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Pretender Lenders: How Tablefunding and Securitization Go Hand in Hand” By William Paatalo and Kimberly Cromwell. CLICK: http://infotofightforeclosure.com/tools-store/ebooks-and-services/?ap_id_102

Wells Fargo — More Lies

Any judge that gives Wells Fargo Bank the “benefit of the doubt” on any assertion, allegation or document is ignoring what is plain for all to see — that its business plan is based upon reporting profits, whether they are real or not, and that it method of operation consists of fraud.

The practices outlined in this article  are not restricted to WFB. This is the business method of all the major banks in virtually all interactions in consumer lending.

The internal policies of the banks are designed to take advantage of the common bias of judges to believe that the bank must have gotten it right and that the consumer is trying to get off with a technicality. Nothing could be further from the truth. The borrowers have it right and the banks are getting off with legal technicalities that do not require them to actually prove that anything they say is or ever was real.

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THIS ARTICLE IS NOT A LEGAL OPINION UPON WHICH YOU CAN RELY IN ANY INDIVIDUAL CASE. HIRE A LAWYER.
—————-

see  Deceptive Auto Insurance Game Follows Familiar Routine for Wells Fargo

Revealing a practice of using brute force against borrowers, Wells Fargo has once again been caught stealing from its loan customers and those it claims are loan customers. The industry is awash with outright fraud — as was revealed when Chase was caught giving “mortgage relief” (as per “settlement”) to loans that were either nonexistent or that had been sold.  This time 800,000 customers were charged fro insurance they neither wanted nor needed and 200,000 of them had their cars repossessed —- all for a “default” in not paying for insurance they had already paid for.

The base line is the cynical bank assumption that regulators are too stupid or distracted to understand what is going on in the world of finance. There is a growing suspicion now that false claims of securitization were not only multiplied by multiple sales of the same loan, but that the current pandemic of “resecuritization” is merely enabling the banks to add a new layers of false documents and securities without ever accounting for the fraudulent manner of false securitization in the first place. This probably extends to payoffs of loans where the mortgage backed securities supposedly deriving their value from loans are unaffected by foreclosure, sale or any other kind of payoff of the loan.

Here we have an exact correlation between the “escrows” supposedly “managed” by “servicers” in the mortgage industry. Many readers will recall all the cases where BOA and other banks were caught putting the insurance payment in a suspense account, then billing for insurance that had already been obtained or paid for in the monthly payment of the homeowner.

When the false invoice is not paid, the banks or “servicers” make “temporary postings” that give rise to a nonexistent default. Then the bank forecloses over the cries of foul by homeowners who have made every payment exactly as claimed by the bank, who probably had no right to collect or enforce anything in the first place. The icing on the cake comes from the bank not accepting the regular monthly payment because the account is in default, this creating the illusion that the “borrower” refused or failed to pay.

The main take-away from this is that lawyers for consumers should be aware that they should assume that everything the bank says is false. Anything less and the court will assume that the loan is true and valid, that the documents are authentic and the defenses are rubbish. And THAT is because of the improper use of legal presumptions when the bank produces false documentation. The presumption is in favor of authenticity whereas the fact is that the document is a fabrication referring to a nonexistent transaction in real life.

The assumption by the consumer lawyer, that nothing about the loan or its administration is true, leads inescapably to objections and discovery that will show the absence of any evidence that any financial transaction occurred in the “chain” relied upon by the “bank” (in mortgage foreclosures usually a “trust” where the false assumption is that a bank is foreclosing.)

It should also lead to motions in limine to prevent the sue of legal presumptions for documents introduced by the “bank” because of the widespread common knowledge that the banks have been caught in a pattern of conduct in which they fabricated, forged and robo-signed documents.

Look up the rules of evidence in your state. It will probably say that such presumptions arise unless there is a reasonable basis for questioning the credibility of the party seeking to introduce the “evidence” that would otherwise receive the benefit of the presumption. Once the presumption is removed, the foreclosing party is left to prove its case with facts (which do not exist) instead of relying upon legal presumptions.

What you are looking for is any evidence in which one party ends up with a loan receivable and the other ends up with a loan payable. No doubt that the loan payable exists. But the loan receivable? Not so much — not in the chain claimed by the banks. This is why I have periodically written about why CPA’s should be used as expert witnesses in these cases. They know how to define a loan receivable. Thus they know how to define the “owner” of the loan.

The practice of creating false insurance contracts at Wells Fargo dates back to at least 2005. Here are some significant quotes from the article:

The confidential report, prepared by the Office of the Comptroller of the Currency and reviewed by The New York Times, criticizes Wells Fargo for forcing hundreds of thousands of borrowers to buy unneeded auto insurance when they took out a car loan, as well as its handling of the problems once they were detected.

The bank is still trying to recover from a scandal in which its employees created millions of credit card and bank accounts that customers had not requested, eventually leading to the ouster of the bank’s chief executive and millions of dollars in regulatory fines.

Wells Fargo’s improper auto insurance practices came to light in July, after The Times obtained an internal report prepared for the bank’s executives. That analysis showed that more than 800,000 people who took out car loans from Wells Fargo were charged for auto insurance they did not want or need, typically because they already had coverage.

