Quiet Title “Packages”

The promise by some title search vendors of a cheap lawsuit that will get rid of your mortgage is generally not based in reality. You might be able to beat a foreclosure with title issues but you probably won’t get rid of the mortgage or deed of trust without pleading and proving that the mortgage or deed of trust is completely void — like it never should have existed or doesn’t exist now by operation of law.

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There are many people out there who are pursuing a business model of offering a quiet title package, sometimes using the word “Turnkey.” Most of these people are well-meaning but not lawyers and they are lacking basic legal knowledge. While the title work by people like TitleTracs is excellent, the promise by some title search vendors of a cheap lawsuit that will get rid of your mortgage is generally not based in reality. You might be able to beat a foreclosure with title issues but you probably won’t get rid of the mortgage or deed of trust without pleading and proving that the mortgage or deed of trust is completely void — like it never should have existed or doesn’t exist now by operation of law.

Personally I think that condition is satisfied by TILA rescission, but the courts are still rebelling against the idea of giving that much power to borrowers. So while I am certain it is correct, I am equally certain that the defense shield raised by the banks is working even though it does not pass muster legally and will probably be struck down again by the US Supreme Court.

While these offers may sound attractive there are many pitfalls and trap doors that will prevent a homeowner from actually achieving anything by focusing on a strategy that is dependent upon a court issuing a declaration quieting title. The very word “quiet” should give you a hint. There must be an actual controversy or dispute involving a present situation requiring the court to decide the rights of the parties. Courts are NOT in the business of issuing advisory opinions.

The Marketing title says it all — it is a “turnkey” “quiet title” package suing for damages. There is no such thing as turnkey title — they don’t know all the possibilities of defects in title. And they won’t know it even after they produce a title report either, although they will have a pretty good list of possibilities of title defects.
Without a title expert (usually an attorney) analyzing the title going back to the last time that a real title examiner looked carefully at title to the subject property, nobody knows what is a defect, what can be corrected by affidavit, and what prevents the grantee of an instrument from doing anything with it. This might mean going back 30 years or more.


Quiet title is an action in equity that is a complaint for declaratory relief wherein the court says “here are the names of the stakeholders and here is the stake of each holder.” But no court is going to allow the lawsuit for that without pleading a present controversy — because that would be the Court giving legal advice.

So you would have to say “A is the owner of the property but B (or B, C and D) is/are saying it is the owner of the property (or B is saying that it has a valid encumbrance upon the land. I am trying to sell, refinance the land and I can’t complete the transaction because of B’S claim, which I think is bogus because [fill in the blank, e.g., the mortgage is a void or wild instrument because …]. So in order to complete my pending transaction I need a declaration from the court as to whether B is a stakeholder, like they say or B is not a stakeholder like I say.” If you don’t have those elements present the court will dismiss the lawsuit 99 times out of 100.

The promise of damages is bogus. That is an action at law that could be derived from any number of breaches or torts by the defendant(s). It could never derive from a turnkey quiet title package even if there was one. It would be a different lawsuit saying B had this duty, they breached it, or committed an intentional tort, and that was the proximate cause of actual damages to me that include x, y and z.


And as many people have found out when they sued for quiet title and had their suit dismissed or judgment entered against them there are two main reasons for that. First, they could not properly plead a present controversy or the competing “stakes” in the property. Second, they could not tie in ACTUAL damages to a breach of duty or intentional tort by the defendant. Proximately caused means legally caused.

Most judges view such lawsuits as “”B is bad. Give me title and whatever monetary damages you think will punish them.” The homeowners are skipping the part that where there are no actual damages you don’t get punitive damages. You can’t sue for JUST punitive damages. If you don’t have actual damages you don’t have standing to sue. The Latin for this is damnum absque injuria. Just because somebody was negligent or greedy doesn’t mean you can sue if you are not a party who suffered actual damages from their illegal act.

Problems with Lehman and Aurora

Lehman had nothing to do with the loan even at the beginning when the loan was funded, it acted as a conduit for investor funds that were being misappropriated, the loan was “sold” or “transferred” to a REMIC Trust, and the assets of Lehman were put into a bankruptcy estate as a matter of law.


