Archive for May, 2010
IRS Form 938- I Have No Idea If This Is Important But It Sure is Curious
Author: Matthew D. Weidner, Esq.
Sometimes this all becomes a bit too overwhelming, trying to unravel this whole foreclosure cataclysm. This is so far beyond the simple situation where a borrower borrows money from a bank and doesn’t pay….that bank is clearly entitled to their money back.
I’m a fairly bright guy with a good education and a fair to ‘middlin grasp on complex legal issues….I just boil down way complex stuff to smaller parts and learn those complex issues piece by piece. The problem we face in foreclosures today is no-one has any idea who’s really owed money on these mortgages, who is entitled to collect payments on the mortgages, what government money was used to bail out mortgages.
Sophisticated attorneys with years of complex litigation and legal experience are perplexed by the inability of Plaintiffs to answer the most basic questions about litigation.
Experienced circuit court judges with decades of trial court, evidentiary and complex litigation experience have started to ask real questions about the millions of dollars in foreclosure judgments they’re signing every day in their courtrooms to entities that they cannot identify.
Federal judges with hundreds of years of experience are really starting to dig into documents filed and representations made by the parties that appear before them….there are real questions being raised in bankruptcy courts and even bigger questions about fraud and collusion and federal crimes at the highest levels of American businesses.
Thrown into all these questions are some thought provoking comments and research from a subscriber to this blog, like I said, it’s a bit beyond me now, but consider his words….
The best way to prove this mess all got dissolved is to go to the IRS.gov website and look for the publication # 938 for 2006 through the present. This is where you will see that the gain on sale reporting etc all stopped as the securitization machine was turned off temporarily in late 2007.
The trusts were all named and reporting until the end of 07 then 08 is missing??????.
They restart the reporting in 09 but it is down to only Ginnie/Freddie/Fannie/JPM/Citi and random trusts that have been created. The government absolutely knows what happened yet seems to help cover this up thinking we are too dumb to catch it.
2009 reported in 2010
http://www.irs.gov/pub/irs-pdf/p938.pdf
2008? is missing and reverts to the 2009 file?? Don’t believe me. try it.
http://www.irs.gov/pub/irs-prior/p938–2009.pdf
2007 reported in 2008
http://www.irs.gov/pub/irs-prior/p938–2007.pdf
They seriously think we are that stupid. What are they hiding from us? Maybe that the banks have committed billions upon billions in tax evasion. Follow what is happening in non-judicial states and you will see the arrogance. They actually show us the blank note endorsement from the original lender yet no recording of the interest through the depositor to the trust. Lack of standing?
Then when they are finished stealing the house they sell the loan from the unlawful foreclosing party(trust) that had no standing to F/C back to the trust through a POA to the servicer and effectively cover their tracks that the loan was never in the trust, they still stole the investors money, and they still claimed the tax exemptions under REMIC.
All while the Govt and IRS watch.
Look at the WAMU BK. They were found to have a 10.3 Billion dollar tax claim filed against them that was reduced to 33M yet Chase got to walk away with a 300 Billion dollar bank 200M in mortgages for 1.9Billion. The loans were shown to have been written down to $0 yet they still want to collect?
Along with the Pub 938 you can review Pub 550 that explains the tax exemptions etc for the REMIC trusts.
No assignments were done as required, no “true and absolute sales under FASB 140″ were ever perfected, No standing has ever been established for most or all of the securitization trusts.
This is the biggest RICO case on earth.
Oh, and maybe we should review who funded LPS…..JPM/BOA/Wachovia when they split off of FIS in 2008.
Scridb filterMore Details on The Corruption of the American Housing Market
Author: Matthew D. Weidner, Esq.
From a report emailed to me over the weekend:
At the core of the foreclosure-prevention strategy is ignoring delinquencies. The percentage of older delinquent loans not yet in foreclosure is startling: 60% have at least 12 missed payments, and 35% have at least 18 missed payments. Add to this that three-fourths of delinquent loans are not in foreclosure, and we see that hidden losses well exceed those in the open.
Uh, they’re not being “ignored” – this is systemic and intentional fraud.
Remember, these loans are either being held by someone or securitized into some sort of package. When you have a loan that has no chance of “curing” (to cure a loan with 12 missed payments the borrower would have to come up with the 12 payments to bring it current!) that loan should be carried at its recovery value – that is, the value of the collateral that can be seized and sold, LESS the cost of eviction, remediation and resale.
Does anyone recall all the entries I’ve written about getting competent legal and accounting (tax) advice before proceeding with any sort of action regarding walking away, short sales or foreclosure? This same report says:
Many homeowners would be better off going into foreclosure, than doing a short sale. Short sales are fraught with potential legal, credit, and complicated tax issues. For example, someone who refinanced could owe capital gains taxes, which are not forgiven under federal and California temporary debt relief acts. In the foreclosure route, borrowers can live in their house mortgage-free for at least one year, maybe two years. Both short sales and foreclosures are reported as “account not paid in full”, and are equally damaging to a credit score. An exception exists if short sellers can negotiate better terms with their lender on recourse liens. The other possible advantage to a short sale is the ability to get a mortgage again in 2 years (Fannie, Freddie), rather than having to wait 3-5 years after a foreclosure.