That internal report said the costs of the unneeded insurance, which covered collision damage, had caused some 274,000 Wells Fargo customers to fall behind on their car loans, and almost 25,000 vehicles were wrongly repossessed. Customers on active military duty were among those hurt by the practice.

The comptroller’s review of Wells Fargo’s auto lending and insurance practices has been underway for several months.

The report paints a damning picture of a bank that didn’t monitor its contractors, that lacked the impetus to correct problems once they were uncovered and that proved unresponsive to complaints from its customers.

Wells Fargo’s auto insurance practices violated a section of the Federal Trade Commission Act that prohibits unfair or deceptive acts in commerce, the report said. For example, the bank did not break out the insurance costs embedded in car loans; rather, it included the amounts owed on the unneeded coverage in the monthly payments. Had borrowers known what the cost increases were for, the comptroller’s office said, they could have taken action more quickly to avoid harm.

Even when Wells Fargo borrowers notified National General that they already had car insurance, they had trouble reversing the erroneous charges. The comptroller office’s review of loan files and consumer complaints showed that Wells Fargo’s customers often had to submit proof of coverage multiple times before the coverage was canceled.

Where’s the Beef? Hell if the Banks know.

beef

To listen to the West Coast Foreclosure Show:

 

Note: For those readers too young to remember, in 1984, the Wendy’s corporation launched an epic ad campaign called, “Where’s the Beef?” It was aimed at McDonald’s and insinuated that the hamburgers at McDonald’s skimped on the beef.  This campaign was launched at the same time McDonald’s was accused of using earthworm as meat filler.  The campaign was a huge success and began Wendy’s expansion.

By J. Guggenheim

Investigator Bill Paatalo joined attorney Charles Marshall on the West Coast Foreclosure show to discuss why the major banks are unable to provide a bank witness in litigation who has knowledge of the loan.  Bank witnesses are unable to provide information regarding the note location, who the creditor is, what the bank paid for the loan, or if the loan was transferred in compliance with the Trust’s Pooling and Servicing agreement.  When deposed, the witness says repeatedly, “I don’t know”, and when they are asked who can provide this information- they say, “I don’t know.”  Where’s the beef?

In loans that were originated between 2000 and 2009 (and often afterwards), the notes were deliberately destroyed upon securitization and the original loan files disappeared. The only way for a bank, servicer, or trust to demonstrate ownership now- is to create (forged) notes and assignments out of thin air via a desktop publishing platform.  This is typically done by a third-party like Black Knight (LPS) to create distance and plausible deniability.

The bank witness, during a deposition or in a sworn affidavit, will base their ‘expertise’ and knowledge on the fabricated note and information shown on a computer screen.  The bank witness will have no personal knowledge of prior loan transfers or sales, or the boarding process, but have been coached by bank counsel on how to be evasive when asked, “Where’s the beef?”  The bank doesn’t want the witness to leak information that might assist homeowners, so the witness will parrot, “I don’t know” repeatedly.

At this point, an aggressive litigator will go for the jugular, but too often, the homeowner’s attorney “let’s their foot off the accelerator, ” and doesn’t press the issue, according to Bill Paatalo.  Aggressive motions and objections must be used to expose that the witness is lying, being evasive or coy, and has no personal knowledge outside of looking at a computer screen.  Paatalo has observed that bank witnesses routinely provide inconsistent testimony, lack training on bank systems and procedures when pressed, and have little credibility.   Therefore, they should not be entitled to any presumptions of truth when their statements are ambiguous and it is apparent they know nothing.

Attorney Charles Marshall states that it is a travesty that the courts allow this to go on, and a homeowner should be allowed to prevail when the bank cannot provide a credible witness or reliable evidence that it owns a loan.  Marshall suggests that homeowners and their counsel hone in on discovery and break out the rules of evidence.  Through a declaration, on the record, it becomes obvious the bank doesn’t have admissible evidence.  Marshall recommends framing the key issues and then filing a Motion to Dismiss to knock out the declaration.

Once the homeowner has evidence the bank witness lacked knowledge, they should file an affidavit, on the record, that the bank was unable to comply with the rules of evidence, and that there is no proof the bank owns the loan. A motion for summary judgment should be filed, but only if you have hard evidence, otherwise the other side will likely prevail.   Institutions routinely file Motions for Summary Judgment after discovery and depositions are taken- and it is useful to beat them to the punch.

Paatalo says the reality is that the opposition is relying on a bank witness with no personal knowledge, who looks at a computer screen, and then states the bank has standing- despite lacking evidence.  He points out that a Texas task force (transcript here) was created in 2007 to make suggestions how to handle the document deficiencies seen in foreclosure.  A retired judge on the panel stated on the record something like, “If there are no witnesses with evidence, what will we do?”  The task force surmised that the foreclosure mills could handle the foreclosures even though they had no way to track ownership, but relaxed believing that most people would assume their loan servicer was the lender, and not ask questions.

Michael Barrett (now deceased), of the Texas foreclosure-mill Barrett-Burke, Castle, Daffin & Frappier, admitted that the mandated paperwork required to lawfully execute a foreclosure does not exist in 90% of the cases:

“So finding a document that says, “I am the owner and holder, and I thereby grant to the servicer the right to foreclose in my name” is an impossibility in 90 percent of the cases.” (transcript page 27, line 16).

