“You have a choice — to keep it or lose it — I want you to know.”
Thomas Jefferson (Letter to James Monroe January 1, 1815)
[Editor’s Note: While I agree this statement, it goes too far. It is centralization of banking, and the power that goes with it, that is the danger to us. Centralization removes the personal relationship from banking, and removes personal responsibility for both loans and deposits from both the financial institution and its customers. Thus character, the one thing that JP Morgan said was the the essence of every banking transaction, was shunted aside in favor of intoxicating excess. We don’t need big banks to provide the convenience or benefits of interstate or even international banking. The technology is already in place to allow the 5,000 banks and credit unions that are NOT in trouble, to accept deposits for any bank from anywhere, to provide surcharge free access to ATM services, loans, billpay, ACH or other services. The only thing stopping free market forces from governing the marketplace is that the referee is owned by the bullies in the playground. The bullies who broke all the rules won’t allow access to the thousands of banks who practiced sound judgment and good management of risk. It is only the appearance of competition that has been established. It is an illusion.]
“If the American People ever allow the banks to control the issuance of their currency, first by inflation and then by deflation, the banks and corporations that will grow up around them will deprive the people of all property until their children wake up homeless on the continent their fathers occupied. The issuing power of money should be taken from the bankers and restored to Congress and the people to whom it belongs. I sincerely believe the banking institutions
We are completely saddled and bridled, and the bank is so firmly mounted on us that we must go where they ill guide.
having the issuing power of money are more dangerous to liberty than standing armies. The dominion which the banking institutions have obtained over the minds of our citizens…must be broken, or it will break us.”
It’s War! The Homeowner’s War. YOU have rights, powerful rights to keep YOUR homes, “foreclose” on your “lender”, collect damages, refunds, rebates, interest, attorneys fees and court costs. Homeowners for once are in the catbird seat of going after the windfall that always seems to hit the big guys. This time it is YOUR turn.
This is a developing resource for attorneys and borrowers to assist them in creating strategies and tactics in foreclosure defense and offense. Assistance and comments regarding bankruptcy jurisdiction is also covered.
Bottom Line: The procedure invoked by the mortgage meltdown scheme defrauded investors and borrowers in identical fashion as part of a single scheme (false ratings and insurance) in asset backed derivative securities, who were the source of funding for the fraudulent loans on residential real property (false appraisals, undisclosed parties, undisclosed fees, abandonment of underwriting standards etc.). The borrower and the investor were co-victims of a Ponze scheme. The middlemen needed money from the investor and a signature from the borrower. Everything else was smoke and mirrors.
We are finding that the notice of sale or filing of foreclosure starts with the wrong people using information that cannot be verified based upon authorization that is assumed rather than provable. we also find that there are good legal grounds for challenging any loan, whether in default or not, that was originated between 2001-2008, and in particular any such transaction in which the borrower is now “upside down” (negative equity, despite the down payment of as much as 20%-35%).
The central theme here is a SINGLE TRANSACTION consisting of many new players in the mortgage loan transaction, new roles for old players, and shifting of the risk of loss, right to receive payment, ownership of the note and ownership of the security instrument, all of which are usually vested in different entities or individuals, trustees, or divisions of had been conventional lending institutions and investment banking institutions.
In a great many cases, if not the majority of cases, we find that the “lender”, while possessing all the attributes of a bank or Lending Institution is actually a mortgage broker or front for an investment banking firm.
A summary of the starts with the source of funds (an investor in an asset backed security -ABS) who buys a share of an entity that possesses certain rights by assignment and certain guarantees by indemnification and indenture. This entity, like all capitalist structures is broken up into smaller shares that investors buy.
The shares are sold to qualified investors through an exemption in SEC laws that allows limited disclosure and virtually no prospectus. The investors appear to have most of the rights to the stream of revenue generated by borrower payments along with guarantees, indemnifications and sue of proceeds allowances from the investment banker, the lender, or other third party insurer or guarantor. Thus the total revenue to the investor is partially from his own funds, partially from third parties and the rest from the payments made by the various borrowers whose mortgages and notes are the center piece of the overall transaction.
The shares are rated by conventional rating agencies who were corrupted by the mortgage meltdown scheme and the flow of funds is insured by one of a variety of insurers of revenue, default risk etc.