Homeowners pursue short sales, unaware of the problems they are creating for themselves. Their agents never warned them of deficiencies, ruined credit, taxes due on forgiven debt, or legal consequences. Agents made flowery promises to get listings, and now the lawsuits are starting.
No, really? You mean that people in the real estate business are less than truthful with their clients? That would never, ever happen with licensed professionals, right?
Then there’s this, which I also have written about:
Another gray area is junior lien holders asking buyers for additional payments. As the market improved, juniors were no longer content with $3k thrown to them from the senior. They now want 10% of the junior note. They argue the additional payment is legal practice because the payment is made to escrow and appears on the HUD-1. However, they are actually hoping the senior lien holder does not read the HUD-1. The California Association of REALTORS® position is that all payments made by the buyer or agent in the purchase of a short sale must be part of the written short sale agreement signed by the senior lien holder. Concealing payments from seniors is loan fraud, and omitting these payments from the HUD-1 closing statement may violate RESPA. Some seniors reinstate their security interests because of the fraud. It’s surprising that the biggest banks are responding, when pressed on the fraud of their request, “just do it if you want the deal done”.
Right. Big banks saying “just do it”? Why would they do that? Is it so they can re-instate their security interests? No, nobody would ever do anything that hoses the consumer, would they? Naw…..
Few people understand that the bank that gave them their mortgage turned around and sold it into a mortgage bond, and the “bank” on their mortgage statement is actually a servicer.
Actually, it’s a bit more complicated than that.
As I’ve been working on (and writing on) for a long time, and as a few attorneys are now starting to understand, the entirety of this process was corrupted and is rife with outright fraud from top to bottom.
Let’s go through a (partial) list of the problems:
-
The originator of the loan (which often was some chop-shop mortgage boutique) was the place that got funding via a warehouse line of credit with a major bank. They paid the seller of the house. The seller thus is “whole” and has no further interest.
-
The originator was shortly paid in full when the loan was sold to a major bank that was intending to (or did) securitize the paper. They were also paid in full and thus have no further legal interest in the property or the paper.
-
The banks, in turn, set up “bankruptcy remote” trusts to hold all this paper. This is (of course) done so that whatever happens to the paper doesn’t impact the bank’s earnings itself. Or does it…. we will get to that later.
-
Many of the assignments from this point onward in the loan are legally defective. In particular, many of the assignments of the loans were made in blank, that is, in bearer form. But in most states trusts cannot hold bearer paper of any sort – period. In addition, in many states you cannot record a bearer instrument. To get around recording fees the industry has even created its own “clearing house” called MERS, which alternately claims to be an agent or the actual holder in due course, whichever suits the position of the trust (or itself) any given time. Whether this is legal under state law varies from jurisdiction to jurisdiction – what is known is that only one state has actually made the “reach around” games MERS plays explicitly legal.
-
The trusts that are the “vessel” in which the securitized instruments are formed and then sold to investors thus hold paper they can’t legally hold. This may in fact be sufficient to void the trust. Worse, they issued prospectuses and offering circulars to investors claiming that they had good recordable title to each and every loan in the trust. In many cases they never did and can’t cure this retroactively. That is, there is at least the appearance of fraud in the sale of these securities, in that the buyers were led to believe they were buying a note backed by a security interest in an asset, when in fact there is no such backing at all – the note is a “bare” promissory note!
-
Cities, counties and states were ripped off to the tune of hundreds of billions of dollars over the previous ten years as a consequence of these intentional failures to properly record. Specifically, the states, counties and localities have laws governing the requirement to record and pay doc stamps – that is, taxes – on transactions of this sort. The necessity of recording these transactions varies from jurisdiction to jurisdiction, and thus the economic damage done by this avoidance varies, but the banksters and their cronies simply kept this money instead of filing and remitting it to the taxing authorities as required by law.
The mess doesn’t end here. If you buy a house where the original note was not satisfied in full and a full chain of assignments cannot verify that all security interests are released the title chain is severely clouded, perhaps to a degree that is almost impossible to unravel. Wise title insurance companies are beginning to recognize this problem and refuse to issue owners policies against properties where a broken chain of assignment exists, especially where a foreclosure or short sale took place, as those properties may still have an enforceable lien against them!
I recently spoke with an attorney who is aggressively pursing these issues when his clients are faced with foreclosure, with some (and likely growing) success. He related to me that he spoke with the FCIC and was asked “Well, what is your solution? Are you asking that we nationalize all the (large) banks?”
If that’s not an admission that FCIC knows the large banks were and are complicit in this and if forced to admit the truth in their financial statements would be rendered insolvent I don’t know what is.
We have fixed nothing, but the can-kicking has also not pushed the bar very far down the road. The gambit was that the economy would return to a “boom” in the two years that have passed, and that the problems would be “absorbed” in that time.
It hasn’t happened.
