Posted on 12/27/2009 6:55:28 AM PST by Beloved Levinite
A landmark ruling in a recent Kansas Supreme Court case may have given millions of distressed homeowners the legal wedge they need to avoid foreclosure. In Landmark National Bank v. Kesler, 2009 Kan. LEXIS 834, the Kansas Supreme Court held that a nominee company called MERS has no right or standing to bring an action for foreclosure. MERS is an acronym for Mortgage Electronic Registration Systems, a private company that registers mortgages electronically and tracks changes in ownership. The significance of the holding is that if MERS has no standing to foreclose, then nobody has standing to foreclose on 60 million mortgages. That is the number of American mortgages currently reported to be held by MERS. Over half of all new U.S. residential mortgage loans are registered with MERS and recorded in its name. Holdings of the Kansas Supreme Court are not binding on the rest of the country, but they are dicta of which other courts take note; and the reasoning behind the decision is sound.
Eliminating the "Straw Man" Shielding Lenders and Investors from Liability:
(Excerpt) Read more at webofdebt.com ...
So if your lender sold your mortgage to another investor through MERS, now you don’t have to pay your mortgage? What a windfall!
Abrogating millions of mortgages would be both an unethical theft from lenders and a devastating blow to the financial system.
To not pay it back is theft.
I believe that there are ways to sell a mortage and to document that sale in a way the would satisfy the court than the mortage holder has standing to sue for foreclosure. However, it appears that MERS may not be the way.
I am a Kansas homeowner. My bank has not sold mortages except under unusual circumstances. As a consequence, they have avoided risky loans and are financially stable today. They are still making all manner of loans to old and new customers who meet the standards of good business practice. Many of their competitors are not so fortunate.
Abrogating millions of mortgages would be both an unethical theft from lenders and a devastating blow to the financial system.
WRONG, it is called PLAYING by the RULES that they disregarded as too cumbersome to follow. Now they are screwed not by we the people, but by their own ILLEGAL ACTS. The vast Majority of these Financial wizards belong in JAIL for LIFE .
Nobody can “pay” off anything. One can only “discharge” debt. There are only “debt obligations,” such as FRNs. There is no real “money” of substance. Hasn’t been since FDR stole all our gold. And when he took our gold, he had to provide a remedy. Only most Americans are oblivious to it.
yes this is terrible,butt there is noway this ruling lasts.
any bets onwho nominated these morons?
First, most Realtors agree, do not move out of your house when you get the first forclosure notice. Keep trying to get the interest rate reduced or payment's renegotiated. Don't move out until all other negotiations have failed and you have to. It takes 6-12 months to finally get a court order to physically remove you, after you receive the first notice.
In order to win a case like this, you have to hire a attorney and a very expensive one at that to pull this kind of suit off. This sounds like you may be going up against the powers that be that are running the world.
I think this judgement cost my brother his job. When his employer saw the results, they immediately ceased all business in Kansas and fired all of their employees in the state.
““The sole goal of the [bailout schemes] is to prevent owners of mortgage-backed securities, many of them foreigners, from suing U.S. banks and forcing them to buy back worthless mortgage securities at face value – right now almost 10 times their market worth. The ticking time bomb in the U.S. banking system is not resetting subprime mortgage rates. The real problem is the contractual ability of investors in mortgage bonds to require banks to buy back the loans at face value if there was fraud in the origination process.
“. . . The catastrophic consequences of bond investors forcing originators to buy back loans at face value are beyond the current media discussion. The loans at issue dwarf the capital available at the largest U.S. banks combined, and investor lawsuits would raise stunning liability sufficient to cause even the largest U.S. banks to fail, resulting in massive taxpayer-funded bailouts of Fannie and Freddie, and even FDIC . . . .
“What would be prudent and logical is for the banks that sold this toxic waste to buy it back and for a lot of people to go to prison. If they knew about the fraud, they should have to buy the bonds back.”
OH MY!!!!
Yes, but you are speaking on ethics, not legality.
Yes, but it’s more complicated than that.
Mortgages “in the good old days” meant at least 50 per cent down, renewable yearly, maybe a 7 year note. Calleable at any time. You mentioned gold, I doubt the average American at the time could come up with a downpayment in gold. I dunno, but...
The 30 year fixed, 20 per cent down mortgage is really a new phenomenon. One wonders what the banksters of the time thought about that. “20 per cent down!!? Blasphemy, I tell you!”
At the time it made sense, there were 15 million men getting out of the military and they had to have somewhere to live. VA loan program worked well, (as did the GI Bill) till the social planners gutted all the rules and regulations.
Why wouldn’t this ruling last? It is sound legally.
I have sucessfully used this defense several times in mortgage foreclosure actions as far back as the early 1990s whenever a “servicing agent” is the named plaintiff in the mortgage forclosure action. At the same time that I serve and answer to the complaint, I also serve a set of interrogatories and document demands that require the plaintiff to establish the paper trail from the original lender that gives the plaintiff the right to foreclose upon the mortgage.
And there lies the problem: Through a series of assignements, the right to receive payment under the note is packaged into an investment product with literally thousands and thousands of other notes, that is then sold to pension funds, insurance companies, mutual funds, etc., as an investment. The plaintiff in the mortgage foreclosure action is usually a servicing agent for the investors. However, neither the investors nor the servicing agent has received an assignment of the mortgage that secured the original debt. The last recorded mortgage is still in the hands of the bank that initially loaned the money or perhaps in an assignee bank, but rarely has the mortgage been assigned to the servicing agent, who is the named plaintiff in the mortgage foreclosure action, or the underlying investors, or even if the mortgage has been assigned, they can’t produce the documents to prove it.
Long sentence, but sums up the issue quite well. If someone fails to pay their mortgage, they risk foreclosure action, but that action must be brought by the entity that actually owns the mortgage. The court should not allow an action to go forward without establishing that simple fact.
The Kansas ruling is absurd. The housing crisis would be on its way to recovery if the government allowed banks to quickly foreclose on deadbeats.
If the mortgage process is fraudulent, the lenders need to pay the price, deadbeats borrowers or not.
Wow...fascinating.
bunch of crooks.
The article is right, a bunch of people should have gone to jail. Instead we apparently gave them large amounts of money.
It is not absurd, it has to do with the law. How do you think things might be right now if they hadn’t done what they did with the mortgages in the first place?
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