I keep receiving the same question from multiple sources about the loans “originated” by Lehman, MERS involvement, and Aurora. Here is my short answer:

Yes it means that technically the mortgage and note went in two different directions. BUT in nearly all courts of law the Judge overlooks this problem despite clear law to the contrary in Florida Statutes adopting the UCC.

The stamped endorsement at closing indicates that the loan was pre-sold to Lehman in an Assignment and Assumption Agreement (AAA)— which is basically a contract that violates public policy. It violates public policy because it withholds the name of the lender — a basic disclosure contained in the Truth in Lending Act in order to make certain that the borrower knows with whom he is expected to do business.

Choice of lender is one of the fundamental requirements of TILA. For the past 20 years virtually everyone in the “lending chain” violated this basic principal of public policy and law. That includes originators, MERS, mortgage brokers, closing agents (to the extent they were actually aware of the switch), Trusts, Trustees, Master Servicers (were in most cases the underwriter of the nonexistent “Trust”) et al.
The AAA also requires withholding the name of the conduit (Lehman). This means it was a table funded loan on steroids. That is ruled as a matter of law to be “predatory per se” by Reg Z.  It allows Lehman, as a conduit, to immediately receive “ownership” of the note and mortgage (or its designated nominee/agent MERS).

Lehman was using funds from investors to fund the loan — a direct violation of (a) what they told investors, who thought their money was going into a trust for management and (b) what they told the court, was that they were the lender. In other words the funding of the loan is the point in time when Lehman converted (stole) the funds of the investors.

Knowing Lehman practices at the time, it is virtually certain that the loan was immediately subject to CLAIMS of securitization. The hidden problem is that the claims from the REMIC Trust were not true. The trust having never been funded, never purchased the loan.


The second hidden problem is that the Lehman bankruptcy would have put the loan into the bankruptcy estate. So regardless of whether the loan was already “sold” into the secondary market for securitization or “transferred” to a REMIC trust or it was in fact owned by Lehman after the bankruptcy, there can be no valid document or instrument executed by Lehman after that time (either the date of “closing” or the date of bankruptcy, 2008).


The reason is simple — Lehman had nothing to do with the loan even at the beginning when the loan was funded, it acted as a conduit for investor funds that were being misappropriated, the loan was “sold” or “transferred” to a REMIC Trust, and the assets of Lehman were put into a bankruptcy estate as a matter of law.


The problems are further compounded by the fact that the “servicer” (Aurora) now claims alternatively that it is either the owner or servicer of the loan or both. Aurora was basically a controlled entity of Lehman.

It is impossible to fund a trust that claims the loan because that “reporting” process was controlled by Lehman and then Aurora.


So they could say whatever they wanted to MERS and to the world. At one time there probably was a trust named as owner of the loan but that data has long since been erased unless it can be recovered from the MERS archives.


Now we have an emerging further complicating issue. Fannie claims it owns the loan, also a claim that is untrue like all the other claims. Fannie is not a lender. Fannie acts a guarantor or Master trustee of REMIC Trusts. It generally uses the mortgage bonds issued by the REMIC trust to “purchase” the loans. But those bonds were worthless because the Trust never received the proceeds of sale of the mortgage bonds to investors. Thus it had no ability to purchase loan because it had no money, business or other assets.

But in 2008-2009 the government funded the cash purchase of the loans by Fannie and Freddie while the Federal Reserve outright paid cash for the mortgage bonds, which they purchased from the banks.

The problem with that scenario is that the banks did not own the loans and did not own the bonds. Yet the banks were the “sellers.” So my conclusion is that the emergence of Fannie is just one more layer of confusion being added to an already convoluted scheme and the Judge will be looking for a way to “simplify” it thus raising the danger that the Judge will ignore the parts of the chain that are clearly broken.

Bottom Line: it was the investors funds that were used to fund loans — but only part of the investors funds went to loans. The rest went into the pocket of the underwriter (investment bank) as was recorded either as fees or “trading profits” from a trading desk that was performing nonexistent sales to nonexistent trusts of nonexistent loan contracts.

The essential legal problem is this: the investors involuntarily made loans without representation at closing. Hence no loan contract was ever formed to protect them. The parties in between were all acting as though the loan contract existed and reflected the intent of both the borrower and the “lender” investors.