Mr. Barrett confirmed “There really isn’t such a document” (Page 27, line 8), and it was revealed by Judge Bruce Priddy (See State of Texas v. Judge Priddy D-1-GV-08-002311) when he stated on the record:
“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 applicant”. (page 28, line 10)

First American Title added:
“The other problem that I see — and, Tommy (Redding), you and I talk about it regularly – that we have a bunch of servicers that are corporations or trusts attempting to foreclose on behalf of other trusts using a power of attorney, and I don’t think that’s really proper. I mean, we all kind of turn a blind eye to it, but I think that’s an issue that’s out there that somebody could use to potentially attack a foreclosure” (p. 33, line 5).

Even back in 2007, the foreclosure mills and judges knew they had a problem.  The only solution possible is for the judiciary to play blind, make erroneous presumptions that fly in the face of the evidence, and stonewall the homeowner.  Bank regulators, the FBI and state Attorney Generals were told foreclosure fraud was not a priority.

Paatalo compares what the courts are doing now to a scene in the movie, Shawshank Redemption, where protagonist Andy Defresne speaks about how to get away with fraud:

Red: Andy, you can’t just make a person up.
Andy Dufresne: Well sure you can, if you know how the system works, where the cracks are. It’s amazing what you can accomplish by mail. Mr. Stevens has a birth certificate, a driver’s license, social security number.
Red: You’re shitting me?
Andy Dufresne: If they ever trace any of those accounts, they’re gonna wind up chasing a figment of my imagination.
Red: Well, I’ll be damned. Did I say you were good? Shit, you’re a Rembrandt!
Andy Dufresne: You know, the funny thing is, on the outside, I was an honest man, straight as an arrow. I had to come to prison to be a crook.
[Red laughs]

The banks, courts, law enforcement and the foreclosure mills know where the cracks are, and the homeowner is at a disadvantage trying to find them.  It is common knowledge that the securitized mortgage loans are a figment of the industry’s imagination.  The homeowner, through targeted litigation and discovery, must find the bank’s lies and bring them to the court’s attention.  It is a tall-order and the bank is betting your attorney will not force the issue, allow deceptive depositions to stand, and fail to compel discovery.  That has been the bank’s strategy to date and it has been effective.

Bill Paatalo points out that the banks and servicers have revised their gameplan and are now creating new-fangled trusts and resecuritizations, while defective loans are being sold in bulk to debt buyers.  By repackaging and transferring what doesn’t even exist, another level of fraud and deception is created.  In fact, according to Paatalo, “Investors are buying nothing but revenue streams, insurance proceeds and servicing advances- not loans.” This convoluted scheme is based on illusion and nothing more.

Paatalo proves his point by bringing up a recent US Bank interrogatory (USBank ROG Response – NV – cannot acsertain amout paid for loan), where the court ordered the bank to reveal how much they paid for an individual loan. The bank witness claimed that US Bank could not ascertain how much it paid for the individual loan because they purchased the loans in bulk.  The next question would be:  if the bank purchased the loans in bulk, did they obtain the note, loan history, and prior transfer history?  Of course not- there is no proof of individual loan ownership.  If US Bank is a depositor, why was the note never endorsed?  Inquiring minds want to know.

Paatalo says the banks have created a ‘fact pattern’ justified by information on a computer screen.  All major lenders signed a consent judgment with all 50 state Attorney Generals that stipulated that all verifiers of mortgage information must be trained, and the training documentation should be placed in their employee files.  This is not being done.  The bank witnesses repeatedly claim ignorance, while the judge allows them to evade answering any question that would assist the homeowner in proving their case.

If a homeowner is to prevail they must focus on the hearsay rule and conduct an evidentiary proceeding to get the facts on the record, and preserve the record for an appeal.    It is the homeowner’s job to raise the issues! Ask questions like: when did they take control of the file, where is the note, how much they paid, who the holder in due course is, and demand to see the foreclosure mill’s retainer agreement with the lender.

Paatalo and Marshall confer that corporations must have corporate counsel, but often there is no connection between the law firm and trust, and instead third parties are behind the scenes pulling strings.  The bank witness should be pressed to disclose who these parties are and demand evidence of representation authorization.  In Paatalo’s own case, he challenged the bank to bring in its own witness/expert, and state on the record that what he was stating was not true.  To date, the bank has not taken him up on his offer- because they know what he says is true, and they can’t refute it.

Banks are not compelled to provide an evidentiary trail, or to  provide complete and accurate information.  Instead, they rely on a ten-minute cursory legal proceeding to establish standing.  The bank relies on a sham entity that doesn’t hold anything and relies on this ruse to illegally foreclose on homes.  The arrogance of the big banks is reinforced by the lack of regulatory enforcement, sanctions or fines.  Lenders and their attorneys are allowed to lie, cheat and steal with impunity, but a good attorney can stop them in their tracks.

 

 

 

 

The West Coast Foreclosure show with Charles Marshall: Bank “Witnesses” don’t know Jack: “Expert” Computer Screen Readers only.

Thursdays LIVE! Click in to the The Neil Garfield Show

Or call in at (347) 850-1260, 6pm Eastern Thursdays

Charles Marshall Logo Southern California

Investigator Bill Paatalo joins Charles Marshall to discuss bank employee weaknesses and lack of credibility in depositions and affidavits.

