The Homeowners Guide To A Winning FC Defense-1
The Homeowners Guide To A Winning FC Defense-1
The Homeowners Guide To A Winning FC Defense-1
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Joe Portofino
____________________
DISCLAIMER:
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No part of this publication may be reproduced, stored in or introduced into a retrieval system, or
transmitted, in any form or by any means (electronically, mechanical, photocopying, recording or
otherwise), without the express prior written consent of both the copyright owner and the
publisher of this book.
Re-selling of this publication through electronic outlets (like Barnes & Noble, Amazon or E-
Bay) without permission of the publisher is illegal and punishable by law.
The uploading and distribution of this publication via the Internet or via any other means without
the express prior written consent of the publisher is illegal and punishable by law.
Please purchase only from an authorized distributor and do not participate in or encourage
electronic piracy of copyrighted materials and publications.
_________________________
ACKNOWLEDGMENTS
Special thanks to my good friend Keith Dennis for his invaluable proofreading and suggestions. I
would also like to thank those named and unnamed people whose contributions to the field of
foreclosure defense contributed to this book.
_________________________
DEDICATION
This book is dedicated first to my wife Sandy, who has stood by me and supported me through
thick and thin. Next, to our six children, to hopefully inspire them to achieve their dreams, that
anything is possible. Lastly, to my parents, who have always been there for me.
_________________________
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TABLE OF CONTENTS
Introduction ..................................................................................................................................... 1
Judicial or Non-Judicial Foreclosure .............................................................................................. 3
The Foreclosure Complaint ............................................................................................................ 5
The caption.................................................................................................................................. 6
The claim or cause of action ....................................................................................................... 7
Relief requested .......................................................................................................................... 8
Contesting the foreclosure complaint ............................................................................................. 9
The contested foreclosure process ................................................................................................ 10
There is no “free house” ............................................................................................................... 14
Some common specific defenses to mortgage foreclosures: ........................................................ 15
The Promissory Note .................................................................................................................... 16
The Assignment of Mortgage or Deed of Trust ............................................................................ 18
Affidavits ...................................................................................................................................... 19
Securitization of your mortgage loan documents ......................................................................... 20
Breach of Contract through Securitization ................................................................................... 24
The Pooling and Servicing Agreement (PSA) .............................................................................. 26
How to find the trust’s Prospectus and PSA ............................................................................. 27
The two KEY parts of the PSA you want ................................................................................. 29
Finding deficiencies in the foreclosure complaint itself ............................................................... 34
Finding deficiencies in the promissory note ................................................................................. 35
Finding deficiencies in the Assignment of Mortgage ................................................................... 38
Finding deficiencies in the Affidavit ............................................................................................ 41
Answering the foreclosure complaint ........................................................................................... 42
Affirmative Defenses (or New Matter) to the Foreclosure Complaint ......................................... 43
Substitution of Party Plaintiff ....................................................................................................... 46
Discovery ...................................................................................................................................... 47
Depositions ............................................................................................................................... 47
Interrogatories ........................................................................................................................... 48
Request for Production and Inspection ..................................................................................... 48
Requests for Admissions........................................................................................................... 48
Motion for Summary Judgment (MSJ) ......................................................................................... 51
Mortgage Loan Modification ........................................................................................................ 54
Summary ....................................................................................................................................... 54
Resources ...................................................................................................................................... 55
Important Cases to Read ............................................................................................................... 56
ATTACHMENT 1 – U.S. Bank – Role of the Corporate Trustee................................................ 57
ATTACHMENT 2 - Decision and Order of Judge Wayne P. Saitta ............................................ 62
ATTACHMENT 3 - Decision and Order of Judge Arthur M. Schack ......................................... 68
ATTACHMENT 4 - SAMPLE: DEFENDANT’S FIRST SET OF INTERROGATORIES
ADDRESSED TO PLAINTIFF .................................................................................................... 79
ATTACHMENT 5 - SAMPLE: DEFENDANT’S FIRST REQUEST FOR PRODUCTION OF
DOCUMENTS DIRECTED TO PLAINTIFF.............................................................................. 90
ATTACHMENT 6 - SAMPLE: DEFENDANT’S FIRST REQUEST FOR ADMISSIONS
ADDRESSED TO PLAINTIFF .................................................................................................... 98
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This Guide will present the homeowner facing foreclosure everything they
need to know about a winning foreclosure defense. The main thing you need to
understand is that the entity foreclosing on your property must have “standing.” In
a foreclosure, without the original promissory note, the foreclosing entity does not
have “standing” to sue for foreclosure.
Every homeowner has three options for defending their home; going it
alone, hiring a certified paralegal to help with the paperwork, or hiring a lawyer to
handle the entire case.
Going it alone is the riskiest course for a homeowner because it requires one
to quickly acquire knowledge that they likely do not have, such as knowing the
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rules of court, rules of evidence and their state’s uniform commercial code (UCC).
These are absolutely critical to a winning defense.
Beware, there are lots of foreclosure defense web sites out there, but most
homeowners will not be able to discern which are reliable and which are
dangerous. Some of them offer “free” paperwork, but most of it is either worthless
or downright dangerous to use.
Most homeowner’s do not have the time required to learn the necessary
information and properly apply it to their unique situation. Considering the money
invested in one’s home, going it alone with insufficient knowledge and experience
is a recipe for disaster and the possible loss of one’s home.
The best option, if one can afford it, is to hire a lawyer who specializes in
foreclosure defense. Consumer advocate type lawyers can also be pretty good at
foreclosure defense. One mistake you want to avoid is to hire a lawyer who works
both sides of the fence. In other words, if the lawyer represents banks and
homeowners in foreclosures, you do not want to hire him/her. You want a lawyer
dedicated 100% to the cause of homeowners.
Should you exercise this option, always remember, YOU are the boss. The
lawyer will give you advice, but the final decision should be yours. You are paying
the piper, you call the tune. That means that you must educate yourself as much as
possible as to what is involved in your foreclosure defense. This Guide will help
you do that. Blindly following anyone, let alone a lawyer, is again, a recipe for
disaster and disappointment.
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In the United States, there are two types of foreclosure, judicial and non-
judicial. The following chart is from a very helpful web site by Realty Trac that
lists foreclosure laws and procedures by state;
http://www.realtytrac.com/real-estate-guides/foreclosure-laws/
Connecticut Delaware
Florida Illinois
Indiana Kansas
Kentucky Louisiana
Maine Maryland
Massachusetts Nebraska
New Jersey New Mexico
New York North Dakota
Ohio Oklahoma
Pennsylvania South Carolina
South Dakota Vermont
Wisconsin
Alabama Alaska
Arizona Arkansas
California Colorado
District of Columbia Georgia
Hawaii Iowa
Michigan Minnesota
Mississippi Missouri
Montana Nevada
New Hampshire North Carolina
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The main difference in state foreclosure laws is whether your state uses
Mortgage Notes or Deeds of Trust as the (alleged) security instrument for the
purchase of real property. Generally, states that use Mortgage Notes conduct
judicial foreclosures and states that use Deeds of Trust conduct non-judicial
foreclosures, because the Deed of Trust contains a power of sale clause.
Additionally, many non-judicial foreclosure states are handled as trustee sales.
_________________________
NOTE: For purposes of this Guide, when you see the word “mortgage” it can also
mean “deed of trust.” It just depends on what state you live in.
_________________________
The two parties most likely to initiate a foreclosure action are the trustee for
a securitized trust and the loan servicer. The loan servicer is usually the entity in
day-to-day contact with a borrower so it is considered to be in the most practical
position to handle foreclosure proceedings. However, some states’ laws require the
servicer to demonstrate its entitlement to foreclose on behalf of the lender or
securitization trustee before initiating a foreclosure suit.
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The trustee for a securitized trust, as the party supposedly holding title to
the promissory note on behalf of the trust investors, is considered the proper party
to foreclose, but only if it possesses the right to do so under state law, which in
most cases requires that it have been formally assigned the mortgage through
lawful endorsement, assignment and transfer.
Interestingly, there is good authority that a trustee is not the proper party to
foreclose. Attachment 1 is a four-page document from U.S. Bank titled, Role of the
Corporate Trustee. At the bottom of page 59, under “Who Initiates and Manages a
Foreclosure?” it states:
So, if a “trustee” for a trust is the foreclosing entity in your case, this is a
great argument to make that it does not have standing and thus the court does not
have jurisdiction and must dismiss the foreclosure complaint.
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The caption
The caption opens the complaint. It identifies the specific court and the
county and state where it is located, the docket or case number and the title of the
action. It also identifies all parties to the complaint as plaintiff(s) and defendant(s).
The plaintiff must be what is called a “real-party-in-interest” in order to have
“standing” to bring the action. The plaintiff is the party who claims it has been
injured or harmed in some way, and the defendant is the person or entity accused
of causing said injury or harm.
SAMPLE CAPTION
Except for the location and name of the court, the caption will generally look
the same for all fifty states.
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The most important part of the complaint is the claim, or cause of action. It
should contain concise statements of the basis for which the plaintiff is seeking
relief. It should identify the statutes or laws that form the basis of the complaint, if
relevant, and then state a timeline of the facts of the complaint that are supported
by the law. Lastly, the claim will accuse the defendant of violating a law or
breaching a contract, causing the injury to the plaintiff, and entitling the plaintiff to
the relief it is asking the court to grant. Most states have specific rules of procedure
regarding the contents of a foreclosure complaint, so be sure to check yours.
Some states require the plaintiff bank to attach a copy of the promissory
note, mortgage, and any assignments of mortgage to its complaint. In
Pennsylvania, if a document such as a mortgage or assignment of mortgage is in
the public record, it is enough to cite the instrument and when and where it is
recorded, without attaching it to the complaint. Again, you must check your state’s
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rules. Later on we will discuss all the deficiencies in the plaintiff bank’s
foreclosure complaint and why it should be dismissed by the court.
_________________________
Relief requested
A typical “WHEREFORE clause” for the bank or plaintiff might look like
this:
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First of all, homeowners need to adopt the mindset that foreclosure is a war
on their property, and court is the hostile environment where that war is going to
be waged. Unfortunately, there are judges on state and federal benches who refuse
to even consider the idea that homeowners were deliberately misled by the banks
into loans they could not afford, signing paperwork they could not understand.
Those judges refuse to believe the banks could do any wrong, including
forging documents to support their unlawful foreclosures, but believe homeowners
are now merely looking for a free house instead of justice. Those judges don’t
understand that even if the bank or other entity cannot foreclose, the homeowner’s
debt STILL exists. In reality, the only party looking for a free house is the plaintiff
bank or securitized trust that has no standing to foreclose.
While homeowners in judicial foreclosure states will have their day in court
after being foreclosed upon, a homeowner in a non-judicial foreclosure state
wishing to contest a foreclosure will have to file a lawsuit themselves, or through
an attorney. They will ask the court to temporarily stop the foreclosure so the legal
issues can be resolved in court. Once the homeowner is in court, he/she can raise
the same defenses they would have raised in a judicial foreclosure proceeding.
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NOTE: Foreclosures are state issues, in other words, the county court has
jurisdiction. In a non-judicial foreclosure state, it is critical that the
plaintiff/homeowner use ONLY state rules and statutes because the defendant bank
might try to have the suit removed to federal court based upon, for example,
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Forcing the alleged mortgage holder to prove its claim against the
homeowner, and this is difficult, if not impossible for them to do because, 1)
the original note has been destroyed, and 2) the legal chain of title required
to prove ownership interest in the note and mortgage more than likely has
been broken, and once broken, cannot be cured;
Asserting specific defenses to mortgage foreclosure suits by use of various
sections of your state’s Uniform Commercial Code (UCC) and your state’s
Rules of Evidence (as specifically detailed further on); and
Filing affirmative defenses or counterclaims against the alleged mortgage
holder, of which there could be many such counterclaims, including but not
limited to, fraud upon the court through counterfeit documents fabricated to
deceive the court.
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The goal of all foreclosure defenses is to avoid trial at all costs. You want to
have the complaint dismissed before trial if at all possible. That is where this Guide
can help you. Even though you should still have an excellent chance to win, court
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is a crapshoot. Too many things can go wrong if your trial attorney is not sharp and
knowledgeable of foreclosure defense tactics. Plus, will the judge assigned to your
case follow the law or let the banks run roughshod over you?
There is also the added time and expense of a trial. The good news is,
plaintiff banks and securitized trusts also want to avoid a trial at all costs. They
know that if a homeowner gets the case to that point, the bank or securitized trust
has a very weak case and a jury will likely side with the homeowner.
Depending on your state, the foreclosure process can take anywhere from
180 days to a year or more. A contested foreclosure process generally goes as
follows:
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Generally, there are two ways to get the foreclosure complaint dismissed
without the need for a trial. One is by filing your answer and affirmative defenses
(sometimes called “new matter” or “counterclaim”). If, after receiving any reply by
the plaintiff to your affirmative defenses, the court agrees with your defenses, it
should dismiss the complaint.
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NEVER let your opponent or the judge get away with saying YOU are
trying to get a “free house.” Object immediately to such an assertion. Actually,
it is the plaintiff bank or securitized trust that is trying to get a free house. They
have come into the court with no standing, and with unclean hands, filing
fabricated, fraudulent documents to give the appearance of legitimacy when there
is none.
Remind the court that defeating a foreclosure action does NOT extinguish
the debt. The debt still exists BUT it is unsecured. And as the U.S. Supreme Court
held in Carpenter v. Longan, 83 U.S. 271 (1872), if a creditor holds the note but no
mortgage security, it can still collect on the debt, it just has no right to foreclose,
but if it has a mortgage with no note, it can’t collect anything.
The homeowner MUST continue to make all property tax payments and
insurance payments, otherwise the local county can file a tax lien, get a judgment
and ultimately sell the property for back taxes. At some point after defeating a
foreclosure action, the homeowner should file a quiet title action. The aim of that is
to clear the title of any encumbrances or liens, like a mortgage.
Again, a quiet title action does NOT extinguish or eliminate the debt. The
debt still exists but you get title to your property free and clear of any liens or
encumbrances. The reality of the situation is that after winning a quiet title action,
the homeowner would then have clean title to sell the house whenever he/she
wanted and can use the proceeds to pay the outstanding debt should a creditor
come forward with the original promissory note.