The solution is for investors to fire the intermediaries and create their own and then approach the borrowers who in most cases would be happy to execute a real mortgage and note. This would fix the amount of damages to be recovered from the investment bankers. And it would stop the hemorrhaging of value from what should be (but isn’t) a secured asset. And of course it would end the foreclosure nightmare where those intermediaries are stealing both the debt and the property of others with whom thye have no contract.


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Not even the Federal Government Can Determine Who owns Your Loan

It was impossible to trace the majority of the mortgage loans on the over 300 homes sold by DSI that were the subject of the FBI investigation; it would have been harder yet to identify individual victims of the fraud given that the mortgages were securitized and traded. (Emphasis added.)



Originally posted at http://mortgageflimflam.com
With additional edits by http://4closurefraud.org

“Counter-intuitive” is the way Reynaldo Reyes (Deutschbank VP Asset Management) described it in a taped telephone interview with a borrower who lived in Arizona.  “we only look like the Trustee. The real power lies with the servicers.”

And THAT has been the problem since the beginning. That means “what you think you know is wrong.” This message has been delivered in thousands of courtrooms in millions of cases but Judges refuse to accept it. In fact most lawyers, even those doing foreclosure defense, and even their clients — the so-called borrowers — can’t peel themselves away from what they think they know.

In the quote above it is obvious that the sentencing document reveals at least two things: (1) nobody can trace the loans themselves which in plain English means that nobody can know who loaned the money to begin with in the so-called loan origination” and (2) nobody can trace the ownership of the loans — i.e., the party who is actually losing money due to nonpayment of the loan. Of course this latter point was been creatively obscured by the banks who set up a scheme in which the victims (investors, managed funds, etc.) continue to get payments long after the “borrower” has ceased making payments.

If nobody knows who loaned the money then the presumption that the loan was consummated when the “borrower”signed documents placed in front of them is wrong for two reasons: (1) all borrowers sign loan documents before funding is approved which means that no loan is consummated when the documents are signed. and (2) there is no evidence that the “originator” funded the loans (regardless of whether it is a bank or some fly by night operation that went bust years ago) loaned any money to the “borrower.” (read the articles contained in the link above).

The reason why I put quotation marks around the word borrower is this: if I don’t lend you money then how are you a borrower, even if you sign loan papers? The courts have nearly universally got this wrong in virtually all of their pretrial rulings and trial rulings. Their attitude is that there must have been a loan and the homeowner must be a borrower because obviously there was a loan. What they means is that since money hit the closing table or the last “lender” received a payoff there must have been a loan. What else would you call it?

Certainly the homeowner meant for it to be a loan. The problem is that the originator did not intend for it to be a loan because they were not lending any money. The originator played the traditional part of a conduit (see American Brokers CONDUIT for example). The originator was paid a fee for the use of their name and traditionally sold the homeowner on taking a loan through the friendly people at XYZ Speedy No Fault Lending, Inc. (a corporation that often does not exist).

Somebody else sent money but it wasn’t a loan to the homeowner. It was the underwriter who was masquerading as the Master Servicer for a Trust that also does not exist. Where did the underwriter get the money? Certainly not from its own pockets. It took money from a dynamic dark pool that should not exist, according to the false “securitization” documents (Prospectus and Pooling and Servicing Agreement).

Who deposited the money into the dark pool? The sellers of fake “mortgage-backed securities”who took money from pension funds and other managed funds under the false pretense that the money would be under management of a specific REMIC Trust that in actuality does not exist, never conducted business under any name, never had a bank account, and for which the Trustee had no duties except window dressing to make it look good to investors. How is that possible? NY law allows for the documentation of a trust without any registration. The Trust does not exist in the eyes of the law unless there is something in it. This like a stick figure is not a person.

None of the money from investors went into any Trust account or any account of any trustee to be held and managed for a REMIC Trust. Sound crazy? It is crazy, but it is also true which is why it is impossible for even the Federal Government with virtually limitless resources cannot tell you who loaned you any money nor who owns any debt from you.

The money was surreptitiously deposited into hundreds of dark pools in institutions around the world. The actual business of the dark pols was to create the illusion of profits for the banks and a huge dark reserve that siphoned some $5 trillion out of the U.S. economy and more out of other economies around the world.