Chase bank ‘witnesses’, and bank witnesses in general, know little about the loan in which they are deposed, beyond what the computer screen shows. Under oath, the bank employee will parrot information the bank’s attorney coached them on prior to their deposition. If you are able to drill-down, it becomes obvious that the person ‘with the most knowledge’, knows nothing regarding the travel of the loan, assignments or current holder in due course.

Bank witnesses can provide a balance, the name of the servicer, and who claims to own the note; but know nothing about payment proceeds from insurance/settlements or when the note was endorsed or by who.  The bank employee relies on hearsay and and erroneous information on a screen to foreclose.

Chase employee Rosemary Martin inundated the court with a ream of mortgage documents and statements that had the appearance of validity, but when placed under oath had no information relevant to the Plaintiff’s loan.  See: Objection_to_Notice_of_Errata Rosemary Martin Deposition.

Even former in-house Chase counsel are oblivious in regards to the operations, documentation and validity of documents.  Despite this lack of knowledge, the attorney submitted affidavits and loan verifications, when he knew nothing beyond what he read on a screen.  See:  McCormick Deposition.

The loans are defective, and only the illusion keeps the ownership facade alive.

Investigator Bill Paatalo

Office: (406) 328-4075

bill.bpia@gmail.com

www.bpinvestigativeagency.com

 

Contact Attorney Charles Marshall:

Charles Marshall, Esq.
Law Office of Charles T. Marshall

Not legal advice– for educational purposes only.

JPMorgan Chase and the Fed in Collusion: The National Mortgage Settlement Sham

Six years ago, in February 2012, JPM was fined $5.3 billion under the National Mortgage Settlement reached with Attorney General Eric Holder. It was one of those sweetheart deals that Holder cut over and over with the big banks — by imposing cost-of-doing-business fines, instead of criminal charges, in keeping with his “too big to jail” policy.

However, as financial muckraker David Dayen reports at The Nation, only $1.1 billion of that $5.3 billion total had to be paid in cash; “the other $4.2 billion was to come in the form of financial relief for homeowners in danger of losing their homes to foreclosure.”

Here’s the rest of the story: “JPMorgan moved to forgive the mortgages of tens of thousands of homeowners; the feds, in turn, credited these canceled loans against the penalties due under the 2012 and 2013 settlements. But here’s the rub: In many instances, JPMorgan was forgiving loans it no longer owned… it had sold the mortgages years earlier to 21 third-party investors.”

The dirty details are now coming to light in a federal lawsuit being heard in New York. Grab the popcorn…

See: http://www.esquire.com/news-politics/politics/a12787808/jp-morgan-mortgage-scam/

Regards,
Neil F Garfield

NJ APPELLATE COURT GETS TO THE ROOT OF MERS AS “NOMINEE”

Bank of N.Y. Mellon v. Davis_ 2017 N.J. Superior Court

Key elements in this decision are:

  1. Whether MERS can sign as nominee for an entity that went out of business years before the assignment.
  2. Whether a MERS document was forged or robosigned.
  3. Whether a Power of Attorney actually conveys the rights that the foreclosing party is claiming.
  4. Whether a document can be used without proper foundation — i.e., authentication based upon personal knowledge.
  5. Whether the DiTech or Green Tree names can be used to fill the gaps in the chain
  6. Whether a foreclosing party may simply rely on its allegations in lieu of proof.

 

Get a LendingLies Consult and a LendingLies Chain of Title Analysis!

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THIS ARTICLE IS NOT A LEGAL OPINION UPON WHICH YOU CAN RELY IN ANY INDIVIDUAL CASE. HIRE A LAWYER.

—————-

 

Hat Tip to Michael Bazemore

 

This decision clearly probes the fictitious documents, testimony and methods used to insert parties into an alleged loan contract for the purpose of foreclosure. You can be sure that the position taken in foreclosures is contrary to the position taken to sell mortgage backed securities or the loans themselves.

 

The ONLY thing I find troublesome in this decision is that once again, it is assumed that the “borrower” received a loan from a now defunct entity that was a mere sham conduit for the disbursing of slush funds accumulated by the banks. Whenever THAT finally comes under scrutiny, the entire “chain” will be laid bare. The inescapable conclusion in such cases is that there is no loan contract between the borrower and the originator and every document executed after that could not, as a matter of law, convey anything except the fictitious paper.

 

I have highlighted and annotated the parts of the decision that I think are of importance and helpful to litigators.

 

Tuesday, October 17, 2017 1:05:00 AM EDT

  1. Bank of N.Y. Mellon v. Davis, 2017 N.J. Super. Unpub. LEXIS 2578
    Court: New Jersey

Reporter

2017 N.J. Super. Unpub. LEXIS 2578 *

THE BANK OF NEW YORK MELLON, f/k/a THE BANK OF NEW YORK, AS TRUSTEE FOR THE BENEFIT OF THE CERTIFICATEHOLDERS OF THE CWABS, INC.,  [Editor’s Note: BONY is saying (1) that it is not appearing on its own behalf, (2) that it is appearing in a representative capacity, (3) that it is representing certificate holders (without naming them) and (4) with no reference to an organized trust into which any assets have been entrusted to a trustee).

