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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john
Are their any sites that shows the laws or regulations for securitization audits which I can determine what the violations are? Are their any spreadsheets or tools which can be used to a securitization audit?
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William A. Roper, Jr.
John:

You just do NOT SEEM TO BE GETTING IT!  Securitization Audits are RIPOFFs.  This is a SCAM!

It is a GOOD IDEA to ascertain the identity of the mortgage trust which claims to own your loan and to find the SEC registration materials, including the PSA, in respect of such trust IF your loan is NOT owned by a GSE -- Fannie, Freddie, or Ginnie Mae.

You can do that using the tips found at this site.

There is no silver bullet that you are going to find within these documents to win your case.  The documents are useful so that you know the TRUE FACTS of the securitization, which can help you to distinguish areas where the plaintiff is LYING, forging documents, fabricating evidence, etc.

So asking about laws or regulations for doing securitization audits is a non-starter.  There ARE NO securitization audits.  What you buy is a report that is taken solely from publicly available data that you could find yourself in an hour or less.  The report going to be inadmissible as evidenceThe persons preparing the report usually have no actual expertise or credentials and wouldn't usually be accepted as expert witnesses, because their ownly expertise is in running scams and swindles! 

If someone contacts you seeking to sell you such a report, I would encourage you to report this person to the Better Business Bureau, your local prosecutor and the state attorney general.

Start reading through prior message threads or post a question about a particular trust.

Someone can probably help you find the SEC registration materials in a matter of a few minutes. 
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john
Thanks, can you list out the steps to do what you mentioned above?

Thank you.

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Moose
john wrote:
Are their any sites that shows the laws or regulations for securitization audits which I can determine what the violations are? Are their any spreadsheets or tools which can be used to a securitization audit?


At the risk of being redundant, a self-performed "audit" is an oxymoron and a layman will probably find things that aren't really there and miss things that are.

Even judges who hear securities cases rely on expert witnesses and amicus briefs when it comes to the complexities of securitization - which include tax law in the case of REMICs.

The SEC, local (New York, for example) regulators, the banking regulators and of course, the IRS have their own tools, resources and experts and all have a hand in the process.

And, as has been pointed out before, the value of such an "audit" to a borrower is less than just questionable and scammers are making all manner of specious offers as if the process would be some kind of magic bullet.

Moose

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Not to mention that a borrower does not have standing with respect to what goes on behind the many securitization curtains.
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Texas
Roper said:

"There is no silver bullet that you are going to find within these documents to win your case.  The documents are useful so that you know the TRUE FACTS of the securitization, which can help you to distinguish areas where the plaintiff is LYING, forging documents, fabricating evidence, etc."

Well Said.

Just to start, one would need to know who created the secondary market security. (i.e., GSE or Private Security, where the Private Security may or not be a registered security.)

Until current day truth is accepted by the courts, I personally do not see how an audit in the securities area would be of value if such audit could even be preformed.


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Texas

I am sure Roper will comment about the length and the posting.

Part 1 of 4

Table of Contents

1. The Creation of the Mortgage Note and Security Instrument

Uniform Commercial Code and Recordation Requirements

2. Tangible – Personal Property versus Real Property

Failure to Maintain Continuous Perfection

3. Original Obligee (Lender) Takes Possession of the Secured Mortgage Note

Proper Parties

4. Original Obligee (Lender) Sells The Secured Mortgage Note

Obligee Indorses Mortgage Note to” In Blank” Indorsee

5. Original Obligee (Lender) Sells an Unsecured Mortgage Note (MERS as Nominee)

MERS Hides the Fraud

6. CONFUSION

Hiding the Fraud

7. Why the Investor Does Not Own the Mortgage Note and Security Instrument

The Mortgage Note Does Not Identify the Subsequent

Owner & Holder of the Mortgage Note or the Security Instrument

8. The First Negotiation in Blank

 “Or How Not To”

9. WHY THE CHAINS DO NOT MATCH

“MERS”

10. The Second Negotiation in Blank Unidentified Indorsee “In Blank” Indorses “In Blank

Still Using the First “In Blank” Indorsement-Failure to Negotiate

11. MERS and Transferable Records

15 USC 7003, Excludes Negotiable Instruments When UCC Governs

12. The Third and Fourth Negotiation in Blank

Subsequent Negotiation by an Unidentified Subsequent Indorsee “In Blank” to additional Subsequent Purchasers “In Blank”

13. Holder, Owner, and Holder in Due Course, Innocent Purchaser

            (A) One can be the holder of the Mortgage Note and not be the owner or have rights as          holder in due course.

            (B) One can be the owner of the note and not be the holder or have rights as holder in            due course.

            (C)  Holder in Due Course

            (D) Innocent Purchaser

15. The Trillion Dollar FUBAR

14. Closing Statement

__________________________________________________________________________________________

 

1. The Creation of the Mortgage Note and Security Instrument

Uniform Commercial Code and state recordation requirements

            The Homeowner (Obligor) signs a Mortgage Note and a Security Instrument.  Upon signing of the Security Instrument and by operation of law, the Security Instrument is automatically attached to the Mortgage Note and temporary perfection is established. The Security Instrument when filed in public records transforms a temporary perfection into a permanent perfection and is notice to the world. Regardless of whether the Mortgage Note is sold to a subsequent purchaser, recordation of the Security Instrument is required to permanently perfect the lien. The Security Instrument affects title to Real Property, and as such, the laws of local jurisdiction govern and such requirement to comply with local laws of jurisdiction is contained within the Security Instrument itself. The filing of record serves a second and distinctive purpose: it creates the priority of perfection among subsequent purchasers of the Mortgage Note and is not addressed further in this document. Upon attachment and perfection of the Security Instrument to the Mortgage Note, the Mortgage Note becomes an indebtedness that is “Secured.

2. Tangible – Personal Property versus Real Property

Failure to Maintain Continuous Perfection

            The Mortgage Note and the Security Instrument are Tangibles and Personal Property and we shall consider the two items in tandem to be called the “Mortgage” and such “Mortgage” is Tangible and Personal Property.  One must not forget the terms contained within the Security Instrument affect an interest in Real Property and these terms require compliance with all applicable, federal, state and local laws and the language contained within the Security Instrument itself. Failure to comply with the laws governing the contents of the Security Instrument or language within the Security Instrument would render the Security Instrument a nullity. If such Security Instrument becomes a nullity, then the classification of the Mortgage Note is reduced in status from “Secured” to “Unsecured” and as a result of the Security Instrument becoming a nullity the “Power of Sale Clause” contained within the Security Instrument would also be nullity.

            The Mortgage being a Payment Intangible can be negotiated by possession and the security for this Payment Intangible is the right to collect monies from the (Mortgage Note secured by the Security Instrument as collateral). Thus, the (Mortgage Note and Security Instrument as collateral) is security for the Payment Intangible and it is this security that follows the Mortgage (Payment Intangible) where the Mortgage is the owner of the Mortgage Note and what should be a valid perfected Security Instrument. Again, the Mortgage is nothing more than a Payment Intangible (Personal Property) and the security for this Payment Intangible is the right to collect monies noted in the Payment Intangible’s security, the Mortgage Note. The Payment Intangible’s security also consists of a valid perfected Security Instrument along with any valid Assignment of Mortgage filed of record to transfer lien rights in accordance with laws that govern the Security Instrument.

            Regardless of the hierarchy of ownership of the Payment Intangible, Mortgage, Mortgage Note or Security Instrument, the terms contained within the Security Instrument must be complied with, and this author has not seen a Security Instrument that does not itself require compliance with federal, state or local laws. Failure to comply with the laws of local jurisdiction that govern the terms within the Security Instrument would render the Security Instrument a nullity and the Mortgage Note would then be reduced to “Unsecured” and the Mortgage (Payment Intangible) would then be left without a valid perfected lien to allow foreclosure of the Real Property. Additionally, if the Security Instrument was rendered a nullity by failure to comply with the laws or the terms contained within the Security Instrument, the secondary market has not purchased a “Secured” indebtedness and any claim made by a subsequent purchaser including Trusts are without rights to enforce the “Power of Sale Clause” and no foreclosure is possible. This failure to provide a complete Mortgage to the secondary market is the real fraud that the financial institutions are trying to conceal.

            Even with a nullified Security Instrument, if a valid Mortgage Note with a complete Chain of Indorsement is proved, the Holder/Owner with right as Holder in Due Course could sue for equity in a court of jurisdiction.

             So when it is said the Mortgage follows the Note, one must remember that the Security for the Payment Intangible follows the Payment Intangible without filing of record, and therefore, the underlying Mortgage Note would be followed by a valid continuous perfected Security Instrument if there were compliance with applicable laws to maintain perfection of the Security Instrument.

