Invalid Assignment defense

[newhope2011]

But in the foreclosure context, given what I wrote, the court doesn't care who gets paid. They really only care about who has standing to commence a foreclosure lawsuit. The original (endorsed) promissory note is proof enough in every case that I know of.

Right, and most of the time, it is pretty clear. In NY, like it's been said here before, to put a lien on a property and have it mean something, you have to have it on the county records through assignment. My case is clearly a mess, and I believe the Judge will see that too. Time will tell.


Where I have seen problems, at least in Florida, is with the Lost Note Affidavit where they try to re-establish the Note. The fact is that they need to prove that they lost it once they actually had possession of it! If it was lost before they got it, then it's easier to challenge them, since they literally cannot produce the note. However, I think, at least for Florida, that the creditors affidavit that they lost the note while they were in possession of it, is prima facie evidence and enough to re-establish the Note... even though it's missing!

Really complex. What I was saying by what you highlighted above, that the court wants to know who is entitled to collect, in that it is always a question of standing. The court really doesn't care "who" gets paid. They (should) care about who is entitled to enforce the provisions in the security instrument -- the mortgage.

Agreed


I look forward to hearing more about your case. I also wish someone could cite the 8 (New York) cases that were mentioned in passing.

(Edited to add) Think of the "did you pay" question. If a mortgagor can answer "yes" and to ABC Bank and prove that... yet XYZ Bank is foreclosing, then you have a real issue of standing and who is entitled to collect on the Note! (This has actually happened before but is extremely rare.) Even better, you answer "no" to that question, but there are TWO foreclosure lawsuits filed! Each by different entities claiming that they are the owner AND holder of the note. Technically impossible for them both to hold it... but there was some "warehouse" fraud a while back (if you read my prior posting on how the actual documents are warehoused).

Thanks, and I will post the results when they happen.

[jimbo367]

Judges don't ask did you pay, can you cite a case....they first need to define who to pay in most cases.

The foremost issue is standing if they didn't follow the PSA the assignment is void.

The county records where I am has a ton of cases that show defendant pro se, it's those cases where the owner gives up or can't afford to fight that just flies thu the system with all kinds of invalid docs, stealing houses. scrolling down the list only few hire a lawyer to defend the action.

I pulled about 75 cases this week and could see immediately the good lawyers that get it and file a real answer (copied a lot of good stuff) and the bums that reply with general denials in two pages, those folks are already screwed.

THe mills that bang out hundreds of these for the banks never remain on the case if it responded to with a real answer, they only continue the walkovers.

Here's a bit I found today.

D was relating to really bogus assignment attacking the fraud of the P and their attorney.

P firm knew that unless his client bank owned the note & mortgage they would not standing to FC.
They also know that unless they fabricate and submitted docs purporting to establish this standing they could not effect FC on behalf of their clients (bank)
most importantly P firm could not profit thereby.

.

[HHM]

if they didn't follow the PSA the assignment is void.

That is by no means a universally accepted fact. But I agree, it should be that way.

[jimbo367]

It only needs to be accepted in NY, more than enough current case law.

In my case the PSA closed Jan '05 it was assigned by someone other than the "originator" as required

But 7 years too late, and that entity is out of biz defunct since '07, but the Trustee Wells Fargo found a VP to sign it..........last month

[HHM]

more than enough current case law.

how many cases do you consider, "more than enough".

How about citing 5, or maybe 10

[jimbo367]

Start with a search of decisions from ARTHUR M. SCHACK

[HHM]

Yeah, how about from more than one judge

[justbroke]

Judges don't ask did you pay, can you cite a case....they first need to define who to pay in most cases.

Yes, but this is not in any motion or order. These are oral arguments and what is very common on the Rocket Docket. It is a central thesis of any claim, from the plaintiff, that in fact you DID NOT PAY. (see http://takeyourhomeback.com/?p=524, "Did you pay your mortgage?" -- which is typical on the Rocket Docket, not just in Broward) If you want to, just attend a foreclosure hearing on the Rocket Docket where a defendant appears in person without an attorney. The "did you pay" is one of two questions the judges typically ask. They are not there to hear about the woes of assignments! If you didn't pay, you'd have to frame it a different way in your answers, such as I didn't pay because I didn't know who to pay, BUT I did escrow all the payments.

The foremost issue is standing if they didn't follow the PSA the assignment is void.

That is a stretch and probably should be a factor for the Judge to hear. However, I have never read any ruling that failure to follow a PSA makes an assignment of the debt and security void. In fact, I'd love to read some cases where a Judge ruled that because the PSA was breached by the participants bound by the PSA, the assignment is void ab initio.