Without the name of a certificate holder who is represented by BONY my opinion is that there is no Plaintiff. This wording from the lawyers sets forth a “hidden” trust (that also probably doesn’t exist) in which the certificate holders have appointed BONY as trustee for their certificates — which are worthless because the certificates were issued by a nonexistent trust that never received any assets to hold in trust]. ASSET-BACKED CERTIFICATES, SERIES 2007-BC3, Plaintiff-Respondent, v. JEFFREY L. DAVIS, MRS. JEFFREY L. DAVIS, his wife, ELISSA M. DAVIS, MRS. DAVIS, husband of ELISSA M. DAVIS, Defendants- Appellants, and STATE OF NEW JERSEY, UNITED STATES OF AMERICA, Defendants.

PER CURIAM

Defendants Jeffrey L. Davis and Elissa M. Davis appeal from the April 29, 2016 Chancery Division order granting summary judgment in favor of plaintiff on its foreclosure complaint, and striking defendants’ answer and counterclaim.[1] Defendants seek reversal, citing multiple genuine issues of material fact. Following our review of the record, we vacate and remand.

 

Opinion

[*1] APPELLATE DIVISION
On March 26, 2007, defendants borrowed $347,000 from Decision One Mortgage Company, LLC (Decision One) [Editor’s Note: As stated above, the assumption that Decision One actually loaned money rather than having been paid a fee to rent its name as “originator” is most probably an incorrect assumption. This leads to the conclusion that the “loan contract” does not exist between ANY of the parties in the chain and the borrower. This is not to say a loan contract or constructive loan contract doles not exist. It clearly does exist between the borrower and the actual creditor(s) who made the loan — whether they knew they were making the loan or not].   to refinance their home in Mount Laurel, secured by a note and non-purchase money mortgage.[2] On April 1, 2010, defendants defaulted on the loan.

 

On November 9, 2011, MERS assigned the mortgage to plaintiff, and on November 30, 2011, the Burlington County Clerk recorded the assignment.[3]On February 23, 2015, plaintiff mailed defendants a notice of intent to foreclose. After defendants failed to cure the default, plaintiff filed its foreclosure complaint on August 7, 2015.

On September 21, 2015, defendants filed [*2] an answer, which included thirty-six affirmative defenses and a six-count counterclaim. On October 26, 2015, plaintiff filed its answer to defendants’

 

We apply the same standard as the trial court when reviewing the disposition of a motion for summary judgment.

On March 24, 2016, plaintiff moved for summary judgment. In support of its motion, plaintiff filed a certification signed by

Rebecca Anderson (the Anderson Certification) of Ditech Financial LLC f/k/a Green Tree Servicing LLC (DiTech). In her capacity as a “Document Execution Specialist” for Ditech, Anderson described Ditech as “attorney[-]in[-]fact for” plaintiff and certified she has “complete access and authorization to review [plaintiff’s] business records, including computer records, logs, loan account and related business records for and relating to the borrower’s loan.”

 

Of note, the Anderson Certification provided no details regarding the power of attorney document that authorized Ditech to act as attorney-in-fact for plaintiff nor did plaintiff otherwise provide a copy of the document with its motion papers.

Defendants opposed plaintiff’s motion on various grounds, including the sufficiency of the Anderson Certification. Defendants also challenged the validity of the assignment of mortgage and note since plaintiff’s [*3] predecessor in interest, Decision One, went out of business in 2007, four years prior to the assignment.

Following oral argument, the motion judge rejected defendants’ arguments, granting summary judgment in plaintiff’s favor and striking defendants’ answer and counterclaim. In a written opinion, the judge found plaintiff established the material facts demonstrating its right to foreclose, namely: (1) the Anderson Certification sufficiently established plaintiff possessed the note prior to filing the foreclosure complaint; (2) plaintiff properly served defendants a notice of intent to foreclose; (3) and defendants defaulted under the note and mortgage’s terms. The judge also held defendants’ “affirmative defenses . . . are nothing more than conclusory arguments devoid of any factual support or reference.”

judgment. W.J.A. v. D.A., 210 N.J. 229, 237 (2012). Summary judgment must be granted if “the pleadings, depositions, answers to interrogatories and admissions on file, together with the affidavits, if any, show that there is no genuine issue as to any material fact challenged and that the moving party is entitled [*4] to a judgment or order as a matter of law.” R. 4:46-2(c). Without making credibility determinations, the court considers the evidence “in the light most favorable to the non-moving party” and determines whether it would be “sufficient to permit a rational fact finder to resolve the alleged disputed issue in favor of the non-moving party.” Brill v. Guardian Life Ins. Co. of Am., 142 N.J. 520, 540 (1995).

In satisfying its burden, the non-moving party may not rest upon mere allegations or denials in its pleading, but must produce sufficient evidence to reasonably support a verdict in its favor. R. 4:46- 5(a); Triffin v. Am. Int’l Grp., Inc., 372 N.J. Super. 517, 523 (App. Div. 2004). It is against these standards that we evaluate defendants’ substantive arguments.

 

On appeal, defendants argue the motion record fails to establish plaintiff’s standing to foreclose, alleging deficiencies in the Anderson Certification. Specifically, they emphasize that plaintiff failed to provide basic information, such as the note’s physical location, as well as who transferred the physical loan documents, and the date of transfer. Defendants further argue plaintiff failed to establish authorization for the issuance of the Anderson Certification because it failed to provide any confirming evidence ofDiTech’s authority to serve as is its attorney-in-fact.

