Ultimately all debts, notes and mortgages (or deeds of trust) are about money. They are not about property. The property is incidental to the deal and ONLY comes about if there is a dispute in which there is a claim that you didn't pay money that is owed to the owner of the mortgage deed or the beneficial owner of a deed of trust. The mortgage deed or deed of trust is conditional, not absolute like your deed to your property that names you as owner. There is no such thing as a fee simple absolute mortgage or encumbrance. It doesn't exist in our jurisprudence or for that matter any jurisprudence.

The ONLY reason your property can be legally sold, denying you future title and possession of the property is that you owe money to the party who foreclosed --- or on whose behalf the foreclosure was initiated. Mastering this one fact will pull your head and that you attorney's head out of the weeds.

We take it as a given that you owe money. The question is whether there is a party that can be identified as the one to whom the money is owed. If so, who is that? What is the identification, address and contact information for the party who is actually owed money from you.

Spoiler alert: So far the banks have successfully skirted the question of money. From funding of the initial loan to the proceeds of sale for the property nobody has actually disclosed where the money came from and where the money went when payments were made or the property was liquidated.


And the absolute immutable truth is that the so-called investors (i.e., the ones who bought "certificates" or "mortgage bonds") do not receive your mortgage payments nor do they receive the proceeds of the sale your home.

So who actually wants the foreclosure and why? The truth is that the investors get paid in the sole discretion of the underwriter of the "certificates." Their payment is not conditioned upon your payment.

They get paid ONLY because the underwriter promised to pay them based upon certain conditions which does NOT include the receipt of mortgage payments. They do not get paid because you promised to pay the investors nor because your promise to pay was sold to either the investors or the trust. That sale never occurred.

How do I know this? Because I have asked two questions thousands of times in the last 12 years. First, to whom were my payments forwarded by the self-proclaimed servicer? Answer: None of my business. Second, who received the proceeds of liquidation of the foreclosed property? Answer: none of my business.

Knowing the banking industry as I do, there was only one possible conclusion: if they answered the question they would either perjure themselves or they would be admitting that the party named as being entitled to foreclosure was not really entitled to foreclosure. You see it is well established law --- for centuries --- that only the owner of a debt can foreclosure on collateral.

For convenience sake a holder of a promissory note can enforce the note but only the owner of the debt is entitled to foreclose. If the foreclosing party claims a representative capacity to establish a prima facie case it must disclose the party whom they claim to be representing and prove that the party being represented is the owner of the debt.

So the one area, pointed out by Charles Koppa, in Southern California, a decade ago is what happens after the sale is authorized and the property is liquidated. He was figuring out the relationship between the bid amount and the amount the underwriter claimed as unpaid servicer advances (in the role of self-proclaimed master servicer for the nonexistent trust). Here we knew the answer but we were lucky enough to get hold of copies of a check made out to BONY/Mellon as trustee (Blah blah). BONY mailed it to the servicer and the servicer mailed it to Chase (i.e., the underwriter and master servicer doing business as the nonexistent trust, like a DBA.)

No trust and no investor ever received the money. Chase got it and lest you forget, remember that Chase was all about selling loans and derivatives based upon loans and synthetic derivatives based upon the derivatives. It was never about actually making loans where Chase could lose money or buying loan as that were going to be worthless of worth less. It was about selling them. So the revelation is that BONY never had a claim to the money and either did the nonexistent trust that was ignored once the foreclosure court proceedings were over.

Our investigations so far, with considerable help from Bill Paatalo, shows that multiple transfers of title occur AFTER the foreclosure sale or shortly before signaling the real player who is going to get the money. So you might want to think about the sale of your property title as the beginning rather than the end. It is the beginning of an action (lawsuit) to vacate the sale and award damages. END


Following The Money — What To Ask For And Look For

Following the money means determining the party to whom you MIGHT owe money. It certainly isn’t the pretender lender and if you can fill in the blanks on this list you will be able to show that. Remember the burden is NOT on you to prove it, the burden is on you to ASK for it in qualified written request, debt validation letter and/or discovery (interrogatories, request to produce, subpoena duces tecum, and requests for admission). If you ever get someone the pretender lender offers to answer your questions at deposition make sure you specify that you will want the person(s) who are able to answer questions about the following items on this list.

