including MERS as a nominee within her mortgage.  After all, Dreamhouse appears to have been a corresponding lender who got its money for this loan from an investor pool.

Remember, you’re in the first circuit here.  MERS rules!  MERS gets to do anything it wants.  Assign mortgages.  Publish confirmatory assignments.  I’m so convinced that MERS (through K&L Gates’ attorneys) gets to control the entire narrative in court arguments I could just spit fire.  Even though the mortgage document doesn’t specifically say that MERS can “assign” anything, MERS got out in front of the mortgage foreclosure crisis and pre-established the narrative, so it could come in in subsequent cases and argue that narrative and win every time.

All the same arguments we’ve heard before (specifically in Culhane v Aurora Loan Svcs_021513-1) that MERS can do anything it wants to. However, the narrative is controlled by what MERS can do or not do.  No one is pointing to the actual parties acting in MERS’s name. What this appears to be is just another redux of Culhane.  MERS’s attorneys can argue that MERS is both a nominee (agent) for the Lender and has all of the power of the Lender, especially in THIS Circuit … and get away with it.  This is why I don’t like federal court for litigating foreclosure cases. This is why banks love federal court to argue foreclosure cases … because they win 99.9% of the time!

Old arguments aren’t working anymore.  We need new ammunition, given the fact the second case ruling was predicated on the first one:

Hayden v HSBC Bank USA NA, 1st App Cir N0 16-2274 (Apr 17, 2020)

SAME ‘OL … SAME ‘OL … 

By now, if you’re reading your own MERS-originated mortgages, you can plainly see how you’ve F**KED yourself!  You gave MERS the “official” and “contractual” right to F**K you.  They can foreclose and sell your home.  They can rape your bank account in the name of preset case law they set in their favor.  They can release and cancel anything.  They can do anything your lender does … and can even come into court and act as your lender. Let me put it bluntly here … MERS is a disguise worn by the servicer.  It’s the servicer that’s actually doing the sodomizing here.

In this case, the Haydens filed multiple bankruptcy cases over time, delaying their foreclosure (and screwing up their credit) until 2026.

Again … as you can see on Page 3 of this ruling … MERS can do anything it wants … including telling the First Circuit to “get on its knees and bark like a dog”!  Again … old argument from the banks … borrowers do not have standing to challenge a mortgage assignment based on a PSA violation!  Again … the banks and MERS are controlling the narrative.  Old hat.  Doesn’t work.  Still being plied upon the courts and borrowers are paying for an attorney to argue the same old hat stuff … and losing.  Statute of limitations arguments … still old hat.  Not working anymore.  Hasn’t worked since 2o15 yet is still being argued.  Borrowers are still paying attorneys to argue the same things that don’t work.  The First Circuit isn’t buying any of it. It’s not having much better luck in any of the other circuits that have had the same ‘ol, same ‘ol garbage pleadings tossed at them.

Oh … and the PSA … that’s the banks’ narrative.  My narrative is the entire 424(b)(5) Prospectus.  It’s used as evidence in the C&E to establish fact.  You have to pick your battles carefully.  Each battle costs money.  After this corona-crisis is over … foreclosures will cost money. Money that hasn’t been there because half of the economy was shut down versus going in and letting “herd immunity” prevail.

YOU’RE DAMNED IF YOU DO AND DAMNED IF YOU DON’T! 

President Trump can’t do anything without being criticized for it.  He shuts down the economy and the public for its own protection and everyone on “the other side” bitches because he either didn’t do it soon enough or it wasn’t the right move in the first place.  You can’t win with these people.  We know the virus started in Wuhan, China.  But as soon as the President references it as the Chinese virus … now he’s a racist.  His opponents don’t know when to quit.  Sometimes, keeping your political trap shut can work in your favor.  They’re making a mockery of everything the President does, yet most of them have had several decades of serving in Washington to “get things done”, but we’re no better off with them than without them.  This is politics folks. If you don’t like the way things are, change them.  But remember …

The President is the head of the Executive Branch, the branch that enforces the laws.  The President is tasked with running the country … not the person that makes the laws in the first place!  He’s a CEO, not a politician, which is why his opponents hate him so much. He won’t play in their “sandbox”.  Boo frickety hoo!

Congress makes the laws (in the form of bills).  When Congress introduces a “bill” … that “bill” costs money to make it work. Taxpayer money. Someone has to pay for it and it sure ain’t Congress!  This latest stimulus package again demonstrates how much pork Congress got away with spending … and the economy that has been doing so well (that all these lame-brained politicians are trying to take credit for) is now stagnating.

The Courts decide whether the laws are constitutional, are properly enforced and/or whether Congress overstepped its bounds when it enacted a law.  Today’s courts like to issue very narrow rulings, which is why you have cases like these being decided against homeowners.

This is our system of checks and balances folks.  It’s what the will of the people created. Deal with it!