The county records where I am has a ton of cases that show defendant pro se, it's those cases where the owner gives up or can't afford to fight that just flies thu the system with all kinds of invalid docs, stealing houses. scrolling down the list only few hire a lawyer to defend the action.

Stealing houses? You mean that these defendants actually paid their mortgage, had a release of security (lien), and then some bank came and foreclosed, thereby stealing their home?

I pulled about 75 cases this week and could see immediately the good lawyers that get it and file a real answer (copied a lot of good stuff) and the bums that reply with general denials in two pages, those folks are already screwed.

Which folks, the banks? These are delay tactics. The fact that the paperwork is wrong is a Rule 11 issue for the court to deal with, and I hope that Courts deal more punitively with the attorneys and banks that violate FRCP Rule 11 (which is usually the same rule in local courts as well).

THe mills that bang out hundreds of these for the banks never remain on the case if it responded to with a real answer, they only continue the walkovers.

It's a business model. The mills do the easy ones and charge less for foreclosure than the more litigious firms. However, most of what you call "mills", here in Florida, actually do the litigation on the difficult cases as well. I am yet to see a case transferred from one of the so-called "mills" to another non-mill firm. I have seen them go from one so-called "mill" to another so-called "mill".

You are right about one thing. The plaintiff banks fluffed up the paperwork to try to make sure that they had standing to effectuate foreclosure. This included the so-called "bogus" assignments and other egregious affidavits. I mean egregious where the affiant from the bank states that they are "holder of the note", but don't attach it to the complaint as evidence. I'm sure if the courts went back to requiring either the original endorsed note or a lost not affidavit with the complaint, there would be fewer problems.

[jimbo367]

Yes, but this is not in any motion or order. These are oral arguments and what is very common on the Rocket Docket. It is a central thesis of any claim, from the plaintiff, that in fact you DID NOT PAY. (see http://takeyourhomeback.com/?p=524, "Did you pay your mortgage?" -- which is typical on the Rocket Docket, not just in Broward) If you want to, just attend a foreclosure hearing on the Rocket Docket where a defendant appears in person without an attorney. The "did you pay" is one of two questions the judges typically ask. They are not there to hear about the woes of assignments! If you didn't pay, you'd have to frame it a different way in your answers, such as I didn't pay because I didn't know who to pay, BUT I did escrow all the payments.

That is a stretch and probably should be a factor for the Judge to hear. However, I have never read any ruling that failure to follow a PSA makes an assignment of the debt and security void. In fact, I'd love to read some cases where a Judge ruled that because the PSA was breached by the participants bound by the PSA, the assignment is void ab initio.

.

NY doesn't have a rocket docket, nor are you required to appear, not to say I wouldn't.

PSA breaches in the assignment are mandated under NY Trust Law to be voided, this isn't FL

[justbroke]

NY doesn't have a rocket docket, nor are you required to appear, not to say I wouldn't.

Florida created the Rocket Docket to deal with the onslaught of foreclosure cases. You are not required to appear in Florida either, but those that did appear were trying, pro se, to stop the foreclosure by appealing to the judge on a non-judicial level. Just doesn't work.

PSA breaches in the assignment are mandated under NY Trust Law to be voided, this isn't FL

I wasn't questioning differences in FL law versus NY law... as so much the UCC. But anyhow, they are mandated, but what is it like in actual practice? That's why I think HHM and I agree that it should probably be the case, but what is the ACTUAL real-world doing with it. I still haven't seen a cite on a NY case for comparison.

I will say this... and I think HHM went here too. If the mortgage was not entitled to be transferred into the Pool because the PSA was violated, then the assignment to the Pool should be invalid. I can see that. I can certainly see that where the mortgage was "allegedly" transferred into the pool after the pool's closing date.

But, does this invalidate the mortgage itself? That I don't believe. The original lender should still have recourse. I think this is a big mess but the court must also not come to an absurd judgment. Absurdity would be that all mortgages are invalid and bifurcated and thus are not security for the underlying note. Getting a judge to believe that is one thing. However, I still see these cases, and no cites for New York, where it is simply a paperwork issue and not a bifurcated note issue. Some entity has the right to foreclose. At worst, it's the entity that is declared in the mortgage and note OR the holder of the note.

I think the real problem is that the servicers keep choosing to close in the name of the Trust (MBS under the PSA) and therein lies the problem.

At least it's a fun academic discussion of the underlying issues, but not everyone is willing to fight at this level and certainly not every superior court level judge is willing to entertain it beyond a certain point.