3. Original Obligee (Lender) Takes Possession of the Secured Mortgage Note

Proper Parties

            Original Obligee takes possession of the Mortgage Note and permanently perfects the Security Instrument by filing of record in the Original Obligee’s name. Failure to name the correct parties could possibly be a fatal to the enforcement of the terms in the Mortgage Note or Security Instrument.

4. Original Obligee (Lender) Sells The Secured Mortgage Note

Obligee Indorses Mortgage Note to “In Blank” Indorsee

            The Original Obligee sells the Mortgage to a subsequent purchaser. Proper procedure is to negotiate the Mortgage Note under cover of a Bailee’s Letter to the subsequent purchaser and then transfer the rights to the Security Instrument by filing of record the name of the subsequent purchaser who purchased the Mortgage Note and completing the Mortgage Note negotiation by noting the owner name in the blank.

            Original Obligee indorses the Mortgage Note and delivers the same to the subsequent purchaser (Second Obligee). Second Obligee then completes the negotiation by filling in the blank, if negotiated in blank, then files of record an assignment of the mortgage to transfer and perfect the Security Instrument’s lien into the Second Obligee’s name. If the Second Obligee fails to complete the negotiation by noting ownership in the “blank,” then the Second Obligee may have become the possessor of the note but has not become the holder of the note and has not achieved holder in due course with rights to enforce the Mortgage Notes terms or the terms within the Security Instrument. Additionally, failure to file of record the Assignment of the Security Instrument fails to transfer lien rights and this failure to transfer lien rights has rendered a once secured Mortgage Note to “Unsecured.”

5. Original Obligee (Lender)  Sells an Unsecured Mortgage Note

(MERS as Nominee)

MERS Hides the Fraud

            Where MERS is filed of record as the Mortgagee as Nominee for a lender and lender’s assigns, and where the first negotiation of the Mortgage Note is executed “In Blank,” one has to inquire how MERS would represent an unidentified Indorsee. In most cases this unidentified Indorsee ceases to exist after the creation of the security trust and may not have existed upon the closing of the loan. This unidentified Indorsee and subsequent unidentified Indorsee’s would constitute a break in the “Chains.”  There are two distinct Chains. One chain is that of indorsements noted on the face of the Mortgage Note and the publicly recorded chain of title that transfers lien perfection. This Paper will not dwell into to the details of the “Chains.”  As MERS claims to be the Mortgagee of record for lender and lender’s assigns and as the Mortgage Note is negotiated in blank through a number of unidentified endorsees, it is clearly observable from the facts that continuous perfection of the Security Instrument has not been in compliance with the laws of local jurisdiction which govern the Security Instrument. The chain of indorsements use of “In Blank” is also fatal as an “IN BLANK” unidentified party cannot negotiate the Mortgage Note.



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Texas
Part 3 of 4

6. CONFUSION

Hiding the Fraud

            Wall Street is buying a Payment Intangible (Personal Property) and as such is the owner and holder of that Payment Intangible and the laws that govern the Payment Intangible allow for negotiation by possession. The Payment Intangible’s security is the Mortgages (Personal Property) contained within the collateral pool. Remember, the Mortgage actually consists of two parts, the Mortgage Note and a lawfully continuously perfected Security Instrument. So it is now safe to say the security follows the note, yep, but the security that follows the note may in fact be a nullity by the hierarchy ownership’s failure to comply with laws that govern the Security Instrument. Bottom line, the Mortgage Note maybe proved up with a proper chain of indorsements years after the trust creation but loss of perfection can never be proved up once lost and therefore Wall Street may have only bought an unsecured Mortgage Note. The author will not comment on REMIC IRS tax issues. To further complicate the issue, multiple purchases by Wall Street may have not been that of the Mortgage Notes but that of a Transferable Record which is registered within the MERS system.

7. Why the Investor

Does Not Own the Mortgage Note and Security Instrument

The Mortgage Note Does Not Identify the Subsequent

Owner & Holder of the Mortgage Note or the Security Instrument

 

            As stated, the Mortgage Note and the Security Instrument is Personal Property and is commonly called the “Mortgage.” This Mortgage which is personal property is offered up as collateral to the Payment Intangible in the formation of the Trust. To explain, we must present the Trust in reverse order. Investors purchase a beneficial interest in Trust Certificates. The Trust owns the right to the monies collected from the Payment Intangible.  The Payment Intangible owns the right to collect monies owed under the Mortgage Note(s).  The Certificates and Payment Intangibles are personal property; the local laws of jurisdiction that affect real estate do not apply in a direct manner. The Trust documents provide a precise mechanism for negotiating the Mortgage Note and Security Instrument into the Mortgage (Payment Tangible) Pool.  The majority of notes this author has reviewed reflect a single indorsement in blank from the Original Obligee, which raises severe concerns that a chain of indorsements is missing from the Mortgage Note to show a complete chain of negotiation that is required by law to be within public records to show a true “Chain of Title”. The “Chain of Title,” an Assignment of Mortgage (The Security Instrument)) that is properly filed of record would be notice of a perfected lien and the priority of those subsequent purchasers of the Mortgage Note. Filing for transferring perfection of the lien (Security Instrument)  and filing for notice of priority to subsequent purchasers of the Mortgage Note to establish who has priority lien rights is not one in the same. Failure to properly negotiate does not transfer “Holder in Due Course” (ownership/status/rank/qualification/legal status etc., according to the UCC governing law) to a subsequent party not named on the Mortgage Note.

8. The First Negotiation in Blank

Or How Not To

            Where the Mortgage Note was being used as collateral in a Mortgage Backed Security (MBS), and an unknown “Indorsee in Blank” would need to be the first entity in the MBS creation, thus the “In Blank” should contain the identity of that party to allow additional negotiation of the Mortgage Note to further the creation of the Trust. Additionally, we must question the means and the methods employed by MERS to be a Mortgagee of record as “Nominee” for an unidentified “In Blank” or any type of agency relationship to an unidentifiable “In Blank.  Currently, one example, the only means offered to identify an unidentified “In Blank” is contained within a Pooling and Servicing Agreement (PSA). The PSA identifies all the parties that would need to appear in the chain of indorsements and chain of title, this required chain of indorsement is not what is usually found on the face of the Mortgage Note. The Mortgage Note being negotiated by a single “In Blank” through multiple unidentified indorsee’s is not in compliance with the PSA, the UCC or the states equivalence of the UCC, and the failure to file of record the named party Indorsee , “In Blank” party also creates a break in the chain of title in public records. The frog’s bottom: the parties that can be identified on the face of the Mortgage Note, chain of indorsements, does not match the chain of title filed of record. “Rivet, Rivet,” add an allonge and affix it.

9. WHY THE CHAINS DO NOT MATCH

“MERS”

            How would one record of record an unidentified Indorsee “In Blank”? The unidentified Indorsee “In Blank” is not a real person, not a company; in fact, the unidentified Indorsee “In Blank” is a non-existent party, or is it? As the author has noted, the evidence offered to identify the Indorsee “In Blank” appears in third party contracts used in the creation of the investment vehicle and this unidentified “In Blank” Indorsee by admission of MERS can be located within the MERS system and would appear in a MERS Audit Trail. As it can be seen, MERS can track an unidentified Indorsee “In Blank;” but can an unidentified Indorsee “In Blank” be named as a party and filed of record? This is one reason the Chain of Indorsements on the face of the Mortgage Note does not match the Chain of Title filed in public records which filing of record would note the legal party entitled to a continuous perfected lien.  The Security Instrument filed of record converts a temporary perfection and attachment into a permanent perfected lien, while the filing of record of an unidentified Indorsee “In Blank” transfers nothing. In the author’s opinion, MERS alludes that they are the Mortgagee of Record as a means to avoid the problems with filing of record an unidentified Indorsee “In Blank.” The process of indorsing in blank raises one serious question, how does an unidentified Indorsee “In Blank” indorse a note in blank to a subsequent unidentified Indorsee “In Blank” and comply with local laws of jurisdiction governing the Security Instrument that was to secure the Mortgage Note?        Failure to follow the terms within the Security Instrument would breach the Security Instrument contract and render the Mortgage Note unsecured. Not only was the Mortgage Note not properly negotiated to the Wall Street trusts through multiple unidentified “In Blank” Indorsees’, but there was also a failure to transfer a perfected lien to the Wall Street trust. Note: these conditions also apply to Fannie Mae, Freddie Mac and certain private investments and also affect Commercial Mortgage Backed Securities.