And what the hell does this have to do with foreclosures?

This is why the Dyer ruling was 12 pages and the Hayden ruling only 5 pages.  Because the Dyer ruling says enough to where it doesn’t have to be repeated ad infinitum, ad nauseam in the Hayden ruling.  It has everything to do with the atrocities that banks are allowed to get away with, using MERS as a disguise for the real truth.

Everything in these two cases affects every ruling that comes out of the U.S. First Circuit Court of Appeals.  Other federal circuits may choose not to rely on these two cases … or Culhane for that matter.  But it clearly shows circuit split when it comes to how the courts treat MERS and what they will let MERS get away with.  If you don’t know what to plead … how can you expect to win your foreclosure case?

THE CANCELLATION & EXPUNGEMENT ACTION (The “C & E”) …

Because we’re seeing results with using the C & E, it goes without saying that I’d talk about it again.  Neither of these two cases discussed anything within the contents of the document that made sense other than the date and time of the event and the claims the assignments made violated the PSA.  That moves the argument into the bank’s narrative.   To argue the bank’s narrative is to liken that strategy with the comment Robert Stack made in the comedy movie Airplane: “That’s just what they’d be expecting us to do!”

The C & E does just the opposite as it moves the narrative in a different direction … one “they won’t be expecting”:

  1. Virtually all 50 states have common law rights to cancel written instruments. That includes bogus assignments!
  2. Virtually all 50 states have penal codes that prohibit the recording of false utterances in the public record!
  3. Virtually all 50 states have a consumer protection act that can be tied to the recording of the false utterance!

The C & E is postured within a declaratory relief action that can be utilized while the banks aren’t foreclosing … hint, hint:

  1. The declaratory relief action is discretionary in federal courts, which is why we like to use it in state courts!
  2. The declaratory relief action can be accompanied by a notice of lis pendens, which can be effective in stopping title closings in foreclosure cases!
  3. The declaratory relief action in many state courts can ask for a ruling on a document to be applied to the entire chain of title as a precursor to filing a quiet title action.

The C & E costs less money to effectuate than most foreclosure defense actions yet still is able to achieve a timed delay:

  1. Investors use C & E’s to buy time.  Time is of the essence no matter what battle you pick. This can buy more time if used correctly in both deed of trust and mortgage states!
  2. We are now seeing that filing corresponding criminal complaints with local law enforcement is “shaking things up” in the civil realm when it comes to litigating false utterances!
  3. Many times, the criminal intent contained within the false utterance can be used to put a court on notice that someone is trying to “protect the sanctity and decorum of the court” by keeping the judge from becoming an accessory to the criminal acts committed by the servicers’ employees, acting in the name of MERS!

You still have time to factor in a positive outcome.  There is still time to get your 2-day training session (with materials) on DVD (8 discs) and train yourself and your attorney to fight the good fight because the foreclosure moratorium is still in play here for most of you. Visit the Clouded Titles website for more information.  Supplies are limited so order yours now!

As a special added bonus … your order includes a 30-minute consultation session with the author! 

 

 

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FLORIDA: To Defeat Bartram, One Must Defeat the Default Claim

OP-ED (NOT LEGAL ADVICE) — 

The author of this post is the author of several books, all of which can be found on the Clouded Titles website. The author is not an attorney but rather a disenfranchised political enemy of the United States Government and consults attorneys on actions involving real property law and consumer issues. 

I was rummaging through some recent cases when I found a case involving HSBC Bank USA, NA who was acting as a Trustee for a REMIC, which got me thinking (which for me, can be dangerous at times) about the idea that every new missed payment constitutes a new default date and thus a new cause of action.  This is the downside of Florida’s infamous Bartram case.

See the referenced case here: HSBC Bank USA NA v Sanchez et al_4D17-1085 (Feb 28, 2018)

While perusing the above-referenced case, it suddenly dawned on me that this was a case involving a REMIC (Real Estate Mortgage Investment Conduit). Being the researcher that I am, I decided to take a look at the Prospectus for this REMIC … and what do you think I found?  Not the Prospectus?  You’re right about that.  (Why does this NOT surprise me?)  What I was looking for was a 424(b)(5) Prospectus because it would have probably contained information regarding the cut-off date, the closing date … and especially the distribution date (to the investors, of money paid by the servicer, which in the above case was probably Wells Fargo Bank, NA).  Why is this important?

If the investors are getting paid every month, then how are they harmed?  What right does HSBC have to go into court and collect on behalf of the certificate holders of the Luminent Mortgage Trust 2007-2 if distribution payments to the investors were being paid every month?  Wouldn’t that defeat a default date?   How would we know if we didn’t know what to ask?   It is highly likely none of this was considered in the defense of the Sanchez borrowers.

