Quiet Title Revisited: Not Quite a Dead End

Why Quiet Title Actions Often Fail

Homeowners often ask about using a quiet title action to clear fraudulent mortgage claims. But the truth is: quiet title is a very limited remedy.

• Quiet title can only remove instruments that are void, not voidable.

• “Void” means the instrument was meaningless when filed.

• “Voidable” means it may still be enforceable under certain conditions.

This distinction is critical, and it’s why most quiet title cases fail.

The Void Assignment Problem

One of the most promising starting points is attacking a void assignment. The allegation is simple:

1. Neither the assignor nor the assignee had the right, justification, or excuse to claim an interest in the mortgage.

2. Neither party ever paid value for any interest in the mortgage.

If proven, the assignment is void and should be removed from the chain of title. This doesn’t remove the mortgage itself—but it clears one major obstacle.

Why Mortgages Are Often Voidable, Not Void

I contributed to the early belief that mortgages were void because they never named the true lender. Borrowers were intentionally kept in the dark about the actual source of funds, leaving the mortgage incomplete.

But courts often hold that:

• The mortgage is not void.

• It is voidable because it could theoretically be “reformed” to insert the correct creditor.

• Proving that no such creditor exists is extremely difficult since only the banks control that information.

As long as the possibility of reformation exists, quiet title cannot succeed.

Courts’ Reluctance and Resistance

Most judges remain resistant to these attacks, often ruling reflexively in favor of banks. Still, appellate courts are slowly beginning to recognize the false securitization schemes and their impact.

A potential strategy:

• First attack the void assignment and demand disclosure of the true creditor.

• If no creditor appears, move to have the mortgage declared void.

• Only then does a quiet title claim have teeth.

The Presumption Problem: Self-Serving Letters

The deeper issue is the way courts treat self-serving documents from banks or debt collectors.

• A letter claiming ownership of a debt raises a legal presumption that it is valid.

• Borrowers are presumed to reasonably rely on the letter.

• Even if it comes from a thief, courts treat payment to the “new servicer” as valid.

This has led to chaos:

• In California, this business model spread quickly.

• “Newco Debt Servicing” companies collect or settle debts they never owned.

• Real creditors wake up too late, while banks and copycats profit.

From Banks to the Marketplace: Chaos Spreads

What began with banks fabricating ownership of securitized debts has spread to nearly every kind of consumer credit:

• Mortgages

• Credit cards

• Student loans

• Auto loans

Investors eventually discover their money wasn’t funding a trust or real business entity. By then, it’s gone. Instead of jail time for bankers, settlements are quietly negotiated—and small-time crooks are left free to copy the same tactics.

The Path Forward

If you begin with the knowledge that banks can never produce the name and contact information of a true creditor, then new strategies emerge.

• Attacking void assignments.

• Forcing disclosure of the “creditor.”

• Highlighting contradictions in banks’ own documents.

These strategies may look like losers at first glance—but under scrutiny, they expose the banks’ inability to prove ownership of the loan account. And that gives homeowners traction in court.