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judgment against the homeowner, but with no mortgage as security, would likely
have a difficult time collecting anything. Every situation is different.
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The securitization failed because the promissory note was not duly assigned,
sold or transferred each and every time the mortgage was assigned, sold or
conveyed.
The documents memorializing the transfer of the mortgage and note to the
plaintiff were not executed until after the date of commencement of the
action. Accordingly, the plaintiff lacked standing to bring the action on the
date it was commenced.
The homeowner properly rescinded the loan under 15 U.S.C. § 1635 prior to
the foreclosure action.
In judicial foreclosure states, proper notice as required by statute was not
given the homeowner.
The easiest way for a homeowner to prove its case to the court is to use the
very same documents the plaintiff submitted in support of its foreclosure action.
By finding all the deficiencies in them, and believe us, they are there, you should
be able to get the foreclosure action dismissed. The most important of these are the
promissory note, any allonge, any assignments of mortgage, and any affidavits.
In those states that do not require the note and assignment(s) be attached to
the foreclosure complaint, the homeowner will have to request in discovery to view
the alleged original promissory note that the plaintiff should be holding, and also
go to their local county recorder’s office to obtain copies of any recorded
assignments.
Next we’ll examine each of these along with the securitization process and
the Pooling and Servicing Agreement in greater detail, and then in later sections of
this Guide demonstrate the numerous deficiencies in each and how you can use
that information to successfully defeat a foreclosure.
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evidence. The mortgage or deed of trust is merely the security for the prima facie
evidence of the debt represented in the promissory note. A promissory note without
a mortgage or deed of trust is still enforceable, whereas a mortgage or deed of trust
without a promissory note is unenforceable.
It is a longstanding American rule that the mortgage is mere security for the
promissory note and follows the promissory note as a matter of law. As noted
earlier, the United States Supreme Court held in Carpenter v. Longan, 83 U.S. 271
(1872), that “The note and mortgage are inseparable; the former as essential, the
latter as an incident. An assignment of the note carries the mortgage with it, while
an assignment of the latter alone is a nullity.” This case has never been overturned.
Further, Professor Whaley said that “a mere copy of the note will not
suffice. There could be 100 copies of the original note, but that would not create a
right of foreclosure in 100 plaintiffs. To the bank's argument that a copy of the
promissory note should be enough, ask any banker if he/she would be willing to
accept a copy of check.”
If the plaintiff does not possess the original promissory note, some plaintiffs
have resorted to filing a “lost note affidavit” whereby they swear that they have
been unable to locate the original, but they have the right to enforce it anyway.
While this is permitted by the UCC, it can still be defeated.
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Be aware that an assignment of mortgage (AOM) must also assign the note,
EXCEPT in cases where “MERS as nominee” is the Assignor. Because by its
charter MERS cannot hold an ownership interest in the promissory note, it has no
lawful authority to transfer what it does not own. So, any purported AOM from
MERS that claims to also assign the note is a legal nullity.
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http://www.osceolaclerk.com/Home/Content/forensic-examination-real-
property-osceola-county
http://www.osceolaclerk.com/Content/UploadedContent/Examination/OC_F
orensic_Examination.pdf
Affidavits
Affidavits are not automatically admitted into evidence, and even when they
are, affidavits are not conclusive (solid) evidence of the facts stated therein.
Homeowners should always challenge the admission of any affidavits into
evidence. Done properly, they can almost always be excluded, especially when the
affiant is not in court to testify or be cross-examined about the information he/she
has set forth in the affidavit.
Affidavits are considered a very weak type of evidence since they are not
taken in court. They are usually submitted when no better evidence can be offered.
This is especially true in foreclosure actions because as you will see, the
documentation necessary to prove a person is entitled to enforce the note or has
standing to foreclose, is either very weak or even non-existent. This is why there
are so many fabricated, counterfeit documents submitted by foreclosure mill law
firms on behalf of foreclosing entities. This practice is illegal and criminal.
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Still, you will find some plaintiff banks and securitized trusts arguing just
the opposite, so do not let them get away with such nonsense. Remember, without
the original promissory note, they are really just trying to steal your house.
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Once the offer to sell is accepted by the buyer and compensation is given for
the note, it must be assigned and transferred with the mortgage to the buyer. Every
assignment and transfer in the chain of title must be recorded, including in the
county recorder’s office where the property is located (if your state requires such
recording). The note must be “endorsed” (with either a “special” or “blank”
endorsement) to the next party in the chain of sales. See UCC §§ 3-204 and 3-205.
Any break in that chain negates the entire assignment and transfer process and
throws ownership of the note into question, which is very helpful in defending a
foreclosure action.
Under the common law, the holder of the note has the right to payments on
the note, and if the owner of the note holds a mortgage as security, then the note
owner has the right to foreclose on the homeowner if the homeowner defaults on
the note.
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The problem for the banks is that the MERS process bifurcated or separated
the promissory note from the mortgage when MERS entered the tracking
information into its database. Anytime a note is separated from the security
instrument, as in the mortgage or deed of trust, the debt obligation under the note
becomes an unsecured obligation. Also, once the note has been separated from the
security instrument they can never be made as one again for purposes of
foreclosure.
This is the main point of the U.S. Supreme Court in Carpenter v. Longan, 83
U.S. 271, 274; 16 Wall. 271; 21 L.Ed. 313, 315 (1872), where it held:
“The note and mortgage are inseparable; the former as essential, the
latter as an incident. An assignment of the note carries the mortgage
with it, while an assignment of the latter alone is a nullity.”
This case has never been overturned and is still used by foreclosure defense
attorneys.
pooled for use in the securitization process, their status changes from negotiable
instruments regulated by UCC Article 3 for promissory notes and Article 9 for
mortgage notes or deeds of trust, into securities regulated by Article 8.
Although the general consensus among the state courts is that the
negotiability of such mortgage documents is lost through their conversion into
securities, plaintiff banks and securitized trusts always try to argue the law of
negotiable instruments instead of the law of securities that the mortgage documents
have become.
This is because the laws governing negotiable instruments are far more
forgiving of the numerous deficiencies in the plaintiff’s complaint. However, either
way, the conversion process calls for the destruction of the original notes. This is
usually why foreclosing plaintiffs cannot and will not produce the original
documents during discovery or any phase of the foreclosure action, and often file a
lost note affidavit even though the notes weren’t truly lost.
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NOTE: A classic example of a homeowner being right but losing anyway is the
case of In re Janice WALKER, Debtor, 466 B.R. 271, (USBC E.D.PA 2012). Here,
Ms. Walker argued correctly that the securitized trust did not comply with the
terms of the PSA, and thus lacked standing. BUT, because she never argued that
the mortgage loan was securitized, it allowed the plaintiff securitized trust to argue
the note was a negotiable instrument, instead of the security it had become. This
allowed the court to rule that Article 3 of the UCC applied, instead of Article 8.
Also, because Ms. Walker did not support her argument about violations of the
PSA with relevant cases, she allowed the court to rule that as a non-party to the
PSA, she had no standing to challenge any violations of it. Having Attachment 1,
U.S. Banks’s Role of the Corporate Trustee certainly would have helped her.
_________________________
Electric Traction Co., 204 F.2d 920 (10th Cir. 1953) and Darland v. Taylor, 52
Iowa 503 (1879).
As a matter of law, “[w]here the payee and owner of a promissory note has
voluntarily destroyed the same, he cannot recover judgment against the maker
either upon the note itself, or upon the debt which was the consideration for which
the note was given.” See for example, Booth v. Smith, Woods 19, Circuit Court D.
Louisiana (Nov. Term 1876). Once converted into a security and sold, it is
impossible for a promissory note and mortgage to be made whole again, to exist as
a negotiable instrument.
Next, we will examine the Pooling and Servicing Agreement (PSA), then
we’ll get to the heart of this booklet, how to defend against a foreclosure
complaint. For those in non-judicial foreclosure states, homeowners will have to
file suit themselves against the entity attempting to foreclose because of the power
of sale clause written into deeds of trust. However, the defenses are identical
because the deficiencies are identical.
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Licensed attorney Neil Garfield’s blog was the first place we saw this type
of argument presented and it makes perfect sense. Despite this apparent truth
however, courts appear reluctant to accept this argument. (You can sign up for
Garfield’s free daily blog here: https://livinglies.wordpress.com)
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Did the contract state that payments were to be made to the “Lender”? YES
Did the contract state that the maker's note might be sold? YES
So far, so good. Now the note gets sold, which a homeowner understood could
happen from the original contract he/she signed. It’s what happens after that sale
that creates the breach of the contract.
The homeowner’s note is most often sold to a securitized trust (as discussed
above) and converted from a negotiable instrument into a security. This is an
unauthorized alteration of the original note, a violation of the UCC § 3-407. The
homeowner (maker) of the note never authorized that conversion to a security.
That is a violation of the contract the homeowner signed.
The homeowner now has a new lender. Instead of making payments to the
original lender or the new lender, the homeowner is told to make payments to a
“servicer.” This is another violation of the original contract. The homeowner never
agreed to make payments to anyone other than the lender or a bona fide purchaser
of the note through a lawfully valid sale.
Garfield has written, “The Banks are painting themselves into a corner. They
have been using assignments from MERS as the basis for showing the sale of the
loan when in fact (a) no sale occurred and (b) MERS never owned the loan (c)
MERS was never a creditor or payee on the note and (d) MERS was never a
mortgagee or beneficiary.”
Garfield goes further and says, “A borrower who signs papers without
having a known party who is required by law to execute a satisfaction (release and
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In other words, when the borrower pays off the loan, the mortgage lien
should be released. In this case however, because MERS is involved, the borrower
has no idea what party is to make that release upon payment. Absent a known
counterparty to the contract, the document is void. We agree with Garfield.
Bottom line, there is a breach of contract because among other reasons, the
actual terms upon which the money was advanced for the mortgage loan and the
new party that is to receive payments as a result of the securitization, were
different from the actual terms accepted by the homeowner/borrower.
_________________________
Your promissory note and mortgage were very likely sold by your loan
“originator,” the company that helped you do all the paperwork for the loan and
which incidentally, is often NOT your true “lender.” The “originator” is merely a
middleman between the borrower and the true undisclosed “lender.” While that is a
violation of the terms and conditions of your note and mortgage, courts are still
reluctant to accept that argument. As such, it is not very helpful in a foreclosure
defense so we will not visit that subject here.
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Once you find your securitized trust’s Prospectus and PSA, you should
contact the SEC to request a certified copy of it. You should also ask for a certified
copy of the Prospectus Supplement, if one was issued. You will need a certified
copy because that certification makes it admissible into evidence if the document is
relevant. The PSA will definitely be relevant, especially Section 2.01.
If you are lucky, the trust will be the actual plaintiff on the foreclosure
complaint. You may see something like this: The Bank of New York Mellon f/k/a/
The Bank of New York, as Trustee for the Certificate-Holders of CWMBS, Inc.,
CHL Mortgage Pass-Through Trust 2007-15 Mortgage Pass-Through Certificates,
Series 2007-15. Here, you have all the information you need to find this trust and
its PSA at the SEC web site.
Private securitized trusts cannot be found here because they are not governed
by the SEC so you will need to hire a professional securitization auditor. They use
a subscription based search tool like ABSNet or Bloomberg. Auditors will
generally charge anywhere from $100 to $600 to conduct the search. You will need
to provide the auditor with your loan number, MIN number if listed on your note,
your name and the property address. Some may want the actual note and mortgage.
Auditors can also find the PSA for you for an additional fee.
One caveat: not all securitized loans can be found on ABSNet or Bloomberg.
Some loans were not sold into REMIC trusts, but into something called a “floating
note debt offering.” For example, Washington Mutual FA did these in the early and
mid-2000’s. Just like a REMIC trust, these debt offerings have a Prospectus and
Pooling and Servicing Agreement, and require an Originator, Depositor, Seller, etc.
as parties to the securitization process.
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Not all auditors are able to trace loans that went into these debt offerings, so
you definitely want to ask the auditor up front if they have the ability to search for
floating note debt offerings along with their access to ABSNet and Bloomberg.
This will save you from paying twice for the same service if your loan is not on
ABSNet or Bloomberg.
One other issue you might run into that will require an auditor is where the
Plaintiff claims to have owned your loan from the beginning. Since over 95% of all
mortgage loans were securitized, this claim is usually false. Again, the only way to
prove that is to find the trust your loan was sold into.
Assuming the trust you are looking for is not a private trust, once you know
the name of the trust, you can try entering that in the search engine. Sometimes you
may need to try a partial name of the trust, or various combinations of terms in the
trust’s name.
When you have found the specific trust your promissory note was sold to,
you can begin your search for its PSA. Unfortunately, the PSA is not an easy
document to find on the SEC web site. There is a lot of trial and error involved.
Don’t be surprised if it takes you up to an hour or more to find it.
Listed under your trust you will see a list of all the documents it has filed to
date. The most common ones are the 10-K, 8-K, 424B5 (Prospectus) and the FWP
(free writing prospectus). Generally, you will find the PSA listed as Exhibit 99-1 to
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an 8-K filing. Again, it requires trial and error to find the right 8-K that contains
that exhibit.
Once you have the PSA, you are interested in two specific sections,
Definitions and Section 2.01. Under definitions, you want the “closing date.” That
is the latest date that a promissory note and mortgage can be accepted by the trust.
Any attempted sale and transfer of these items into the trust after that date are
void per the PSA. You will need this date when examining any purported
assignments of mortgage or deed of trust.
Section 2.01 of most PSAs includes the mandatory process (also called
“conveyancing rules” or “conveyance of mortgages”) by which the promissory
notes and mortgages are to be sold and transferred into the securitized trust, and
any representations and warranties. The basic terms of this Section of the standard
PSA are set forth below:
the extent that there is no room on the face of any Mortgage Note
for an endorsement, the endorsement may be contained on an
allonge, unless state law does not so allow and the Trustee is advised
by the Responsible Party that state law does not so allow. If the
Mortgage Loan was acquired by the Responsible Party in a merger,
the endorsement must be by “[last endorsee], successor by merger to
[name of predecessor].” If the Mortgage Loan was acquired or
originated by the last endorsee while doing business under another
name, the endorsement must be by “[last endorsee], formerly known
as [previous name]”; (All bold, underlined emphasis added.)