Now we’re faced with having structuralized a $1.5 trillion annual budget deficit into the indefinite future while those who were “helped” by HAMP and similar programs are facing re-default a few months to a couple of years down the road. DTIs over 60% virtually guarantee that outcome. At the same time the holders of these notes were sold a bill of goods and eventually some of them will wise up to the fact that the so-called “bankruptcy remote trusts” that allegedly hold the paper (and thus immunize the banks that created them) are legally defective. Those holders, when (not if) they suffer actual principal and coupon loss, can be reasonably expected to pursue their remedies at law with the aim of voiding the trust and opening the assets of the creating financial institution to attack.
If this line of inquiry is pursued it is entirely possible that these trusts would in fact be voided, and the resulting exposure landing on the major financial institution balance sheets would render them insolvent.
Again, we had the choice in 2007 and 2008 to force the institutions that did these things to “eat their own cooking”, which would have likely bankrupted many or even most of them. But while we need a banking system, we do not need any particular set of individual banks. Instead of “bailing people out” and playing “extend and pretend” we could (and should) have taken the $700 billion in TARP funds and used it to charter 10 new banks with strictly-limited 10:1 leverage and reserve ratios, which would have provided the ability to take up $7 trillion in new and rollover lending – and let the overlevered behemoths fail.
Yes, the FDIC would have had to step in, and it might have cost us a trillion or more in FDIC insurance payouts. But even that would have been cheaper than what we have done, and in addition, we would have a safe, sound and stable financial system today.
Instead we have allowed the banksters to rob us once again, fixing nothing. As this mess continues to unravel – and it will – we will find that in fact we have simply blown more than $4 trillion in borrowed funds and in fact gotten nothing in return for it.
“Secret” Foreclosure Documents The Lenders Don’t Want You To See- AND THAT NO JUDGE SHOULD GRANT FORECLOSURE WITHOUT STUDYING!
Author: Matthew D. Weidner, Esq.
A Key to Foreclosure Litigation: Get Comfortable Searching The SEC Website!
Every asset-backed mortgage trust is supposed to make detailed and substantive filings with the SEC. The 8-K Prospectus is the initial document that provides much of the detail for the fraud subsequently acted upon. The Pooling and Servicing Agreement for each mortgage backed loan trust is another key document because it spells out exactly what the rules are among the different parties to virtually every foreclosure. Importantly, the initial 8-K prospectus was created to sell the mortgage trust to the investors on whose behalf the Plaintiff asserts to be collecting. Much of the information in the prospectuses was incorrect or fraudulent at the time the initial prospectus was created. Thus the party who is suing (trustee), lied to the fiduciary it asserts to be suing on behalf (certificateholders) from the inception of the transaction. How can the trustee or servicer now be trusted to be acting in the best interests of the intended beneficiaries of the trust now?
How can circuit court judges continue to allow “trustees” to sue on behalf of certificate holders when those certificate holders may have been the
victims of fraud committed by the Trustee from the outset?
Who Are the Potential Parties in Most Current Residential Foreclosures?
Borrower, Originating Lender, Trustee of Mortgage Trust, Certificateholders or Investors in Trust, Servicer or Bill Collector for Trust. There are many conflicts among each of these parties yet the issues never even get raised, much less scrutinized by courts because we’re not raising them. When you do raise them however, you find things like Dillon has detailed below.
1. Find Out The Name of The Trust That Holds Your Mortgage
Foreclosure mills have stopped placing the full name in the lawsuit so you may need to do a Qualified Written Request.
2. Search The SEC Website For That Trust
The website is here, put “6189″ in the SIC field to narrow down the results.
3. Pull All Documents That Relate to Your Mortgage
The PSA spells out all the rights and obligations of all parties…you’ll find that this agreement has largely been ignored.
4. Who Owns Your Mortgage?
You should be able to find your mortgage in that pool by finding the MIN or Mortgage Identification Number. Look on the front of your recorded mortgage, there is a long 16 digit number, it’s your mortgage’s social security number. It may not be listed as an asset of the trust that is suing you….whether it’s listed or not, the Plaintiff must prove BY ADMISSABLE EVIDENCE that it is the owner of your NOTE AND MORTGAGE and that it is entitled to proceed with foreclosure—this may not be true in many cases and even if it’s true, they may not be able to prove it.
Let’s move judges beyond, “Did you pay your mortgage” and get them asking, “Who exactly owns this mortgage or who actually collects any of the proceeds from this mortgage?”
Reading A Mortgage Backed Security Prospectus
If you’re fighting foreclosures in any manner, if you’re a homeowner, if you’re an attorney, if you’re a reporter…if you’re a judge. Don’t go one step further until you read in it’s entirety the attached
Mortgage Backed Securities Prospectus
This document is not supposed to be fiction, but in most cases, these agreements were so fanciful and outrageous that they go beyond fiction and are a Frankenstien-ish version of legal/financial gobbleygook science fiction. The problem is there’s so much wrong with these documents and the Pooling and Servicing Agreements and so many conflicts of interest set up between all the parties, yet these agreements form the sole basis of the foreclosure litigation that follows. THE ONLY PROPER LEGAL BASIS FOR FORECLOSURE ARE THE EXPLICIT TERMS OF THE AGREEMENTS OF THE MORTGAGE BACKED TRUST….often times the conflicts in those agreements would prohibit the pursuit of that foreclosure litigation.
