Why the SPV (TRUST) is NOT THE LENDER: Using MERS Against the Pretender Lenders

the use of nominees or straw men doesn’t mean they can be considered principals in the transaction anymore than your depository bank is a principal to a transaction in which you buy and pay for something with a check. The fact that the money was processed through your depository bank doesn’t make them party to the transaction.

In answer to the central question being asked let me first state the strategic error being made by lawyers and pro se litigants: you can’t prove what you don’t know and you will lose credibility if you make representations you cannot back up. You can make allegations based upon Google information or an expert witness affidavit but you must accompany it with an allegation that the pretender lenders won’t give you the detailed information required by law. Then they come in and try to pin you with the burden of proof saying that you can’t allege or prove the details of the transaction. They are right. You can’t provide that information because only they have it and they refuse to give it you.

Here is what you DO know:

1. Nearly all loans are securitized and your loan appears to be one of the loans that was securitized, which means that in a number of steps through intermediary conduits, the obligation either was transferred or was attempted to be transferred to what ultimately became a group of investors who funded the subject loan.
2. If you have an expert witness affidavit you have a witness who says that your loan was securitized.
3. A securitized loan by definition means that the lender is the person(s) or entity(ies) at the top of the securitization chain — i.e., the “investors” who purchased bonds that were mortgage backed securities.
4. Those investors meet the definition of lenders — they advanced cash with the expectation of getting it back with interest.
5. There are multiple stakeholders who purport to either had or have claims relating to the obligation, note or encumbrance. This creates a conflict, a cloud on title and doubt as to what to do with these people or entities that purport to have rights to enforce an obligation that was clearly funded by a real lender which was not themselves.
6. The identity of the lender(s) is being withheld on the basis of confidentiality or some other ruse or obstruction fabricated by the pretender lenders.
7. Federal Law (TILA, RESPA) requires the servicers to identify the lender, the name of a contact person at the lender, their address and phone number. They must supply the documents that show the identity of the lender. And the lender is responsible for providing a complete accounting of all transactions involving all funds paid and received by the Lender with respect to this obligation — from all sources.
8. Federal Law and local laws or rules require an effort be made to modify, restructure or settle competing claims on these securitized loans.
9. It is impossible to name the correct parties in litigation and impossible to comply with Federal Law without disclosure of the identity of the Lender.
10. Any entity that meets the definition of a lender or creditor appears to be absent from the proceedings.

So the pretender lenders have come back with a series of arguments as they move up the securitization chain. First they said it was MERS who was the lender. That clearly didn’t work because MERS lent nothing, collected nothing and never had anything to do with the cash involved in the transaction. Then they started with the servicers who essentially met with the same problem. Then got cute and produced either the actual note, a copy of the note or a forged note, or an assignment or a fabricated assignment from a party who at best had dubious rights to ownership of the loan to another party who had equally dubious rights, neither of whom parted with any cash to fund either the loan or the transfer of the obligation. Katherine Ann Porter and April Charney were early leaders in exposing this deficiency.

Now the pretender lenders have come up with the idea that the “Trust” is the owner of the loan and that the Trustee is the proper party to represent the Trust and that therefore the Trustee has the power to enforce the obligation, the note and the encumbrance (mortgage or deed of trust). They first tell us that although MERS was named as nominee only and was not the lender even though it was named the beneficiary or mortgagee. Then they tell us that the Trustee and the “Trust” even though it is just a nominee (just like MERS) is the sole owner of the loans and that the real parties in interest (i.e., the investors who were the source of the cash) somehow don’t count. They can’t have it both ways.

My answer is really simple. The lender/creditor is the one who advanced cash to the borrower. The money used by the homeowner at closing when the homeowner purchased the loan product from the originating seller (pretender lender, actually a mortgage broker unregulated and unregistered) came from the Lender (investor). Therefore the investor is the lender. And the use of nominees or straw men doesn’t mean they can be considered principals in the transaction anymore than your depository bank is a principal to a transaction in which you buy and pay for something with a check. The fact that the money was processed through your depository bank doesn’t make them party to the transaction.

The pretender lenders do not want you to “meet” your Lender(s) (investor(s)). If you do, and compare notes, they will know that they gave an excessive amount of money that wasn’t really used entirely to fund mortgages and that the loans were structured in pools that were guaranteed to fail providing the underwriter, not the investor, with a windfall from the trigger of credit default swaps. The obvious answer is that if you meet your Lender (investor), you can restructure the loan yourselves and then jointly go after the pretender lenders for all the money they received and didn’t disclose as “agent” or nominees for either the homeowner who purchased the financial product consisting of a loan product with a promissory note and an agreement for encumbrance nor the investor who purchased a financial product consisting of a bond, deriving its value from the note executed by the homeowner, but which was insufficient on its face to actually cover the amount invested by the investor.

You will probably find that the trust has been dissolved or that the distribution reports provided by the CDO manager for the underwriter (investment bank) tell a very different story than the one being represented in court. The SPV (Trust) is a REMIC which is a conduit that keeps nothing. It might have the documents as a nominee but that merely makes them a records custodian, since the Trust clearly has no right to keep the money. In fact in order to maintain its status as an entity that has no tax “events” it CAN’T actually own anything or have any income, losses, assets or liabilities. Ask for a copy of the the financial statements and ledgers for the Trust and watch them go nuts.

Tags: bankruptcy, borrower, disclosure, Eviction, foreclosure defense, foreclosure offense, fraud, Lender Liability, lost note, rescission, securitization, trustee
Posted in bubble, Eviction |