The Trustee “allegedly” came into court claiming that the Borrowers missed multiple payments before, during and after the pendency of the proceedings. Being the dutiful Senior Judge that the Hon. Barry Stone allegedly is, he misapplied Bartram, found for the Bank, and subsequently got reversed by the 4th DCA.  Notice also from the last paragraph that the 4th DCA couldn’t find where Judge Stone made a determination that the Trustee Bank was damaged and remanded the case back to his court.  This was a per curiam decision (which means all judges on the appellate panel agreed one the same sticking points). This would mean (to me) that the servicer’s attorneys “didn’t get it right” in their contrived pleadings.

My whole point here is this:  If a REMIC is involved, wouldn’t it be nice to find out about the ADVANCES section?   This is the section of the REMIC’s own governing regulations (NOT THE PSA), contained in the Prospectus, wherein the servicer (or in the alternative, the Master Servicer), is mandated to make the Borrower’s monthly payments to the investors if it reasonably believes it can collect the payments from the Borrower.  The Distribution Date of almost every REMIC occurs between the 20th and 25th of every month and the payment is made to them as the Borrowers within the tranches of the REMIC pay the servicer (who distributes the payments).  When the Borrower misses a payment, the servicer makes the payment anyway.  So how are the investors harmed?  How was HSBC harmed?  How was there a “default” when the servicer was continually required to make and thus would keep making the payments?

Wait a minute!

WHO is actually paying the law firm for the Trustee to foreclose?  The REMIC?  Nope.  U.S Bank has admitted in its own brochures that, as a Trustee for a REMIC Trust, does NOT know when borrowers are in default (probably because they get reports showing the servicer has been making the payments for the borrowers when they can’t make them).  We have come to find that the servicers are the entities paying the law firms to come into court and misrepresent the payment schedules.  I am only aware of a handful of cases where attorneys have seen payments actually made by the servicer show up on a loan payment schedule where the servicer complied with the terms of the Prospectus, signed under penalty of perjury under Sarbanes-Oxley.  So then … why are we nitpicking at “when’s the last time the borrower made a payment” when we should be nitpicking at “when’s the last time the servicer made a payment on behalf of the borrower to prevent the distribution date from being interrupted”.  This IS a big deal!

The allegations made by all servicers is that the Borrower is in “default”, all the while the servicer is hiding the fact that the servicer made the payments to the investors, who have been getting paid religiously.  You see, the servicers have a Servicing Agreement with the REMIC.  They get to go into court and attempt to recoup the payments they’ve made on behalf of the borrowers to the investors.  Do you have a contract with the servicer?  Nope. Didn’t think so.

Your mortgage was signed by you, representing a unilateral adhesion contract with the originating lender (who is probably using Mortgage Electronic Registration Systems, Inc. to securitize the mortgage loan), NOT the servicer.  The REMIC sets up credit default swaps, default insurance, PMI, LPMI and requires the seller to pay for a title policy to insure the chain of title, when in fact, the falsely manufactured assignments we see in most cases is a clear attempt by the servicer to commit perjury upon the land records (F.C.C. § 817.535).  When the lawyers for “the Bank” come into court and regurgitate all of these allegations, they are part of the conspiracy to commit felony perjury on the court because they are employed by the servicer, who is trying to recoup payments they made on behalf of the Borrower, NOT the Trustee.

IMHO, this case bears a lot deeper “digging” through discovery in a new cause of action against the servicer and the law firm bringing the case on behalf of the wrong party.  The REMIC has probably been paid off several times over when the Borrower actually did miss a payment.  The REMIC then went in and “cashed in” on the aforementioned policies and collected on those policies so it could continue to make payments to the certificate holders.  There is no mention of this in the foreclosure Complaint, is there?

The servicer then files an Affidavit through its representative, claiming that the REMIC Trust, the certificate holders and the Trustee have been harmed because the borrower missed making the mortgage payments, all the while it has been meeting the Distribution Date deadlines set forth in the Prospectus.

By the way, this REMIC filed a 15d6 notice with the United States Securities and Exchange Commission on January 25, 2008 (BEFORE the financial crash), claiming that it had less than 3oo investors and was no longer required to file reports to the SEC: SEC Info – Luminent Mortgage Trust 2007-2 – ‘15-15D_ on 1:25:08   This would indicate that distribution payments are probably still being paid on ALL of the loans that allegedly were put into the tranches of the REMIC Trust, which can be found HERE: SEC Info – Luminent Mortgage Trust 2007-2 – ‘FWP_ on 4:24:07 re: Lares Asset Securitization, Inc.