To cover their tracks, the banks took some of the money from the dark pool and started a chain reaction of offering what appeared to be loans but which in most cases were financial death sentences.

The investors, for sure, have a potential claim against the homeowners who received actual benefit from a flow of funds, but without being named in the loan documents, they have no direct right of foreclosure. And then there is the problem of coming up with the correct list of investors whose money was commingled with hundreds of fake trusts. The investors know that collectively, as a group they are owed money from homeowners as a group. But NOBODY KNOWS which investors match up with what alleged loan. The homeowner can ONLY be a “borrower” if they executed a loan contract and the contract became enforceable because there was offer, acceptance and consideration flowing both ways. Without all four legs of the stool it collapses.

Judges resist this “gift” to homeowners while ignoring and accepting the consequence of a gift of enormous proportions to the few banks at the top who started all this. Somehow word has spread that the middle and lower class is the right place to put the burden of this illegal bank behavior.

The homeowner’s offer of consideration is the promise to pay principal sometimes with interest. The originator’s offer of consideration is not to the homeowner. The originator has offered services for a fee to the conduits and sham corporations that put the originator up to selling bad loans from undisclosed third parties to people who lacked the financial knowledge to understand what was happening. So no contract there. No contract? No borrower. No contract? No lender. Hence the term I used back in 2007, “pretender lender.” I should have also coined the term “mock borrower.”

Sound impossible? Here is the finding from the sentencing document:

During the time of the information, DSI worked with two “preferred lenders,” Wells Fargo Bank and J.P. Morgan Chase. Certain employees and managers of those two preferred lenders knew about the incentive programs offered by DSI and the builders, and knew that the incentives were not being disclosed in the loan files. (Emphasis added.)

And that is what we mean by “counter-intuitive.” It is a lie, a cover-up and a fraudulent scheme directed at multiple  victims. Under existing law, foreclosure is not an option for persons who lack standing and have unclean hands. Nearly all loan transactions were table funded and that means, according to TILA, that they are and were predatory loans. And that means, according to me, that it is impossible to allow any equitable relief be had by those who have unclean hands — especially those who seek foreclosure, which is an equitable remedy.

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COVER-UP: Whatever Happenned to Those Settlements?

This is for general information only.

For further information please call 954-495-9867 or 520-405-1688

Consult a lawyer before making any decisions based upon the content of this article or anything else on this blog.


see http://www.mpamag.com/news/foreclosure-settlement-funds-misspent-26697.aspx

The media and the Bank lobby keep referring to illegal activity, risky or mismanagement. I call it a cover-up that dwarfs Watergate by comparison. Here are some facts:

  1. Foreclosures are still increasing, despite dozens of articles per day that say otherwise. Those articles are writing about a particular city or county whereas the true numbers can only be measured nationally. Wall Street has creatively used its dominance in the press to get them using the terms that would lead one to believe that the foreclosure crisis in behind us.
  2. This wasn’t negligence. It is intentional, it is fraud, it is illegal and probably criminal. The banks didn’t suddenly wake up one morning with amnesia abut how to make a loan and how to account for it. They also didn’t accidentally destroy the original loan papers. It was intentional. Why did they destroy cash equivalent instruments? Because they had made reports to multiple third parties about the loan that would be readily obvious that (a) the loan did not qualify to be approved (b) that the loan did not qualify for the investment criteria needed by the stable managed funds (pension, for example) and (c) it is much easier on bankers if they admit to negligence than to produce proof of fraud (they obviously had made multiple misrepresentations and sales to multiple third parties).
  3. The foreclosures are for the benefit of the intermediary banks whose self-proclaimed status as agents for unidentified creditors makes a mockery of our marketplace and our judicial system.
  4. The banks were found by administrative and law enforcement agencies to have committed fraud on the courts, to have pushed through foreclosures in which they had no ownership or rights to the alleged loans, that probably was never consummated (in the legal sense) in the first place.
  5. The homeowners whose files were reviewed by investigators and found to have fatal defects were never notified by the investigators or anyone else about the finding and the agreement by the banks. This one example of the wrong-headed policies started by Bush and continued by Obama have been wrong headed and bone-headed.
  6. Hundreds of Billions, approaching $1 Trillion have been paid in settlements by the major banks, many with specific provisions that the settlement was to be to the benefit of homeowners who were illegally foreclosed or who were in foreclosure when the foreclosing party was (a) non existent or (b) a sham naked nominee with no interest in the loan, the note or the mortgage and or (c) a party who has never been disclosed in the courts during foreclosure litigation but who was directing the entire false and fraudulent scheme of “securitization”.
  7. The banks make no bones about it — they admit that the Trusts are and always were empty but have been asserting successfully to Judges who didn’t think through that whether there were actual underlying transcriptions where money exchanged hands or not, is irrelevant because they “hold” the note. So they admit that nobody in the chain of custody upon which they rely ever actually had any financial interest in the alleged “loan” with the homeowner and admit further, upon interrogation that they have no privity of contract with the homeowner.  The banks successfully turned the heads of thousands of judges with the myth of the homeowner getting a free house.
  8. Out of hundreds of billions of dollars in settlements, homeowners have seen virtually nothing — disbursements of less than 1% of the alleged principal or their alleged loan.
  9. It is an inescapable conclusion that the funds for the”Settlements” (a) remain unpaid or (b) resulted in payment of an amount equivalent to a nuisance settlement when the issuer was taking hundreds of thousands of dollars without any right, justification or excuse by proceeding with a foreclosure they have admitted, according to their own audit that the foreclosure was wrongful.