The complete chain of title from originator to last endorsee (usually the
trust) includes all of the following:
the Originator
the Seller
the Depositor
the Sponsor or Issuing Entity
the Trustee
Pursuant to the UCC and the PSA, there MUST be a valid receipt for the
assignment and transfer of the mortgage loan documents from each entity to the
next one in the chain, otherwise the chain is broken, title is clouded and ownership
of the note cannot be ascertained. Thus, with a broken chain of title, the plaintiff
securitized trust cannot have standing to foreclose as it is not a real-party-in-
interest, thus, the complaint should be dismissed.
Understand that the bank or entity that you make monthly payments to does
not own your promissory note; it is merely servicing (collecting) those payments
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for the trustee on behalf of the investors in the trust. But the investors have no right
to receive their interest portions of those payments if the mortgage documents
weren’t transferred into the trust before the closing date listed in the PSA. This is
the most common ownership defect in foreclosures and is another way to prove
FAILED securitization and thus questionable ownership.
See: New York Trust Law EPTL § 7-2.4, “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.”
In that case, it is very likely impossible to establish what entity, if any, owns
your promissory note and mortgage. Thus, the court will have no choice but to
either dismiss the complaint on motion by the defendant/homeowner, or award
summary judgment to the defendant/homeowner because the plaintiff cannot
establish standing and its right to enforce the note.
_________________________
NOTE: Most plaintiffs will try to argue to the court that a defendant/homeowner
has no right to challenge alleged violations of the PSA because they are not a
beneficiary or party to it. Do not allow the plaintiff to get away with such an
argument. As you will see below, prior to 2012, some courts agreed with that
argument, but since then, courts have recognized such a right and it is now
unquestioned. Needless to say, the banks are very unhappy with this.
Also, the federal First Circuit has ruled in two cases, Culhane v. Aurora
Loan Services of Nebraska, 708 F.3d 282, 289-90 (1st Cir. 2013) and Woods v.
Wells Fargo Bank, N.A., 733 F.3d 349, 353-54 (1st Cir. 2013), that a homeowner's
standing to sue is not foreclosed by virtue of their lack of privity to the assignment
documents.
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even though they are not a party to, or a third party beneficiary of, the
assignment agreement.”
However, two years later in Talton v. BAC Home Loans Servicing LP, 839
F.Supp.2d 896 (E.D.Mich. 2012), that same court held differently when it ruled;
“It is true that the Livonia Properties opinion contains the statement
that “there is ample authority to support the proposition that ‘a litigant
who is not a party to an assignment lacks standing to challenge that
assignment, ‘” Livonia Properties, 399 F. App’x at 102 (quoting
Livonia Properties Holdings, LLC v. 12840-12976 Farmington Road
Holdings, LLC, 717 F.Supp.2d 724, 736-37 (E.D. Mich. 2010)); but
when read carefully the case does not stand for such a general and
unqualified position. The Court believes, therefore, that Livonia
Properties does not compel the conclusion that a foreclosure plaintiff
can never attack the foreclosure by challenging the validity of an
underlying assignment.”
Notably, the cases cited favorably above all post-date Livonia (2010), and
held that a homeowner need not claim party status nor third party beneficiary status
to the PSA, in order to challenge a foreclosure based on violations of the PSA that
rendered a purported assignment void.
the date the trust closed, would be void.” (Wells Fargo Bank, N.A. v.
Erobobo (Apr. 29, 2013) 39 Misc.3d 1220(A), 2013 WL 1831799,
slip opn. p. 8; see Levitin & Twomey, Mortgage Servicing, supra, 28
Yale J. on Reg. at p. 14, fn. 35 [under New York law, any transfer to
the trust in contravention of the trust documents is void].)” id.
_________________________
The first thing you need to understand about a complaint is that a plaintiff
needs only to allege certain facts (called “allegations”); it is not required to submit
its proof at this stage. That will come during discovery and trial if necessary.
Despite most foreclosure complaints not strictly complying with the rules of
civil procedure, courts have let those complaints stand. We want you to be aware
of the most common deficiencies, especially if the plaintiff is NOT the original
lender, and always include them in your affirmative defenses.
In no particular order:
plaintiff has not alleged its standing to sue
plaintiff has not alleged it loaned homeowner any money
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Absent these type of allegations, a complaint normally will not stand, unless
it is a foreclosure complaint. Without a contract, like the promissory note, there is
no legally binding requirement for a defendant to do anything. Without a claim of
injury, there is nothing for the court to grant recovery of. Without standing, a court
has no jurisdiction and should dismiss the complaint.
_________________________
Under the UCC Article 3, Part 3, there are only three ways a plaintiff can be
a person entitled to enforce a note: (1) as an assignee of the original lender’s
interest in the note, (2) as a holder of the note, or (3) as a non-holder in possession
of the note with the rights of a holder. Each distinct status requires the plaintiff to
present different materials to demonstrate its right to enforce.
_________________________
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Also, a note may be “endorsed in blank,” in which case it becomes “bearer” paper
under the UCC. However, in order to prove a “true sale” from the Sponsor to the
Depositor you must have written delivery and transfer receipts and proof of pay
outs and pay in transactions. You will ask for these documents in discovery.
_________________________
In discovery, which will be discussed later on, you will ask for proof that the
plaintiff has standing and is a person entitled to enforce the note. This includes
proof of value and consideration having been given for the note as well as proof of
negotiation, delivery and transfer of the note, per the UCC.
In the previous section, under Section 2.01 of the PSA you will find this:
demonstrated. These will help you prove that the plaintiff has no standing and is
not a person entitled to enforce your note.
Since the vast majority of mortgage securitization trusts were formed under
New York State’s Estates, Powers and Trusts Law, New York laws are controlling,
and the “no space on original note test” should apply. Also, UCC § 3-204(a)
mandates that the allonge be “affixed” to the original note, not an unattached sheet.
The Official Code Comment for UCC § 3-204 explains the requirement that
the indorsement be on or firmly affixed to the instrument. It states that the UCC
“follows decisions holding that a purported indorsement on a mortgage or other
separate paper pinned or clipped to an instrument is not sufficient for negotiation.
The indorsement must be on the instrument itself or on a paper intended for the
purpose which is so firmly affixed to the instrument as to become an extension or
part of it. Such a paper is called an allonge.” See Adams v. Madison Realty &
Development, 853 F. 2d 163, (3rd Cir. 1988).
Examine your note. More than likely, there is plenty of space after your
signature on the note, but an alleged allonge with the blank endorsement on that
separate page was included anyway. That is a problem for the plaintiff, as it is an
indication the endorsement was made after the fact in order to deceive the court
into believing it was timely and legitimate.
Also, see if there is any information on the allonge containing the blank
endorsement that connects it to your note. Information such as your name, the
address of the property and the loan number are critical. Otherwise, it is simply a
piece of paper with an endorsement, unconnected to any identifiable document
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such as your note. Utilizing this information along with the rules of evidence
(Articles VIII and IX) should prevent the allonge and any endorsements from
being entered into evidence.
Another problem with many endorsements is that they were stamped onto
the note by a person other than whose signature (name) appears on the stamp. This
is known as robo-signing and will be explained below. The person stamping the
endorsement onto the note had no personal knowledge as to anything having to do
with the transaction.
In foreclosure cases, the foreclosure mill law firm representing the plaintiff
contracts with a document processing company such as Lender Processing
Services (LPS) in Jacksonville, Florida, to unlawfully fabricate missing
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documents. These documents are necessary for the plaintiff to falsely claim party-
entitled-to-enforce status and thus standing, in order to foreclose. Whether you call
it forgery or fraud, it is illegal, yet companies like LPS are still in business.
At the top of most AOMs you should find “Recording Requested By” and
“When recorded return to.” Often, the recording is requested by the foreclosure
mill law firm doing the foreclosing, years after the closing date for the securitized
trust. This makes no sense because an assignment should have been recorded at the
time of each “true sale” into the securitized trust, not years later by a foreclosure
mill law firm claiming to represent an alleged plaintiff attempting to unlawfully
foreclose.
The date on the AOM is usually after the closing date, a very reliable
indication that the note and mortgage never made it into the securitized trust. That
means the securitization FAILED and the securitized trust does not lawfully own
the promissory note or the mortgage and is not a person entitled to enforce the
note. Therefore, it cannot foreclose.
You must use whichever deficiencies you identify in your documents for
your defense. They will be organized under your Affirmative Defenses or New
Matter.
_________________________
Note that it is what the affiant doesn’t say in his/her affidavit that leaves
wide open defenses for you. For example, there is usually no evidence provided
by exhibit or testimony of the affiant that the plaintiff is the alleged holder or
owner of the original promissory note and thus a person entitled to enforce said
note.
Even if the affiant claims in the affidavit that the plaintiff has physical
possession of a promissory note and has attached an alleged “true and correct
copy,” note the job title and description of the affiant. It will usually be in some
department that has nothing to do with the handling or ownership of any
promissory notes.
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examining books and records is a red flag telling you this affiant did not have
personal knowledge. Should your case go to trial, any trial lawyer worth his/her
salt should be able to impeach the affiant’s credibility and testimony under cross-
examination. And if the affiant is not in the courtroom, your lawyer should move
to have the affidavit excluded as inadmissible evidence, which it most certainly is.
_________________________
The most important thing to remember is to deny, deny, and deny ALL
allegations in the foreclosure complaint except for obvious allegations such as a
description of the property or receipt of a letter, if it can be proven you signed for
its receipt. Never, ever admit that you missed a payment(s) or your loan is in
default. If you do that, you will lose. End of story. While it has not yet been
determined if a default exists, your loan is likely NOT in default, and is paid up to
date.
So, among other things, deny that your loan is in default and force the
plaintiff to prove a default, deny that you owe plaintiff any amounts, deny the
amounts listed are correct, deny that you ever received any proceeds of a loan from
plaintiff (which is especially true if the plaintiff listed is not who you thought was
the original lender), deny that your signature is on the copy of the promissory note,
if they present one (remember, ONLY an original promissory note with your wet-
ink signature can help prove standing and a possible right to foreclose), and most
importantly, deny that plaintiff has standing and deny plaintiff is a person entitled
to enforce the note. Some of these denials can be repeated for more than one of the
plaintiff’s allegations.
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After you have addressed all the allegations in the numbered paragraphs of
the foreclosure complaint, you will ask the court to dismiss the complaint for the
various reasons in your denial, basically that the plaintiff has no standing, is not a
party entitled to enforce the note and there is no evidence the loan is in default, or
even that there is a mortgage loan outstanding. Generally, your denials are not
going to be enough to get the foreclosure complaint dismissed, which is why the
next section is critical.
Whatever the rules of civil procedure for your state call them, your defenses
will give the court the evidence it needs to dismiss the foreclosure, despite many
courts’ bias in favor of the banks. Each individual defense is numbered separately
with its own paragraph.
If the foreclosure complaint included a copy of the note and any AOMs, you
should have no trouble compiling affirmative defenses. However, in those states
that do not require attachment of the note and any AOMs to the foreclosure
complaint, you will have to go to your local courthouse and check your property
records for any AOMs and get copies. Otherwise, your defenses will be more
general and thus not strong enough to support a dismissal of the foreclosure
complaint on their own.
Not having the note and AOM makes it more likely that you will not be able
to get the foreclosure complaint dismissed at this stage, and instead, the case will
be scheduled for trial and proceed to discovery. However, after discovery is
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In order to do that, you must effectively use the three discovery tools at your
disposal - requests for admissions, interrogatories and requests for production of
documents. These will be discussed further on and samples will be attached at the
end of this Guide.
Plaintiff and its counsel filed this instant action with unclean hands
because they did not possess the documents they swear they
reviewed in their affidavits and pleadings filed with this court.
Plaintiff and its counsel knowingly filed false, fraudulent, unlawful
and deficient documents with the County Clerk’s Office to
expedite this foreclosure to Defendant’s detriment, therefore,
Plaintiff’s complaint should be dismissed with prejudice.
(If you have identified specific deficiencies in the AOM, use them
here. The following is from an actual affirmative defense.) “The
purported ASSIGNMENT OF MORTGAGE dated _________ and
recorded with the ______ County, Recorder of Deeds is a robo-
signed forgery and therefore void, a nullity with no legal effect.
See Exhibit “A” for a copy of the Assignment of Mortgage.
Reasons the document is a robo-signed forgery include the fact that
names and dates are STAMPED instead of hand-written and the
purported signature of Christopher Herrera, alleged Vice President
of MERS is a robo-signed forgery. Christopher Herrera is a known
employee at BAC Home Loans Servicing, LP
(http:ll4closurefraud.org/201I106127lfalse-statements-bank-
ofamerica-bank-of-new-york-mellon-corelogic-cwabs-cwalt-
mers/).”
Mr. Herrera did not read the documents or verify the facts
contained therein by reviewing the primary source(s) of evidence
regarding the purported assignment. Evidence will be requested
and should be provided through discovery, of Christopher
Herrera’s position as Vice President of MERS and proof of his
signing authority, if any, as well as the page from the notarial
journal of notary Danya Bucaro containing the purported
notarization of said assignment.
Further, Defendant believes that notary Danya Bucaro was an
employee of one of the entities named on the Assignment of
Mortgage at the time of the notarization, thus, the notarization may
be neither effective nor lawful.
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Depending on what your examination of the note and any AOMs reveals,
there may be other affirmative defenses to list. By rule in most states (Florida
being a notable exception), the Plaintiff must respond to your affirmative defenses,
and you will then have a set period of time (depending on your state’s rules) to
reply to the Plaintiff’s response to your affirmative defenses. ALWAYS take
advantage of any opportunity to make your case to the court. And, in the rare case
that the plaintiff does not respond to your affirmative defenses, you can file for a
default judgment.
After you have listed all your affirmative defenses, you will include another
wherefore clause, repeating your request that the court dismiss the foreclosure
complaint. For example:
In some cases, after the homeowner has filed his/her answer and affirmative
defenses (or new matter), they will receive a motion to substitute the foreclosing
party or party plaintiff. This is merely a ruse where the original foreclosing party
now requests that another party be substituted as the new foreclosing party. The
goal is to further distance any parties to the original transaction from being
questioned through discovery or called as witnesses during trial.