10. The Second Negotiation in Blank

Unidentified Indorsee “In Blank” Indorses “In Blank”

Still Using the First “In Blank” Indorsement-Failure to Negotiate

            The second negotiation in the Mortgage Note negotiation would be from the creator of the trust to the depositor of the trust, but in actuality the “First Indorsement in Blank” is utilized for this negotiation. Again, there is an unknown party alleging to be the Holder and Owner of the Mortgage Note by a negotiation “In Blank.” This negotiation is usually indorsed “In Blank” utilizing the “In Blank” from the Original Indorser and no record is filed of record to transfer lien rights to the second “In Blank” Indorsee.

11. MERS and Transferable Records

15 USC 7003, Excludes Negotiable Instruments When UCC Governs

           

            For a moment we have to step back to the “Original Obligee” to understand the movement of the Mortgage Note. This author has noted some commentators are adamant that the Mortgage Notes are not destroyed at any step in the process and we shall follow that reasoning for the moment. In concession of conversation it is somewhat agreed that the Mortgage Notes are placed within custody of a Document Custodian. With that said, we have to address many court filings of copies of the Mortgage Notes submitted by the financial institutions where the originals cannot be found and it is common to only see an “Indorsement in Blank” from the Original Obligee. One has to ask why and how this possibly occurred. Simply, if the Original Obligee placed the Mortgage Loan package within the custody of a custodian and the MERS system tracked a “Transferable Record” alleging to be the lawful negotiation of the Mortgage Note and if a need was required for proof, the current entity claiming rights would retrieve whatever documents resided with the original custodian.

12. The Third and Fourth Negotiation in Blank

Subsequent Negotiation by an Unidentified Subsequent Indorsee “In Blank” to additional Subsequent Purchasers “In Blank”

            The third step in the Mortgage Note negotiation would be from the depositor of the trust to the Trustee of the Trust, but again, in actuality the “First Indorsement in Blank” is utilized for this negotiation. Again, there is an unknown party alleging to be the Holder and Owner of the Mortgage Note by a negotiation “In Blank.

            The fourth step in the Mortgage Note negotiation would be from the trustee of the trust to the Trust, but again, in actuality the “First Indorsement in Blank” is utilized for this negotiation. Again, there is an unknown party alleging to be the Holder and Owner of the Mortgage Note by a negotiation “In Blank.

13. Holder, Owner and Holder in Due Course, Innocent Purchaser

(A) One can be the holder of the Mortgage Note

and not be the owner or have rights as holder in due course.

            Servicers and trustees possibly could become the possessor of the note and claim they represent the owner and the holder in due course, however, if proper negotiation of the Mortgage Note was not followed as required, the trusts that these trustees represent do not hold sufficient legal rights to enforce the terms in the Mortgage Notes, much less enforce the terms in a nullified Security Instruments.

(B) One can be the owner of the note

and not be the holder or have rights as holder in due course.

            The trust may claim to own the Mortgage Note but this would be a misconception. The trust where MERS is involved owns the rights to a “Transferable Record” where that record reflects who has control over a custodian that holds the Mortgage Note, if and when a vaulted copy does exist, and control over MERS as a so called mortgagee of record.

(C)  Holder in Due Course

            Holder in Due course where proper negotiation was not followed would still reside with the Original Obligee, but issues still exist as to a continuous perfected Security Instrument.

            Under the Uniform Commercial Code a subsequent purchaser could not achieve “Holder In Due Course” where fraud was committed by one of the Unidentified “In Blank” Indorsee’s as it affected the Mortgage Note.

(D) Innocent Purchaser

            As to an innocent purchaser, a party to the creation of the trust where MERS is involved and named in the PSA or other documents of incorporation has actual notice of MERS’s involvement and therefore cannot claim to be an innocent purchaser.



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Texas
Part 3 of 4

14. Trillion Dollar FUBAR

The Trillion Dollar FUBAR Uncovered

 

What is known about the multi Trillion Dollar FUBAR reveals an extreme complex machine.

 

A Secured Mortgage consists of two parts, the Mortgage Note and a Security Instrument (Deed of Trust or other such Security Instrument properly perfected). Upon initial signing of the Mortgage Note and the Security Instrument, the Security Instrument attaches and is temporary perfected. Temporary perfection of the lien is converted to a permanent perfection upon the filing of the Security Instrument of record in the appropriate records office. Actions to this point would have created a “Secured Indebtedness”.

In creating the secondary market Mortgage Backed Securities, where MERS is named as Mortgagee , in many instances results in a loss of perfection of the lien and thus renders the Mortgage Note “Unsecured.” Where MERS is named as Nominee for Lender Successors and Assigns on the Security Instrument reflects an agent relationship with the originating lender as holder of the Mortgage Note. Whether lawful or not, MERS being named as Mortgagee for the original Noteholder notices that MERS is attempting to be an agent for same.  Where the original lender endorses the Mortgage Note in blank to multiple unidentified Successors and Assigns creates and condition where MERS cannot be agent for the unidentified Successors and Assigns as “Indorsee,” such as the Mortgage Note on its face does not identify any intervening Noteholder, and as such, no agency rights exist between MERS and any unidentified intervening party.

Just like many people who purchase a home, one assumes the parties executing the paper work are watching out for your best interests and follow the written laws.  At the closing everything appears to be legal and lawful.  But that changes, almost immediately after closing, without your even knowing.  

What we do know about mortgage notes is that many originate with an originating lender.  How the Mortgage Notes lawfully ends up in the possession of a bank is no longer a mystery, it just doesn’t happen. Where the GSE’s are concerned, i.e.; Fannie Mae should have been the holder/owner of a secured Mortgage Note the banks claim that right. In a number of court proceedings the bank present “Lost Note Affidavits,” accompanied by a “printed out digitized copy,” of the mortgage note and present same to the court as “proof” of a “lawful indebtedness.”

Under the Federal Rules of Evidence, a Lost Note Affidavit without personal knowledge is nothing more than hearsay and therefore inadmissible.  The printed out digitized copy of the note also fails under the hearsay rule.  The Uniform Commercial Code and most states’ equivalent allow for Lost Note Affidavits but require supporting evidence.  For cases dealing with Mortgages, records filed in Public Records Offices would support a valid Lost Note Affidavit.  But a nationwide review of public records reveal many “Notices of Assignment” of lien rights to reflect a negotiation of the Mortgage Note that could allow the bank have a claim to the mortgage simply does not exist.  Where a bank or trustee had no Original Mortgage Note and no filing in public records to support their Lost Note Affidavit--any claim by a bank or trustee is without merit.

In reverse engineering of the banking system for Mortgages from origination to Wall Street; excavating the Crime of the Century; knowing how it was perpetrated against investors, assurance companies, homeowners, and others and deceiving the judiciary appears to be by design and as such the world needs to know.   

Now we enter the world of molecular science,

eNotes and the Secondary Market

To begin understanding the fraud we must revisit the author’s 2008 document entitled “Potomac Two Step”:

 

In 1929 the "Great Depression" hit and 4 years later in 1933 the "Glass-Steagall Act" was enacted by Congress. The "Glass-Steagall Act" requires that holding banks and investment banks be entirely different entities.

 

Fast forward to approximately 1996 and Weiss of Citicorp and others had for a decade wanted the "Glass-Steagall Act" repealed. Along comes the "Gramm-Leach-Bliley Act", in part authored by Phil Graham, that was enacted by Congress in 1998 which eliminated the separate bank requirement.  Electronic capabilities had increased by this point and book-entry was in the process of going to an electronic database system. During this same period of time the banking industry in whole, with the help of Mortgage Bankers Association which was also a creation of the banks, created an electronic database processing entity named "Mortgage Electronic Registration System", "MERS" for short.

 

It has been discovered that in 1998 in Decatur County, Georgia MERS had been registering titles with the land records office which would evidence that MERS was functioning in some manner.

 

In 1999 the House of Representatives held hearings that addressed the forth coming "E-Sign Act”. In one hearing it was noted that only two (2) exclusions existed. These two (2) exclusions did not mention the Uniform Commerce Code, "UCC". At present it is unknown how many hearings were held before President Clinton signed the E-Sign Act into law in 2000. The 2000 enacted version of the E-Sign Act had a third (3rd) exclusion added, Sections 1-107 and 1-206, Article 2, and Article 2A of the Uniform Commercial Code were the only sections that the E-Sign Act would not exclude. This exclusion stated that the E-Sign Act had no authority to override the Uniform Commercial Code except for the 4 exceptions. It would be interesting to learn who authored the change and for what reason. None of these four (4) exceptions were Articles that govern "Negotiability" of "Negotiable Instruments".

 

Mortgage Bankers Association, MERS and others began an advertising campaign to state that the E-Sign Act had now given Electronic Signatures the equal legal force of Blue Inked Paper Signatures.