Here are some key terms and provisions taken right from the Agreement:
CLOSING DATE, CREDIT ENHANCEMENT
On the closing date, the trust will acquire the initial mortgage loans.
SERVICING OF THE MORTGAGE LOANS
Countrywide Home Loans Servicing LP will act as servicer and will be obligated to service and administer the mortgage loans on behalf of the trust,
for the benefit of the holders of the certificates.
ADVANCES
The servicer will be required to make cash advances with respect to delinquent payments of principal and interest on the mortgage loans unless the
servicer reasonably believes that the cash advances cannot be repaid from future payments on the applicable mortgage loans. These cash advances are only intended
to maintain a regular flow of scheduled interest and principal payments on the certificates and are not intended to guarantee or insure against losses.
RATINGS
In order to be issued, the offered certificates must be assigned ratings not lower than the following by Fitch, Inc., Moody’s Investors Service, Inc. and
Standard & Poor’s Ratings Services, a division of The McGraw-Hill Companies, Inc.: FITCH MOODY’S S&P
The mortgage loans were made, in part, to borrowers who, for one reason or another, are not able, or do not wish, to obtain financing from traditiona
sources. These mortgage loans may be considered to be of a riskier nature than mortgage loans made by traditional sources of financing, so that the holders of
the certificates may be deemed to be at greater risk than if the mortgage loans were made to other types of borrowers.
The underwriting standards used in the origination of the mortgage loans held by the trust are generally less stringent than those of Fannie Mae or
Freddie Mac with respect to a borrower’s credit history and in certain other respects. Borrowers on the mortgage loans may have an impaired or
unsubstantiated credit history. As a result of this less stringent approach to underwriting, the mortgage loans purchased by the trust may experience higher
rates of delinquencies, defaults and foreclosures than mortgage loans underwritten in a manner which is more similar to the Fannie Mae and Freddie Mac
guidelines.
Newly originated mortgage loans may be more likely to default, which may cause losses on the LIBOR certificates. Defaults on mortgage loans tend to occur
at higher rates during the early years of the mortgage loans. Substantially all of the mortgage loans have been originated within the 12 months prior to
their sale to the trust. As a result, the trust may experience higher rates of default than if the mortgage loans had been outstanding for a longer period of time.
The internal credit enhancement features of the trust described in the summary of this prospectus supplement are intended to enhance the likelihood that
holders of the Class A certificates, and to a limited extent, the holders of the Class M certificates and, to a lesser degree, the holders of the Class B
certificates, will receive regular payments of interest and principal. However, we cannot assure you that the applicable credit enhancement of the trust will
adequately cover any shortfalls in cash available to pay your certificates as a result of delinquencies or defaults on the mortgage loans. If delinquencies or
defaults occur on the mortgage loans, neither the servicer nor any other entity will advance scheduled monthly payments of interest and principal on delinquent
or defaulted mortgage loans if the advances are not likely to be recovered.
PARTIES (I scream about pleading capacity, and here’s what proper capacity pleading looks like.)
The Depositor. Morgan Stanley ABS Capital I Inc., a Delaware corporation. The principal executive office of the depositor is located at 1585 Broadway, New
York, New York 10036 and its telephone number is (212) 761-4000.
General. IXIS Real Estate Capital Inc., formerly known as CDC Mortgage
Capital Inc. (the “Seller”), is a New York corporation that primarily engages in
originating, lending against, purchasing and securitizing commercial and
residential mortgage loans. The Seller is a wholly-owned subsidiary of IXIS
Capital Markets North America Inc., which is more than a 95% owned subsidiary of
IXIS Corporate & Investment Bank (“IXIS CIB”), a fully licensed bank under
French laws.
IXIS Corporate & Investment Bank. IXIS Corporate & Investment Bank is a limited liability company (societe anonyme a Directoire et Conseil de
Surveillance), incorporated on March 31, 1987. Initially named CDC International, the company changed its name to CDC Marches, and subsequently to
CDC IXIS Capital Markets.
ASSIGNMENT OF THE INITIAL MORTGAGE LOANS
Pursuant to mortgage loan purchase and warranties agreements, the
Originators sold, transferred, assigned, set over and otherwise conveyed the
Initial Mortgage Loans, without recourse, to the seller, and the seller will
sell, transfer, assign, set over and otherwise convey the Initial Mortgage
Loans, including all principal outstanding as of, and interest due and accruing
after the close of business on the cut-off date, without recourse, to the
depositor on the closing date. Pursuant to the pooling and servicing agreement,
the depositor will sell, transfer, assign, set over and otherwise convey without
recourse to the trust, all right, title and interest in and to each Initial
Mortgage Loan, including all principal outstanding as of, and interest due after
the close of business on the cut-off date. Each such transfer will convey all
right, title and interest in and to (a) principal outstanding as of the close of
business on the cut-off date (after giving effect to payments of principal due
on that date, whether or not received), and (b) interest due and accrued on each
such Initial Mortgage Loan after the cut-off date. However, the seller will not
convey to the depositor, and will retain all of its right, title and interest in and to
(x) principal due on each Initial Mortgage Loan on or prior to the cut-off date
and principal prepayments in full and curtailments (i.e., partial prepayments),
received on each such mortgage loan prior to the cut-off date and (y) interest
due and accrued on each Initial Mortgage Loan on or prior to the cut-off date.
