Mortgage Servicing Fraud
occurs post loan origination when mortgage servicers use false statements and book-keeping entries, fabricated assignments, forged signatures and utter counterfeit intangible Notes to take a homeowner's property and equity.
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I am new to the forum and trying to read as much as i can to understand our options.

Currently we were forclosed on in California and date of sale was set.  We halted the sale by filing for ch.7 bankruptcy one day prior to that sale date.  We had our BK hearing (meeting of creditors) and now we are waiting for notice to be sent for discharge which won't happen until end of november or 1st week of december.

However, a few days ago lender (Wells Fargo) sent a motion for relief from automatic stay in order to continue with the sale of our home.

In their supporting evidence they show a copy of the note with a stamp of "Allonge Attached" on front and VP signature on allonge in back page.  This note shows the old lender.  they also include a copy of deed of trust with recorder stamp in front.  This deed shows old lender and has MERS as a nominee for lender and lender's successors and assigns.  It also states "MERS is the beneficiary under this Security Instrument"  Lastly, there is an ssignment of deed of trust where MERS grants, assigns, transfers to Well Fargo beneficial interest--but this is recorder and dated almost 2 months AFTER Wells Fargo sent us notice of default and just prior to notice of sale.

In our BK schedules we checked that the property (home) would be surrendered.  We did this for Wells Fargo debt and also for equity line (Chase--though we took equity line through Wamu)

My question is, can we be discharged and then file for I believe it is called quiet title if Wells Fargo does not have the original note?  Or do we have to update our BK schedule to state we are going to retain the property and contest Wells Fargo's motion for relief from automatic stay in BK court.

Sorry if this post doesn't make complete sense, I am still learning and if I might have an option to keep my home free and clear I will enlist the help of legal consuel (p.s. if there are recommendations for good legal consuel in northern california I would appreciate)

Thank you
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Are you sure you filed a Chapter 7 and not a 13?


Generally speaking, you can keep your home during a Chapter 7 case so long as you "reaffirm" the debt to the mortgage company during the case. This means you contact the mortgage company and tell them you want a "reaffirmation agreement," then they will send you one and you sign it, they sign it, and you file it with the court. This reaffirmation agreement puts you back on the hook legally for the mortgage debt, but lets you keep your home. In other words, it allows the mortgage to pass through the bankruptcy unscathed.


There are a couple of roadblocks to this though: (1) If you are not current on your mortgage payments, the mortgage company will usually not allow you to reaffirm the debt. So, generally people in Chapter 7 must be current on mortgage payments to be able to keep a home in a Chapter 7. (2) If you have too much equity in the home, the Bankruptcy Court may seek to sell the home. In other words, each State says how much equity in residential real estate a person who files bankruptcy in that State may protect. If you go over this amount, the Bankruptcy Court can sell the home to get that unprotected equity to give to your creditors.

So, to keep a house in Chapter 7 you have to be current on the mortgage and check and be sure you are within the amount of equity you are allowed to have in your State. Please note that nothing in this posting or in any other posting constitutes legal advice; this is simply my understanding of the facts and law.

The reference to the lift of stay usually occurs during a Chapter 13, where the homeowner agrees to make payments to the bank. If you don't stay current in your payments the bank will file a lift of stay to be able to sell the home. If you are behind and file a Chapter 13 you can halt the sale of the home, but if you want to keep the home you have to start making payments again. You have to stay current on these payments or the bank will file a lift of stay and begin foreclosure.

The banks are supposed to do an assignment of mortgage before filing a foreclosure, you should speak with a foreclosure attorney right away. Once the debt is discharged you will no longer owe on the debt, but you will also lose the home.

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First of all if I am not mistaken, you only have 14 days to answer the motion for relief from stay. In your motion, you need to challenge them in reference to who has standing to foreclose. A Federal Judge may want to listen. Especially, if you know the assignment of mortgage is bogus as well as knowing if your mortgage is in a trust. You may not have much time to put this together. You will have to research your mortgage.

You may want to ammend your schedules. You have to put the foreclosing party as an unsecured and disputed debt.

Do you have an attorney? If you do, you may want to make sure he knows what he is doing. He needs to know and "Understand" about the securitization of these mortgages.

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Thanks cmc, yes time is very short.

I was digging in my loan documents and found a "substitution of trustee and full reconveyance"  document filed with the county recorder soon after we refiananced with old lender.

It shows the current beneficiary as MERS and the New Trustee as Recon Trust Company, N.A.  (never heard of them and no other reference to them in loan documents)

I'm not sure if i understand this correctly, but wouldn't this mean that MERS is no longer the beneficiary (trustee?) and thus can not be used as having standing and transferring interest/standing to Wells Fargo?

Also it appears the copy of the Note that Wells Fargo sent in their motion for relief is the same copy that we have in our loan docs--except for the allonge attachment (ours is more formal with form numbers and there's is partially written out with no form numbers at bottom of page).
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You need to file a "DEBTOR'S OBJECTION TO MOTION FOR RELIEF FROM STAY" It has to filed within the 14 days.

It sounds like anything with MERS in it, is nothing but trouble. MERS never owned your note nor will they ever.

And as I said earlier, You need to ammend your schedules. You have to add MERS, Wells Fargo, the Trust and anyone else as Unsecured and disputed.

I know for a fact (I've seen it with my own eyes) that if the Judge is listening he may lift the stay but will tell them that they can't come after you for one dime after the foreclosure. (If your Objection is strong and shows a broken chain of title, etc.. )
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