Notice that Lares Asset Securitization, Inc. is listed as the Depositor?  I guarantee you that nowhere is this Depositor mentioned on any assignment, endorsement or allonge anywhere in the Sanchez’s paperwork.  THIS would be in violation of the Pooling and Servicing Agreement (PSA), which is part of the Prospectus.   What generally happens is that the servicer is doing the foreclosing (by written Power of Attorney with the Trustee) in order to collect all of those “missed payments” it had to make up by paying the investors when the borrower didn’t make them.  It would appear that despite the REMIC’s collecting on all of those insurance policies, it profited from the collection of those policies to the point where it could continue to reinvest those profits as capital, avoid paying taxes because of its pass-through tax-exempt status and continue to make the payments to the certificate holders (investors) every month.  There is no proof that Lares put that Note and Mortgage into the Trust pool, is there?

So, to be honest … yes … the borrower indeed may have missed their mortgage payments, but are they really in default if the servicer made the payments for them?   The results of this case obviously beg for more “behind the scenes” attention (discovery) to WHO is coming to collect and why, followed by the appropriate civil and criminal action against those responsible.  In Florida, Florida Criminal Code § 817.535 has a civil remedy as well as a criminal one.

And here … we’re arguing about default?

To find out more inside detail, read this Report: OSCEOLA COUNTY FORENSIC EXAMINATION

Hear Dave Krieger every Friday night at 6:00 p.m. (Eastern Time) on WKDW-FM!

 

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The Pooling and Servicing Agreement: Why eat just half the enchilada?

Securitization Issues — Throughout the trials and tribulations of pouring over thousands of documents, the same issue keeps popping up in my head.  Why are attorneys claiming to rely ONLY on the Pooling and Servicing Agreement (the “PSA”) to establish REMIC failure and nothing else?

How many cases have you read in the last two years that there was strict reliance on the use of the PSA to win a foreclosure case?

I have read of very few instances that go into extreme detail in an attempt to educate a judge (unless you’re in one of the “sand states”, which got hit the hardest and well before the rest of the nation caught on), who really didn’t major in securities law (unless you happen to be “seated” somewhere in the Southern District of New York), all the while opposing counsel is objecting to entering the PSA into evidence at trial.  At the end of the day, who has the note with the right to enforce it seems to be the bottom line.  This issue has also come under severe scrutiny, because when MERS and securitization are involved, it means the promissory note you signed is now an electronic memory and does not consist of what the bank’s attorneys claim is “the original note”.  (I will save the forensic discussion of promissory notes for another argument and another article!)

Perhaps it’s because some well-meaning individuals out there in the legal world told the attorneys that the crux of their argument was in the PSA.

I say, “No, it’s not just the PSA! You’re only eating half the enchilada!”

I am writing this piece (not for my own self-gratification) for the sake of those who have gotten past Securitization 101.  I know most of the blog readers understand what a PSA is and what it contains.  They subscribed to this blog in the past because there was something worthwhile posted on here, so the assumption is … the PSA to the readers of this blog is at least within their sphere of knowledge.  This may be a little “deep” for those of you reading this post for the first time.

In my travails, I have discovered that the “blind eye” seems to include such terms as “Cut-off Date” and “Closing Date”, when referencing the PSA, yet these terms are not found in the PSA.  They are merely referenced.  To find these two dates, what must one do?   Go to the front of the bloody 424(b)(5) Prospectus and find it within the first few pages of the document’s definitions.

I am not being paid by SECINFO.COM to tell you that it is much easier to search for REMIC information on this website than many of you have experienced on SEC.GOV.  I only use SEC.GOV to order complete certified copies of the 424(b)(5) Prospectus, because I want to eat and digest the whole enchilada. Why?  Because I’m hungry for the truth, that’s why.  I want the truth, the WHOLE truth and nothing BUT the truth (the WHOLE truth).  That means, if I have to peruse a bloody 400+ page prospectus that defines the parameters of how a REMIC behaves, I’m going to get this knowledge in my craw, because it’s going to come in real handy and some point and this is an RMBS Trust we’re talking about, it’s somebody’s house that is affected by what’s in this bloody document!

If man’s thought processes anything like electricity, it’s following the path of least resistance.  There are “securitization gurus” out there in the hinterland that I tip my hat to because they’ve gone above and beyond the call of duty in reading and understanding the entire “enchilada” (the sales pitch), and you know who you are, but they keep pointing to Section 2.01 (or its relative counterpart in some other types of PSA’s) and not referencing (and including as evidence) the WHOLE truth.

I say, the judge needs to “get smart” in order to play the game.  But … most won’t.

I’ve also heard that judges in America really don’t give a shit about you and whether you lose your home. You didn’t make your payments so you deserve to, whether someone else made them for you or not.  Judges just want to clear their court dockets as quickly as possible to convince the populace and hierarchy that keeps putting them on the bench that they are efficient in their duties and that their political careers and pensions are priority #1 (and go play golf and vacation with their families).

If you wonder what others are saying about judges across America, just dial up The Robing Room and see for yourself!