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proving exactly what was transferred to the new plaintiff, when the alleged transfer
occurred, how the alleged transfer took place and the agreement by both parties to
the alleged transfer and substitution.
If the court permits the substitution, you should immediately file a motion to
amend your answer and affirmative defenses (or new matter). Due process
mandates that the homeowner be permitted to amend its pleadings to include
defenses to this alleged and undocumented transfer, and to conduct discovery on
the alleged transfer.
_________________________
Discovery
Discovery tools are powerful weapons you must use in order to prove your
case and win a dismissal of the foreclosure complaint at any stage of the legal
process. Discovery is used before trial to obtain evidence by requiring the adverse
party to disclose information that is essential for the preparation of the requesting
party's case and that the other party alone knows or possesses.
Depositions
Interrogatories
This is the least utilized, yet most powerful discovery tool at your disposal.
You are seeking simple admissions or denials. There is no wiggle room. Facts
constructed properly will leave your adversary no choice but to admit to them. Be
sure your facts are facts, and not conclusions of law or opinions. See Attachment 6
(p. 98) for sample admissions to request.
This discovery tool is used to minimize the time and expense incurred in
proving issues that are not in dispute. If an adversary denies a fact that evidence in
the record proves is true, that will work in your favor. If your adversary fails to
respond to your request, it will result in all facts being admitted. This also serves to
prevent your adversary from challenging the admission of those facts during trial.
_________________________
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If you are in a non-judicial foreclosure state, you will be the plaintiff and the
bank or securitized trust will be the defendant, so you will need to reverse them in
the samples provided.
The three SAMPLE discovery documents contain boilerplate language before the
actual numbered requests. Some numbered requests were compiled from various
sample discovery documents found on the internet and used in actual cases, and
adapted as necessary. Others were created by the author, a certified paralegal. Feel
free to modify, add or delete items as necessary.
_________________________
The most common responses by the foreclosing party are to, a) object to all
your requests and not answer them, b) state they are overly burdensome and would
not lead to any discoverable information that can be used in court, or c) simply
ignore them completely. In any case, after the applicable time to respond has
passed, you can do one of two things, 1) file a Motion to Compel Discovery or,
better yet, 2) file a motion for summary judgment.
In your motion to compel discovery, you must tell the court that you
properly served discovery requests on your adversary and they either filed
objections to everything you requested or they simply did not respond at all. For
discovery to be granted, you must explain to the court that you have a reasonable
belief such evidence is necessary to your foreclosure defense and why.
means there are no issues of material fact in dispute and the court should grant
your motion which would dismiss the foreclosure complaint. MSJ’s are explained
below at page 51.
You can initiate discovery at any time, even before you have filed an answer
to the foreclosure complaint, but some parties wait until the court issues a
scheduling order giving dates to initiate and complete discovery. It is a good idea
to serve discovery requests on your adversary concurrent with the filing of your
answer and affirmative defenses. You can always refile them if necessary.
You want to put the plaintiff bank or securitized trust on the defensive
immediately. Always send those requests via certified, return receipt requested
mail. That way, you will know exactly when the requests were received and when
the clock starts and stops for a response.
_________________________
NOTE: Of the dozens of foreclosure cases we have assisted with or studied, only
once has a foreclosing plaintiff served discovery requests on the
defendant/homeowner. You must answer the requests as best you can while
continuing to deny, deny, and deny. Deny your signature is on the note they
presented for evidence because it will most assuredly be a “copy” of an alleged
original and your wet-ink signature can ONLY appear on the original, deny you
owe plaintiff any money and deny you are in default. As every foreclosure case is
different, it is impossible to get any more specific than that. However, be sure to
read your state’s rules on how to write a proper denial. Merely denying without
providing a factual basis for the denial will be deemed an admission under the
rules.
_________________________
At any time after initial pleadings have been filed, but usually after
discovery has been completed and before preparations for trial begin, either party
may file a Motion for Summary Judgment (MSJ). In virtually every case
however, the plaintiff bank or trust will prematurely file its MSJ, before discovery
is initiated and completed. You should respond with an Answer in Opposition to
Plaintiff’s Motion for Summary Judgment, Defendant’s Counter-Motion for
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Summary Judgment, and Brief in Support Thereof. Yes, that’s a mouthful, but
all will be explained in the next section.
_________________________
A motion for summary judgment is where one party asks the court to render
judgment in its favor because it claims there are no material facts in dispute, and
those undisputed facts support its position. If, after the other party has filed its
response, the court agrees with your motion, it grants the motion and the case is
dismissed. There will be no trial. Of course, a MSJ ruling against either party is
appealable to the appellate court.
The standard for the plaintiff bank or other entity to win a MSJ is actually
much higher than that of the defendant opposing the motion. It has to prove among
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NOTE: Although outside the scope of this Guide, we would be remiss if we did
not at least mention the following.
One other item of proof that courts have so far refused to entertain is the fact that
the alleged “lender” did not lend the homeowner any money. Congress considered
a “debt” to be one “arising out of a transaction.” (See 15 U.S.C. §1692a(5).) In
banking terms, a “transaction” is defined as:
Only when the “transaction” causes a change (decrease) in a lender’s Net Worth
account can the lender prove a legitimate debt obligation was created against a
homeowner/borrower as a loan of “money.” In the case of money loans, almost
100% of them were entered on the lender’s books as an increase in assets and a
corresponding increase in its liabilities, resulting in no change to the lender’s net
worth.
This is the reason you should always ask for copies of the lender’s books and
records in a request for production of documents. However, be prepared for the
court to rule against the production of such books and records in order to protect
the banks from being exposed for their fraudulent lending practices.
It is also why the original lender is virtually never the foreclosing plaintiff, and
why you often see substitute trustees. The banks are trying to put as much distance
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Why? Because the banks know their books and records reflect no change to their
net worth, meaning no money was lent, and thus are the smoking gun that would
defeat their foreclosures. The courts also know this all too well.
_________________________
The easiest way to do this is to prove violations of the PSA, especially that
the attempted assignment and transfer of the note and mortgage into the securitized
trust was void because it missed the closing date of the securitized trust. Earlier,
you learned how to do that by comparing the date on the AOM with the closing
date of the securitized trust. They are often years apart. That also means the
securitization of your note failed because the plaintiff bank or securitized trust
does NOT hold a perfected mortgage lien upon your property. An unperfected
mortgage lien is of no legal significance or value.
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Summary
The goal of this Guide is to teach homeowners the basics of how to contest
and defeat the foreclosure action. If you choose to delve deeper into the issue, there
is a list of resources following this section that you can research. Even if you do
not win a dismissal of the foreclosure complaint with your affirmative defenses or
a MSJ, everything you have used to construct your defense will help you during
trial. Just because the court does not grant a dismissal at these pre-trial stages does
not mean your case is weak. Remember, most judges are reluctant to deprive a
party to a lawsuit its day in court unless that facts are undeniably in favor of one
party or the other.
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Having said that, there are many instances where courts have done just that,
and deprived homeowner’s their day in court by granting a bank's motion for
summary judgment, despite numerous disputed issues of material fact. Some courts
have a blatant and undeniable bias in favor of the banks. However, all court
decisions are appealable, so hopefully in those cases the homeowner with a solid
defense will find justice at the appellate level of the court system.
Utilizing the information provided in this Guide will give you your best
chance of defeating a foreclosure action. Good luck!
_________________________
Resources
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8. Anything you can find on-line by attorney Robert M. Janes, Nye Lavalle,
and Florida attorney April Charney, who performed groundbreaking work in
the foreclosure defense field.
9. Clouded Titles by Dave Kreiger
10.http://stopforeclosurefraud.com/2013/11/18/adam-levitin-the-paper-chase-
securitization-foreclosure-and-the-uncertainty-of-mortgage-title/
11.www.sec.gov to look up the securitized trust that supposedly owns your
promissory note and mortgage.
12.You can run your mortgage through all three of the following systems
whether you’re in a non-judicial or a judicial state.
http://www.fanniemae.com/loanlookup/
https://ww3.freddiemac.com/corporate/
https://www.mers-servicerid.org/sis/
_________________________
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• U . S . B A N K G LO BA L C O R P O R AT E T R US T S E R ){I C ES
The combination of high foreclosure rates and high levels of mortgage backed
securitization activity has many people attempting to understand the complex
securitization process and identify the parties to the MBS transactions and their
assigned responsibilities.
Parties involved in a MBS transaction include the borrower, the originator, the servicer
and the trustee, each with their own distinct roles, responsibilities and limitations.
usbank.
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As noted, the trustee does not play a role in initiating or managing a foreclosure
process and consequently has little, if any, information relating to mortgage loan
activities including a foreclosure. Depending on the particular trust and pool, the trustee
may have very limited information on either the borrower or the property.
The servicer, who is selected by the Sponsor of the trust, may have to foreclose on a
property if a borrower (mortgagee) does not make payments as required by the
mortgage documents. Any action taken by the servicer must maximize the return on the
investment made by the "beneficial owners of the trust” -- the investors.
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U.S. Bank Global Corporate Trust Services, as Trustee, is responsible and accountable to
the investors or holders of the securities that the mortgages are pledged against as collateral
Why not modify
for the duties set forth in the contracts governing the transaction. These duties are carefully mortgage loans in
detailed in the contracts and are limited to the responsibilities specifically accepted by the default?
trustee.
Borrowers agree, under the
terms of their mortgage and
How Do I Obtain Information on a Specific note, that upon a payment
Mortgage Loan? default the lender or owner
has the right to assume
To learn more about a foreclosed property, contact the servicer for the MBS transaction that ownership of the property.
holds the mortgage as collateral. The most effective way to identify the servicer for a specific Whether the servicer pursues
mortgage is to ask the borrower (homeowner) who they make their monthly payment to or a foreclosure or considers a
from whom they receive their monthly statements. The firm receiving the payments and
modification of the loan, the
sending statements is generally the servicer for the MBS transaction and can offer more
goal is still to maximize the
details regarding a foreclosed property.
return to investors.
To ensure clarity of the various participants related to a foreclosure process with MBS Consideration of any loan
transactions, modification is predicated on
U.S. Bank has taken two important actions. U.S. Bank has sent notices to servicers with whether the trust documents
whom they work on MBS transactions to reinforce the importance of properly identifying U.S. allow modifications, the
Bank as Trustee for the specific trust in all foreclosure actions and filings, complying with underwriting criteria
industry servicing practices and maintaining any foreclosures in accordance with applicable applicable to the particular
laws. Secondly, U.S. Bank established a dedicated toll-free (800) number to handle calls borrower's circumstances,
related to loans which identify and federal and state laws
U.S. Bank as Trustee. Our professional staff explains to callers the role of U.S. Bank as concerning loan
Trustee and also provides the information callers need to connect with the servicer who can modifications.
best address their questions. Regardless, the servicer is
fully empowered to enter into
For more information about U.S. Bank and our role as trustee in MBS
modifications with borrowers
transactions, please call (800) 236-3488 between the hours of 8 a.m.
so long as such actions
and 5
comply with industry
p.m. central standard time Monday through Friday.
servicing practices, is
allowed under the trust
Additional Sources of Information : documents. maximizes the
-- American Bankers Association White Paper. The
Trustee's Role in Asset-Backed Securities, dated return to investors and
November 9, 2010 (http://www.aba.com/Press+Room/ complies with relevant laws.
11091ORoleofATrustee.htm) The Trust Indenture Act of
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sharenb38@aol.com 04 Sep 2018
Borrower Trust
The person or entity responsible for the mortgage note Generally a special purpose entity, such as a Real Estate
and making principal and interest payments in Mortgage Investment Conduit (REMIC). that is formed solely
accordance with the underlying mortgage documents. to hold the mortgage collateral and to issue the securities
which are then sold to investors. The trust owns the pooled
Investment Bank/Sponsor
mortgages. The trust conducts no other business. Certificates
Responsible for structuring the MBS transaction and issued by the trust represent a financial interest in a pool of
selling the securities to investors. mortgages owned by the trust and is the primary source of
funds for payment of interest and principal due to the
Investor investors on certificates they own.
The buyer and owner of an MBS certificate or Trustee
certificates.
An independent party, responsible for administering the trust
Originator
for the benefit of investors. While the trustee is listed as the
The financial institution or mortgage lender who owner of record, the trustee does not have an economic or
originally initiates the mortgage agreement with the beneficial interest in the loans. The trustee is the owner of the
borro wer. mortgage solely for the benefit of the investors in the
mortgage backed securities, who are the true beneficial
Servicer owners of the mortgages. The Trustee holds a security
Appointed by the sponsor and is a contractual party to interest in the mortgaged property by having the mortgage
the trust, to administer the mortgages loans and to loans assigned in the name of the trustee for the benefit of the
collect monthly payments (e.g. principal/interest, tax, trust (e.g. U.S. Bank as Trustee for the MBS Trust) or in the
insurance). After collection. the servicer sends the name of MERS, a Mortgage Electronic Recording System
funds to the trustee who then makes payment to used by many of the largest financial institutions. The duties of
the investors. If a borrower (mortgagee) does not the trustee are administrative in nature, are clearly spelled out
make payments to the servicer as required by the in the MBS transaction documents. and generally are non-
mortgage documents, the servicer may have to discretionary in nature.
foreclose on the property and provide property
maintenance to maximize the return on the investment
made by the "beneficial owners of the Trust" -- the For more information about U.S. Bank and our
investors. Some MBS transactions have more than one role as trustee in MBS transactions, please call
servicer. The servicer does not own the (800) 236-3488 between the hours of 8 a.m.
mortgages/collateral. The trustee does not designate and 5 p.m. central standard time Monday
the loan servicers, nor are the loan servicers agents of through Friday.
the trustee.
U.S. Bank is not responsible for and does not guarantee the
products, services, performance or obligations of its affiliates. usbank
All of us serving you'"
usbank.com/corporatetrust
NOT A DEPOSIT NOT FDIC-INSURED MAY LOSE VALUE NOT NOT INSURED BY ANY FEDERAL GOVERNMENT
GUARANTEED BY THE BANK A
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against
21739/2008
Wayne P. Saitta, J.