[jimbo367]

I will say this... and I think HHM went here too. If the mortgage was not entitled to be transferred into the Pool because the PSA was violated, then the assignment to the Pool should be invalid. I can see that. I can certainly see that where the mortgage was "allegedly" transferred into the pool after the pool's closing date.

But, does this invalidate the mortgage itself? That I don't believe. The original lender should still have recourse.

Perhaps not but it ends this plaintiff's case.

Not if the original lender were paid at the time of their BS transfer.

Not if as in my case they are out of biz.

If I can get this pretender lender knocked out of the box,
which will in this part will take years then I suppose I have to seek quit title but I'm getting way ahead of my self.

here's a bit from my answer
Moreover, being that this particular Trust was one constructed under the laws of the State of New York ; New York Trust law requires strict compliance with the Trust documents (i.e., the PSA) and any transaction by the Trust or participating parties that is in contravention of the Trust documents is void, meaning the transfer cannot actual take place or be recognized as a matter of law.

Specifically, N.Y. Est.Powers & Trusts Law S 7-2.4 states:

“If the trust is expressed in the instrument creating the estate of the
Trustee, every sale, conveyance or other act of the trustee in
Contravention of the trust, except as authorized by this article and
by any other provision of law, is void.”

At least it's a fun academic discussion of the underlying issues, but not everyone is willing to fight at this level and certainly not every superior court level judge is willing to entertain it beyond a certain point.

Not sure about the fun part when it's my butt, however, yes I'll fight not only at this level but the next if need be, been there before on non foreclosure cases.

I have found that the judges here are not assigned pro se cases if they don't wish to, and they have never been impatient or short if you are raising I legal arguments that make sense.

I have sat through cases ahead of mine where the pro se litigant was way over his head and off point that they were given a little time but then cut short.




.

[justbroke]

Not if the original lender were paid at the time of their BS transfer. Not if as in my case they are out of biz.

But therein lies the rub. In one part, you say that they were paid during the transfer, but you also say that the transfer is void ab initio under NY Trust Laws. So, it's one or the other. Besides, them being paid is not a payment by the mortgagor. I understand this line of reasoning... that the original lender is already paid... but it has never worked in any case. The theory being that the securitization of the loan caused the lender to be paid so the mortgage is paid. But, the mortgage is NOT paid.

Furthermore, there is such thing as a successor! A successor could be the FDIC or another bank through acquisition or failure (where the bank's assets are assigned by the FDIC). This doesn't mean that because La Salle bank doesn't exist anymore, doesn't mean that Bank of America, who is the successor and who acquired La Salle, doesn't have the right to enforce the terms of the security instrument.

Not sure about the fun part when it's my butt, however, yes I'll fight not only at this level but the next if need be, been there before on non foreclosure cases.

Yes, fun even when it is your butt. I suppose that you did, in fact, mortgage your home in consideration of a loan -- to either purchase or refinance the home. Additionally, I suppose that you stopped paying the purported pooling agent or the lender itself at some period in time. For that reason, I don't know what your butt has to do with it, but I do understand! I was actually looking at defending a foreclosure action against one of my properties under similar reasoning, but it is just not the mainstream.

I have found that the judges here are not assigned pro se cases if they don't wish to, and they have never been impatient or short if you are raising I legal arguments that make sense.

The judges are not short either, but when you come in and all you can say is... produce the note... or the assignment is wrong, without any cause as to why the judge should rule i your favor and against the plaintiff, then I don't call that being "short". I'm sure you'd agree that raising a legal argument is a far cry from just... well... crying foul.

I have sat through cases ahead of mine where the pro se litigant was way over his head and off point that they were given a little time but then cut short.

Exactly. They are entertained, because the Supreme court has ruled favorable that courts should construe the motions (oral or otherwise) presented by pro se individuals, liberally. However, the Supreme court, in the same breath, stated that it's not the court's (judge's) job to formulate a legal argument or to "find" cause with a pro se that doesn't know what they're doing.

I think what I just wrote goes to the heart of what HHM wrote previously. That is, that merely crying foul, saying PSA this, assignment that, is not a winning argument. Furthermore, HHM wrote, and I agree, that what you're hearing from those participating in this thread, should be seen as a prelude to what a judge and/or plaintiff bank will seek to discover.

At some point, the court is really weary of these claims as they just clog up and slow down a system that is already being crushed by the sheer volume. I think that is where you see the judges try to be patient with the pro se, but also tend to become leery of their collective positions.

As for you, I think that you are starting to formulate the right argument, but only time will tell.

I wonder what would happen if the lender just showed up with the properly endorsed note on a Motion for Summary Judgment? That makes me also wonder, where is the Note while all this is going on?