In short what is happening here is that the crimes or illegal activities are ongoing every day and not subject to (a) being barred by the statute of limitations and (b) foreclosure is  a behavior to avoid detection (which is a crime in itself) and (c) each time a Judge enters an order allowing or ordering forced sale, the Court itself is complicit in the cover-up, even if the Court is “unaware” of it.

All of this is presumptively true because of the findings of fact by the investigative and regulatory agencies, whether they are admitted or not by the mega banks. The burden should be placed on the foreclosing party, whose history of fabrication, lying under oath, and forgery SHOULD make the testimony, documents, and representations proffered by counsel for banks presumptively NOT CREDIBLE. Instead Judges have treated them like they are holders in due course where the risk falls entirely on the homeowner who also has the burden of proving defenses against a holder in due course who is not subject to those defenses (but who also doesn’t exist).

In my opinion policy makers, regulators and law enforcement are still functioning under the Wall Street myth that if the mega banks fall so does the economy. It is quite the reverse. If the mega banks fall then banking becomes local again, and there is no such thing as too big to fail. There is not single function performed by a mega bank that couldn’t be done by a small community bank or credit union. The current policy has allowed the mega banks to raise a cloud over everything with their unregulated “Shadow banking” sector which now accounts for around 15-20 times the amount of all the money in the world. That being the case, we are allowing our institutions to be marginalized. When the Fed, or Congress or anyone else attempts to address the problems of economic growth and inequality they are using primitive tools without any real effect.

We have replaced income and currency with debt that is “cash equivalent”. As long as allow that, we will forever be on the brink of the worst depression in history — which history tells us frequently leads to war. As a distraction there are those who point to the National Debt without making any reference to the more important household debt. It is an irrefutable fact that out economy is built on consumption. 70% of our gross domestic product is consumption of goods and services by ordinary consumers. Thus the only rational, practical policy is one that increases consumption. Instead politicians are creating ideological talking points. Where does consumption ordinarily come from? Do those people have the money or credit to make purchases? If they don’t, then what policy will put money in their hands in a manner in which overall consumption increases.

Menendez and Booker Take on Zombie Foreclosures

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This is for general information only. Get a lawyer.


see http://dsnews.com/news/10-30-2015/senators-call-federal-regulators-to-action-on-zombie-foreclosures

It seems ridiculous. Why would a lender reject a workout, reject modification, reject a short sale and insist on a foreclosure — and then walk away from the property? Why has this not been a center of attention as hundreds of communities, cities and states have been decimated by this phenomenon?

The answer turns on the themes of this blog and several other media outlets but nobody in a position to change the conversation wants to face up to the single true statement about this: somehow the banks are making more money going to foreclosure (and walking away from the property) than doing a workout to save the loan as a valuable asset. The foreclosure sale is worth more to them than the property.

The banks are not stupid. They know that destroying neighborhoods and cities results in a precipitous drop in home values (going to zero in many places). They know that this results in a disastrous deterioration of the value of the security for the alleged loans.