The Plaintiff renews its motion for an appointment of a referee in the underlying foreclosure
action.
Upon reading the Notice of Motion and Affirmation of Charles C. Martorana Esq., of counsel to
Hiscock and Barclay, LLP attorneys for Plaintiff, dated September 28 2010, and the exhibits
annexed thereto; the Affirmation of Charles C. Martorana Esq., dated January 7, 2011; the
Affirmation of Todd Falasco Esq., of counsel to Frenkel, Lambert, Weiss, Weisman, & Gordon,
LLP,. Former attorneys for Plaintiff and the exhibits annexed thereto; the Affidavit of Jonathan
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Hyman sworn to February 10, 2011, and the exhibits annexed thereto; and upon all the
proceedings heretofore had herein, and after hearing oral argument by Plaintiff's counsel on
March 3, 2011, and after due deliberation thereon, the motion is denied for the reasons set forth
below.
The underlying action is a residential foreclosure action on a property located at 639 East 91st St.
in Brooklyn. Plaintiff's original application for the appointment of a referee to compute was
denied by order of this court dated April 19, 2010. The Court denied the application because the
Plaintiff, could not demonstrate that the original mortgagee, Countrywide Home Loans Inc.,
(doing business as America's Wholesale Lender), had authorized the assignment of the mortgage
to the Plaintiff.
The assignment to Plaintiff was executed by Mortgage Electronic Reporting System (MERS) as
nominee for America's Wholesale Lender.
Black's Law Dictionary defines a nominee as "[a] person designated to act in place of another,
usually in a very limited way".
In its Memoranda to its original motion , Plaintiff quoted the Court in Schuh Trading Co., v.
Commissioner of Internal Revenue, 95 F.2d 404, 411 (7th Cir. 1938), which defined a nominee
as follows:
The word nominee ordinarily indicates one designated to act for another as his representative in
a rather limited sense. It is used sometimes to signify an agent or trustee. It has no connotation,
however, other than that of acting for another, or as the grantee of another.. Id. ( Emphasis
added).
An assignment by an agent without authority from the principal is a nullity. Plaintiff failed to
provide any evidence that Countrywide had authorized MERS to assign its mortgage to
Plaintiff. The Court denied the application with leave to renew upon a showing that
Countrywide had authorized MERS to assign its mortgage to Plaintiff.
Plaintiff has again moved for an order of reference, and submitted in addition to the MERS
assignment, what it purports to be an endorsed note and a corporate resolution of MERS showing
that MERS had appointed all officers of Countrywide Financial Corporation as assistant
secretaries and vice presidents of MERS.
This present motion must fail for the same reason as the prior motion as Plaintiff has failed to
provide documentation from the lender that it authorized the assignment.
[*2]The Endorsed Note Plaintiff submits an affidavit from Sharon Mason, a vice president of
BAC Home Loan Servicing LP (BAC), a servicer of the loan, in which she asserts, based upon
Plaintiff's books and records, that at the time the action was commenced the original note bearing
the endorsement of Countrywide was in Plaintiff's possession.
Plaintiff also submits an affidavit from Jonathan Hyman, an officer of BAC, based on BAC's
records. Hyman asserts in his affidavit that the mortgage was assigned to Bank of New York and
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that "the original note was delivered and endorsed to the plaintiff with endorsement in the name
of the plaintiff." Hyman appends to his affidavit a copy of what purports to be an endorsed note.
The note contains a stamped endorsement which states, "Pay to the Order of * * without recourse
Countrywide Home Loans Inc., A New York Corporation Doing Business As America's
Wholesale Lender By: Michele Sjolander Executive Vice President". Under the stamp is
handwritten " * * The Bank of New York, as Trustee for the Benefit of the Certificate, CWABS,
Inc. Asset Backed Certificates, Series 2007-2". The endorsement is undated.
However, the note that was appended to the summons and complaint filed in court on July 25,
2008 does not bear any endorsement. Plaintiff has offered no explanation, from anyone with
knowledge, as to why, had the note had been endorsed and in its possession when it commenced
the suit, that the note filed when the suit was commenced did not bear an endorsement.
Significantly, counsel for Plaintiff stated in oral argument before the Court on March 3 2011 that
"There is nobody left to speak at to Countrywide".
The affidavits of Hyman and Mason, which were based on the books and records of the plaintiff
and BAC, are insufficient to establish ownership of the note in light of the fact that the note
originally submitted bore no endorsement, and the fact that purported endorsement is undated.
The affidavits are based on books and records, not on personal knowledge. Yet the affiants did
not produce any of the records on which they based their assertion that Plaintiff possessed an
endorsed note at the time the action was commenced.
The face of the assignment indicates that MERS is assigning the mortgage as nominee of
America's Wholesale Lender (a trade name of Countrywide), and more [*3]importantly that
Selman executed the assignment as assistant vice president of MERS.
Hyman's assertion that the assignment incorrectly lists Selman's title as assistant vice president of
MERS, instead of assistant secretary and vice president of MERS, is of no relevance other than
to demonstrate the casual and cavalier manner in which these transactions have been
conducted.
While Hyman further asserts in his affidavit that Selman "under her authority as an Assistant
Secretary and Vice president of MERS, expedited the Assignment of Mortgage process on behalf
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of MERS, with the approval and for the benefit of Countrywide," he provides no evidence that
Countrywide in fact approved or authorized the assignment.
Similarly, William C. Hultman, Secretary and Treasurer of MERS, states in a conclusory fashion
in paragraph 8 of his affidavit that Countrywide "instructed MERS to assign the Mortgage to
Bank of New York" without offering the basis for that assertion, other than it role as nominee.
Plaintiff claims, that by the terms of the mortgage MERS as nominee, was granted the right "(A)
to exercise any or all of those rights, including, but not limited to the right to foreclose and sell
the Property, and (B) to take any action required of the Lender including, but not limited to,
releasing and canceling this Security Instrument." However, this language is found on page two
of the mortgage under the section "BORROWER'S TRANSFER TO LENDER OF RIGHTS IN
THE PROPERTY" and therefore is facially an acknowledgment by the borrower. The fact that
the borrower acknowledged and consented to MERS acting as nominee of the lender has no
bearing on what specific powers and authority the lender granted MERS as nominee. The
problem is not whether the borrower can object to the assignees' standing, but whether the
original lender, who is not before the Court, actually transferred its rights to the Plaintiff.
Furthermore, while the mortgage grants some rights to MERS it does not grant MERS the
specific right to assign the mortgage. The only specific rights enumerated in the mortgage are the
right to foreclose and sell the Property. The general language "to take any action required of the
Lender including, but not limited to, releasing and canceling this Security Instrument" is not
sufficient to give the nominee authority to alienate or assign a mortgage without getting the
mortgagee's explicit authority for the particular assignment.
Plaintiff cites Rules of MERS membership, Rule 2 section 5. However what that rule requires is
that a member to warrant to MERS that the mortgage either names MERS as mortgagee or that
they prepare an assignment of mortgage naming MERs as mortgagee.
In this case MERS was named in paragraph (c) of the mortgage as Mortgagee of record for the
purpose of recording the mortgage. Being the mortgagee of record for the [*4] purpose of
recording the mortgage does not confer the right to assign the mortgage absent an instruction to
do so from the lender. Paragraph 2 of the MERS terms and conditions provide that "MERS shall
serve as mortgagee of record with respect to all such mortgage loans solely as a nominee in an
administrative capacity", and that "MERS agrees not to assert any rights (other than rights
specified in the governing documents) with respect to such mortgage loans or mortgaged
properties". Assigning or alienating a mortgage without an explicit instruction from a lender to
do so, is not acting in an administrative capacity.
Further, paragraph 6 of the terms and conditions provides that, "the MERS system is not a
vehicle for creating or transferring beneficial interests in mortgage loans." (emphasis added)
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Lastly, Section 6 of the MERS agreement provides that MERS shall comply with the instructions
from the holder of the notes and that in the absence of instructions from the holder may rely on
instructions from the servicer with respect to transfers of beneficial ownership.
What the MERS agreements and terms and conditions provide, is that MERS may execute an
assignment when instructed to do so by the lender or its servicer. This is nothing more than
saying that if granted authority by the lender, or its agent, to assign a mortgage, MERs can assign
the mortgage on behalf of the lender.
To read the MERS agreement as granting MERS authority to assign any of the mortgages of its
thousands of members, on its own volition, without the instruction or consent of the member
would lead to a nonsensical result.
Plaintiff has failed to meet the very basic requirement that proof of an agent's authority
must be shown from the mouth of the principal not from the agent. Lexow & Jenkins, P.C. v.
Hertz Commercial Leasing Corp., 122 AD2d 25, 504 N.Y.S.2d 192 (2nd Dept 1986), Siegel v.
Kentucky Fried Chicken of Long Island, Inc., 108 AD2d 218, 488 N.Y.S.2d 744 (2nd Dept
1985).
As Plaintiff has not shown that it owned the note and mortgage, it has no standing to
maintain this foreclosure action. Therefore the renewed motion for an order of reference
must be denied and the action dismissed.
The Court has raised the standing issue sua sponte because, in this case, it goes to the
integrity of the entire proceeding. For the court to allow a purported assignee to foreclose, in
the absence of some proof that the original lender authorized the assignment of the mortgage to
them, would cast doubt upon the validity of the title of any subsequent purchasers, should the
original lender or successor challenge the assignment at a future date.
WHEREFORE it is hereby Ordered that Plaintiff's motion for an Order of Reference is denied
and the action is dismissed. This constitutes the decision and order of the Court.
[*5]
J.S.C. (ALL shaded and bold emphasis added.)
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The Bank of New York, AS TRUSTEE FOR THE CERTIFICATEHOLDERS CWALT, INC.
ALTERNATIVE LOAN TRUST 2006-OC1 MORTGAGE PASS-THROUGH CERTIFICATES,
SERIES 2006-OC1, Plaintiff,
against
Denise Mulligan, BEVERLY BRANCHE, et. al., Defendants.
Plaintiff:
McCabe Weisberg Conway PC
Jason E. Brooks, Esq.
New Rochelle NY
Defendant:
No Appearances.
Arthur M. Schack, J.
Plaintiff’s renewed application, upon the default of all defendants, for an order of reference for
the premises located at 1591 East 48th Street, Brooklyn, New York (Block 7846, Lot 14, County
of Kings) is denied with prejudice. The complaint is dismissed. The notice of pendency filed
against the above-named real property is cancelled.
In my June 3, 2008 decision and order in this matter, I granted leave to plaintiff, THE BANK OF
NEW YORK, AS TRUSTEE FOR THE CERTIFICATEHOLDERS CWALT, INC.
ALTERNATIVE LOAN TRUST 2006-OC1 MORTGAGE PASS-THROUGH
CERTIFICATES, [*2]SERIES 2006-OC1 (BNY), to renew its application for an order of
reference within forty-five (45) days, until July 18, 2008, if it complied with three conditions.
However, plaintiff did not make the instant motion until May 4, 2009, 335 days after June 3,
2008, and failed to offer any excuse for its lateness. Therefore, the instant motion is 290 days,
almost ten months, late. Further, the instant renewed motion failed to present the three affidavits
that this Court ordered plaintiff BNY to present with its renewed motion for an order of
reference: (1) an affidavit of facts either by an officer of plaintiff BNY or someone with a valid
power of attorney from plaintiff BNY and personal knowledge of the facts; (2) an affidavit from
Ely Harless describing his employment history for the past three years, because Mr. Harless
assigned the instant mortgage as Vice President of MORTGAGE ELECTRONIC
REGISTRATION SYSTEMS, INC. (MERS) and then executed an affidavit of merit for assignee
BNY as Vice President of BNY’s alleged attorney-in-fact without any power of attorney; and,
(3) an affidavit from an officer of plaintiff BNY explaining why it purchased the instant
nonperforming loan from MERS, as nominee for DECISION ONE MORTGAGE COMPANY,
LLC (DECISION ONE).
Moreover, after I [JUDGE SCHACK] reviewed the papers filed with this renewed motion for an
order of reference and searched the Automated City Register Information System (ACRIS)
website of the Office of the City Register, New York City Department of Finance, I discovered
that plaintiff BNY lacked standing to pursue the instant action for numerous reasons. Therefore,
the instant action is dismissed with prejudice.
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Background
Defendant DENISE MULLIGAN (MULLIGAN) borrowed $392,000.00 from DECISION ONE
on October 28, 2005. The mortgage to secure the note was recorded by MERS, “acting solely as
a nominee for Lender [DECISION ONE]” and “FOR PURPOSES OF RECORDING THIS
MORTGAGE, MERS IS THE MORTGAGEE OF RECORD,” in the Office of the City Register
of the City of New York, New York City Department of Finance, on February 6, 2006, at City
Register File Number (CRFN) 2006000069253.
Defendant MULLIGAN allegedly defaulted in her mortgage loan payments with her May 1,
2007 payment. Subsequently, plaintiff BNY commenced the instant action, on August 9, 2007,
alleging in ¶ 8 of the complaint, and again in ¶ 8 of the August 16, 2007 amended complaint, that
“Plaintiff [BNY] is the holder of said note and mortgage. said mortgage was assigned to
Plaintiff, by Assignment of Mortgage to be recorded in the Office of the County Clerk of Kings
County [sic].” As an aside, plaintiff’s counsel needs to learn that mortgages in New York City
are not recorded in the Office of the County Clerk, but in the Office of the City Register of the
City of New York. However, the instant mortgage and note were not assigned to plaintiff BNY
until October 9, 2007, 61 days subsequent to the commencement of the instant action, by MERS,
“as nominee for Decision One,” and executed by Ely Harless, Vice President of MERS. This
assignment was recorded on October 24, 2007, in the Office of the City Register of the City of
New York, at CRFN 2007000537531.
I denied the original application for an order of reference, on June 3, 2008, with leave to renew,
because assignor Ely Harless also executed the March 20, 2008-affidavit of merit as Vice
President and “an employee of Countrywide Home Loans, Inc., attorney-in-fact for Countrywide
Home Loans, Inc.” The original application for an order of reference did not present any power
of attorney from plaintiff BNY to Countrywide Home Loans, Inc. Also, the Court pondered how
[*3]Countrywide Home Loans, Inc. could be its own an attorney-fact?