[jimbo367]

But therein lies the rub. In one part, you say that they were paid during the transfer, but you also say that the transfer is void ab initio under NY Trust Laws. So, it's one or the other. Besides, them being paid is not a payment by the mortgagor. I understand this line of reasoning... that the original lender is already paid... but it has never worked in any case. The theory being that the securitization of the loan caused the lender to be paid so the mortgage is paid. But, the mortgage is NOT paid.
Furthermore, there is such thing as a successor! A successor could be the FDIC or another bank through acquisition or failure (where the bank's assets are assigned by the FDIC). This doesn't mean that because La Salle bank doesn't exist anymore, doesn't mean that Bank of America, who is the successor and who acquired La Salle, doesn't have the right to enforce the terms of the security instrument.

So what, this plaintiff is knocked out, let someone else scramble to figure out who may sue you, my guess is with thousands of mortgages in this mess no one will surface.

Additionally, I suppose that you stopped paying the purported pooling agent or the lender itself at some period in time. For that reason, I don't know what your butt has to do with it, but I do understand! I was actually looking at defending a foreclosure action against one of my properties under similar reasoning, but it is just not the mainstream.

I think you need to understand if the trustee had no standing and is out, read tru a PSA and its prospectus, that person you think you owe doesn't exist was paid by the Gov or insurance or wrote it off.

saying PSA this, assignment that, is not a winning argument.

I disagree with that completely, there is case law in FL NY and else where.

See this site there is much to learn how it all works

I wonder what would happen if the lender just showed up with the properly endorsed note on a Motion for Summary Judgment? That makes me also wonder, where is the Note while all this is going on?

As a trustee that's not enough, they had to obtain it in accord with the PSA, and they can't.

The note-lost

[davetedge]

PSAs etc.

Investors aren't too happy about PSAs either. If the mortgage failed to enter the trust or never should have entered due to deficient criteria, the bank may be forced to buy it back and reimburse the investors (as you can imagine, the banks are fighting hard to not have to do the put backs at face value). So if the mortgage note fails to enter the trust, then it either belongs to the bank or the previous holder (originator, mortgage warehouser, or another intermediate). In theory that party could then sue to foreclose (if they still exist).

So if a foreclosure brought by Trust X fails, the note might be put back to Bank Y, who can foreclose after receiving the note, or it might revert back to Originator Z (who probably liquidated in 2009). In NY at least, timing is important. The judges check to make sure the moving party had standing to foreclose at the time they filed.

btw, most PSAs operate under NY Trust law, which has time limits on when assets can enter the trust. So if you can imagine, foreclosures operate in the nexus of the UCC, the property laws of the state, NY State Trust and Estate law (if the mortgage was securitized), and the discretion and preferences of each state's court systems. This is why FL gets a rocket docket, NY forces the lender to negotiate alternatives with homeowners.

I wonder what would happen if the lender just showed up with the properly endorsed note on a Motion for Summary Judgment? That makes me also wonder, where is the Note while all this is going on?

I've always wondered if there's a Raiders of the Lost Ark style warehouse where all notes go to disappear. There was a deposition over Countrywide where someone said most of the notes were first scanned and then the originals destroyed. This is not a bad idea for many states, but for the ones that require wet-ink signatures on original documents, Countrywide kinda screwed up in that situation.

In my situation, my original mortgage with WaMu would have had a slam dunk foreclosure. The original note existed, had been endorsed correctly, perfected (filed with the county register), and clearly they were in possession . But I refinanced with a company that then sold it on and it wound up with Deutsch Bank. They don't seem to have any idea where the note is, which might explain why its just one of thousands in NY's "Shadow Docket."

[jimbo367]

Agree that's why you need to read the PSA & prospectus, but they are several hundred pages, don't get put off by that there are only about a a dozen things in it you need to know and point out to the court.

In researching other cases by the same bank at the clerks office I hit the gran daddy 2700+ pages and 20 page Prospectus, but the firm answering the complaint went thru the PSA like surgeon, I copied that 50 page answer real quick, it was well worth the .25 per page.

The answer included all the discovery stuff as as well.

I have used it as my foundation included tons of case law I was soooo lucky to find this.

You just go to www.secinfo.com and find yours print it.

Mine was 310 pages, following the case mentioned above I yellow yellow highlighted all the needed reference.

I found my trust was started 1/2005, it closed for any additional mortgage to added 1/13/05, that how quick they wrap theses multi million dollar deals up, all pre arranged.

There was never an assignment of mine to the trust until 2012, and that was just a bit late as in 7 years.