 

The writer of this document does not argue the fact that an "Electronic Signature" has the same legal force as a "Blue Inked Paper Signature" so long as it is created electronic and complies with all laws and is never required to be negotiable. Negotiability is required to further assign the “negotiable Instrument” for use in the secondary market place. Without this negotiability the loan originator has no legal framework to execute any transfer to any buyer, whether that buyer is a bank, Fannie Mae, Freddie Mac, etc.

There are several federal agencies that have stated the creation requirement by electronic is required. Several federal agencies also state that a "Blue Inked Paper Signature" cannot be converted to an "Electronic Signature"/”Electronic Transferable Record” after the fact.

 

In 2001 the "National Telecommunications Information Agency", part of the Department of Commerce, complied with the enacted E-Sign law and requested comments regarding the exclusions within the E-Sign Act. Several of the Federal Reserve banks, the National Consumer Law Center and others stated that the exclusion needed to remain. It was also mentioned that removal of the exclusion could possibly result in legal issues for items governed by the UCC.

 

Research has determined that beginning in 2002  the states’ equivalence of the federal Uniform Commercial Code were being modified to allow for a "Lost Note Affidavit" along with a copy of the "Negotiable Instrument" to suffice to provide legal standing in a court of law at the state level.  At this point the "Originator" of the "Negotiable Instrument" in many instances has already scanned the "Negotiable Instrument" into a graphic image and stored this scanned image alongside the data that was scrapped from the "Promissory Note/Negotiable Instrument". In this writing the term "Negotiable Instrument" is a representation of the "Original Blue Inked Signed Promissory Note" that for all intent was created to be used in the secondary market as a "Negotiable Instrument".

 

The procedure of imaging an "Original Promissory Note" into an electronic format has no legal basis for providing "Negotiability" for buying, selling or transferring to another party much less the secondary market and "Wall Street" as defined by the "Uniform Commercial Code".

 

Research has shown that a high probability exists that at the time of scanning the "Original Blue Inked Signed Promissory Note" the originals are destroyed. This scanned created electronic version is being referred to as an "E-Note" and has no lawful basis to exist. Forty (40) to fifty (50) million of these "E-Notes" have been registered on the "MERS" system and all claims are made on the basis that they are lawful "Negotiable Instruments"--in fact they are fraudulent/fictitious documents that are deliberately being misrepresented.

 

In reviewing thousands of "Notice of Trustee Sales" and other documents filed in MERS’ name at local county recordation offices and with the courts, records indicate "MERS" is an "Assignee", (step into my shoes) for a "Security" that was offered for sale on the secondary market. These notices give creed that that an "E-Note" was bought and sold and used as collateral on "Wall Street". What is amazing is that in the Prospectuses themselves there is mention that the "Security/Collateral/Negotiable Instrument" can be represented by using a "Lost Note Affidavit/LNA" with a copy of the "Negotiable Instrument" as a source of validity that a true "Negotiable Instrument" had been offered up in the collateral pool and then lost. There is no lawful basis for the “Lost Note Affidavit/LNA” to exist if all reference is made to a fraudulent & fictitious document.

 

If the first security is sliced and diced to make many securities, how many such LNA's would be required to withdraw an item of collateral from a collateral pool? If at the conception/scan negotiability was destroyed, how could that item be offered up as collateral as if it had a legal basis of authority, if it is not legally possible under current law?  How many fictitious documents have been created that possibly would fall under Title 18, Fraudulent & Fictitious Documents for legal interpretation!?!

 

This short story is a condensed version; the writer has not included other "Acts" such as "Check 21" that help in disguising the fraud.

 

Offered opinion is that the banks got too far into book-entry and discovered that the third (3rd) exclusion existed or they did not like the exclusion and had no other option but to conceal the exclusion so that the electronic book-entry system would work, regardless of whether or not legal, which allowed the massive unlawful book entry transfers to feed the appetite of Wall Street. So we have a massive smoke screen offered to the courts by the banks’ legal counsels to make sure the fault is never uncovered. This document will not go into the financial fraud committed against the land records offices and other frauds.

 

Simple facts are that "Promissory Notes/Negotiable Instruments" for homeowners are governed by the Uniform Commercial Code, Article 3, and the Esign Act and UETA exclude items governed by Uniform Commercial Code, Article 3.

 

The banks and MERS operate under the false impression the Esign Act and UETA laws give them lawful status to operate using "eNotes" based on homeowners’ "Promissory Notes/Negotiable Instruments" and have attempted an all out effort to cloud the issue before the courts and the banks are aiding by clouding the eyes of Congress.

 

It also has been uncovered that since the laws of the land will not support the non-legal book-entry system there has been an effort to modify state law, specifically in the area of "Lost Note Affidavits".

 

Since the law will not support the non-legal book-entry system it appears there has been a multistate endeavor to influence the courts, see Exhibit "1" below as one example. If the law does not support us then let's change the court rules so we don't have to prove anything.

 

In short, converting a "Paper Promissory Note/Negotiable Instrument" into electronic book-entry to create a so called "eNote" has no legal basis. Once this "eNote" has been created within the book-entry system the "eNote" is then offered up as collateral to the "Secondary Market" on Wall Street or into the Federal Reserve's BIC program (Borrower in Custody) at which time a crime has been committed as the book-entry notes are non-negotiable as defined by the Uniform Commercial Code and a fraud has been introduced into the securities market. Once negotiability has been destroyed it can never be regained and cannot be bought/sold/transferred/assigned into the secondary market place. Issuance of a "Lost Note Affidavit" ends the negotiability of a lawful item.

 

The writer’s comments: a paper note cannot be sliced and diced but the electronic version can be sliced and diced or duplicated, triplicated or quadricated. That is why so many different secondary market securities state we hold the same note and no true owner can be identified. One paper note for one collateral use, simple and at present that is all that is allowed by law.

 

An alarming issue at hand is how after the "Paper Promissory Note/Negotiable Instrument" has been converted into an unlawful eNote and a legal proceeding ensues (def: to take place afterward or as a result) which in some cases the original blue inked original "Paper Promissory Note/Negotiable Instrument" miraculously reappears or a graphic representation is offered up as “The Original”.  There goes the concept of "One Note" and "One Note" only. In reality there is an unlawful electronic version of the "Paper Note" being utilized in the secondary market while the "Paper Note" is in storage somewhere, or was the original destroyed when the electronic version was created? Under current laws both notes are not lawful at such time; they both exist in tandem and neither can be enforced, but it happens every day in the courts of this land.

 

There are many areas the Esign Act & UETA laws work well in such as transit of goods, bills of lading, warehouse receipts, etc.”   End of excerpt. 

 

It was not until some years after publishing The Potomac Two Step, the author was able to prove by admission of Florida Bankers Association’s filing with the Florida Supreme Court in Case no.: 09-1460[1] the scan, copy and destruction was in truth a reality by the following excerpt:

 

“In actual practice, confusion over who owns and holds the note stems less from the fact that the note may have been transferred multiple times than it does from the form in which the note is transferred. It is a reality of commerce that virtually all paper documents related to a note and mortgage are converted to electronic files almost immediately after the loan is closed. Individual loans, as electronic data, are compiled into portfolios which are transferred to the secondary market, frequently as mortgage-backed securities. The records of ownership and payment are maintained by a servicing agent in an electronic database.

The reason "many firms file lost note counts as a standard alternative pleading in the complaint" is because the physical document was deliberately eliminated to avoid confusion immediately upon its  conversion to an electronic file.”

 

What is alarming is not only does the Supreme Court Case no.: 09-1460 provide an admission of scan, copy and deliberate destruction, it also shows that if and when the laws cannot be complied with, the banks under attempted disguise of industry standard, attempt to change the Rules of the courts so as not to have to comply with the law.

 

Florida is not the only state that has issues with banks changing the rules to avoid the law; Texas also has a similar issue as noted in a certified transcript identified as “Meeting of the Task Force on Judicial Foreclosure Rules[2], November 7, 2007. The alarming fact of this transcript is the identities of several of the parties in attendance: Texas State Judge Mark Davidson, 11th District Houston; Phil Johnson, Texas Supreme Court liaison; Texas State Judge Bruce Priddy, 116th District Dallas.  Also in attendance were Michael Barrett and Tommy Bastian of Barrett, Burke, Wilson, Castle, Daffin & Frappier, one of the largest foreclosure mills in Texas.

 

Tommy Bastian is noted to say, “In about 60 percent of all loans MERS is going to be the mortgagee of record, but all MERS is is a registration system. That’s all it is.”

 

Michael Barrett commented, “So, finding a document that says, ‘I am the owner and holder, and I hereby grant to the servicer the right to foreclose in my name’ is an impossibility in 90 percent of the cases.”