In my June 3, 2008 decision and order I noted that Real Property Actions and Proceedings Law
(RPAPL) § 1321 allows the Court in a foreclosure action, upon the default of defendant or
defendant’s admission of mortgage payment arrears, to appoint a referee “to compute the amount
due to the plaintiff” and plaintiff BNY’s application for an order of reference was a preliminary
step to obtaining a default judgment of foreclosure and sale. (Home Sav. Of Am., F.A. v
Gkanios, 230 AD2d 770 [2d Dept 1996]). However, plaintiff BNY failed to meet the clear
requirements of CPLR § 3215 (f) for a default judgment, which states:
On any application for judgment by default, the applicant
shall file proof of service of the summons and the complaint, or
a summons and notice served pursuant to subdivision (b) of rule
305 or subdivision (a) of rule 316 of this chapter, and proof of
the facts constituting the claim, the default and the amount due
by affidavit made by the party . . . Where a verified complaint has
been served, it may be used as the affidavit of the facts constituting
the claim and the amount due; in such case, an affidavit as to the
default shall be made by the party or the party’s attorney. [Emphasis
added].
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Plaintiff BNY failed to submit “proof of the facts” in “an affidavit made by the
party.” (Blam v Netcher, 17 AD3d 495, 496 [2d Dept 2005]; Goodman v New York City Health
& Hosps. Corp. 2 AD3d 581[2d Dept 2003]; Drake v Drake, 296 AD2d 566 [2d Dept 2002];
Parratta v McAllister, 283 AD2d 625 [2d Dept 2001]; Finnegan v Sheahan, 269 AD2d 491 [2d
Dept 2000]; Hazim v Winter, 234 AD2d 422 [2d Dept 1996]). Instead, plaintiff BNY submitted
an affidavit of merit and amount due by Ely Harless, “an employee of Countrywide Home
Loans, Inc.” and failed to submit a valid power of attorney for that express purpose. Also, I
required that if plaintiff renewed its application for an order of reference and provided to the
Court a valid power of attorney, that if the power of attorney refers to a servicing agreement, the
Court needs a properly offered copy of the servicing agreement to determine if the servicing
agent may proceed on behalf of plaintiff. (EMC Mortg. Corp. v Batista, 15 Misc 3d 1143 (A),
[Sup Ct, Kings County 2007]; Deutsche Bank Nat. Trust Co. v Lewis, 14 Misc 3d 1201 (A) [Sup
Ct, Suffolk County 2006]).
I granted plaintiff BNY leave to renew its application for an order of reference within forty-five
(45) days of June 3, 2008, which would be July 18, 2008. For reasons unknown to the Court,
plaintiff BNY made the instant motion to renew its application for an order of reference on May
4, 2009, 290 days late. Plaintiff’s counsel, in his affirmation in support of the renewed motion,
offers no explanation for his lateness and totally ignores this issue.
Further, despite the assignment by MERS, as nominee for DECISION ONE, to plaintiff BNY
occurring 61 days subsequent to the commencement of the instant action, plaintiff’s counsel
claims, in ¶ 17 of his affirmation in support, that “[s]aid assignment of mortgage [by MERS, as
nominee for DECISION ONE to BNT] was drafted for the convenience of the court in
establishing the chain of ownership, but the actual assignment and transfer had previously
occurred by delivery.” The alleged proof presented of physical delivery of the subject
MULLIGAN mortgage is a computer printout [exhibit G of motion], dated April 30, 2009, from
[*4]Countrywide Financial, which plaintiff’s counsel calls a “Closing Loan Schedule,” and
claims, in ¶ 21 of his affirmation in support, that this “closing loan schedule is the mortgage loan
schedule displaying every loan held by such trust at the close date for said trust at the end of
January 2006. The closing loan schedule is of public record and demonstrates that the Plaintiff
was in possession of the note and mortgage about nineteen (19) months prior to the
commencement of this action.” There is an entry on line 2591 of the second to last page of the
printout showing account number 1232268089, which plaintiff’s counsel, in ¶ 22 of his
affirmation in support, alleges is the subject mortgage. Plaintiff’s counsel asserts, in ¶ 23 of his
affirmation in support, that “[t]he annexed closing loan schedule suffices to proceed in granting
Plaintiff’s Order of Reference in this matter proving possession prior to any default.” This claim
is ludicrous. The computer printout, printed on April 30, 2009, just prior to the making of the
instant motion, has no probative value with respect to whether physical delivery of the subject
mortgage was made to plaintiff BNY prior to the August 9, 2007 commencement of the instant
action.
Further, even if the mortgage was delivered to BNY prior to the August 9, 2007 commencement
of the instant action, this claim is in direct contradiction to plaintiff’s claim previously mentioned
in ¶ 8 of both the complaint and the amended complaint, that “Plaintiff [BNY] is the holder of
said note and mortgage. said mortgage was assigned to Plaintiff, by Assignment of Mortgage to
be recorded in the Office of the County Clerk of Kings County [sic].” Both ¶’s 8 allege that the
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assignment of the subject mortgage took place prior to August 9, 2007 and the recording would
subsequently take place. The only reality for the Court is that the assignment of the subject
mortgage took place 61 days subsequent to the commencement of the action on October 9, 2007
and the assignment was recorded on October 24, 2007.
Further, attached to the instant renewed motion [exhibit D] is an affidavit of merit by Keri
Selman, dated August 23, 2007 [47 days before the assignment to BNY], in which Ms. Selman
claims to be “a foreclosure specialist of Countrywide Home Loans, Inc. Servicing agent for
BANK OF NEW YORK, AS TRUSTEE FOR THE CERTIFICATEHOLDERS CWALT, INC.
ALTERNATIVE LOAN TRUST 2006-OC1 MORTGAGE PASS-THROUGH
CERTIFICATES, SERIES 2006-OC1 . . . I make this affidavit upon personal knowledge based
on books and records of Bank of New York in my possession or subject to my control [sic]”
Countrywide Home Loans, Inc. is not Countrywide Home Loans Servicing LP, referred to in the
power of attorney attached to the renewed motion [exhibit F]. Moreover, plaintiff failed to
[*5]present to the Court any power of attorney authorizing Ms. Selman to execute for
Countrywide Home Loans, Inc. her affidavit on behalf of plaintiff BNY. Also, Ms. Selman has
a history of executing documents presented to this Court while wearing different corporate
hats. In Bank of New York as Trustee for Certificateholders CWABS, Inc. Asset-Backed
Certificates, Series 2006-22 v Myers (22 Misc 3d 1117 [A] [Sup Ct, Kings County 2009], in
which I issued a decision and order on February 3, 2009, Ms. Selman assigned the subject
mortgage on June 28, 2008 as Assistant Vice President of MERS, nominee for Homebridge
Mortgage Bankers Corp., and then five days later executed an affidavit of merit as Assistant Vice
President of plaintiff BNY. I observed, in this decision and order, at 1-2, that:
Ms. Selman is a milliner’s delight by virtue of the number of hats
she wears. In my November 19, 2007 decision and order (BANK OF
NEW YORK A TRUSTEE FOR THE NOTEHOLDERS OF CWABS, INC.
ASSET-BACKED NOTES, SERIES 2006-SD2 v SANDRA OROSCO NUNEZ,
et. al. [Index No., 32052/07]), I observed that:
Plaintiff’s application is the third application for an
order of reference received by me in the past several days that
contain an affidavit from Keri Selman. In the instant action,
she alleges to be an Assistant Vice President of the Bank of
New York. On November 16, 2007, I denied an application for
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Further, the Court needs to address the conflict of interest in the June 20, 2008 assignment by
Ms. Selman to her alleged employer, BNY. I am still waiting for Ms. Selman’s affidavit to
explain her tangled employment relationships. Interestingly, Ms. Selman, as “Assistant Vice
President of MERS,” nominee for “America’s Wholesale Lender,” is the assignor of another
mortgage to plaintiff BNY in Bank of New York v Alderazi (28 Misc 3d 376 [Sup Ct, Kings
County 2010]), which I further cite below.
It is clear that plaintiff BNY failed to provide the Court with: an affidavit of merit by an officer
of plaintiff BNY or someone with a valid power of attorney from BNY; an affidavit from Ely
Harless, explaining his employment history; and, an explanation from BNY of why it purchased
a nonperforming loan from MERS, as nominee of DECISION ONE. Moreover, plaintiff BNY
did not own the subject mortgage and note when the instant case commenced. Even if
plaintiff BNY owned the subject mortgage and note when the case commenced, MERS
lacked the authority to assign the subject MULLIGAN mortgage to BNY, as will be
explained further. Plaintiff’s counsel offers a lame and feeble excuse for not complying with
my June 3, 2008 decision and order, in ¶ 23 of his affirmation in support, claiming that “[t]he
affidavits requested in Honorable Arthur M. Schack’s Decision and Order should not be
required, given the annexed closing loan schedule.”
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dismissal: (1) the courts have jurisdiction only over controversies; (2) a
plaintiff found to lack “standing” is not involved in a controversy; and
(3) the courts therefore have no jurisdiction of the case when such a
plaintiff purports to bring it.
“Standing to sue requires an interest in the claim at issue in the lawsuit that the law will
recognize as a sufficient predicate for determining the issue at the litigant’s request.” (Caprer v
Nussbaum (36 AD3d 176, 181 [2d Dept 2006]). If a plaintiff lacks standing to sue, the plaintiff
may not proceed in the action. (Stark v Goldberg, 297 AD2d 203 [1st Dept 2002]). [*7]
Plaintiff BNY lacked standing to foreclose on the instant mortgage and note when this
action commenced on August 7, 2007, the day that BNY filed the summons, complaint and
notice of pendency with the Kings County Clerk, because it did not own the mortgage and note
that day. The instant mortgage and note were assigned to BNY, 61 days later, on October 7,
2007. The Court, in Campaign v Barba (23 AD3d 327 [2d Dept 2005]), instructed that “[t]o
establish a prima facie case in an action to foreclose a mortgage, the plaintiff must establish the
existence of the mortgage and the mortgage note, ownership of the mortgage, and the
defendant’s default in payment [Emphasis added].” (See Witelson v Jamaica Estates Holding
Corp. I, 40 AD3d 284 [1st Dept 2007]; Household Finance Realty Corp. of New York v Wynn,
19 AD3d 545 [2d Dept 2005]; Sears Mortgage Corp. v Yahhobi, 19 AD3d 402 [2d Dept 2005];
Ocwen Federal Bank FSB v Miller, 18 AD3d 527 [2d Dept 2005]; U.S. Bank Trust Nat. Ass’n
Trustee v Butti, 16 AD3d 408 [2d Dept 2005]; First Union Mortgage Corp. v Fern, 298 AD2d
490 [2d Dept 2002]; Village Bank v Wild Oaks, Holding, Inc., 196 AD2d 812 [2d Dept 1993]).
Assignments of mortgages and notes are made by either written instrument or the assignor
physically delivering the mortgage and note to the assignee. “Our courts have repeatedly held
that a bond and mortgage may be transferred by delivery without a written instrument of
assignment.” (Flyer v Sullivan, 284 AD 697, 699 [1d Dept 1954]). The written October 7, 2007
assignment by MERS, as nominee for DECISION ONE, to BNY is clearly 61 days after the
commencement of the action. Plaintiff’s BNY’s claim that the gobblygook computer printout it
offered in exhibit G is evidence of physical delivery of the mortgage and note prior to
commencement of the action is not only nonsensical, but flies in the face of the complaint and
amended complaint, which both clearly state in ¶ 8 that “Plaintiff [BNY] is the holder of said
note and mortgage. Said mortgage was assigned to Plaintiff, by Assignment of Mortgage to be
recorded in the Office of the County Clerk of Kings County [sic].” Plaintiff BNY did not own
the mortgage and note when the instant action commenced on August 7, 2007. “[A] retroactive
assignment cannot be used to confer standing upon the assignee in a foreclosure action
commenced prior to the execution of an assignment.” (Wells Fargo Bank, N.A. v Marchione,
69 AD3d 204, 210 [2d Dept 2009]). The Marchione Court relied upon LaSalle Bank Natl. Assoc.
v Ahearn (59 AD3d 911 [3d Dept 2009], which instructed, at 912, “[n]otably, foreclosure of a
mortgage may not be brought by one who has no title to it’ (Kluge v Fugazy, 145 AD2d 537 [2d
Dept 1988]) and an assignee of such a mortgage does not have standing unless the assignment is
complete at the time the action is commenced).” (See U.S. Bank, N.A. v Collymore, 68 AD3d
752 [2d Dept 2009]; Countrywide Home Loans, Inc. v Gress, 68 AD3d 709 [2d Dept 2009];
Citgroup Global Mkts. Realty Corp. v Randolph Bowling, 25 Misc 3d 1244 [A] [Sup Ct, Kings
County 2009]; Deutsche Bank Nat. Trust Company v Abbate, 25 Misc 3d 1216 [A] [Sup Ct,
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Richmond County 2009]; Indymac Bank FSB v Boyd, 22 Misc 3d 1119 [A] [Sup Ct, Kings
County 2009]; Credit-Based Asset Management and Securitization, LLC v Akitoye,22 Misc 3d
1110 [A] [Sup Ct, Kings County Jan. 20, 2009]; Deutsche Bank Trust Co. Americas v Peabody,
20 Misc 3d 1108 [A][Sup Ct, Saratoga County 2008]).
The Appellate Division, First Department, citing Kluge v Fugazy, in Katz v East-Ville Realty
Co., (249 AD2d 243 [1d Dept 1998]), instructed that “[p]laintiff’s attempt to foreclose upon a
mortgage in which he had no legal or equitable interest was without foundation in law or
[*8]fact.” Therefore, with plaintiff BNY not having standing, the Court lacks jurisdiction in
this foreclosure action and the instant action is dismissed with prejudice.