Your forensic review can only estimate the some of the data. But the closer you get to answering more and more of these questions by aggressively enforcing their obligation to answer under federal law, state law and rules of civil procedure, the closer you get to proving that the wrong party is servicing the loan, the wrong party is collecting on the loan, and the wrong party is enforcing the note, while the obligation has been altered by events outside of the report that the foreclosing party is reporting to the court. Each time they fail to give you the right person or the information leading to the names of the investors/lenders, the amount still owed on the obligation (not the note), you will get the judge increasingly interested as to why they can’t come up with information they should have had when they started foreclosure. Remember this is not about getting a free house — it is about getting answers to your questions. You might end up with a free house as others have done or you might end up with a re-structured loan on terms you can afford. One thing is sure — when you DO have all the answers, the amount due is bound to be far different than the amount they are claiming.

Laymen will be confused by my distinction between the obligation and the note. Under law, the note is only evidence of the obligation and is often confused, even in court, with the obligation itself. It is that confusion that the pretender lender are leveraging so they can keep everyone’s eye off the ball — the true amount of the obligation, not the indisputable amount written on the note. By distracting the Judge into looking only at the note, they finesse the proof requirement as to what is really owed. The fact that the real lender has been paid or settled through federal bailout, insurance, credit default swaps etc., is kept off the table as long as you fall into the trap of looking at the note (merely evidence of the obligation) instead of looking at the entire transaction through the lens of the creation and payment of the obligation from all potential sources.

Items to Demand in Accounting For the Obligation:

  • Original face value
  • Beginning Notional/Principal balance
  • Pass-through rate
  • Principal distribution
  • Interest distribution
  • Total Distribution
  • Principal loss
  • Interest loss
  • Deferred Interest
  • Ending Notional principal balance
  • The accrual period
  • Acrrual methodology
  • Optimal Interest Amount
  • Interest loss
  • Deferred Interest
  • Interest shortfall amt
  • Other income
  • Accrued certificate interest remaining unpaid

Other income detail:

  • Certificate class
  • Prepayment charge
  • Remaining excess cash flow and OC release amount
  • other income distribution

Interest shortfalls, compensation and expenses (per Group)

  • Current prepayment interest shortfall amt
  • Compensating interest
  • net prepayment interest shortfall amount
  • Civil Relief act shortfall count
  • civil relief act shortfall amount
  • Compensation
  • subservicer
  • master servicer

Advances by master servicer

  • Allowable expenses per governing document
  • non-recoverable advances

Prepayment interest and Basis risk/net WAC shortfall amount (by certificate class)

Collateral summary


  • original loan count / scheduled principal balance
  • beginning loan count / scheduled principal balance
  • scheduled principal
  • curtailment
  • payoff
  • matured loans
  • repurchases (by the way this is 0 for all months reported)
  • beginning aggregate scheduled principal balance of liquidations (and?) charge-offs
  • ending loan count scheduled principal balance

None of the information is specific to any one loan as I had hoped. But, they have to keep that info somewhere (use discovery)... END


Example Discovery

Date: _____________

Your name and address

Regarding: home address:___________________ Loan, mortgage, or reference number, for the notice received on date _________ .

Dear Sir or Mdm.:

Your office sent a document to us dated _________ and titled___________ (the "Notice"). A copy is included. I/We do not know you and do not know if you have the legal rights alleged in the Notice. I/We need to determine whether the Notice has any legal validity. We do not want to make payments to the wrong person or to let the wrong person take our home.

Please, therefore, provide within fifteen (15) calendar days from the date of this letter the below-requested information and any additional information or documents you think establishes your right to make demands or to carry out the threats of the Notice. Your compliance with this request will not require much time or effort if, in fact, you have such rights and you verified same before sending the Notice to us.