It seems like the foreclosure defense community just wants to “cut to the chase” to inform the judge that the “path of least resistance” is out there.  All of us lazy folk don’t have time to read the whole enchilada.  (“Your Honor, we know you have a full docket today, so out of professional legal courtesy, we’re not going to waste your time … because after all, we’re ‘officers of the court’ and we have a duty to represent the concerns of the court first, the public second and our clients … in last place!  We have a business model to run, Your Honor, and we can’t do that wasting time in court, when we can make money playing the delay game.  Oh, wait!  That’s part of Your Honor’s game too!  Drag the proceeding out as long as possible so the homeowner runs out of money, gives up and walks away, right?  Either way, the banks win!”)

The foregoing thought process sounds like many a pissed-off homeowner that has lost faith in America.  You know what?  I don’t blame you.  I’ve lost faith in America too.  I’ve learned that you cannot depend on the charity of others in your quest to survive. However, we live in a society that condones and promotes such behaviors (it’s called socialism) and the multiculturalized American society gobbles it up like a hot enchilada.  But … they eat it so fast they don’t take the time to digest it and it passes through their systems like “shit through a goose” (to quote Gen. George Patton). Yet these same pissed off homeowners are quick to criticize anyone else that’s trying to do the right thing, as if we’re all destined to be miserable in life.

This is the chief concern when I don’t see the entire 424(b)(5) Prospectus (in certified form) being offered as evidence at trial. One can always “tab” the document with miniature, self-adhesive type notes or make reference to those sections of the document in their written arguments so the judge will see it.  Bankruptcy judges have to deal with this all the time, because they’re concerned about debt, not chain of title.

So the question then becomes: Does securitization actually have anything to do with chain of title?  Do you know the answer?

YES! 

It’s just that Wall Street’s idea of “pure intellectual masturbation” hasn’t permeated into the crevices of America’s primary educational system.  Kids in school today don’t even learn “Checkbook 101”.  Nope!  They just want their allowance so they can go out and blow it on junk.  Wait a minute!  That sounds kind of like Wall Street in 2008 when everyone in the securitization game was being compensated into the millions so they could go out and party in blow, booze and hookers, doesn’t it?  Now, I suppose some of you out there are also picturing Dante’s Inferno, right?  Especially the Third, Fourth and Eighth Circles. 

When it comes to securitization, you simply CANNOT cut corners.  If you’ll notice, the entire 424(b)(5) Prospectus document, in whatever form, has some commonalities:

  1. It was signed under penalty of perjury under the Sarbanes-Oxley (“SOX”) Act.
  2. Virtually ALL of the REMICs have Cut-off and Closing Dates.
  3. The chain of title to the subject property (under attack) probably contains an Assignment of Mortgage or Assignment of Deed of Trust that makes reference to a REMIC by name (if it’s written correctly, some aren’t). This is where the REMIC shows up in the chain of title and becomes a “party” in the “adverse claimants to title” category.
  4. Most if not all of the time, the Assignment in question (also suspect to this very day) was drafted by the employees of the mortgage loan servicer you’re trying to deal with, using MERS or some other “made up” interest so the servicer can “hide behind the scenes”.
  5. All prospectuses make reference (somewhere in the document) of who the “players” in the securitization game are, generally they’re right up front.  These are offered to investors right up front, prior to investing, which also promoted the caveats (there were no guarantees), when the creators of the REMICs knew exactly what they were doing in running the reader around in circles (the “pure intellectual masturbation”) until they’re so confused they don’t know which end of the document is “up”.
  6. All make reference to who collects the money to support the distribution payments to the investors at the other end of the REMIC who claimed to be harmed when the REMIC drags you into court or announces it’s selling your home on the courthouse steps.
  7. In some way, shape or form, most if not all prospectuses contain a Pooling and Servicing Agreement of some sort, which explain HOW mortgage loans are supposed to be conveyed into the trust pool and when.

The problem is, none of the banks ever followed their own rules.  The servicers of the mortgage loans began paying your mortgage loans for you when you hit your financial “tipping point” and couldn’t make them any longer (or wouldn’t because you found out the truth).  When the borrower stops making payments, the servicer starts making the payments for the borrower.  This is mandated by the Prospectus, but again, how convenient THAT was left out of the legal equation brought before the Court.  We couldn’t have the judge thinking some rich uncle was making our mortgage payments now, could we?

UPDATE: A NEW TWIST OF THE TALE! 

Some REMICs have a third party involved.  That third party is called the Credit Risk Manager.  It’s generally an outside company that is paid a fractional portion of the REMIC’s gain to monitor the activities of the mortgage loan servicer.  This would mean that this entity has documentation (that it gets on a regular basis, IF it’s doing its job properly) being supplied to it by the servicer and the Trustee (if certain aspects of the REMIC’s operations are applicable) for evaluation to make sure that the servicer is doing its job correctly in compliance with the REMIC’s own governing regulations.