So we are faced with a second undeniable truth: the banks are not losing money on foreclosures, they are making money.

So when Senators like Menendez and Booker from New Jersey write a letter to federal regulators asking them to look into the wild phenomenon of Zombie foreclosures, we can only hope that such Senators and the federal regulators will ask themselves some very simple questions. That is the only way this crisis will be averted and it is a vehicle for bringing down the largest banks who are performing illegal acts every day in foreclosures across the country.

If we go beyond the basic questions, then we start to drill down to the real facts — not the ones that practically everyone assumes to be true.

How could the banks not be losing money on Zombie foreclosures? The loss of the loan and the loss of the property securing the loan obviously reduces the value of the alleged loan to zero. In fact, it creates a liability to the bank for walking away after they kicked out the people who own the house. The City can go after them for taxes and the prospect of liability for attractive nuisance and other torts requires them to pay for insurance or brace for impact when the lawsuit happens. Any normal banker will tell you that this is not an acceptable scenario nor is it industry practice amongst banks who make loans.

Hence the conclusion that the parties who invoking the foreclosure procedures did not make loans — nor did anyone else in their alleged chain. The part of the deal where the lender hands over the cash to the closing agent never happened in those loans. If it had happened then the loan and the property would have value to these banks and other entities. Since it was “other people’s money” involved in that “loan” transaction, the banks simply don’t care what happens to the loan or the property except that THEY want the foreclosures to the detriment of the owners of the property, the detriment to the Pension funds whose money was somehow used to make the alleged loans, the detriment of our communities, and the detriment of government which ramped up to handle all the new housing only to find that their tax base vanished.

So if the banks are not losing money on the alleged default of the borrower, it opens the door to understanding that practically anything else they do would result in profits to the banks who are illegally and fraudulently controlling the foreclosure process. When they bring a foreclosure action they use self proclaimed authority that is presumed to be true even though truth is not involved. They have credibility even though they lack the truth.

It’s a perfect world to Wall Street. They use nonexistent entities as claimants in the foreclosure process thus insulating themselves from liability for wrongful foreclosure when those few cases actually get decided on the merits. The money from the pension funds goes into the pocket of the Wall Street banks instead of those empty Trusts.

The pension funds gets a certificate of ownership and debt from the empty trust and they are contractually bound not to ask questions about any specific loan. Ever wonder why that provision is in every Pooling and Service Agreement. So while intermediary parties have a party with pension money, the pension money was used to fund loans that were underwritten for the purpose of loss instead of the usual profit motive. And by knowing that the loans would fail the banks were able to get even more money by betting on loans that they knew would fail. And then they got even more money by betting on the loss of value of the certificates. And they got even more money when they engaged in the Re-REMIC practice of closing out the old trust and starting a new one. And to add insult to injury, the pension fund keeps getting paid by the wrongdoers from a “reserve fund” consisting entirely of pension money. Pouring salt on that wound is the bank’s hubris in claiming the right to recover “servicer advances” made from the reserve pool — only upon foreclosure sale. And the cherry on top is that the “servicers” who are not servicers sell the right to recover servicer advances in additional securitization schemes.

Homeowners take it personally when the servicer tells them  they were rejected by the investor for a modification (false claim). They think it must be personal because no other explanation makes sense to them. But that is because they don’t have the information on “securitization fail.”

The BIG LIE is that lenders are foreclosing. They are not. In fact, there are no lenders in the legal and conventional use of the word. There are only victims of fraud.

Old Habits Die Hard: Rescission Confusion Continues Despite Supreme Court Clarity

You know something stupid is going on when you see tens of millions of dollars spent on ads enticing consumers to get a loan at 2.99%. There is no profit at that rate so something else is going on — leading to the conclusion that disclosure from the start has been misleading — unknown to the borrower.


For more information please call 954-495-9867 or 520-405-1688

This is not a legal opinion on your case. Consult a qualified, knowledgeable licensed attorney in the jurisdiction in which your property is located.