Respond only to the parts of the request that apply to you. Please let us know which parts you claimed don't apply to you. Failure to eliminate any particular level of involvement will be viewed as your admission of claiming more than one hat regarding our mortgage loan and not having provided a complete and meaningful response.

If you have a document that is responsive to this request, please provide a copy of that entire document, including exhibits a summary, abstract, or comment about a document is not acceptable, and will not be treated as genuine evidence supporting whatever position you claim regarding our mortgage loan and Home.

Silence or an incomplete response will be understood as your admission that the Notice was improperly issued and that your office has no right to enforce our mortgage loan pursuant to the Uniform Commercial Code (the UCC) as adopted by the state where our Home is located and, therefore, no right to foreclose on our Home.

1. If you claim to be the trustee appointed to conduct a non-judicial foreclosure of our Home, you need only comply with the following:

a. Please provide the name, address, and phone number of the company and the person(s) at the company who instructed you to commence this foreclosure process. We deem your receipt of this letter to be receipt by your customer, also, we require responses by you and your customer accordingly.

b. Please describe the portion or text of any document I executed regarding my mortgage loan that authorizes you to perform the foreclosure services you have agreed to perform regarding our Home.

c. If you claim you received only a verbal instruction to initiate this foreclosure process, please identify the date of that instruction and the name, address, employer, and phone number of the person who gave that instruction to you.

d. Please explain everything you did to assure yourself that the company or person who instructed you to initiate the foreclosure process was, in fact, authorized to do so by law. Further, please provide a copy of each document, digital or hard copy, you review in making that assessment.

e. Please provide a copy of the contract or agreement and each of them if more than one, by which you were engaged to act as trustee regarding the foreclosure of our Home.

f. Please provide a copy of all communications, whether email, fax, letter, or otherwise, that you have received or sent regarding our Home.

g. If you have an office manual or policy statement about how and when you engage in and prosecute foreclosures, please provide a copy.

h. Your failure to provide the requested information will be deemed your admission that you have engaged in this foreclosure process without authority and in violation of the terms of our mortgage loan documents and the laws of the state in which the Home is located.

2. If you are an attorney representing a company that is involved with the demands and foreclosure threats of the Notice, please identify your client or clients with name, address, phone number, and a description of the clients relationship to our mortgage loan and Home. Further identify your contact person for each such identify client, including his or her name, address, employer, and phone number. We deem your receipt of this letter to be receipt by your client and we require responses by you and your client(s) accordingly.

3. Do you claim that you are entitled to enforce our mortgage loan according to the Uniform Commercial Code of the state where our home is located, and not in the capacity as a servant for whomever might be that person? If so, please explain and identify the circumstances by which you obtained that right and when. In addition please provide the explanations and documents requested below:

a. If you claim to have physical possession of the Note we executed, please let us know when you will make a Note available for inspection and copying. The place you select must be close to our Home, unless we all agree otherwise.

b. Please provide a complete accounting of the amount alleged due under our Note from its inception to the current time, including every credit and debit. Please account for each and any insurance proceeds, claim settlement, or warranty payments made regarding our Note And Home. If you maintain that no insurance, claim settlement, or warranty payments have been sought or received that involved, directly or indirectly, our mortgage loan and Home, please state so in an affidavit under oath executed by one of your officers who is also your employee.

c. Please provide a complete history of each transfer of the physical Note and each sale, transfer, exchange or assignment of the mortgage loan, in full or part, from its creation to the current time, including but not limited to the name, address, and phone number of each transfer and each transfer re-in that chain. Further, for each transfer or transaction please provide, in addition to any resulting assignment or conveyance instrument, the contract(s) or agreement(s) involved with their respective transfer or transaction, is made by the parties to each respective transfer or transaction. Also please identify the source or sources of your information regarding that chain of activity regarding our mortgage loan.

d. Please provide a copy of each email, fax, letter, or other communication you sent to or received from any person or company regarding our mortgage loan since its inception.