 

Plaintiff [*5] counters that Anderson had sufficient personal knowledge to satisfy Rule 1:6-6 because she reviewed defendants’ loan file, which contained business records maintained during the ordinary course of business, citing Wells Fargo Bank v. Ford, 418 N.J. Super. 592, 600 (App. Div. 2011)

Page 2 of 4

andN.J.R.E. 803(c)(6). Furthermore, plaintiff states Anderson certified that plaintiff acquired the note and mortgage in November 2011, prior to its filing the foreclosure complaint, and because an endorsement in blank permits the note to be transferred and negotiated by delivery alone to a bearer, Bank of N.Y. v. Raftogianis, 418 N.J. Super. 323, 336 (Ch. Div. 2010), it demonstrated it was the holder of the note and mortgage. In the alternative, plaintiff argues it also satisfies the requirements of a “non-holder in possession with the rights of a holder.” SeeN.J.S.A. 12A:3-203(b).

 

In order to have standing to foreclose a mortgage, a party “must own or control the underlying debt.” Raftogianis, supra, 418 N.J. Super.at 327-28. [Editor’s Note: This key factor is usually completely overlooked as the banks, through misdirection, maintain focus on the paper instrument and not the underlying debt. The importance of this error cannot be overstated.

If the Payee on a note does not own the underlying debt (because it never paid for the loan) then it is an inescapable conclusion that the debt is NOT merged into the note.

As such the note and mortgage become floating instrument without foundation; but it is possible for a holder in due course to claim its status by virtue of purchase of the note and mortgage instruments for value (a requirement in Article 9, UCC) in good faith and without knowledge of the maker’s defenses.

ONLY a holder in due course can escape the defense of failure of consideration thus no consummation of contract.]

 

To establish such ownership or control, plaintiff must present properly authenticated evidence that it is the holder of the note or a non-holder in possession with rights of the holder under N.J.S.A. 12A:3-301. Wells Fargo Bank,supra, 418N.J. Super.at 597-99. Transfer of possession must be “authenticated by an affidavit or certification based on personal knowledge.” Id. at 600; [*6] see alsoR. 1:6-6.

 

Following our review of the motion record, we conclude plaintiff failed to establish, as a matter of law, that it acquired ownership or control of the note to maintain the foreclosure action. Most notably, plaintiff failed to produce a power of attorney document evidencing its legal relationship with DiTech. See N.J.S.A. 46:2B-8.9 (“A power of attorney must be in writing, duly signed and acknowledged in the manner set forth in [N.J.S.A.] 46:14-2.1.”). Furthermore, the Anderson Certification failed to identify the note’s physical location or state details concerning the note’s physical delivery. See e.g.,Raftogianis, supra, 418 N.J. Super.at 330-32 (describing how, in the absence of proof that one is a note holder, a transferee could still “have the right to enforce the note” through physical delivery).[4] [Editor’s Note: If they can’t describe the physical location of the note (and the chain of custody?) they obviously cannot claim possession or delivery.]

 

Moreover, plaintiff failed to properly authenticate the documents it relied upon to establish its status as a holder. A certification will support the grant of

summary judgment only if the material facts alleged therein are based, as required by Rule 1:6-6, on “personal knowledge.”SeeClaypotch v. Heller, Inc., 360 N.J. Super. 472, 489 (App. Div. 2003). Anderson’s certification does not allege she has personal knowledge that plaintiff is the holder and owner of the note, and has possessed the original note [*7] and mortgage since April 23, 2014. Instead, the basis of her certification is “my personal review of the [p]laintiff’s relevant business records,” without identifying those records or how she acquired knowledge of plaintiff’s record- keeping practices.

 

The certification also does not indicate the source of Anderson’s alleged knowledge that “all of the documents included” in plaintiff’s summary judgment motion are “true and correct copies,” except to generally reference “my personal review of the business records.”

 

Like Wells Fargo Bank, here “the purported assignment of the mortgage, which an assignee must produce to maintain a foreclosure action, see N.J.S.A. 46:9-9, was not authenticated in any manner;” rather, it was attached to plaintiff’s motion. The trial court should not have considered this document unless it was authenticated by an affidavit or certification based on personal knowledge. SeeCelino v. Gen. Accident Ins., 211 N.J. Super. 538, 544 (App. Div. 1986). As noted, the assignment was not made by Decision One, as payee of the promissory notes secured by the mortgage, but rather by MERS, “as nominee for Decision One.” Although the mortgage appointed MERS as plaintiff’s nominee, the record contains evidence that Decision One ceased operating in [*8] 2007, long before the purported assignment of defendant’s mortgage on November 9, 2011.

 

Therefore, we question whether Decision One’s designation of MERS as its nominee remained in effect after it ceased operations. On remand, the trial court should address the question of whether MERS remained the nominee of Decision One or its successor as of the date of its purported assignment of defendant’s note and mortgage to plaintiff.

Because plaintiff did not establish its standing to

Page 3 of 4

pursue this foreclosure action by competent evidence, we vacate the order granting summary judgment to plaintiff and remand the case to the trial court. On remand, defendants may conduct appropriate discovery, including taking the deposition of Anderson and Dominique Johnson, the person who purported to assign the mortgage to plaintiff on behalf of MERS.