DELIVERY OF MORTGAGE LOAN DOCUMENTS
In connection with the sale, transfer, assignment or pledge of the mortgage
loans to the trust, the depositor will cause to be delivered to the custodian on
behalf of the trustee, on or before the closing date or the subsequent transfer
date, as applicable, the following documents with respect to each mortgage loan
which constitute the mortgage file:
(a) the original mortgage note, endorsed without recourse in blank by the
last endorsee, including all intervening endorsements showing a
complete chain of endorsement from the originator to the last
endorsee;
(b) the related original mortgage and evidence of its recording or, in
certain limited circumstances, a copy of the mortgage certified by the
Originator, escrow company, title company, or closing attorney;
(c) except with respect to each MERS Designated Loan, the mortgage
assignment(s), or copies of them certified by the applicable
Originator, escrow company, title company, or closing attorney, if
any, showing a complete chain of assignment from the originator of the
related mortgage loan to the last endorsee — which assignment may, at
the Originator’s option, be combined with the assignment referred to
in clause (d) below;
(d) except with respect to each MERS Designated Loan, a mortgage
assignment in recordable form, which, if acceptable for recording in
the relevant jurisdiction, may be included in a blanket assignment or
assignments, of each mortgage from the last endorsee in blank;
(e) originals of all assumption, modification, consolidation and extension
agreements, if provided, in those instances where the terms or
provisions of a mortgage or mortgage note have been modified or such
mortgage or mortgage note has been assumed; and
(f) an original title insurance policy or attorney’s opinion of title and
abstract of title.
Pursuant to the pooling and servicing agreement, the custodian will agree
to execute and deliver on or prior to the closing date or the subsequent
transfer date, as applicable, an acknowledgment of receipt of the original
mortgage note, item (a) above, with respect to each of the mortgage loans
delivered to the custodian, with any exceptions noted. The custodian will agree,
for the benefit of the trustee and the holders of the certificates, to review,
or cause to be reviewed, each mortgage file within ninety days after the closing
date or the subsequent transfer date, as applicable – or, with respect to any
Substitute Mortgage Loan delivered to the custodian, within thirty days after
the receipt of the mortgage file by the custodian- and to deliver a
certification generally to the effect that, as to each mortgage loan listed in
the schedule of mortgage loans:
o all documents required to be reviewed by it pursuant to the pooling
and servicing agreement are in its possession;
o each such document has been reviewed by it and appears regular on its
face and relates to such mortgage loan;
o based on its examination and only as to the foregoing documents,
certain information set forth on the schedule of mortgage loans
accurately reflects the information set forth in the mortgage file
delivered on such date; and
o with respect to each MERS Designated Loan, it has verified with
Mortgage Electronic Registration Systems, Inc. that the trustee for
the benefit of the certificateholders is the beneficial owner of such
MERS Designated Loan.
If the custodian, during the process of reviewing the mortgage files, finds
any document constituting a part of a mortgage file which is not executed, has
not been received or is unrelated to the mortgage loans, or that any mortgage
loan does not conform to the requirements above or to the description of the
requirements as set forth in the schedule of mortgage loans, the custodian is
required to promptly so notify the seller, the related Originator, the servicer,
the trustee and the depositor in writing. The related Originator is required to
use reasonable efforts to cause to be remedied a material defect in a document
constituting part of a mortgage file of which it is so notified by the
custodian. If, however, within thirty days after the depositor’s notice of such
defect, the related Originator has not caused the defect to be remedied, such
Originator is required under the related mortgage loan purchase and warranties
agreement to either (a) if so provided under the related mortgage loan purchase
and warranties agreement, substitute in lieu of such mortgage loan a Substitute
Mortgage Loan in accordance with the requirements of such mortgage loan purchase
and warranties agreement or (b) purchase such mortgage loan at a price equal to
the outstanding principal balance of such mortgage loan as of the date of
purchase, plus all other amounts required to be paid in connection with such
repurchase in accordance with such mortgage loan purchase and warranties
agreement, which purchase price shall be deposited in the distribution account
on the next succeeding Servicer Remittance Date after deducting from the account
any amounts received in respect of such repurchased mortgage loan or loans and
being held in the distribution account for future distribution to the extent
such amounts have not yet been applied to principal or interest on such mortgage
loan. The obligation of the related Originator to cure such defect or to
substitute or repurchase the defective mortgage loan will constitute the sole
remedies against such Originators with respect to any such defective mortgage
file to the holders of the certificates and the trustee.
REPRESENTATIONS AND WARRANTIES RELATING TO THE MORTGAGE LOANS
Pursuant to each of the assignment and recognition agreements among the
related Originator, the seller and the depositor, each Originator will make
representations and warranties, with respect to each mortgage loan transferred
by it, as of the closing date or the subsequent transfer date (except as
described below), as applicable, including, but not limited to:
(1) Except as set forth on the mortgage loan schedule, no payment
required under the mortgage loan is 30 days or more contractually
delinquent.