Let me put it this way: even the borrower lacks the authority to undo the rescission which is effective by operation of law. The loan, the note and mortgage are canceled. If the borrower wants to reinstate them, the borrower would need to get together with the creditor and sign new documents for a new loan transaction.

see Hiding-in-Plain-Sight_-Jesinoski-and-the-Consumer_s-Right-of-Rescind

A recent law review article from the law school at Duke University gets a lot of things right. But it still gets some key points wrong. You will see highlighted portions that raise questions if you click on the link above. But overall it does provide excellent background on the Truth in Lending Act and rescission.

Some of the errors I found —-

The twenty days applies to the duties of the “lender” or “creditor” not to the borrower and the writer completely misses the point in that sentence when he says that the lender must “return the property.” The creditor does not have the property. It might be that this is just poor wording. But as it is written, it is wrong.

There is no procedural bar to asserting the rescission. It is effective by operation of law. That means it is a fact — not a claim yet to be determined. Whether he meant to say that he agreed with what the court was doing or he just got it wrong, I don’t know. Once again we see some very intelligent people who have done a lot of study but still can’t get their heads around a very simple proposition — the statute says the rescission is effective by operation of law. There is nothing left to be done. That means the note and mortgage are void (REG Z and Jesinoski). This is substantive law and not subject to change by any procedural rules.

Footnote 102 is also poorly worded indicating that rescission under common law can be effected without suit. It is ONLY TILA rescission that can cancel the loan without suit.

His conclusion is also poorly worded adding to the confusion out there. He should have said that the rescission is effective by operation of law and that from that point forward the loan contract, the note and the mortgage have been nullified and are void, as stated under Reg Z.

Without this point of clarity the simple TILA rescission “procedure” is lost. The big mistake is that people, judges and lawyers continue to view rescission as a pending claim — despite the US Supreme Court stating that courts cannot interpret a statute without finding ambiguity (and being right about that) they don’t have power to change, add, amend or modify the the express wording of the statute. After rescission is sent there is no pending claim. After rescission is sent there is only the fact that the note and mortgage are gone.

My attempt at clarification would be said as follows: if you are in a court or in a transaction after a notice of rescission has been sent, then the previous note and mortgage no longer exist. No court action may be undertaken on an instrument that does not exist. No transaction can ignore the fact that the note and mortgage were canceled and under Reg Z are void.

Lawyers and some scholars continue to miss the point — despite the Jesinoski decision, unanimously in the US Supreme Court (a place where all arguments cease because it is the court of last resort). Old habits die hard. Sanctity of contract seems to be causing a kind of mental pollution causing many people to continue to assert positions based upon the premise that in order for the loan, mortgage and note to be canceled and rendered void upon mailing the notice of rescission, some court action is required or permitted. Let me put it this way: even the borrower lacks the authority to undo the rescission which is effective by operation of law. The loan, the note and mortgage are canceled. If the borrower wants to reinstate them, the borrower would need to get together with the creditor and sign new documents for a new loan transaction.

Florida Supreme Court Considers Clearing up Conflicts on Statute of Limitations

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“Kafaesque” is the term being applied to the state of Florida law on foreclosures. If you have commercial property then you have rights, but if it is your home, then maybe you don’t. Due process has been shattered for homeowners while complete strangers take their homes with the cooperation of Judges who are struggling with the caseload and their own bias about how damaging it would be if debts were not paid. What they are missing is that none of the people foreclosing own any debt and nobody is going to get paid as a result of the foreclosure except third parties with breadcrumbs, if any, left to the actual source of funds for the origination or acquisition of the loans.

Depending upon where you live in Florida the results are different. If you beat the foreclosing party in court, then at least one court thinks that the “bank” can re-foreclose on a subsequent default on a loan and default they failed to prove. Florida’s rule HAD BEEN clear. Banks get one chance to foreclose and if the case goes against them, they get nothing in foreclosure and if the statute of limitations has run they can’t collect on the note either. They can’t come back over and over again until they a get a judge who thinks they got it right. And it didn’t matter before whether the property was commercial or residential.

So now because various districts have interpreted the law differently, the Supreme Court must decide what it had already decided. It is reviewing teh Bartram case and will consider the arguments of all sides. For me, the issue is simple. If the borrower wants to file claims against the lender and he is barred by the statute of limitations, he is done regardless of the merits. What is good for the goose was good for the gander until the courts starting bending the rules to the breaking point. They should be corrected by the Florida Supreme Court.

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