4. Do you work for a company that claims the right to enforce our mortgage loan pursuant to the Uniform Commercial Code of the state where our Home is located? If so, please identify the company with its name, address, and phone number, and identify the person or persons at that company to whom you report.

a. If you are an agent or servant, we deem that your receipt of this letter constitutes receipt by the company for which you are working, and we require that company to respond as if it received this letter directly rather than through you.

b. Please provide the contract, agreement, or document by which you were engaged to provide services for that company respecting our Home. If more than one contract or agreement is involved, these provide complete copies of each.

c. Please admit that you hold no economic interest in our mortgage loan Or Home. If you maintain otherwise, please explain and provide each and all documents that you assert create an economic interest in our mortgage loan or Home.

d. Please have the company you claim hired you respecting our Home to provide by the hand of one of its employees, directly to us, it's affirmation of your engagement and authority to represent it respecting our Home and the Notice, and all of its documents regarding our mortgage loan.

e. Please provide a copy of the document or documents by which that company declared a default under our mortgage loan and instructed you or some other person to commence collection actions regarding same. If you claim that instruction was verbal, please identify the person who gave it to you and include the date of that instruction and that person's name, address, employer, and phone number.

You are welcome to answer that you have no such information with which to reply to any particular request. If you need more time to provide the requested information and documents, we would be amenable to an extension of time subject to a reciprocal extension, day-by-day, of each deadline stated in the Notice. Additionally during such additional time, if granted per this paragraph, your delay in providing the required answers and documentation will nevertheless deemed your admission, pending proof to the contrary, that the Notice was issued by mistake and that neither you nor the company that you claim to represent, if applicable actually has the right by law to make the demands and threats included in the Notice.


Name and address



The Answer is Nobody Has Standing to Legally Enforce the Alleged Mortgage Loan Documents

"So here's the million-dollar question. If the investors who put up the money to either fund the loans or purchase the "underlying" assets have no recourse to go after the collateral, who does?"

The current answer is nobody, which is nearly impossible to wrap your head around. But the future answer lies in either well-informed court doctrine or new legislation (or both) that will clear the obvious bungled title issues and the obvious wrongful and fraudulent foreclosures conducted over the last decade or more.

In my opinion, the convoluted securitization scheme has resulted in multiple inequities to practically everyone involved other than the perpetrators. If we accept the premise of an intention to produce justice and equity then only a court of equity can declare the rights of the parties, enjoin parties from asserting nonexistent rights, and order disgorgement of windfall profits from illegal activities. Until then the title mess and the gross inequity to American homeowners and the ongoing cost to American taxpayers will only get worse.

My analysis is below.

This Article is Not a Legal Opinion Upon Which You Can Rely on in any Individual Case.


Part I - From The Bottom Up

1. Borrower gets money.

2. Borrower promises to pay it back

3. Borrower agrees to use the house (property; real estate) as collateral

4. Borrower is directed to pay servicer

5. Borrower pays servicer

6. Servicer pays TPS (Third Party Stranger) --- the borrower's original promise to pay has been converted into a flow of money that never reaches the named "lender," creditor or owner of the debt.

7. The two indispensable parties recognizable in the single transaction doctrine or the step transaction doctrine --- the investor/lender and the borrower/homeowner --- are separated on paper but not separated in equity.

Part II From The Top Down

1. Investor pays for certificates issued in the name of a nonexistent Trust. Ergo the trust name is a fictitious name being used by the underwriter of the certificates. These are called "mortgage bonds" (mortgage backed securities)

2. The indenture of the certificates (15 U.S. Code 77nnn) bars the investor from even asking about the trust assets or status, and also bars the named Trustee from asking about the assets or status. Neither the named Trustee nor the investor has any present or even conditional right to assert title or interest in any assets.

3. The holder of the certificate gets a promise from the underwriter of the certificates who is operating under the fictitious name of the nonexistent trust.

4. Reading the prospectus and the Pooling and Servicing Agreement (PSA) it is apparent that the promise consists of a only a conditional forecast of payments from the underwriter of the certificates that are NOT based upon the payments or even the schedule of payments from any one mortgage or any group of mortgage loans. In most instances, the MLS (Mortgage Loan Schedule) attached to the prospectus is disclaimed by the prospectus as for example only and does not represent anything owned by the trust.