(2) There are no defaults in complying with the terms of the
mortgage, and, to the best of the Originator’s knowledge, all taxes, water,
or sewer charges which previously became due and owing have been paid, or
an escrow of funds has been established in an amount sufficient to pay for
every such item which remains unpaid and which has been assessed but is not
yet due and payable;
(3) The terms of the mortgage note and mortgage have not been
impaired, waived, altered or modified in any respect, except by an
instrument which has been recorded;
(4) The mortgage loan is not subject to any right of rescission,
set-off, counterclaim or defense, including, without limitation, the
defense of usury, nor will the operation of any of the terms of the
mortgage note or the mortgage, or the exercise of any right under the
mortgage note or the mortgage, render either the mortgage note or the
mortgage unenforceable, in whole or in part, and no such right of
rescission, set-off, counterclaim or defense has been asserted with respect
thereto;
(5) All buildings upon the mortgaged property are insured against
loss by fire, hazards of extended coverage and such other hazards;
(6) The mortgage has not been satisfied or subordinated, in whole or
in part, and the mortgaged property has not been released from the lien of
the mortgage, in whole or in part;
(7) The mortgage is a valid and subsisting first lien or second lien
on the mortgaged property. The lien of the mortgage is subject only to:
(a) the lien of current real property taxes and assessments and,
with respect to some originators, water and sewer rents not yet due
and payable;
(b) covenants, conditions and restrictions, rights of way,
easements and other matters acceptable to mortgage lending
institutions generally and which do not adversely affect the value of
the mortgaged property;
(8) The mortgage note and the mortgage and any other agreement
executed and delivered by a mortgagor in connection with a mortgage loan
are genuine, and each is the legal, valid and binding obligation of the
signatory enforceable in accordance with its terms. All parties to the
mortgage note, the mortgage and any other such related agreement had legal
capacity to enter into the mortgage loan and to execute and deliver the
mortgage note, the mortgage and any such agreement, and the mortgage note,
the mortgage and any other such related agreement have been duly and
properly executed by other such related parties. No fraud, error, omission,
misrepresentation, negligence or similar occurrence with respect to a
mortgage loan has taken place on the part of any person, including without
limitation, the mortgagor, any appraiser, any builder or developer, or any
other party involved in the origination of the mortgage loan;
(9) There is no default, breach, violation or event which would
permit acceleration existing under the mortgage or the mortgage note and no
event which, with the passage of time or with notice and the expiration of
any grace or cure period, would constitute a default, breach, violation or
event which would permit acceleration, and neither the Originator nor its
affiliates or any of their respective predecessors have waived any default,
breach, violation or event which would permit acceleration;
(10) Either (a) the mortgage loan was originated by a mortgagee
approved by the Secretary of Housing and Urban Development pursuant to
Sections 203 and 211 of the National Housing Act, a savings and loan
association, a savings bank, a commercial bank, credit union, insurance
company or other similar institution which is supervised and examined by a
federal or state authority, or (b) the following requirements have been met
with respect to the mortgage loan: the applicable original loan seller
meets the requirements set forth in clause (a), and (i) such mortgage loan
was underwritten by a correspondent of the applicable original loan seller
in accordance with standards established by the applicable original loan
seller, using application forms and related credit documents approved by
the applicable original loan seller, (ii) the applicable original loan
seller approved each application and the related credit documents before a
commitment by the correspondent was issued, and no such commitment was
issued until the applicable original loan seller agreed to fund such
mortgage loan, (iii) the closing documents for such mortgage loan were
prepared on forms approved by the applicable original loan seller, and (iv)
such mortgage loan was actually funded by the applicable original loan
seller or was purchased by the applicable original loan seller at closing
or soon thereafter;
(11) The mortgage contains customary and enforceable provisions such
as to render the rights and remedies of the holder of the mortgage adequate
for the realization against the mortgaged property of the benefits of the
security provided by the mortgaged property, including, (a) in the case of
a mortgage designated as a deed of trust, by trustee’s sale, and (b)
otherwise by judicial foreclosure;
(12) To the Originator’s knowledge, the mortgaged property is lawfully
occupied under applicable law. To the Originator’s knowledge, all
inspections, licenses and certificates required to be made or issued with
respect to all occupied portions of the mortgaged property and, with
respect to the use and occupancy of the same, including, but not limited
to, certificates of occupancy and fire underwriting certificates, have been
made or obtained from the appropriate authorities;
(13) The mortgage note is not and has not been secured by any
collateral except the lien of the corresponding mortgage and the security
interest of any applicable security agreement or chattel mortgage;
(14) To the Originator’s knowledge, (a) there is no proceeding pending
or threatened for the total or partial condemnation of the mortgaged
property, (b) the mortgaged property is undamaged by waste, fire,
earthquake or earth movement, windstorm, flood, tornado or other casualty
so as to affect adversely the value of the mortgaged property as security
for the mortgage loan or the use for which the premises were intended, and
(c) each mortgaged property is in good repair;
(15) No action or inaction by the originator or, to the best of the
originator’s knowledge, no event has occurred and no state of facts exists
or has existed that has resulted or will result in the exclusion from,
denial of, or defense to coverage under any insurance policy related to the
mortgage loans, irrespective of the cause of such failure of coverage;
(16) The mortgage file contains an appraisal of the related mortgaged
property;
(17) No mortgage loan is classified as a “high cost” loan under the
Home Ownership and Equity Protection Act of 1994 (“HOEPA”) and no mortgage
loan is in violation of, or classified as a “high cost,” “threshold,”
“predatory” or similar loan under, any other applicable state, federal or
local law;
(18) No mortgage loan that was originated on or after October 1, 2002
and before March 7, 2003 is secured by property located in the State of
Georgia;
(19) No mortgage loan that was originated on or after March 7, 2003,
is a “high cost home loan” as defined under the Georgia Fair Lending Act;
(20) No mortgagor is offered or required to purchase single premium
credit insurance in connection with the origination of the related mortgage
loan;
(21) Except as specified on the mortgage loan schedule attached to the
related mortgage loan purchase and warranties agreement, no mortgage loan
originated on or after October 1, 2002 will impose a Prepayment Premium for
a term in excess of three years. No mortgage loan originated prior to
October 1, 2002 will impose Prepayment Premiums in excess of five years;
(22) With respect to each mortgage loan, the related mortgage is
secured by a “single family residence” within the meaning of Section
25(e)(10) of the Internal Revenue Code of 1986 (as amended) (the “Code”).