 

An alarming statement came from Judge Bruce Priddy, “And what the – happens is they just execute a document like Mr. Barrett says doesn’t exist. They just create one for the most part sometimes, and the servicer signs it themselves saying that it’s been transferred to whatever entity they name as the applicant.”

 

Judge Bruce Priddy is also noted to state, “One of the other concerns I have is that most applications, the rule says it can be on information – it can be on personal knowledge or information and belief. Nearly all of the applications I see are on personal knowledge, and you can tell that there’s no way that one person can have personal knowledge of everything that’s in there.”

 

Honorable Bruce Priddy, “It’s just – to me, I think we need to massage it a lit bit and not encourage folks who do this, because it really kind of devalues the idea of personal knowledge in my court because of what they’re say they have personal knowledge to they can’t possibly have personal knowledge to.”

 

From an exchange of comments between Judge Bruce Priddy and Mr. Bagget

 

Judge Priddy stated, “And so I would like to have some tweaks of that.”

 

Mr. Bagget replied, “And we shouldn’t write the rule in a way that they can’t comply with. That’s not very smart.”

Judge Bruce Priddy responded, “Right. But they can do it if they do it on information and belief and just say that it’s based on their records, but no one does.”

 

In The Supreme Court of Texas, Misc. Docket No. 07-9160[3] provides a complete list of attendees.

 

One need to question changing the Rules of the Court to be in non-compliance with the Rules of Evidence, as “based on their records” would be hearsay.





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Texas
Part 4 of 4

In United States of America v. Hibernia[1], No. 86-3774, United States Court of Appeals, Fifth Circuit, April 5, 1988 the court commented:  “Commercial customs does not apply where the U.C.C provides otherwise.”  One would have to conclude that “commercial customs” has the equivalent, contextual, and immediate definition and interpretation of “industry standards”.

 

As such, it appears Florida and Texas courts do not follow all the Laws but follow Court Rules to circumnavigate certain Laws.  Due Process of Law--not in Florida or Texas.

 

 

It is unknown to the author how many other states have similar scenarios.

 

      We shall address our attention to Fannie Mae’s Announcement[2] 06-24 dated December 7, 2006, titled “Amends these Guides: Servicing, Process for Foreclosing on Mortgage Loans Reflecting Mortgage Electronic Registration Systems, Inc as Mortgagee.  Under the sub title Servicing Guide Part VIII, Section 105, Conduct of Foreclosure Proceedings.  It instructs:

“Therefore, in most jurisdictions, the servicer will need to prepare a mortgage assignment from MERS to the servicer, and then bring the foreclosure in its own name, unless the Servicing Guide requires that the foreclosure be brought in the name of Fannie Mae.  In that event, the assignment will need to be from MERS to Fannie Mae.”

 

Once the security instrument has been bifurcated from the note, rendering the indebtedness “Unsecured”, any attempt to assign the security instrument back to the note as shown above will not convert an “Unsecured Indebtedness” back into a “Secured Indebtedness”. 

 

Now we turn attention to a Mortgage Bankers Association publication, Technology White Paper, “Security Interests in Transferable Records, Evidencing Residential Mortgage Lending Transactions and the Rights of Warehouse Lenders,” as by, “Analysis and Proposal, MBA Residential Technology Steering Committee (ResTech) – eMortgage Adoption Task Force.”  Page 10, footnote 40:

 

 “UCC Revised Article 9, 9-102(42), 9-102(47) and 9-102(61); UCC 3-104. A “payment intangible” is a general intangible that primarily evidences an obligation to repay money. A “general intangible” is any personal property that does not fall into one of the other collateral classifications in Revised Article 9. An “instrument” is a negotiable instrument or other writing customarily transferred by delivery of possession with any necessary indorsement. Therefore, a transferable record is not an “instrument” for purposes of perfection and priority, because it is not in writing.”

 

 “Therefore, a transferable record is not an “instrument” for purposes of perfection and priority, because it is not in writing.”  What does this statement really mean?

 

It means that eNotes are, in fact, a “transferable record” in the form of an electronic digitized graphic file which can identify an “authoritative copy” as well as the party that has control of that “authoritative copy.”  However, since this “transferable record” is in electronic form,   negotiability is not allowed under the Uniform Commercial Code.  It is this eNote/“transferable record” that is offered up into the secondary market and as it is in electronic form,  transferring lien rights from the original-paper-holder-to-an-electronic-holder destroys the perfection of the Security Instrument.  What was once a “Secured Indebtedness” at conception is now an “Unsecured Indebtedness” at the secondary market.

 

Once perfection of the “Security Instrument” is lost, the “Power of Sale” clause contained within the “Security Instrument” is forever lost.  No Bank, servicer, trustee, investor, not even God could use the Power of Sale clause to “Foreclose,” but the courts have allowed foreclosures to occur.  

 

National Journal’s Technology Daily[3] article dated July 3, 2003 in part reads:

 

“The Bush administration is calling on Congress to continue exempting an array of documents from a law that gives legal weight to e-signatures….”  “…Contracts governed by state commercial law.”

 

The American Bar Association’s article “PROBATE & PROPERTY”[4] Jan/Feb 2007, Vol. 21 No. 1 states, “The eMortgage is not a scanned-in document image. Instead, it is a specific electronic file of the security instrument package that is consented to, recorded, assigned and stored electronically.”

 

The American Bar Association did not address the negotiable instrument as to be included within the electronic scope.  What is of concern is the highly respected American Bar Association also does not recognize that the “Security Instrument” as governed by Article 9 of the Uniform Commercial Code or the states equivalence is also excluded under UETA and ESIGN.

 

American Bar Association’s comments to Josephine Scarlett[5], Attorney, Office of the Chief Counsel, National Telecommunications and Information Administration provides the following information:

 

“The Electronic Signatures in Global and National Commerce Act (codified at 15 U.S.C. § 7001 et seq) ("Esign") provides that the "provisions of Section 7001 of this title shall not apply to a contract or other record to the extent it is governed by. . . . the Uniform Commercial Code, as in effect in any State, other than sections 1-107 and 1-206 and Articles 2 and 2A." 15 U.S.C. § 7003.

 

This exclusion from the provisions of Section 7001 for contracts or records subject to the Uniform Commercial Code should be maintained. The Uniform Commercial Code as in effect and as revised accommodates electronic commerce in a carefully considered manner. Section 7001 is not necessary to facilitate electronic commerce in these transactions, and would be potentially harmful to established and evolving paper-based and electronic commercial transactions which are governed by the Uniform Commercial Code.”

 

Uniform Commercial Code Article 3 governs negotiable instruments, including checks and promissory notes. Negotiable instruments must be in writing and signed. To the extent that parties want to engage in electronic payment mechanisms, Article 3 does not prevent parties from doing so. Thus parties may use funds transfer, debit cards, credit cards, ACH transactions or other forms of electronic payment mechanisms. All of those other types of payment mechanisms are governed by law other than Article 3 and Article 3 does not prevent their use.”

 

“The primary purpose of Article 3 is to provide for the rights of third parties who take the negotiable instrument. Article 3 is premised on a regime of possession and indorsement of an instrument and the rights and obligations that accompany that possession and indorsement. To allow for electronic negotiable instruments there must be a concept that is the functional equivalent to possession and indorsement in order to adequately protect third party rights. The difficulty in making such a wholesale change was recognized at the time that both the Uniform Electronic Transactions Act (UETA) and Esign were promulgated by setting up the concept of a "control" system to substitute for the possession and indorsement concept as it applies to electronic notes. UETA Section 16 and Esign Section 7021.  Nothing has changed to make that concern less real. Adequately protecting third party rights and assuring commercial market stability cannot be done by two party contracts in the absence of a statutory scheme that is designed to accommodate electronic negotiable instruments. Applying Section 7001 provisions would sweep away the writing and signature barriers as applied to the creation and enforcement of a negotiable instrument. This change would create havoc as there would be substitute for the possession and indorsement concepts that currently govern the rights and obligations of third parties as to a negotiable

instrument.®”

 

Uniform Commercial Code Article 9 governs secured transactions and was significantly revised in 1999. The revised Article 9 is in effect in all states and the District of Columbia. Revised Article 9 allows for electronic security agreements, electronic financing statements, electronic filing and electronic notices. Subjecting Article 9 to the provisions of Section 7001 designed to do away with the paper requirements is unnecessary to facilitate electronic commerce. In addition, for some collateral types, such as negotiable instruments and documents of title, the ability to perfect and enforce security interests in those items are based in part upon the concept of possession of those tangible items. For other collateral types, such as chattel paper and investment securities, parallel systems of rules have been developed for electronic forms and paper forms of that type of collateral. Applying the provisions of Section 7001 to the paper form would upset the certainty necessary for an efficient system of secured transactions and is not necessary to allow for electronic transactions.”