To insist that the Credit Risk Manager may be in breach of his fiduciary duties to the REMIC would depend on three (3) things:

(1) The Credit Risk Manager (if one is shown, not all REMICs have them) was not compliant in keeping track of the servicer and its records;

(2) The Credit Risk Manager failed to report the failure of servicer compliance to the Trustee; and

(3) The Credit Risk Manager was getting a paycheck for doing nothing.

This is another classic example of REMIC failure!

OCWEN FESSES UP!

The judges just want to give your homes to the bank.  They really don’t have time for details.  Right?

Again, I post the following for your consideration: Ocwen’s Letter to 6 Government Agencies

The foregoing transmission is 9 pages long.  I would suggest, as part of your digestion process of “the whole enchilada”, you focus on the parts of the Prospectus that talk about payments being made to investors to keep the REMIC going.  What happened in 2008 was pure “overload” on Wall Street’s financial system.  When you read this Ocwen transmission, you will probably be infuriated, because this affects NOT JUST OCWEN, but EVERY mortgage loan servicer out there!

Read the 9 pages again!  The servicers are the parties doing the foreclosures in the name of the lender.  The problem is, you don’t have a written agreement with the servicer.  You have a written agreement with the Lender.  If the lender’s out of business, the servicer is still collecting mortgage payments and is still paying the REMIC’s investors.  When you stop making the mortgage payments, along with your taxes and insurance payments, the servicer makes them for you!

In the case of a GSE, like Fannie Mae, Freddie Mac, Ginnie Mae or Sallie Mae (WHAT?  Student loans are securitized too?), they too manage REMICs and are knee deep in securitization failure just like the rest of the published REMICs contained within the SEC’s databases.  If there is default insurance involved anywhere in the securitization process, someone got made whole (or at least the payments kept coming in to pay investors), so who is “harmed”?

THE SECURITIZATION CHAIN

The way that the OCC Asset Securitization Handbook contemplated the path of cash flows through the securitization chain started at the top, with the Borrower.  Even U. S. Bank, N.A. admits the Borrower is a party to the Securitization Chain in its 4-page brochure, here:  US Bank Brochure – Role of the Corporate Trustee

So then, why do bank attorneys in court keep downplaying that the Borrower has nothing to do with the Assignment of Mortgage, when the Borrower clearly is AT THE TOP OF THE CHAIN? (taken from p. 8, virtually right up front, just like the Cut-off and Closing Dates are located in a Prospectus).

 

The “Originator” and “Servicer” work in tandem with (but independent of) each other to make the loans and then collect the payments so the investors who “buy into” the securitization scheme get paid (on the distribution date, generally the 25th of every month).   The “Rating Agency” issues ratings for the bonds the investors would be able to buy (this is shown in the Prospectus, NOT in the PSA).  How much more evidence do you need that the Borrower’s payments to the chain have everything to do with compliance of the entire Prospectus, even when the Borrower DOESN’T MAKE THE PAYMENTS!

For the purposes of this discussion, we move within the path of the securitization chain to discuss WHO makes your payments when you can’t.

The following item was taken from the front end of the Prospectus (NOT in the PSA, which I why I say ya’ll spend so much time focusing on the PSA, you miss the good shit**):

 

 

So, if you think I’m making this stuff up, think again.  This paragraph (taken out of the front end of a Free Writing Prospectus in conjunction with the REMIC paperwork offered on SECINFO.com, which I subscribe to) explains the same thing that the 9-page letter Ocwen wrote about who makes the payments when the Borrower doesn’t.  So, these are the “baker’s dozen” questions I leave you with:

  1. Is your written contract (the Security Instrument) with the mortgage loan servicer or with the lender?
  2. Does it say anything in your Mortgage or Deed of Trust that the Servicers may change during the life of your loan?
  3. Did anyone tell the mortgage loan servicer to make your payments for you when you couldn’t?
  4. Did the mortgage loan servicer handling your loan tell you that it was making your payments for you when you couldn’t?
  5. Did the foreclosure mill law firm mention in the foreclosure complaint that the servicer made the payments for you?
  6. When you asked the servicer (in discovery or through a QWR) for a payment history, did the servicer disclose ALL the payments made (including the payments the servicer made)?
  7. Did the servicer’s law firm misrepresent the character and status of the debt as being in “default” when it really wasn’t? [FDCPA § 807(2)(A)]
  8. As the result of Question #7, has the servicer been wrongfully trashing your credit reports? (FUTURE CREDIT DAMAGE, actual harm under Spokeo v. Robins)
  9. As the result of Question #7, did the foreclosure mill law firm attempt to collect payments from you that you believe were already paid by the servicer?
  10. As the result of Question #7, did the foreclosure mill law firm allege that the REMIC was the Plaintiff when the servicer had been paying the REMIC’s investors all along?
  11. If the servicer had been making the payments all along, was the REMIC and its investors actually harmed?
  12. In deed of trust states, are you non-judicial foreclosure victims now kicking yourself because you didn’t realize this information was in the Prospectus … and you could have truly fought this?
  13. If you retained an attorney to fight your foreclosure, why didn’t your foreclosure defense lawyer pick up on this?  (Remember, the path of electricity?)