Each related mortgage is a “qualified mortgage” under Section 860G(a)(3) of
the Code; and
(23) Any and all requirements of any federal, state or local law,
including, without limitation, usury, truth-in-lending, real estate
settlement procedures, consumer credit protection, equal credit
opportunity, predatory and abusive lending and disclosure laws applicable
to the mortgage loan have been complied with.
Certain of the Originators will make certain of the representations and
warranties listed above and certain other representations and warranties as of
the respective dates the related mortgage loans were transferred to the seller
or as of the respective dates servicing on the mortgage loans was transferred to
the servicer, as applicable. In addition to the representations and warranties
made by the Originators, with respect to certain mortgage loans, the seller will
make certain representations and warranties to the depositor including that no
event has occurred from (i) the date on which it purchased such mortgage loan
from the related Originator or (ii) the date on which servicing on such mortgage
loan transferred from the related Originator, as applicable, to the closing date
which would render the representations and warranties as to such mortgage loan
made by the applicable Originator to be untrue in any material respect as of the
closing date.
Pursuant to the pooling and servicing agreement, upon the discovery by any
of the servicer, the depositor, the seller or the trustee that any of the
representations and warranties contained in the pooling and servicing agreement
or the assignment and recognition agreements have been breached in any material
respect as of the date made, with the result that value of, or the interests of
the holders of the certificates in the related mortgage loan were materially
and adversely affected, the party discovering such breach is required to give
prompt written notice to the other parties. Subject to certain provisions of the
pooling and servicing agreement, the related mortgage loan purchase and
warranties agreements and the assignment and recognition agreements, within no more than ninety days of the earlier to occur of an Originator’s discovery or its receipt of notice of any such breach of a representation or warranty with respect to a mortgage loan transferred by it, such Originator will,
o use its best efforts to promptly cure such breach in all material
respects,
o if substitution is permitted pursuant to the terms of the related
mortgage loan purchase and warranties agreement, remove each mortgage
loan which has given rise to the requirement for action by the
responsible party, substitute one or more Substitute Mortgage Loans
and, if the outstanding principal balance of such Substitute Mortgage
Loans as of the date of such substitution is less than the outstanding
principal balance of the replaced mortgage loans as of the date of
substitution, deliver to the trust as part of the amounts remitted by
the servicer with respect to the related Distribution Date the amount
of such principal shortfall plus, with respect to certain Originators,
all related accrued and unpaid interest on the related mortgage loans
and all related unreimbursed servicing advances (the “Substitution
Adjustment Amount”), or
o repurchase such mortgage loan at a price equal to the unpaid principal
balance of such mortgage loan as of the date of purchase, plus all
related accrued and unpaid interest, plus the amount of any
unreimbursed P&I Advances, servicing advances made by the servicer and
unpaid servicing fees, plus any costs or expenses incurred by or on
behalf of the trust in connection with such breach of representation
or warranty.
In the event of a breach of a representation or warranty with respect to a
mortgage loan by the seller, or with respect to certain Originators, in the
event that such Originators fail to repurchase such mortgage loan, the seller
will be obligated to cure, substitute or repurchase such mortgage loan in the
same manner set forth above. The obligation of the seller to cure such breach or to substitute or repurchase any mortgage loan constitute the sole remedies
respecting a material breach of any such representation or warranty to the
holders of the certificates, the trustee and the depositor. In the event that an Originator or the seller repurchases any such mortgage loan, the trustee will direct the servicer to deposit such repurchase price into the distribution account on the next succeeding Servicer Remittance Date after deducting any amounts received in respect of such repurchased mortgage loan or mortgage loans and being held in the distribution account for future distribution to the extent such amounts have not yet been applied to principal or interest on such mortgage loan.