 

Accordingly, we vacate the summary judgment entered in favor of plaintiff and remand to the trial court for further proceedings in conformity with this opinion. We do not retain jurisdiction.

[1] Defendants also appeal from the final judgment entered on September 26, 2016; however, our reversal of the grant of summary judgment makes it unnecessary to address [*9] defendants’ challenge to the final judgment.

[2] The mortgage named Mortgage Electronic Registration Systems, Inc. (MERS) as the nominee for Decision One, its successors and assigns.

[3] The record lacks documentation evidencing the assignment’s recording.

[4] Because Decision One, as the payee of defendant’s note, was a holder, and it allegedly transferred the note to plaintiff without an indorsement, plaintiff may have acquired the status of a nonholder in possession of the note with the status of a holder. SeeWells Fargo Bank, supra, 418 N.J. Super.at 599 (citing 6B Anderson on the Uniform Commercial Code §§ 3-203:4R, 5R, 9R, 10R, 11R (Lawrence ed., 3d ed. 2003)).

 

MERS Unraveling

“Aside from the inappropriate reliance upon the statutory definition of “mortgagee,” MERS’s position that it can be both the mortgagee and an agent of the mortgagee is absurd, at best. — Judge Grossman, Federal Bankruptpcy Court

The Court recognizes that an adverse ruling regarding MERS’s authority to assign mortgages or act on behalf of its member/lenders could have a significant impact on MERS and upon the lenders, which do business with MERS throughout the United States.

However, the Court must resolve the instant matter by applying the laws as they exist today. It is up to the legislative branch, if it chooses, to amend the current statutes to confer upon MERS the requisite authority to assign mortgages under its current business practices.

MERS and its partners made the decision to create and operate under a business model that was designed in large part to avoid the requirements of the traditional mortgage recording process. This Court does not accept the argument that because MERS may be involved with 50% of all residential mortgages in the country, that is reason enough for this Court to turn a blind eye to the fact that this process does not comply with the law.

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See In re: Ferrel L. Agard, Debtor, Chapter 7, United States Bankruptcy Court, Eastern District of New York, The Honorable Robert E. Grossman.

NOTE: Emergency bells when off when Grossman rendered his decision.  Grossman’s decision was subsequently overturned by the Federal District Court Judge. But the logic expressed in Judge Grossman’s reasoning cannot be assailed. And it has been followed in numerous instances — in and out of court like where MERS has been banned from the Courtrooms in certain states.

The fundamental thing to know about MERS is that it is merely a step in the process of fabricating, forging and robo-signing documents. In substance it is the same thing as ANYONE simply creating a document that creates the illusion of ownership or control.

MERS helps in creating the illusion that the process was legal and proper and perhaps even official. But the reality is that the use of MERS is just a layering strategy to cover up what is really happening. MERS is a curtain to assure that neither the investors nor the borrowers ever truly know what is happening. It is a vehicle for what has become the largest economic crime in human history.

The Wall Street business model for multiple sales of the same loans, derivative products sold as hedges or minibonds, is completely dependent upon the ability of the Banks to insert themselves into a loan transaction by separating the actual lender(s) and borrowers so far that neither one knows about the other.

The Banks step into the void they created and claim ownership of all the money advanced by investors, all the mortgage backed securities ever “issued” and all of the notes and mortgages that were signed by homeowners.

A crucial component of this business strategy is the ability to create the illusion of ownership in both primary market lending and secondary markets where loans and securities are bought and sold.  It all falls apart if each (or some) transfer of the loan is faked. In order for the banks to have succeeded in their strategies they needed to convince everyone that they were, in fact, the only parties authorized to do business in connection with the existence of any loan.

The vehicle for creating this illusion is an intermediary who is presented as an alternative to the county records where deed and mortgages are filed. As a former president stated, “if you tell a lie that is big enough it will be accepted as truth and the truth will be accepted as false.”

The primary vehicle was MERS. (Chase used another similar vehicle that only Chase controlled). MERS is a real live corporation whose ownership is complex — involving the largest players on planet Earth. It consists of a handful of people who maintain an IT platform that is a cross between a database for identifying members and a chat room for conspiracy.

People with no affiliation with MERS enter the IT platform with a login and password. Once inside they appoint themselves as officials of MERS and then execute documetns on behalf of MERS. Transfers are sometimes logged into the database and sometimes they are not. But when it comes time that a MERS member would like to assume control of an alleged loan and foreclose on it, an entry is made showing that member as the latest transferee of the mortgage, thus giving the appearance of a party entitled to enforce.

The problem, identified by Judge Grossman, is that MERS, although self described in the mortgage as “mortgagee” and as “nominee” for the mortgagee is that this is doublespeak.  In fact, it is neither an agent for the actual lender whose existence is withheld and hidden, nor is it the lender, and hence MERS does not qualify as a mortgagee under statutory definitions.

This is no technicality. Because MERS expressly disclaims any right, title or interest in the money, the debt , the note and the mortgage. It is directly expressed on the MERS websites, the MERS agreements and anything else you can run across where an official MERS notice or statement appears. And there is a reason for this. The Banks made sure that (1) they were in complete control of MERS and (2) there had to be no doubt that if MERS ended up in litigation or someone declared bankruptcy, there would be nothing in the bankruptcy estate in which MERS owned any asset or possessed any right to enforce a mortgage. The banks wanted that all for themselves.