Therefore, it would stand to reason that if everyone stopped making their mortgage payments on known securitization chains, the mortgage loan servicers now in existence would go broke overnight making everyone’s payments, as there isn’t enough money in their coffers to support doing that.  All of the RMBS’s on Wall Street would go under on the distribution date following the borrowers’ loan payment stoppage.

See how easy it would be to collapse part of the U.S. economy?

We’re not talking about the TBTF institutions that started all this garbage, we’re talking about the loan servicers that are the real parties filing foreclosure complaints trying to collect their “servicer advances” before the REMIC itself, which has been getting paid all along, gets any residual payments.  It’s the servicers that are lying to the courts in an attempt to reimburse their coffers for all the money they’ve stolen from everyone’s escrow accounts to keep securitization afloat! 

Eventually however, the investors would get stung.

Ignorance is bliss.

For now, I rest my case.

**The information shown above came from SEC filings on behalf of the Bear Stearns Asset Backed Securities I Trust 2006-AC1.

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STRIKE TWO AGAINST OCWEN’S “QUALIFIED WITNESS”; SAY ALOHA OCWEN!

BREAKING NEWS, OP-ED … 

(Honolulu, HI) — For those of you looking for ammunition against Real Estate Mortgage Investment Conduits (REMICs) and the servicers and subservicers who screw homeowners on their behalf, a new case out of Hawaii has surfaced that should put more securitization and civil procedure into greater detail, courtesy of foreclosure defense attorney Gary Victor Dubin.  You can download the .pdf of the Hawaii Supreme Court ruling here:

US Bank NA v Mattos, Sup Ct HI No SCWC-14-0001134 (Jun 6, 2017)

For those of you battling against U.S. Bank, NA as a Trustee of a REMIC, you should know that U.S. Bank has admitted in a 4-page brochure that they do NOT know when a Borrower is in default:

US Bank Brochure – Role of the Corporate Trustee

Further, U. S. Bank (in the same brochure) admits that the Borrower is in fact a part of the securitization chain!

The Office of the Comptroller of the Currency, long before the Glass-Stegall Act was repealed in 1999, issued a Comptroller’s Handbook on Asset Securitization that also stated the Borrower was a party to the securitization chain (see Page 8 of 92), contemplating in advance of how the chain actually was supposed to work:

OCC Asset Securitization Handbook

Ocwen, as you may recall, admitted to the United States Government (via 6 different federal agencies) in writing that when Borrowers don’t make their payments (to the REMIC), Ocwen, as servicer through the Sales and Servicing Agreement, makes their payment for them, in an article I just posted, see page 2 (bottom) and 3 (top) of  EXHIBIT 29

The Hawaii Supreme Court reversed an appellate court ruling, which upheld the district court’s ruling that U.S. Bank, as Trustee of a REMIC, had the right to foreclose on a property belonging to a Hawaii property owner, which other courts across the land have dared to lightly tread upon these same similar issues. Sadly, borrowers seldom ever follow through on getting to the nation’s highest courts (the state Supreme Courts) to achieve finality.

I beg of you to read Gary Dubin’s case, because part of the equation in securitization failure has been examined and ruled upon by a state Supreme Court (Hawaii).  I am singularly surprised that other state’s haven’t made the same glaring rulings finitely (Florida’s 4th DCA is close, but NOT THIS CIGAR!).

This case is a rarity that should be examined in more detail because the Pooling and Servicing Agreement (“PSA”) was included in the attack.  What’s worse, Ocwen’s “Contract” witness, who tendered an affidavit claiming he was a “know-it-all” about Ocwen’s business records (which 20 states and the District of Columbia are calling a sham), which did nothing for U.S. Bank because U.S. Bank’s attorneys couldn’t prove the relationship between Ocwen and U.S. Bank.

I was truly shocked about the part of robo-signing, which in fact was mentioned in the ruling.  No one has yet to challenge this act as part of a civil conspiracy (yet); however, this is to come.  I am not going to go into detail for you here, because I know many of you out there like to do your own research into the elements of civil conspiracy in your respective states, as in a Google search, “What constitutes the elements of civil conspiracy in _____ (insert your state here)____?” and see what pops up.  The burden of proof is much lower than RICO and easier to prove by attacking the signers, witnesses and notary involved in the assignment.

Oh, darn! This involves spending money doing depositions, huh? Shit!  And here you thought you were going to get a “free house”!  I don’t know where the bank’s attorneys get off making these snide remarks about homeowners wanting a free house, because they don’t even know what the homeowners are thinking.