In addition, under each of the mortgage loan purchase and warranties
agreements and assignment and recognition agreements the Originator shall be
obligated to indemnify the depositor for any third-party claims arising out of a breach by such Originator of its representations or warranties regarding the mortgage loans. The obligation of each Originator to cure such breach or to substitute or repurchase any mortgage loan and to indemnify constitute the sole remedies respecting a material breach of any such representation or warranty to the holders of the certificates, the trustee and the depositor.
Foreclosure Case Killer- Failure to Allege Capacity
Author: Matthew D. Weidner, Esq.
Capacity Part 1:
Fla. R. Civ. Pro. 1.120(a) provides that
[i]t is not necessary to aver the capacity of a party to sue or be sued, the authority of a party to sue or be sued in a representative capacity, or the legal existence of an organized association of persons that is made a party, except to the extent required to show the jurisdiction of the court. (emphasis added)The initial pleading served on behalf of a minor party shall specifically aver the age of the minor party. When a party desires to raise an issue as to the legal existence of any party, the capacity of any party to sue or be sued, or the authority of a party to sue or be sued in a representative capacity, that party shall do so by specific negative averment which shall include such supporting particulars as are peculiarly within the pleader’s knowledge. Bold emphasis added
Capacity Part 2:
“Capacity to sue” is an absence of legal disability which would deprive a party of the right to come into court. 59 Am.Jur.2d Parties § 31 (1971). This is in contrast to “standing” which requires an entity have sufficient interest in the outcome of litigation to warrant the court’s consideration of its position. Keehn v. Joseph C. Mackey and Co., 420 So.2d 398 (Fla. 4th DCA 1982)
Capacity Part 3:
The issue of capacity to sue may be raised by motion to dismiss where the defect appears on the face of the complaint. See Hershel California Fruit Products Co. v. Hunt Foods, 111 F. Supp. 603 (1975), quoting Coburn v. Coleman 75 F. Supp. 107 (1974); Klebano v. New York Produce Exchange, 344 F.2d (2nd Cir. 1965)
Scridb filterA TREASURE TROVE of MERS DEPOSITIONS~ PRICELESS AND FREE HERE FOR ALL
Author: Matthew D. Weidner, Esq.
I want to thank and acknowledge Mike Dillon at GetDShirtz.com for sharing information and helping to get the word out…stop by his site for interesting information.
The beautiful thing about this site is pro se advocates, normal every day people, sophisticated foreclosure defense attorneys, journalists and attorneys who are just dipping their toes into the foreclosure defense water are all viewing the information contained on this site. We’re all learning new, confusing, mind-blowing, scary things about foreclosure.
Part of what we’re all struggling to do is wrap our arms around just how deep and complex this whole mortgage and foreclosure mess is. Sure you have judges who still say, “They haven’t paid their mortgage, they should get out.” But increasingly, judges and all of us are starting to recognize just how convoluted, shady, confusing and potentially fraught with fraud this whole process is.
Once we learn and accept that in cases that are actively being litigated we’re dealing with questionable practices and when we begin to understand that these practices have become so widespread as to be institutionalized, either outright fraud or just sloppy and bad….the only responsible thing for courts to do is sit back, take a deep breath and
STOP SANCTIONING ABUSES AND IMPROPER PRACTICES IN COURTROOMS ACROSS THE COUNTRY
At some point in time, I believe the whole lid is going to be blown off this whole mess and then we’re really going to be dealing with a mess of epic proportions. The corporate procedures adopted by the subprime lenders and its agents are woefully inadequate to survive proper judicial scrutiny and the fundamental (and preserved) fatal error caused by these problems will be deconstructed for decades to come.
The depositions below describe in great detail a variety of important MERS procedures and help to delineate and define some issues for courts and advocates to consider. Read on and enjoy!
My great thanks to the honorable and activist party that provided these to me to “Share With The Class”. Pursuant to my new rules regarding info I come into possession of, if you submit into to me either in a comment or emailed directly to me at weidnerlaw@yahoo.com, I may publish that info. I will not reveal the source of the info, but if you wish to take credit and publicize your website or issues or whatever else, I will confirm your sourcing of the material then help you in whatever ways you request. We’re all working together here and the more we learn and share the better off the whole community is!
Scridb filterLook How Hard the Foreclosure Mills Will Fight Not to Have a Robo Signer’s Deposition Taken
Author: Matthew D. Weidner, Esq.
All parties to litigation are entitled to ask any relevant questions that relates to the litigation, but the foreclosure mills don’t want the secrets behind both their and their client’s business practices….apparently depositions like the Cottrell deposition that I posted earlier are not very helpful to the Foreclosure Mill’s cause.
You see when judges read these depos and get more information about the shady business practices, they might just stop or slow down to examine the garbage without any authority that’s being shifted under their noses every day. I love paragraphs 7, 8 and 9 which essentially state that although we have placed an Assignment of Mortgage into the record, that piece of evidence means nothing so the court is not required to allow inquiry into it. Kinda like the Cullaro depositions that are “withdrawn” when counsel attempts to take their deposition…and seeks to insulate themselves from questions about their production….read on….