The securitized entity appears to have the most rights (but apparently not the exclusive rights) to the mortgage notes that make up the portfolio of assets within the securitized entity.
The investment banker that created the entity whose shares were sold to investors appears to have formed subsidiary(ies) or affiliated entities that (a) hold most of the rights to the security instrument (mortgage) and (b) other entities that act as mortgage aggregators, lenders, mortgage brokers etc.
A perusal of the blog site will reveal that our opinion is that in all cases the “lender” should at best be identified as contingent, the mortgage and note should at best be identified as contingent, and that “John Doe” should be added to the list of Defendants and/or schedule of creditors, being the unknown person(s) or entity (ies) that own shares or bonds that are backed by the mortgages and notes of hundreds or thousands of people.
Each party received a fee that could be called a transaction fee arising out of the real estate closing which included the loan closing in which the signature of the borrower on the loan documents on one end, and the signature and funding of the investor in the ABS on the other end.
The point that needs to be made immediately to any sitting Judge is that the foreclosure process has changed from simple to complex litigation by virtue of the fact that securitization of loans introduced many new parties into the transaction, many of whom were not disclosed, each of whom received compensation that was not disclosed, each of whom violated Truth in lending laws, Unfair and Deceptive Trade Practices Acts, and Securities laws and rules, with multiple rights of rescission accruing to the borrower from a variety of applicable laws.
Foreclosure has become far more complex and complicated that it was before the securitization of mortgages and other loans began, and before that financial model spawned a surge of predatory lending practices that changed the landscape of foreclosure litigation.
We have seen several cases around the country where the lender was found to have decoupled the security interest from the note, where the note was satisfied by Truth in Lending violations (TILA), and where the Trustee, Lender and/or mortgage servicer is unable to produce the original note and mortgage, unable to produce the actual assignment of the mortgage and note to a mortgage aggregator and unable to to trace a particular asset backed security that was sold somewhere in the world to dozens, hundreds or thousands of investors to a particular piece of property (in this case — YOUR property).
Look carefully at the Garfield Glossary at entries regarding the holder in due course under the UCC and the details of securitization, clouds on title and strategies to take the offense in the Homeowner’s War.
Our purpose here is to provide a beginning point for lawyers and non-lawyers in their quest to save their property and recover refunds, points, closing expenses, compensatory damages and punitive, exemplary or statutory treble damages. Secondarily we provide information generally on economic data and other stories of interest.
For over a year, Neil Garfield in Phoenix, Az has been researching, writing and collecting information about homeowners in distress. After correctly predicting the housing crash right down to the last dotted “i” and crossed “t” he began writing his blog http://www.livinglies.wordpress.com. Starting with modest results, the blog took on a life of its own and has enjoyed 20 straight weeks of increasing volume, the latest being 10,000 visits in one week.
His basic premise, set forth in his FAQ and Mission statement is that the foreclosure mess was not a situation where millions of people suddenly appeared needing housing, but where Trillions of dollars were in search of people who could be convinced to sign their names.
But Garfield, a former investment banker and former trial attorney, goes further. He says that homeowners can walk into the courthouse in foreclosure and walk back out having foreclosed on their lender and receiving the title to their home free and clear of the mortgage or note. He turns the windfall argument about how unfair it would be for some people to get their homes for free and uncovers the real windfall — that lenders who have been paid in full and received undisclosed fees, are now foreclosing on property so that they end up with the property, the money, and a deficiency judgment too. It is the ultimate windfall and the misperceptions and ideologies that are in circulation perpetuate the fraud that has been committed on our citizens, our country’s place in the world, the erosion of our economy, and the value of our money.
Garfield is now in the process of giving low-cost seminars to lawyers and homeowners on the basics of defending their property and seeks nothing less than to stop All foreclosures on property financed between 2001-2008, which is when Wall Street stepped into the mortgage market and caused a drop in underwriting standards that can only be understood by people like Garfield, who worked there, who created some of these exotic securities.
He says the rule is simple: if you want to sell a security make it complicated. If you want to buy a security look for something simple. In the complex there is fraud, in the simple there is usually just fundamental cash flow, finance and economics.
Video: Truth & Rational Principles Set Us Free: Resistance to being a part of a human livestock management through enslavement (debt) and illusion (freedom) – Make it Real