 

As can be seen from the above comments, the current exclusion for the Uniform Commercial Code from the provisions of Esign Section 7001 should be continued.(10) To subject the Uniform Commercial Code to the generalized approach of Section 7001 is in large part unnecessary given the carefully crafted accommodations to electronic commerce already in place and would create much disruption and uncertainty in the transactions governed by the Uniform Commercial Code.”

 

Let’s focus attention on a document called, “eMortgage Closing Guide, Version 1.0[6], Final Release, April 27, 2006, MISMO eMortgage Workshop,” published by MISMO.  The eMortgage Guide reflects that MISMO is owned by Mortgage Bankers Association as shown in this statement:

 

The MISMO eMortgage Closing Guide, published by the Mortgage Industry Standards Maintenance Organization, Inc. ("MISMO®"), a wholly owned subsidiary of the Mortgage Bankers Association, is a mortgage industry reference tool - a guide to the various aspects of electronic mortgage closing technology and business.”

 

Introduction, more like:  “Start the Illusion,” Author’s personal comment

Introduction

 

“…The closing of an electronic note (eNote), security instrument (eSecurityInstrument), and other electronic closing documents requires the use of a specialized computing platform, generally known as an electronic closing or eClosing system.  An electronic closing system is typically a web-based platform that allows the lender, the closing agent and the borrower to electronically review, sign, store and transfer closing documents.”

 

“However, the enforceability and transferability of the eNote, and the legality of other electronically signed documents depend on whether the closing process and/or system used to create, execute, and store the electronic documents complies with applicable federal and state legal requirements.”

15. Closing Statement

            One has to consider under Title 15 USC, 77nnn, the filing of compliance reports is not in compliance based on the procedural actions that were implemented in the creation of secondary market trusts by the financial institutions. Fannie Mae’s and Freddie Mac’s role in creating securitized trusts as additional fraud creation practices are not addressed in this writing.

            With all the failure of compliance with law in the creation of the secondary market trusts, this writer is alarmed that the “Robo-Signing” and “Robo-Verification” will only serve the financial institutions with a diversionary method to conceal a greater fraud. The “Robo” actions and accounting for all previous failure to comply with laws of governance show proof the financial institution will commit any number of frauds to protect their Friday Paycheck and Crystal Tower Bonuses.

It may be, just may be possible to prove up the Mortgage Note but you can “NEVER” prove up a lost “Perfection of Lien.” Regardless of the number of Affidavits filed with the courts and regardless of the number of Assignment of Mortgages filed of record, none of these actions will perfect a lien once perfection has been lost. Proper procedure for default recovery of an unsecured note--suit for monies: “but you cannot foreclose.” “THEY ARE SUING UNDER A CAUSE OF ACTION THAT IS NOT AVAILABLE,” if filing for foreclosure. Nobody will have gotten anything for free, the home is without a lien secured to the Mortgage Note and the bank can still sue under the default on the Mortgage Note if such note has not been discharged by willful intentional act as noted in the UCC.

Over 2000 years ago, Jesus began this fight with the money changers and today, God has set forth the stampede of Pale horses to fight this evil and the riders’ names are “The People.”

This country is the greatest country on the planet and has laws of justice unparalleled by any other country; the financial institutions have made a mockery of America’s judicial system by use of slickery trickery wording, lies, fraud and deceit and manipulation of lawmakers to create laws to help conceal the fraud.  Sufficient laws do exist and they are just laws, but just not followed by the financial institutions.

GOD BLESS THIS COUNTRY



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Bill
This is the same garbage that is floating all over the internet and I'm sure this garbage has cost more than a few Pro Se ligitants their home.  Without going into the fact that NONE of the OPINIONS in the above posts are supported with any kind of case law or statutes, the main problem is that all the assertians are contrary to LAW. 

The mortgage is in full force when it is executed and delivered to the bank.  The mortgage is perfected when it is recorded.  THERE IS NO FURTHER PERFECTION NEEDED.  The mortgage follows the note.  Any negoation of the note carries with it an equitable assignment of the note.  Bifurcation of the note and mortgage has NOT been accepted by the U.S. Courts. 

A blank endorsement has been used by the mortgage industry for decades.  This is a STANDARD

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Once the security instrument has been bifurcated from the note, rendering the indebtedness “Unsecured”, any attempt to assign the security instrument back to the note as shown above will not convert an “Unsecured Indebtedness” back into a “Secured Indebtedness



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It may be, just may be possible to prove up the Mortgage Note but you can “NEVER” prove up a lost “Perfection of Lien.”


 
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Bill

A blank endorsement has been used by the mortgage industry for decades.  This is a STANDARD BUSINESS PRACTICE.

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Texas
Bill stated:

"A blank endorsement has been used by the mortgage industry for decades.  This is a STANDARD BUSINESS PRACTICE."

Have no issues with a blank endorsement if used properly, especially if accompanied by a Bailee's letter.

Mr. Bill, would you be so kindly to explain how can modern day law would allow MERS to be an agent for a entity only identified as "In Blank"/Endorsement.

And if you read closely, United States of America v Hibernia states in essence, STANDARD BUSINESS PRACTICE would not apply where the Uniform Commercial Code governs. Would love to hear your argument that subject.
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Moose
Texas - who is the author?

Moose


p.s.  You should use caution in posting what might be copyrighted works without any attribution.

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Moose
Texas wrote:
...
And if you read closely, United States of America v Hibernia states in essence, STANDARD BUSINESS PRACTICE would not apply where the Uniform Commercial Code governs. Would love to hear your argument that subject.


Texas - commercial entities can write their way around the UCC as long as the parties agree to it.

Moose

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Texas
Moose, agreed, you can write a contract anyway you want so long as it is within legal compliance.

Seriously doubt anybody will make a copyright complaint.

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William A. Roper, Jr.
Quote:
Moose said:
The SEC, local (New York, for example) regulators, the banking regulators and of course, the IRS have their own tools, resources and experts and all have a hand in the process.


john:

By my original post, I certain did not mean to appear to assert that the are no state or national securities law or regulations, or that GAAP accounting rules or GAAS audit standards might not be applied to such transactions.

And Moose's post reinforces that the principals in these transactions are both subject to such laws and also subject to supervisory inspections and audits, internal audits by the audit staffs of the enterprises involved and audits by certified public accountants who certify the enterprise's financial statements.

Seeking to perform any audit without access to the primary records can be problematic.

I stand by my original assertion that those peddling "securization audits" are mostly simply engaged in scams and swindles, defrauding the desparate borrower.
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Bill

Texas wrote:
Bill stated:

"A blank endorsement has been used by the mortgage industry for decades.  This is a STANDARD BUSINESS PRACTICE."

Have no issues with a blank endorsement if used properly, especially if accompanied by a Bailee's letter.

Mr. Bill, would you be so kindly to explain how can modern day law would allow MERS to be an agent for a entity only identified as "In Blank"/Endorsement.

And if you read closely, United States of America v Hibernia states in essence, STANDARD BUSINESS PRACTICE would not apply where the Uniform Commercial Code governs. Would love to hear your argument that subject.


Mers is acting as Mortgagee for the owner of the note, they hold a bare legal title for the true Mortgagee.  As with all the affidavits submitted by the Servicers where they lie, MERS CAN DO ANYTHING THEY WANT, but it does not make it legal, binding, and in most cases, it is most likely void and without effect.  The key words being "void and without effect".  The mortgage follows the note.  MERS can assign what ever they like, MERS can record what ever they like, but what ever entity that is the true legal owner of the note will have the true equitable right to enforce the mortgage whether or not an assignment was done. 

An endorsement in blank COMPLIES WITH THE UCC.  THIS IS THE WAY THINGS HAVE BEEN DONE FOR YEARS.  There is nothing sinister about an endorsement in blank.  There is no requirement for each entity to endorse the note, it would be a bearer instrument after the first endorsement.  Trying to imply that there is a requirement for EACH entity to endorse the note would require you to enforce a contract to which you are not privy and cannot complain about a breech. 

Bifurcation is a 3 legged purple unicorn.  I have not seen ANY case that the court ruled the note was separated from the mortgage and the mortgage is therefore not enforceable.  To the contrary, MERS actions to assign the note and mortgage would be VOID and without effect.  It's fraud.     
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Texas
Bill said:

" it would be a bearer instrument after the first endorsement" , "Mers is acting as Mortgagee for the owner of the note..." That's one of the problems, the owner is not identified being "in Blank" or "Bearer Paper" for MERS to be an agent for.

If the MERS machine was not involved, then "in blank bearer paper" would probably not present any legal issues.