The Banks made sure that (1) they were in complete control of MERS and (2) there had to be no doubt that if MERS ended up in litigation or someone declared bankruptcy, there would be nothing in the bankruptcy estate in which MERS owned any asset or possessed any right to enforce a mortgage. The banks wanted that all for themselves.

Outside the Wall Street bubble, this strategy came under fire and was actually banned in some states. MERS was personna non grata. The basic element to the MERS strategy is that documents could be fabricated and robo-signed to create the appearance of an assignment of a mortgage. THAT could only be true if MERS was either (a) the mortgagee or (b) the agent for a mortgagee. It has never been either one. And the transfers made the original entries in the MERS IT platform increasingly remote from the real world.

In the real world neither MERS nor the “lender” identified on the mortgage deed owned the debt , note or mortgage. So MERS could not very well execute any paper that conveyed a greater interest than what it possessed, which was nothing.

Thus in all cases involving a “MERS mortgage” the party seeking to enforce the mortgage instrument should be required to prove their interest with actual evidence of a purchase and sale and not just a paper instrument that essentially says “Trust me, I’m a bank.” In theory it shouldn’t be hard to come up with that evidence. But in reality, outside the Wall Street bubble, it is crystal clear that there were no purchases, there were no sales of the debt,

But in reality, outside the Wall Street bubble, it is crystal clear that there were no purchases, there were no sales of the debt, note and mortgage because the “origination”, “aggregation,” or “acquisition” of the loan was long ago funded not by the parties stated on the note and mortgage but by the investors who were barred from knowing how their money was being used. And the borrowers, in most cases were signing notes and mortgages in favor of companies that had not made any loan to them. And that is the real derivation of a “free house.” Except that it applies to the banks and not the homeowners.

The moral of the story is that neither borrowers nor their lawyers should realize and know that words scribbled on paper are hearsay and do not necessarily reflect the truth of the matter asserted. And those words certainly don’t mean that any of the presumptions that you would ordinarily make about the instrument are true and correct.

The importance of this revelation is simple. By inserting themselves, MERS, LPS, and servicers into the grey cloud of mortgages and foreclosures, the banks have interfered with the relationship that arose when the borrowers received money from the investors through multiple conduits that neither the investors nor the borrowers knew existed. The borrowers have always maintained that they wanted to do a workout with the real creditors, but they are prevented from doing so because the identity of the investors continues to be hidden.

But for the interference from the banks and the fraudulent business plan they pursued in creating completely fake loan accounts, the number of foreclosures would have been a tiny fraction of what has occurred in real life with real lies. It is continuing. And decisions like this one are breaking the ice allowing homeowners a chance to successfully confront the fraudulent foreclosure practices.

And as for the free house, most homeowners only want to work out the terms of a real note and a real mortgage and pay back the money that the investor would otherwise lose if that portion of the loan that has not already been paid as “settlement” when the investors discovered what had been done with their money.

 

California Foreclosure Process Overview

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By Patricia Rodriguez, Attorney

The process of foreclosure defense begins with pre-litigation (gathering all of the necessary information); once that is accomplished then Litigation of Real Property Ownership/Title in California can occur. First you must file the complaint. Questions to pose are when to file, what to write, what to file, and how to file. You want to file asap so that you do not miss any statute of limitations.

It is recommended that you use a checklist of possible causes of actions. Compare your facts to the checklist and build your complaint from there. You must include with your filed complaint, a summons, civil case cover sheet, attachments, complaint, complaint verification page, and the complaint exhibits. You will want to determine if you should file in Federal or State Court. You will also want to determine which court, based on jurisdictional issues.

Once a complaint is filed you can seek a temporary restraining order and a preliminary injunction to stop a sale of the property. The court may require you to put  upa bond to be granted such an order. Temporary restraining orders are temporary until an order to show cause hearing can be had on the matter. The court will look to see if there has been proper notice, exigent circumstances exist, and if Plaintiff has a likelihood of succeeding on the merits of the case.  The court will not look favorably on a party that waits until the last minute to seek such an order and may conclude any exigent circumstances that exist, are due to Plaintiff’s failure to bring the request sooner and deny it on that basis alone.

Once the case is filed, an analysis should be done to determine whether or not to record a Lis Pendens which is a two-page document which attaches the lawsuit over the title to the property; thus, when it’s sold at a trustee sale date, no one but the bank will buy the lawsuit –and the bank must buy it back. There can not be a bona-fide purchaser because everyone is on record of the notice of the lawsuit. The lis pendens should only be recorded if there are real property issues and if there is a likelihood of success on the merits. The defendants will likely file a motion to expunge the lis pendens and if its not voluntarily withdrawn the court may award attorneys fees and costs to the defendants who had to bring the motion to expunge. In order for the motion to expunge to be granted but attorneys fees and costs to be denied the Plaintiff must show that it had substantial justification in recording and maintaining the lis pendens.

To contact Patricia Rodriguez (if located in California), please call 626-888-5206.

The Rodriguez Law Firm: http://www.attorneyprod.com/

For a free consultation, fill out the contact form: http://www.attorneyprod.com/contact.html

This article is not legal advice, but for educational purposes only.
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