MERS had no authority to assign the subject mortgage and note
Moreover, MERS lacked authority to assign the subject mortgage. The subject DECISION
ONE mortgage, executed on October 28, 2005 by defendant MULLIGAN, clearly states on page
1 that “MERS is a separate corporation that is acting solely as a nominee for Lender [DECISION
ONE] and LENDER’s successors and assigns . . . FOR PURPOSES OF RECORDING THIS
MORTGAGE, MERS IS THE MORTGAGEE OF RECORD.” The word “nominee” is defined
as “[a] person designated to act in place of another, usu. in a very limited way” or “[a] party who
holds bare legal title for the benefit of others.” (Black’s Law Dictionary 1076 [8th ed 2004]).
“This definition suggests that a nominee possesses few or no legally enforceable rights beyond
those of a principal whom the nominee serves.” (Landmark National Bank v Kesler, 289 Kan
528, 538 [2009]). The Supreme Court of Kansas, in Landmark National Bank, 289 Kan at 539,
observed that:
The legal status of a nominee, then, depends on the context of
the relationship of the nominee to its principal. Various courts have
interpreted the relationship of MERS and the lender as an agency
relationship. See In re Sheridan, 2009 WL631355, at *4 (Bankr. D.
Idaho, March 12, 2009) (MERS “acts not on its own account. Its
capacity is representative.”); Mortgage Elec. Registrations Systems,
Inc. v Southwest, 2009 Ark. 152 ___, ___SW3d___, 2009 WL 723182
(March 19, 2009) (“MERS, by the terms of the deed of trust, and its
own stated purposes, was the lender’s agent”); La Salle Nat. Bank v
Lamy, 12 Misc 3d 1191 [A], at *2 [Sup Ct, Suffolk County 2006]) . . .
(“A nominee of the owner of a note and mortgage may not effectively
assign the note and mortgage to another for want of an ownership interest
in said note and mortgage by the nominee.”)
The New York Court of Appeals in MERSCORP, Inc. v Romaine (8 NY3d 90 [2006]),
explained how MERS acts as the agent of mortgagees, holding at 96:
In 1993, the MERS system was created by several large
participants in the real estate mortgage industry to track ownership
interests in residential mortgages. Mortgage lenders and other entities,
known as MERS members, subscribe to the MERS system and pay
annual fees for the electronic processing and tracking of ownership
and transfers of mortgages. Members contractually agree to appoint [*9]
MERS to act as their common agent on all mortgages they register
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Thus, it is clear that MERS’s relationship with its member lenders is that of agent with the
lender-principal. This is a fiduciary relationship, resulting from the manifestation of consent by
one person to another, allowing the other to act on his behalf, subject to his control and consent.
The principal is the one for whom action is to be taken, and the agent is the one who acts. It has
been held that the agent, who has a fiduciary relationship with the principal, “is a party who acts
on behalf of the principal with the latter’s express, implied, or apparent authority.” (Maurillo v
Park Slope U-Haul, 194 AD2d 142, 146 [2d Dept 1992]). “Agents are bound at all times to
exercise the utmost good faith toward their principals. They must act in accordance with the
highest and truest principles of morality.” (Elco Shoe Mfrs. v Sisk, 260 NY 100, 103 [1932]).
(See Sokoloff v Harriman Estates Development Corp., 96 NY 409 [2001]); Wechsler v Bowman,
285 NY 284 [1941]; Lamdin v Broadway Surface Advertising Corp., 272 NY 133 [1936]). An
agent “is prohibited from acting in any manner inconsistent with his agency or trust and is at all
times bound to exercise the utmost good faith and loyalty in the performance of his duties.”
(Lamdin, at 136).
Thus, in the instant action, MERS, as nominee for DECISION ONE, is an agent of DECISION
ONE for limited purposes. It only has those powers given to it and authorized by its principal,
DECISION ONE. Plaintiff BNY failed to submit documents authorizing MERS, as nominee for
DECISION ONE, to assign the subject mortgage to plaintiff BNY. Therefore, even if the
assignment by MERS, as nominee for DECISION ONE, to BNY was timely, and it was not,
MERS lacked authority to assign the MULLIGAN mortgage, making the assignment defective.
Recently, in Bank of New York v Alderazi, 28 Misc 3d at 379-380, my learned Kings
County Supreme Court colleague, Justice Wayne Saitta explained that:
A party who claims to be the agent of another bears the burden
of proving the agency relationship by a preponderance of the evidence
(Lippincott v East River Mill & Lumber Co., 79 Misc 559 [1913])
and “[t]he declarations of an alleged agent may not be shown for
the purpose of proving the fact of agency.” (Lexow & Jenkins, P.C. v
Hertz Commercial Leasing Corp., 122 AD2d 25 [2d Dept 1986]; see
also Siegel v Kentucky Fried Chicken of Long Is. 108 AD2d 218 [2d
Dept 1985]; Moore v Leaseway Transp/ Corp., 65 AD2d 697 [1st Dept
1978].) “[T]he acts of a person assuming to be the representative of
another are not competent to prove the agency in the absence of evidence
tending to show the principal’s knowledge of such acts or assent to them.”
(Lexow & Jenkins, P.C. v Hertz Commercial Leasing Corp., 122 AD2d
at 26, quoting 2 NY Jur 2d, Agency and Independent Contractors § 26). [*10]
Plaintiff has submitted no evidence to demonstrate that the original lender, the mortgagee
America’s Wholesale Lender, authorized MERS to assign the secured debt to plaintiff [the
assignment, as noted above, executed by the multi-hatted Keri Selman].
In the instant action, MERS, as nominee for DECISION ONE, not only had no authority to
assign the MULLIGAN mortgage, but no evidence was presented to the Court to demonstrate
DECISION ONE’s knowledge or assent to the assignment by MERS to plaintiff BNY.
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The dismissal with prejudice of the instant foreclosure action requires the cancellation of the
notice of pendency. CPLR § 6501 provides that the filing of a notice of pendency against a
property is to give constructive notice to any purchaser of real property or encumbrancer against
real property of an action that “would affect the title to, or the possession, use or enjoyment of
real property, except in a summary proceeding brought to recover the possession of real
property.” The Court of Appeals, in 5308 Realty Corp. v O & Y Equity Corp. (64 NY2d 313,
319 [1984]), commented that “[t]he purpose of the doctrine was to assure that a court retained its
ability to effect justice by preserving its power over the property, regardless of whether a
purchaser had any notice of the pending suit,” and, at 320, that “the statutory scheme permits a
party to effectively retard the alienability of real property without any prior judicial review.”
CPLR § 6514 (a) provides for the mandatory cancellation of a notice of pendency by:
The Court, upon motion of any person aggrieved and upon such
notice as it may require, shall direct any county clerk to cancel
a notice of pendency, if service of a summons has not been completed
within the time limited by section 6512; or if the action has been
settled, discontinued or abated; or if the time to appeal from a final
judgment against the plaintiff has expired; or if enforcement of a
final judgment against the plaintiff has not been stayed pursuant
to section 551. [emphasis added]
The plain meaning of the word “abated,” as used in CPLR § 6514 (a) is the ending of an action.
“Abatement” is defined as “the act of eliminating or nullifying.” (Black’s Law Dictionary 3 [7th
ed 1999]). “An action which has been abated is dead, and any further enforcement of the cause
of action requires the bringing of a new action, provided that a cause of action remains (2A
Carmody-Wait 2d § 11.1).” (Nastasi v Natassi, 26 AD3d 32, 40 [2d Dept 2005]). Further,
Nastasi at 36, held that the “[c]ancellation of a notice of pendency can be granted in the exercise
of the inherent power of the court where its filing fails to comply with CPLR § 6501 (see 5303
Realty Corp. v O & Y Equity Corp., supra at 320-321; Rose v Montt Assets, 250 AD2d 451,
451-452 [1d Dept 1998]; Siegel, NY Prac § 336 [4th ed]).” Thus, the [*11]dismissal of the
instant complaint must result in the mandatory cancellation of plaintiff BNY’s notice of
pendency against the property “in the exercise of the inherent power of the court.”
Conclusion
Accordingly, it is
ORDERED, that the renewed motion of plaintiff, THE BANK OF NEW YORK, AS TRUSTEE
FOR THE CERTIFICATEHOLDERS CWALT, INC. ALTERNATIVE LOAN TRUST 2006-
OC1 MORTGAGE PASS-THROUGH CERTIFICATES, SERIES 2006-OC1, for an order of
reference, for the premises located at 1591 East 48th Street, Brooklyn, New York (Block 7846,
Lot 14, County of Kings), is denied with prejudice; and it is further
ORDERED, that the instant action, Index Number 29399/07, is dismissed with
prejudice; and it is further
ORDERED that the Notice of Pendency in this action, filed with the Kings
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County Clerk on August 9, 2007, by plaintiff, THE BANK OF NEW YORK, AS TRUSTEE
FOR THE CERTIFICATEHOLDERS CWALT, INC. ALTERNATIVE LOAN TRUST 2006-
OC1 MORTGAGE PASS-THROUGH CERTIFICATES, SERIES 2006-OC1, to foreclose a
mortgage for real property located at 1591 East 48th Street, Brooklyn, New York (Block 7846,
Lot 14, County of Kings), is cancelled.
This constitutes the Decision and Order of the Court.
ENTER
________________________________HON. ARTHUR M. SCHACK
J. S. C.
~
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__________ :
:
Plaintiff, :
:
vs. : CASE NO.:
:
:
___________ :
: JURY TRIAL DEMANDED
Defendant(s). :
:
__________________________________________________________________________
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DEFINITIONS
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H. The terms “related to,” “relates to” or “relating to” mean in any way directly
or indirectly, concerning, referring to, disclosing, describing, confirming, supporting,
evidencing or representing.
I. The past tense shall be construed to include the present tense and vice-versa to
make the request inclusive rather than exclusive.
a. The singular shall be construed to include the plural and vice versa to make
the request inclusive rather than exclusive.
b. Any reference to the Note and Mortgage refers to the specific documents
alleged by Defendants to be involved in the instant proceedings.
J. The term “promissory note(s)” or the word “note(s)” means the promissory
note(s) described in the Complaint.
K. The term “mortgage(s)” means the mortgage(s) described in the Complaint.
L. The term “mortgage loans” means loans made or indebtedness owed to
Plaintiff or its predecessors in connection with secured transactions on real property.
M. The term “Plaintiff” refers to The Bank of New York, as Trustee for the Benefit
of the Certificateholders, CWABS, Inc., Assetbacked Certificates, Series 2007-10.
N. The term “Defendants” refers to Mr. ________ and Mrs. ______________
O. When Defendant(s) use a term, it shall be construed to have the same meaning
as used in Plaintiff’s Complaint and supporting attachments, unless explicitly noted
otherwise.
INSTRUCTIONS
INTERROGATORIES
1. Please identify each person who answers these interrogatories and each person
(attach pages if necessary) who assisted, including attorneys, accountants,
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employees of third party entities, or any other person consulted, however briefly,
on the content of any answer to these interrogatories.
ANSWER:
2. For each of the above persons please state whether they have personal
knowledge regarding the subject loan transaction.
ANSWER:
3. Please state the date of the first contact between Plaintiff and the borrower in the
subject loan transaction; the name, address and telephone number of the
person(s) in your company who was/were involved in that contact.
ANSWER:
4. Please identify the person(s) involved in the underwriting of the subject loan.
“Underwriting” refers to any person who made representations, evaluations or
appraisals of value of the home, value of the security instruments, and ability of
the borrower to pay.
ANSWER:
5. How did Plaintiff first receive the original Note in question? Was it endorsed
when Plaintiff received the document? Where did this happen, when did it
happen, who received the Note (name of the employee who received it), was any
consideration paid for the Note, is there any evidence of that consideration, and
are the any contracts which memorialize this transfer? Include specific details,
not generalities such as “Plaintiff is the holder and entitled to enforce.”
ANSWER:
6. Please identify any person(s) who had any contact with any third party
regarding the securitization, sale, transfer, assignment, hypothecation or any
document or agreement, oral, written or otherwise, that would affect the
funding, closing, or the receipt of money from a third party in a transaction that
referred to the subject loan.
ANSWER:
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8. Please state all details known by Plaintiff regarding the indorsement placed on
the original Note in question. Include the date said indorsement was placed on
the Note, who authorized the indorser to place the indorsement on the note,
what authority the indorser had to make the indorsement, and whether any
subsequent indorsements were placed on the note.
ANSWER:
10. Please state for the history of the mortgage loan on whose behalf mortgage
payments were collected, specifying the applicable dates collection was made for
each such person or entity and specifying the name, current address, current
phone number, current employer, and employer at the time, and the current
address of any and all employers, of each such person or entity.
ANSWER:
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11. Please identify the person(s) in custody of any document that identifies the loan
servicer(s) in the subject loan transaction.
ANSWER:
12. Please identify any person(s) in custody of any document which refers to any
instruction or authority to enforce the note or mortgage in the subject loan
transaction.
ANSWER:
13. Other than people identified above, identify any and all persons who have or
had personal knowledge of the subject loan transaction, underwriting of the
subject loan transaction, securitization, sale, transfer, assignment or
hypothecation of the subject loan transaction, or the decision to enforce the note
or mortgage in the subject loan transaction.
ANSWER:
14. Please state the address, phone number, and employment history since
____________ of _____________________whose purported signature appears as
__________________ on the undated blank endorsement on the purported copy
of the HOMEOWNER’S note. (REPEAT IF MORE THAN ONE
ENDORSEMENT.)
ANSWER:
15. Please state the address, phone number, and employment history from _______
to __________ of ____________________, whose purported signature appears as
________________ on the purported copy of the Assignment of Mortgage (or
Deed of Trust) dated ______. (REPEAT IF MORE THAN ONE ASSIGNMENT.)
ANSWER:
16. Please state the address, phone number, and employment history from _______
to __________ of ____________________, whose purported signature appears as
the notary on the purported copy of the Assignment of Mortgage (or Deed of
Trust) dated ______. (REPEAT IF MORE THAN ONE ASSIGNMENT.)
ANSWER:
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17. Please state the address, phone number, and employment history from
__________________of ________________________, whose purported signature
appears on the purported copy of the ANSWER:
18. Please state the date on which ______________ sold the subject mortgage to
_______________________.
ANSWER:
19. Please state all details known by Plaintiff regarding how it first received
possession of the note. Include when Plaintiff received the note, who delivered
the note to Plaintiff, who received the note, whether Plaintiff only received
certain rights in the note, if so, what rights, the location the note was stored prior
to this action, etc.