So if you apply lien laws and real property laws of each of the states, can the lien be perfected by agency to "in blank" or "bearer" whereas MERS cannot identify who they are an agent for. (Need to look at other laws [lien, statutes of fraud, etc] in tandem with UCC for the Note.)

Like I said, I have no issue with endorsements, "in blank" or "bearer" paper under the UCC, but state laws apply to the perfection of the Security Instrument which was to be the security for the Mortgage Note.

Not understanding and applying incorrectly, most likely you will get your hat handed to you and direction to the courts door.

Does any one person understand all the laws that apply to modern day securitization?

 I doubt it, this is where I defer to Roper as most judges still live an operate with premise the world is still in the 1872 era of Longham.

All the way back to Carpenter v Longham, the security follows the note, but state lien laws (not UCC) regarding perfection have evolved over time and today one must consider under state law whether it is a perfected lien or an un-perfected lien that follows the note!

Also, if you are following the Bankruptcy court you will notice that possession of the Note does not always give you rights as "Holder" with rights to enforce.

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john
Does anyone know the steps to do a securitization audit on my own, please stop arguing about laws and such, I am just asking for a series of steps to do a securitization audit on my own, is this not an educational forum?
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Bill
Texas wrote:
Bill said:

" it would be a bearer instrument after the first endorsement" , "Mers is acting as Mortgagee for the owner of the note..." That's one of the problems, the owner is not identified being "in Blank" or "Bearer Paper" for MERS to be an agent for.



But the owner is identified.  The mortgage ALWAYS says MERS is the nominee for xxxxxxxxxxxxxxx.  You seem to be arguing assumptions.  You are arguing that the note WAS transferred to someone else.  MERS is ACTING for someone other than the original lender.  THIS IS THE PROOF PROBLEM THE BANKS HAVE.  IT'S NOT MY PROOF PROBLEM.  The entity that is claiming an agency has the burden to prove this agency relationship and the authority to act.

Your assertion that after being executed and delivered the mortgage is not perfected and in full force is misplaced.  A mortgage does not need to even be recorded to be valid.  The recording act is to protect a mortgagee's interest in the priority of the lien.  If a mortgagee was lazy or negligent and did NOT record their mortgage they could possibly lose their place as the first lien holder.  This failure to record the mortgage would in no way affect the validity of the mortgage or make the note unsecured. 

I do wonder if you are the one that typed this gibberish.  The only thing that you posted in the "document" is a bunch of incorrect legal conclusions with no supporting statutes or cases.  They would love that post on Living Lies.  Maybe Mr. Garfield could add a little more an claim it as his own.  This type of document is right in his wheel house. 



 


Quote 0 0
Bill

john wrote:
Does anyone know the steps to do a securitization audit on my own, please stop arguing about laws and such, I am just asking for a series of steps to do a securitization audit on my own, is this not an educational forum?


John,

You are not being ignored.  You received your answer in several different posts on multiple threads. 

YOU CANNOT DO A SECURITIZATION AUDIT YOURSELF. 
 
YOU DO NOT HAVE ACCESS TO THE DOCUMENTS   
/RECORDS THAT WILL SHOW IF YOUR MORTGAGE IS IN A TRUST. 

You can do some research on your trust as well as find the trust controlling documents.  There are several threads on how to look up your trust.  What trust is claiming to own your mortgage?  Post some more information and we'll see if we can point you in the right direction.


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john
Who is the author of the in depth explanation?

Table of Contents

1. The Creation of the Mortgage Note and Security Instrument

Uniform Commercial Code and Recordation Requirements

2. Tangible – Personal Property versus Real Property

Failure to Maintain Continuous Perfection

3. Original Obligee (Lender) Takes Possession of the Secured Mortgage Note

Proper Parties



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John
Ok,
I see it online now. Is that considered public information>?

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Texas
Bill Said:

"But the owner is identified.  The mortgage ALWAYS says MERS is the nominee for xxxxxxxxxxxxxxx."

Where "xxxxxxxxxx" is Lenders Successors and Assigns is not definitive to an identity and does not indentify a Holder with rights to enforce the note. Does that comply with state real estate law, statutes of fraud, etc and allow MERS to bypass public recordation as to whom the correct parties are?

In Texas, you are required by statute, Texas Local Government Code 192.001 & 192.007 to record the Mortgage (Deed of Trust) and Assignment of Deed of Trust.

The recording statutes also provided that there would be no secret contracts and prevent fraud, priority and perfection are not the same.

UCC § 9-303. When Security Interest Is Perfected; Continuity of Perfection.

(1) A security interest is perfected when         it has attached and when all of the applicable steps required for perfection         have been taken. Such steps are specified in Sections 9-302, 9-304, 9-305 and 9-306.         If such steps are taken before the security interest attaches, it is perfected         at the time when it attaches.

(2) If a security interest is originally perfected         in any way permitted under this Article and is subsequently perfected in some         other way under this Article, without an intermediate period when it was unperfected,         the security interest shall be deemed to be perfected continuously for the purposes         of this Article.

Except UCC 9 does not apply to liens on real estate, local laws of jurisdiction apply.

Perfection and Continuity of Perfection not to be confused with priority. Seen many attorneys make that mistake. 








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Not to put too fine a point on it, if you're not a really experienced BK attorney, you have a fool for a client.

Real Estate Services Technology has just released their Property Solutions Report software for distressed homeowners that suspects their mortgage servicer has broken the chain of title on their property, and therefore has no legal claim to foreclose.

This strategy is a direct result of the Foreclosuregate/Robosigner scandal that came to light last November (although evidence of mortgage document forgery on the part of mortgage servicers goes back to 2004). This is a spectacular strategy to force mortgage servicers to recognize their own Net Present Value (NPV) calculations and Average Valuation Model (AVM), to lower the principal balance on a mortgage to a Fair Market Value. It is complete with vesting information, chain of title, assignments, assessments, judgements, endorsements, voluntary and involuntary liens, legal descriptions, allonges, even MERS data and Pooling & Servicing Agreements, if requested.  It is one, all-inclusive, dynamic report. It prepares the homeowner with the proof to demand the original note or deed from the mortgage servicer.

This strategy is ideal for the homeowner whose hardship doesn't qualify for HAMP or an in-house mortgage modification or short sale.

The REST Menu of Property Solutions Reports is the leading edge of 'Loan Disposition Analysis Reporting Technology.' To date, 4000 REST Reports have been run for distressed homeowners to calculate a mortgage modification or short sale with zero failures.

There is not a dissatisfied customer anywhere.

Again, I hope Wm Roper researches this and sees that this is no joke.
4000 out of 4000 successes is not too bad.
A case will now boil down to what state the property is in, and how much of a tiger the attorney is. I can help there, too.
More info at:  http://mortgage-monster.com/sue-your-lender.html


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George Burns

Is it 4000 or is it 1500 reports produced?
Is it 4000 that were successful out of the 1500 or what? 4000 out of 1500 would be a fantastic ratio.

From the website:

" For 2011, third party negotiators can’t do anything you can’t do yourself. The solution is to prepare yourself with the same unbiased calculations the banks use to calculate the Net Present Value of your property and your hardship.
To date, we’ve run approximately 1500 REST Reports. Of the ones that have gone to court as foreclosure defenses, every single one has been welcomed by the foreclosure judge as unbiased proof of a foreclosure solution that stands up to the most critical scrutiny. The judge brings his gavel down on the knuckles of your clueless mortgage servicer and makes it clear that he will hold the servicer legally accountable to good faith negotiations – as evidenced by the calculations of that same REST Report. (Want a court transcript? I’ll send you and/or your judge one.)"

I can't wait to see a court transcript.

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I've replied to this post elsewhere. 1500 is a typo. It is 4000 out of 4000 Reports
and the quote comes from my Mortgage modification page - not my Sue Your Lender page.

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Bill

Just another scammer.

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Your mortgage servicer may not have the legal right to foreclose on you. If your title was not assigned correctly, they have broken the chain of title and their foreclosure action is illegal.



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If your lender can't provide the title or deed to your property, you win big time.



What happened to Carpenter v. Logan?  I guess the mortgage doesn't follow the note anymore.  I guess there is no equitable assignment of the mortgage when the note is negotiated. 

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This software will tell you in advance if you have a winnable case in court



Do we type the attorney names in the software as well as jurisdiction and the judge's name so the "software" will give me the correct result?

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This report costs less, is more extensive, and more reliable than the typical title search from your title company.
Your attorney knows this.




How does my attorney know some scammer in their basement on a computer can produce a more "extensive" and "reliable" report than a licensed, bonded, and insured title company?

