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Krieger is right about the fundamentals. While I have not reviewed his report, it appears from what I have heard about it that in contains misstatements and inaccuracies. BUT the idea that the foreclosures are largely a fraud upon homeowners and the Courts is well-founded.
The parties who are initiating the foreclosures are mostly servicers. They want the foreclosure so they can collect on advances and fees. But they have no right to foreclosure on those claims because they have no contract, no note, and no mortgage in which they have the right to make such collections or enforce the terms of what they claim to be the original note and mortgage. They MIGHT have some equitable claim against the homeowner but it isn’t secured by any security instrument (mortgage).
The banks have painted themselves into a corner and you can be sure that past reports will be combined with new reports about the details of fabrication, forgery, and perjury from robo-signers, robo-witnesses and people with no knowledge of anything other than the script that some lawyer gave them before they appeared in court.
The plain truth is that there are no defaults in nearly all of the claims on which foreclosure is sought. That is because the creditor, frequently identified as a REMIC Trust (but in actuality is a group of investors) have continued to get paid through servicer advances. There is nothing about that in the note or mortgage signed by the alleged borrower. Since they received payment the party claiming to be the mortgagee shows no default on its books but the servicer wants the foreclosure anyway because it makes them money.
Then there is the other problem resulting in the conclusion that there is no legal “creditor” in the conventional sense. When you come right down to it there isn’t anyone who answers the definition of a creditor or lender with rights to enforce either the note or the mortgage because none of them are actually in privity with the borrower and virtually none of the parties claiming to “own” the loan never paid for it, never received it, and have no power to collect, much less foreclose on it.
Take a step back and look at the larger picture. Why wouldn’t the “real parties in interest” end the entire dispute by merely producing proof that they are holders in due course or were the original lenders. This is the essential problem for the banks and it is only in taking the longer view that you can see patterns that cannot be reconciled.
First they said they were no trusts, then they said there were trusts but the authority to enforce was with the servicer, then they kept switching servicers (an illusion) and producing a “power of attorney” instead of a transfer of servicing rights. Why couldn’t they produce a transfer of servicing rights? Answer: because they were not transferring the servicing rights which included the right to collect servicer advances (volunteer payments) made by the master servicer.
Now they are saying the trusts own the loan — but they can’t produce proof of payment. So they are saying we don’t need to produce proof of payment. We only need to show the note. This is circular reasoning but Judges are still going with this faulty line of reasoning. If you analyze the pattern you can see that they are not alleging that the trusts are holder in due course or owners of the debt because the trusts are not holders in due course and not owners of the debt. what does that make the trusts? Perhaps, depending upon the forged, backdated endorsements and assignments, it might make them an accommodation holder.
That still leaves open the essential question: who owns the loan. The investors money was used to originate and/or acquire the loans but they don’t appear on the notes or mortgages. The trust was supposed to pay for the loans but it didn’t. Why not? Because the investment bank diverted (Stole) the money. The key to this puzzle is that the investment banks created unregistered entities on paper and then had them issue “mortgage backed securities”. The trusts never operated, never received any money and therefore could never pay any money for anything. They didn’t even have a bank account.
Why did the world’s largest financial institutions fake the documents and lie to the courts? Because they had to do that. They needed fake documents because none of the real events and real documents would suffice. Hence, the claim of fraud is true even if some of the details were not exactly right. But the fraud is not just upon borrowers and the courts. It starts with the initial fraudulent transaction with investors (pension funds) who gave up their money thinking that the money would go into an operating trust that would then originate and acquire mortgage loans. That never happened. If it did happen the way the investors thought and were promised, (a) there would not have been the rush to push bad loans onto borrowers and (b) the foreclosure battle would be non existent.
Filed under: foreclosure |