That NOTICE OF DEFAULT is probably not what it appears. It is probably an unauthorized document based upon incorrect financial data, and fabricated or useless documents.
That ASSIGNMENT might look good on its face but it probably has no legal effect.
California Reconveyance is suspect for the following reasons
- The notice of default usually says they are either the trustee or the agent of the trustee. This is an admission that they don’t know who they are, which makes the notice default potentially defective for this and several other reasons. If they were the agent of the trustee, then where is the power of attorney? It certainly isn’t recorded, so the notice of default is defective unless California Reconveyance is the Trustee.
- It can’t be the Trustee unless it is appointed by an authorized party and the recording of the substitution predates the notice of default.
- The authorized party must be truly authorized and not a party with APPARENT authority because the authority must be executed in properly recordable form and then recorded PRIOR to the notice of the default.
- Why was California reconveyance used at all? There already was a trustee.
- Does California Reconveyance qualify as a Trustee under California law?
- In all the cases I have seen, the assignment is dated long after the PSA was executed. If there was a close-out time (which there usually is) then the assignment might have been offered but by the terms of the PSA it wasn’t accepted because it couldn’t be accepted.
- If there was an additional document(s) allowing the transfer, then that should have been recorded as well. But there couldn’t be such a document because
- The pool ONLY accepts assignments of performing mortgages, not mortgages that are in default. Therefore it would be a direct violation of the PSA and Prospectus to put in a non-performing loan. Hence, again, the assignment may have been offered and might look good on its face, but it must be taken as only part of the securitization documents that create the securitization structure.
- A claim of acceptance might be expected from the “Trustee” (whom we have already identified as not having any Trustee powers or duties in real life). This claim is an admission that the Trustee has violated the terms of the securitization document that put him in that position.
- At least one judge expressed the opinion that these are matters between the creditors and do not affect either the borrower’s obligation nor the ability of some creditor possessing some aspect of credibility to foreclose on the home. This opinion should be met with a compelling argument: “Ordinarily I would agree your honor that these are mere technicalities that do not affect the obligation nor the ability to enforce it. I would also ordinarily agree that if the wrong party brings the action, then they might have some liability to some other creditor with a colorable claim. But here we have something different: legally the assignment was neither authorized to be made or accepted which means that there is a high probability that the loan is still owned by other parties and could very well have been assigned or will be assigned into a new pool of resecuritized assets. This leaves the borrower with financial double jeopardy. Perhaps worse than that we are compounding an already clouded title situation.In your effort to prevent the borrower from getting a free house, you are giving a free house to someone else who neither has any right to it nor do they represent anyone who does. Therefore it is a question of fact that must be heard on its merits, after an opportunity to conduct discovery (a) the identity of the actual creditor (b) the true balance of the obligation after allocation of third party payments and (c0 the true status of the loan and whether there ever was a default after allocation of the third party payments being applied in accordance with the terms of the note and Deed of Trust.
- The UCC provides that a transfer of a loan in default might not be perfected. It may also be evidence of splitting the note and mortgage. (Deed of Trust)
Filed under: CASES, CORRUPTION, expert witness, foreclosure, foreclosure mill, Forensic Analysis Workshop, GTC | Honor, HERS, Investor, MODIFICATION, Mortgage, Motion Practice and Discovery, securities fraud, Securitization Survey, Servicer, STATUTES, trustee, workshop | Tagged: apparent authority, assignments, authorized, California Reconveyance, clouded title, default, fabricated, trustee |