I'll rush out to send a check (I'm sure you would prefer well hidden cash) to this scammer today!!!!!!!!!  Of course I don't have the Name, address, or any other identifying information to address my letter.  I guess I'll just wait until you post a pay-pal link, or better yet, just let me finish sending my money to Nigeria.  I just got an email that will make me rich and I'll have plenty of money for your scam too.

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Dear Sir:

        I have been requested by the Nigerian National Petroleum Company to contact you for assistance in resolving a matter. The Nigerian National Petroleum Company has recently concluded a large number of contracts for oil exploration in the sub-Sahara region. The contracts have immediately produced moneys equalling US$40,000,000. The Nigerian National Petroleum Company is desirous of oil exploration in other parts of the world, however, because of certain regulations of the Nigerian Government, it is unable to move these funds to another region.

        You assistance is requested as a non-Nigerian citizen to assist the Nigerian National Petroleum Company, and also the Central Bank of Nigeria, in moving these funds out of Nigeria. If the funds can be transferred to your name, in your United States account, then you can forward the funds as directed by the Nigerian National Petroleum Company.  In exchange for your accomodating services, the Nigerian National Petroleum Company would agree to allow you to retain 10%, or US$4 million of this amount.

        However, to be a legitimate transferee of these moneys according to Nigerian law, you must presently be a depositor of at least US$10,000 in a Nigerian bank which is regulated by the Central Bank of Nigeria.

        If it will be possible for you to assist us, we would be most grateful. We suggest that you meet with us in person in Lagos, and that during your visit I introduce you to the representatives of the Nigerian National Petroleum Company, as well as with certain officials of the Central Bank of Nigeria.

        Please call me at your earliest convenience at [Phone Number]. Time is of the essence in this matter; very quickly the Nigerian Government will realize that the Central Bank is maintaining this amount on deposit, and attempt to levy certain depository taxes on it.

Yours truly, etc.

Ben Ahore

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Moose
pompapah wrote:
I've replied to this post elsewhere. 1500 is a typo. It is 4000 out of 4000 Reports
and the quote comes from my Mortgage modification page - not my Sue Your Lender page.



Three questions:

(1) Why does a Trustee or Trustee's contracted servicer have to accept the findings of the "report?"

(2) How does the user of the report insert himself or herself into/between the servicer and Trustee and overcome the contractual relationship established in the PSA?

(3) Knowing you can't charge in advance for these kinds of services, how much does the report cost the borrower and when do they have to pay?

Moose






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Texas
Bill said:

"What happened to Carpenter v. Logan?  I guess the mortgage doesn't follow the note anymore.  I guess there is no equitable assignment of the mortgage when the note is negotiated."

The 1872 Carpenter principle are still the same today, the security follows the note. MERS of today interrupts the security follows the Note to subsequent Who's, where there is a lack of identifying the Who's which need to be identified so MERS can be an agent.

Where identity of a subsequent note holder is missing, wish someone could explain how a legal contract could be drawn up between MERS (to act as agent) and the unknown subsequent note holder. (That's not contracting around the UCC, that's simply failure to follow other governing law.) Way more complex than that, but that's the short. You cannot look at only the UCC as governing law, you have to look at a number of other laws, which few appear to comprehend.

The first Who is commonly identified as the originating lender who at closing has an attached and temporary perfected security for the note. Filing of the security permanently perfects the lien. The last Who, i.e.,  could be the Trustee for the Trust who maybe the note holder but without a continuous perfected lien. It is all the middle Who's who are not identified except by a 3rd party document sometimes called a PSA. "Attachment and Perfection" is not the same as "Filing for Priority".

With all MERS members agreeing that the MERS system is controlling, the priority issue would not present itself as the parties agreed that MERS would resolve priority. But, the MERS system cannot replace public records for lien perfection or assigning of lien perfection.

As the second, third and fourth Who are not identified then MERS could not be an agent and thus lacks authority to assign the security, not to mention not having a beneficial interest in the indebtedness. So when MERS jumps in and assigns the lien from them self to a Trustee for a Trust, that assignment is without force. Secondly, as the Trust claim to be the holder of the note, MERS recording system is not legally sufficient to replace public records for lien perfection to subsequent purchasers of the note.

What follows the note is then that of either a continuously perfected lien, where recordation in public records legally transferred the lien or lack of continuous perfection where MERS is concerned which results in the lien expiring by failure to record in a "known" (MERS as Agent for "Indorsee In Blank", as the subsequent purchaser has not been identified) subsequent purchaser of the notes name.

If the Banks had followed Roper's understanding of law which is the same as my grand pappy and myself, the banks would be holding the note as holder in due course with rights to enforce the note and rights to enforce a perfected lien.

But the banks did not follow the law.

So the old adage, a "continuous perfected" security follows the note is still valid today.. Nothing changed except the inception of MERS, which caused all the problems and the expiration of perfection.



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Bill wrote:
This is the same garbage that is floating all over the internet and I'm sure this garbage has cost more than a few Pro Se ligitants their home.  Without going into the fact that NONE of the OPINIONS in the above posts are supported with any kind of case law or statutes, the main problem is that all the assertians are contrary to LAW. 

The mortgage is in full force when it is executed and delivered to the bank.  The mortgage is perfected when it is recorded.  THERE IS NO FURTHER PERFECTION NEEDED.  The mortgage follows the note.  Any negoation of the note carries with it an equitable assignment of the note.  Bifurcation of the note and mortgage has NOT been accepted by the U.S. Courts. 

A blank endorsement has been used by the mortgage industry for decades.  This is a STANDARD

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Once the security instrument has been bifurcated from the note, rendering the indebtedness “Unsecured”, any attempt to assign the security instrument back to the note as shown above will not convert an “Unsecured Indebtedness” back into a “Secured Indebtedness



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It may be, just may be possible to prove up the Mortgage Note but you can “NEVER” prove up a lost “Perfection of Lien.”


 


As this is old you might want to edit it and correct your useless opinion that bifurcation cannot occur. Guess that bit of what you KNOW is proven wrong problem with you is there is so much wrong to go. Oh and from another post to all here; I can string a fair number of letters after my name too. The real test is [is] the use of your information worth anything.

Stick to the front page of MS Fraud dot org these idiots know nothing but a little bit of nothing and when you add to what they know or prove what little they know is wrong; and the information you are using to do this you acquired from their front page at msfraud.org  and they still argue ....well hellsbells not much to say about that but follow an idiot if you like.
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Bill

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As this is old you might want to edit it and correct your useless opinion that bifurcation cannot occur. Guess that bit of what you KNOW is proven wrong problem with you is there is so much wrong to go

As I posted before, post a case that supports your position.  ANY case that shows bifurcation can happen.  

Any at all??  In the last HUNDRED years?  

It's always funny when these donkeys use the "I'm right, but there are no cases that support my argument."  or the "I know this is right but no one else does".


As with the other scammers here, I'll post mine first.

Carpenter vLongan, 83 U.S. 271, 274 (1872)

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The note and mortgage are inseparable; the former as essential, the latter as an incident.
An assignment of the note carries the mortgage with it, while an assignment of the latter alone is a nullity.

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The transfer of the note carries with it the security, without any formal assignment or delivery, or even mention of the latter. If not assignable at law, it is clearly so in equity. 


The Supreme Court of the UNITED STATES disagrees with your wing-nut theory that bifurcation can occur.  When you just "post" your "ideas" what are you basing this on???  When a homeowner goes to court what legal argument are they exactly using??  The because Charlton "said so" argument?

This argument HAS been made and was NOT accepted.  When an argument is NOT accepted that means you LOSE.  

Why don't you ask your "uncle" about that one also, as well as the importance of case law, then you should "correct your useless opinion".




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The United States federal goverment has 4 core laws that make the guidelines uniform and administered fairly and equally for all individuals. In fact, all lenders are required to operate under certain rules, regulations and procedures when taking loan applications. Those rules, regulations and procedures are spelled out in the Real Estate Settlement Procedures Act (RESPA), the Truth in Lending Act (TILA), Equal Credit Opportunity Act (ECOA) and Fair Credit Reporting Act (FCRA).

The details are given here : http://www.mortgageauditsonline.com/mortgage-lending

Go through this...it will definitely help you.
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Ferdinand
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The United States federal goverment has 4 core laws that make the guidelines uniform and administered fairly and equally for all individuals. In fact, all lenders are required to operate under certain rules, regulations and procedures when taking loan applications. Those rules, regulations and procedures are spelled out in the Real Estate Settlement Procedures Act (RESPA), the Truth in Lending Act (TILA), Equal Credit Opportunity Act (ECOA) and Fair Credit Reporting Act (FCRA).

The details are given here : http://www.mortgageauditsonline.com/mortgage-lending

Go through this...it will definitely help you.

The website given in the link is is operated by scam artists.
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