5. The forecast does not guarantee any payment to the investors. Payment to investors are within the sole discretion of the underwriter who usually appears as Master Servicer or who controls the named Master Servicer of the nonexistent assets of the nonexistent trust.

6. Upon default in payments investors have no remedy. They have waived all right, title and interest to the debts, notes, mortgages or other assets of the nonexistent trust. Combined with the other terms this means that the certificates were neither mortgage-backed nor bonds.

7. Since the investor's only expectation of payment is from the underwriter doing business in the name of the nonexistent trust the investor has no standing to assert any rights in the nominal trust arrangement. Nor does the investor have any right to claim, collect, receive or otherwise enforce the debt, note or mortgage.

8. Investors are not beneficiaries under the trust instrument (PSA). There are no beneficiaries.

9. Named Trustees have no trustee powers under the trust instrument. Neither do the servicers or anyone else. There is no trustee.

10. There is no Trustor/Settlor who owned assets (loans) and conveyed them to the Trustee to hold and actively manage for the benefit of nonexistent beneficiaries. There is no res, which is Latin for "the thing" that is entrusted to a trustee to hold in trust to own and actively manage the assets for the benefit of beneficiaries.

11. There is no transaction where anyone acting in the name of the nonexistent trust acquired ownership of the debts, notes or mortgages. There is no trust.

12. The parties named in most foreclosures as claimants do not exist or do not exist in the role that is implied. Nor do they represent the equitable owners of the debt. They are acting purely out of self interest without regard to either the investors or the homeowners. They are intermediaries who used complexity to create the illusion of ownership or representation of ownership where none existed.

Part III --- Putting It All together

1. The homeowner's debt was converted either at origination or immediately following origination from a promise to pay the creditor who funded them into a promise to pay as instructed to a servicer, who neither loaned money nor purchased the debt, note or mortgage.

2. The conversion consisted of changing the borrower's promise to pay to the underwriter's promise to pay.

3. At that point the debt became separated from the paperwork. That means that the debt is till owed to the party whose money funded the transaction, but that party is not mentioned anywhere on the borrower's paperwork and does not have any direct or indirect rights to the debt, note or mortgage.

4. The mortgage, while potentially enforceable with extrinsic (parol) evidence is unenforceable but not necessarily extinguished.

5. The note is merely evidence of a debt and the agreement of the borrower to repay according to the terms set forth on the note.

6. Both the note and mortgage are either fatally defective or unenforceable because neither one is attached to the debt which is payable and paid to servicers who do not represent the investors who funded the loan.

7. The servicers are paying the underwriters who may or may not make good on their promise to pay the investors according to a schedule that is entirely different than the one set forth on any purported mortgage loan.

8. In the same way that borrowers do not have standing to assert any claim based on anything in the trust instrument (PSA) or prospectus, the investors are also barred (lack of standing) and if it came to it, the named Trustees of the nonexistent Trust would also be barred (lack of standing).

Hence the answer to the obvious question is that there is no party who is legally entitled to claim a right to be in correspondence with, or collect from borrowers, much less to enforce a debt or foreclose on a home. Eventually the courts will come to realize that they were duped by complexity and undeserved reliance on the representations of the banks.

It is only in a court of equity that modification and new terms can be fashioned to reflect the original intent of the borrower and the original intent of the investor under reasonable terms that both can live with. I do not predict when this will happen but only that such a "fix" is indispensable for the economic health of the nation and its citizens.

The "free house" myth is merely a PR bank statement to deflect from a "free loan" and "free money" and "free foreclosures." END



Parol: A word; speech ; hence, oral or verbal; expressed or evidenced by speech only; not expressed by writing; not expressed by sealed instrument. The pleadings in an action are also, In old law French, denominated the “parol,” because they were formerly actual viva voce pleadings in court, and not mere written allegations, as at present. Brown. As to parol “Agreement,” “Arrest,” “Demurrer,” “Evidence.” “Lease,” and “Promise,” see those titles.

15 U.S. Code 77nnn - Reports by obligor; evidence of compliance with indenture provisions


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