ANSWER:
20. Please identify the custodian of the records that would show all entries regarding
the flow of funds for the subject loan transaction prior to and after closing of the
loan. (“Flow of funds” means any record of money received, any record of
money paid out and any bookkeeping or accounting entry, general ledger and
accounting treatment of the subject loan transaction at your company or any
affiliate including but not limited to whether the subject loan transaction was
ever entered into any category on the balance sheet at any time or times, whether
any reserve for default was ever entered on the balance sheet, and whether any
entry, report or calculation was made regarding the effect of this loan transaction
on the capital reserve requirements of your company or any affiliate.)
ANSWER:
21. Please identify the person or persons who prepared the monthly Remittance
Reports submitted by the Servicer to the Trust.
ANSWER:
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22. Please identify the auditor and/or accountant of Plaintiff’s financial statements or
tax returns.
ANSWER:
23. Please identify any attorney with whom you consulted or who rendered an
opinion regarding the subject loan transaction or any pattern of securitization
that may have affected the subject loan transaction directly or indirectly.
ANSWER:
24. Please identify any person who served as an officer or director with
_______________________ commencing with 6 months prior to closing of the
subject loan transaction through the present. (This interrogatory is limited only
to those people who had knowledge, responsibility, or otherwise made or
received reports regarding information that included the subject loan transaction,
and/or the process by which solicitation, underwriting and closing of residential
mortgage loans, or the securitization, sale, transfer or assignment or
hypothecation of residential mortgage loans to third parties.)
ANSWER:
26. Please identify the person(s) involved or having knowledge of any insurance
policy or product, plan or instrument describing over-collateralization, cross-
collateralization or guarantee or other instrument hedging the risk of default as
to any person or entity acting as an issuer of any securities or certificates. (Such
instrument(s) relate to the composition of a pool, tranche or other aggregation of
assets that was created, included or referred to the subject loan and the pool or
aggregation was transmitted, transferred, assigned, pledged or hypothecated to
any entity or buyer. A person who “transmitted, transferred, assigned, pledged
or hypothecated” refers to any person who suggested, approved, received or
accepted the composition of the pool or aggregation made or confirmed
representations, evaluations or appraisals of value of the home, value of the
security instruments, ability of the borrower to pay.)
ANSWER:
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27. Please identify the person(s) involved or having knowledge of any credit default
swap or other instrument hedging the risk of default as to any person or entity
acting as an issuer of any securities or certificates. (Such instrument(s) relate to
the composition of a pool, tranche or other aggregation of assets that was
created, included or referred to the subject loan.)
ANSWER:
28. Describe in detail how Plaintiff came to possess the subject note and mortgage.
ANSWER:
29. List the names and addresses of all persons who are believed or known by
Plaintiff, its agents, or its attorneys to have any knowledge concerning any of the
issues in this lawsuit; and specify the subject matter about which the witness has
knowledge.
ANSWER:
30. Does Plaintiff intend to call any expert witnesses at the trial of this case? Yes or
no.
ANSWER:
31. If your answer to Question 28 is yes, state as to each such witness the name and
business address of the witness, the witness‘s qualifications as an expert, the
subject matter upon which the witness is expected to testify, the substance of the
facts and opinions to which the witness is expected to testify, and a summary of
the grounds for each opinion.
ANSWER:
32. List all non-expert witnesses that you intend to call at the trial in this matter and
any documents or other tangible items you intend to introduce as evidence at the
trial in this case.
ANSWER:
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I HEREBY CERTIFY that a true and correct copy of the foregoing was furnished via
________________________
______________________________
HOMEOWNER
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__________ :
:
Plaintiff, :
:
vs. : CASE NO.:
:
:
___________ :
: JURY TRIAL DEMANDED
Defendant(s). :
:
__________________________________________________________________________
INSTRUCTIONS
A. You are requested to produce all documents in your custody, possession or control,
including all documents which are in the custody of your employees, attorneys,
consultants, accountants, or agents, regardless of the location of such documents.
B. If any document responsive to a specific request was, but no longer is, in your
possession, custody or control, please identify that document and state whether any
such document (a) is missing or lost; (b) has been destroyed; (c) has been transferred
voluntarily or involuntarily; or (d) has been otherwise disposed of, and, in each
instance, please explain in detail the circumstances surrounding any such disposition
thereof.
C. All documents are to be produced in or with their original file folders, file jackets,
envelopes, or covers.
D. In answering these requests for production you are required to furnish all
information, documents and/or things that are available to you or subject to your
reasonable inquiry, including information and things in the possession, custody or
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DEFINITIONS
DOCUMENTS TO BE PRODUCED
1. All documents which are related to the subject loan transaction including but not
limited to the original wet-ink Note, modification of mortgage, judgment notes,
security agreements, mortgages, assignments, allonges, insurance agreements,
servicing agreements, pooling and servicing agreements and any and all other
documents that relate or reference in any way the loan, or Plaintiff’s ability to
service the loan, which is the subject of this instant litigation.
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2. All contracts, agreements and other documents which show the exact date that
Plaintiff came into possession of the Note involved in this action, including: 1)
evidence such as a cancelled check or wire for payment of the note, 2) the
original entries from Plaintiff’s “general ledger” showing the date the note came
onto the books of Plaintiff all the way through the date of the foreclosure filing,
3) copies of any and all transfers, assignments, mergers, purchase and sale
agreements, endorsements or other documents that demonstrate Plaintiff is a
party entitled to enforce Defendant’s note.
3. All documents which show that Plaintiff held, received, or was in possession of
the original note on or before August 11, 2008.
4. Copies of any and all documents which create or demonstrate the existence of a
nominee or agency relationship by, between, or otherwise relating to Lehman XS
Trust Mortgage Pass-Through Certificates Series 2006-8 U.S. Bank National
Association as Trustee Successor in Interest to Lasalle Bank National Association
as Trustee and Equihome Mortgage Corp. and which supports Plaintiff’s
allegation that it has standing to bring this Complaint in Foreclosure.
5. Copy of the Pooling and Servicing Agreement (PSA) that governs the
____________ Trust. (APPLICABLE IN 95%+ OF ALL FORECLOSURES.)
6. Copy of the latest Remittance Report submitted by the servicer to the investors.
9. If Plaintiff claims that this mortgage and note are held in trust and Plaintiff is
associated with said trust, please produce any relevant mortgage loan schedule
which should include the Mortgagor’s name, loan identification number, the
property address, etc. Please also produce any exceptions schedule which shows
what mortgages were not transferred into the trust.
10. Any corporate resolution, power of attorney, contract, or document which shows
that all parties which are able to act as servicing agent or otherwise authorized to
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act on behalf of Plaintiff with regard to the note or mortgage attached to the
complaint.
11. All correspondence generated by any party concerning the alleged loan
transaction, mortgage or note in question, and instant foreclosure, from May 1,
2007 until the date of responding to this request.
12. All telephone log sheets, computer printouts and any other internal memoranda
or notes concerning this account.
14. All contracts between Plaintiff and any person or entity responsible for servicing
the mortgage and/or note.
16. All documents which show the (1) name of the computer system that holds,
processes, creates documents, prepares data, maintain, analysis, and otherwise
contain the documents, information, data compilations, codes, and records of
Defendant’s purported mortgage, note, payment history, indebtedness, lender
placed insurance, hazard insurance, late charges, appraisal, property inspections,
brokers price opinions, title charges, title updates, etc., (2) the date of the system
was created, (3) who maintains the system, (4) who developed the system, (5)
what tasks the system performs, (6) who has access to the system, (7) how often
the system is audited for accuracy, (8) how information is boarded or input into
the system, (9) who boards the information into the system, and (10) where the
server to the system is located.
17. Any and all bailee letters or other documents or data compilations which show
who owned, held, serviced, or otherwise had any rights to enforce the note or
mortgage attached to Plaintiff’s complaint.
18. All documents that borrower sent to lender, or its successors and assigns that
designates a substitute address by which notices should be sent under the
mortgage. (IF APPLICABLE.)
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20. The exact page from notary _____________’s notarial journal containing the
notarization of the purported assignment dated _____. (NOTE: NOTARIES IN
LOUISIANA ARE NOT REQUIRED TO KEEP SUCH A JOURNAL, BUT IT
DOESN’T HURT TO ASK ANYWAY.)
22. A copy of the mortgage loan schedule which references the instant note or
mortgage.
23. A copy of all Requests for Release of Documents which reference the instant note
or mortgage.
24. All written notices to either Defendant or Defendants which notify them of the
assignment of the note at issue to another entity.
27. Copies of the legal services and retainer agreements for each law firm
representing Plaintiff in the instant action including without limitation the scope
of services to be provided and fees for handling this action.
28. Copies of all licenses and authority (including a true and correct copy of their
signature) to provide notary services required for each of the notary publics
utilized for any portion of the pleadings or filings utilized in this case by
Plaintiff, including but not limited to_____.
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I HEREBY CERTIFY that a true and correct copy of the foregoing was furnished via
certified prepaid US Mail this ___ day of ___________, 201_ to:
__________________
______________________________
HOMEOWNER
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__________ :
:
Plaintiff, :
:
vs. : CASE NO.:
:
:
___________ :
: JURY TRIAL DEMANDED
Defendant(s). :
:
__________________________________________________________________________
INSTRUCTIONS
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or deny the remainder. You may not give lack of information or knowledge as a reason
for failure to admit or deny unless you state that you have made a reasonable inquiry
and that the information known or readily obtainable by you is insufficient to enable
that party to admit or deny. You may not object to a request solely because you consider
that a matter of which an admission has been requested presents a genuine issue for
trial. All references to “you” and “your” below refer to the Plaintiff listed in the Caption
of the Complaint in this action. The phrase “Promissory Note” or the word “Note” shall
refer to the Promissory note described in the Complaint and the word Mortgage shall
refer to the mortgage described in the Complaint and upon which Plaintiff is seeking to
foreclose. Unless stated otherwise, Defendant will utilize the same definitions and
terminology as used in Plaintiff’s Complaint.
DEFINITIONS
A. The term “promissory note(s)” or the word “note(s)” means the promissory
note(s) described in the Complaint.
B. The term “mortgage(s)” means the mortgage(s) described in the Complaint.
C. The term “mortgage loans” means loans made or indebtedness owed to
Plaintiff or its predecessors in connection with secured transactions on real
property.
D. The term “Plaintiff” refers to ________________
E. The term “Defendants” refers to _________________
F. When Defendant(s) use a term, it shall be construed to have the same
meaning as used in Plaintiff’s Complaint and supporting attachments, unless
explicitly noted otherwise.
ADMISSIONS
1. Admit that Plaintiff was not in possession of the original wet-ink promissory
note at the time this foreclosure lawsuit was filed, February 18, 2015.
____ ADMITTED ____ DENIED
2. Admit that no party, at least thirty (30) days prior to the filing of this lawsuit,
gave Defendant notice that the Note was assigned to Plaintiff.
____ ADMITTED ____ DENIED
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4. Admit that Plaintiff is not the non-holder in possession of the instrument who
has the rights of a holder.
____ ADMITTED ____ DENIED
5. Admit that Plaintiff is not the assignee of the original lender’s interest in the note.
____ ADMITTED ____ DENIED
6. Admit that no document exists that shows Plaintiff received the original wet-ink
note on or before February 18, 2015.
____ ADMITTED ____ DENIED
7. Admit that no document exists that shows Plaintiff held in its possession the
original wet-ink note on or before February 18, 2015.
____ ADMITTED ____ DENIED
10. Admit that these admissions are being answered by Plaintiff’s servicer.
____ ADMITTED ____ DENIED
11. Admit that the note is an obligation of a consumer to pay money arising out of a
transaction in which the money or property which are the subject of the
transaction are primarily for personal, family or household purposes.
____ ADMITTED ____ DENIED
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14. Admit that notary Danya Bucaro is an employee or agent of Bank of America,
N.A. or its subsidiaries.
____ ADMITTED ____ DENIED
15. Admit that Bank of America, N.A. fabricated the Assignment of Mortgage from
MERS to Bank of New York Mellon.
____ ADMITTED ____ DENIED
16. Admit that the Assignment of Mortgage from MERS to Bank of New York
Mellon was fabricated for the purposes of litigation.
____ ADMITTED ____ DENIED
17. Admit that no due diligence was conducted by Plaintiff as to whether the note
and deed of trust at issue in this litigation was ever properly assigned to Plaintiff
pursuant to the requirements of the pertinent Pooling & Servicing Agreement
and 424B Prospectus.
____ ADMITTED ____ DENIED
19. Admit that the loan originator never had the subject loan on its books and
records as a loan receivable.
____ ADMITTED ____ DENIED
20. Admit that the loan originator was paid by third parties which were not
disclosed to homeowner/Defendant.
____ ADMITTED ____ DENIED
21. Admit that the loan originator was not the source of funds for any financial
transaction with homeowner/Defendant.
____ ADMITTED ____ DENIED
22. Admit that no assignment of the alleged loan was ever supported by
consideration or value.
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23. Admit that no accounting or report has ever been issued and delivered to
homeowner/Defendant by the actual source of funds for the origination of any
alleged loan transaction.
____ ADMITTED ____ DENIED
24. Admit that the master servicer never issued and delivered to
homeowner/Defendant an accounting or report for the origination or transfer of
the alleged loan.
____ ADMITTED ____ DENIED
25. Admit that the note and mortgage at issue in this litigation were never lawfully
assigned to Bank of New York Mellon.
____ ADMITTED ____ DENIED
26. Admit that the Remittance Report submitted by Bank of New York Mellon to the
CWMBS, Inc., CHL Mortgage Pass-Through Trust 2007-15 Mortgage Pass-
Through Certificates, Series 2007-15 Trust shows the subject loan/note paid up to
date.
____ ADMITTED ____ DENIED
27. Admit that the alleged loan obligation under the Note and Deed of Trust at issue
in this litigation is not in default.
____ ADMITTED ____ DENIED
I HEREBY CERTIFY that a true and correct copy of the foregoing was furnished
via certified prepaid US Mail this ____ day of _____________, 201_ to:
____________________
____________________
Homeowner
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