The Trustee hasn’t paid a nickel to the investors that it can document; however, EXHIBIT 29 clearly identifies WHO pays the investors.  So, taking this to its logical conclusion: If the investors are getting paid, then how can the Trustee, on behalf of the investors, claim the investors have been harmed or prejudiced because the securitization chain failed?  I have no contract with the servicer, do I?  My contract is the Mortgage and Note. Those contracts are with the Lender.  When the Lender goes belly up, as history has shown us, the mortgage servicers use the MERS® System to “keep the lie going” by giving unproven authority to thousands of writer’s cramped individuals who execute assignments in its name, being told by third-party document mill executives that it’s perfectly legal to do what they’re doing.

This is why the entire banking underbelly is corrupt and illegal as hell.

The securitization chain failed because the parties to the trust DID NOT follow the REMIC’s own governing regulations, not because the investors weren’t getting their payments!  When push came to shove, Ocwen and other third-party butt plugs had to gum up the chain of title with what I consider falsified documents, Assignments of Mortgages and Assignments of Deeds of Trust.  That is my new term for document mill robo-signers who have no knowledge of the facts contained in an assignment they’re claiming they have knowledge of! To even proffer this … and then brag about it like NTC does (the McDonald’s of robo-signing, “over 16-million served”, referring to the number of documents this third-party document mill says it’s recorded as a means to “clear title”) … should have put this entity, its directors and employees, in prison.  However, since the banks have virtually paid off the state legislators and executive enforcement arms … no one has gone to prison, yet.

A Court Case Full of Surprises! 

I am glowing about the securitization/forensic analysis included as a mention in this Hawaii case as a means to educate a judge … and nothing more.  Most judges can’t wrap their heads around this kind of testimony because they are only thinking about their retirement accounts and how those accounts might be affected if they rule against the bank.  Unfortunately, what they DON’T GET … it that the entire 424(b)(5) prospectus is in play here, NOT just the PSA portion of it!  Let’s take a look, shall we?

SEC Info – Mortgage Asset Securitization Transactions Inc – ‘424B5_ on 1:14:05 re: Mastr Alternative

There are 357 pages in the Prospectus attached above.  Yes, the WHOLE enchilada!  Why just pick out the PSA?  That’s like eating the peas and leaving the steak! It doesn’t contain ALL of the information now, does it?  This is the Prospectus for the foregoing Hawaii case! 

Look at the portion of the Prospectus that talks about the PSA.  If you look under the TABLE OF CONTENTS, the Pooling and Servicing Agreement is found beginning at Page S-95.  However, the cut-off and closing dates that are related to the issues expressed within the Pooling and Servicing Agreement are found OUTSIDE OF the section on the PSA, at Page S-5, 90 pages away from the PSA!  The Prospectus of this REMIC (and any REMIC for that matter) is the entire “sales pitch” of the REMIC!  It’s the entire set of governing relations for the REMIC!  Why then are we just focusing on the PSA when the entire 424(b)(5) Prospectus has all the rest of the nuggets that make the PSA make sense?   Because judges are lazy and don’t want to read 357 pages of this stuff.  If judges figured this out, there wouldn’t be one retirement plan vested in RMBS’s and CMBS’s!

This is the end result of what the repeal of the Glass-Steagall Act has caused.  This is the lazy man’s excuse for not wanting to read (texting is more funner, sic).  This is why Sen. Elizabeth Warren’s reintroduction of the Act cannot go unsupported.  The people need relief here.

Text – S.881 – 115th Congress (2017-2018): 21st Century Glass-Steagall Act of 2017 | Congress.gov |

I have talked about securitization failure systematically on this blog prior to the mass deletion of what came before this set of recently-posted articles.  It would make no sense to educate a judge that thinks his retirement account will fail if he rules against a bank.  This is why I have always told consumers involved in foreclosure litigation to “background their judge” (hire a private investigator if you have to, to dig up the judge’s nasty little political secrets)!

What has happened since the Glass-Steagall Act was repealed has turned into an all-out war involving servicer fraud and this case is a clear example of it.  I seriously doubt that U.S. Bank was really involved in this case (more like Ocwen).  If the attorneys for the bank were actually forced to admit WHICH aggrieved party they were representing in this case, they probably couldn’t tell you.  My guess is, Ocwen retained them because Ocwen wants to steal your house to reimburse itself for all those pesky servicing fees it racked up paying the REMICs off!  This is how Ocwen wants to get rich off America … and it uses Altisource and REALServicing (more-than-arm’s-length devices) to pull it off!  Any time that you see “corporate layering”, you are going to have to dig deep like many of the readers of this blog do … and pull up the serious stuff that matters.

We have to be smarter than the banks if we want to win.  Unlike the banks, we have to expose the truth!

This is my truth: OSCEOLA COUNTY FORENSIC EXAMINATION

 

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Filed under BREAKING NEWS, OP-ED