Posted on 08/18/2018 9:26:18 AM PDT by RideForever
Today, during a deposition of the designated representative of the Bank of New York as Trustee for a Countrywide CWMBS securitization, the representative (who is an attorney and employee of the servicer Shellpoint) admitted under oath that MERS is not the true beneficiary of a Deed of Trust (DOT) despite claiming to do so, as the Beneficiary is the lender and MERS is not and was never the lender. The representative also admitted that the Substitution of Trustee filed by a law Firm and signed by Shellpoint (as a dba of New Penn Financial) contained a false statement that the Note was payable to MERS. The representative further admitted that two letters sent to the homeowner which stated that the loan was owned by a CWALT Trust were also incorrect.
As those of you who follow this website know, the Supreme Courts of Oregon, Washington, and Montana issued opinions that MERS is not the beneficiary of a DOT despite claiming to be so, and the Washington case even permitted MERS to be sued for misrepresenting that it is the beneficiary. Todays testimony is in line with these decisions. As MERS is not the beneficiary, it cannot act as such for purposes of executing Assignments of Deeds of Trust or Substitutions of Trustee in non-judicial foreclosure cases.
The homeowner is represented by Jeff Barnes, Esq. of W.J. Barnes, P.A. Mr. Barnes took the deposition of the representative this afternoon in Nashville, TN.
Bookmark MERS
Take a deep breath and then explain what this is about.
“Deed of trust or trust deed is a deed wherein legal title in real property is transferred to a trustee, which holds it as security for a loan (debt) between a borrower and lender. ... The borrower is referred to as the trustor, while the lender is referred to as the beneficiary.”
“Take a deep breath and then explain what this is about.”
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I had NO idea what MERS was-—Googled it——it means Middle East Respiratory Syndrome. :-)
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I would think whoever you are making the payment to, or not making in this case, owns the note.
My mortgage went through three different lenders before I paid it off.
For the vast majority of folks this only becomes a problem when they fail to make payments.
MERS or “ mortgage electronic recording system” was one of the key components in the financial meltdown of 2008. It was this system that permitted mortgages to be recorded, which ordinarily would have required a paper filing to be placed in the county where the property was located, but it also allowed the bundling of mortgages into securitization packages. Those packages typically held some reasonable mortgages, but they also contain mortgages with the quality of used dog food. Many mortgages were bundled and securitized in a way where the sheer numbers of mortgages so packaged hid the underlying horrific quality of much of the contents. Now, as I read this, just skimming it, t
MERS was simply a recording system that save Banks tens of thousands of 10 + 15 + $25 fees in tens of thousands of local County offices. The distinction made here, is that this is simply a recording system.... MERS is not the beneficiary....thus they cannot make changes....such as reconveying indiv mortgages into loan packages. It would be like depositing your family jewels and coins Etc in a bank safety deposit box, and simultaneously giving the bank the right to sell those goods or buy those goods or trade those goods. This case appears to establish that the MERS system was simply a recording methodology and gave the system of recording no particular right to transfer those deeds into securitization packages.
One of the great problems that borrowers encountered during the wave of foreclosures that happened during that time was the borrower had to sue mers for the improper bundling and transfer. But Mers was nobody or nothing that could show up in court and it was a very ambiguous situation. Now, whether 10 years later any kind of kinkiness that can be cured by more than one half of 1% of the people who had problems is going to be quite another story.
Mortgage Electronic Registration Systems
MEARS has also made it impossible for some people to get a clean clear title once they have paid off their notes.
From a mortgage registered with MERS:
“MERS is a separate corporation that is acting solely as a nominee for Lender and Lender’s successors and assigns. MERS is the mortgagee under this Security Instrument. MERS is organized and existing under the laws of Delaware...”
Document proceeds to identify the actual lender, in the case at hand it’s a local bank.
I should add, that another subtlety of m e r s was the idea that these deeds and mortgages could be recorded electronically, without a so-called “wet signature”. Kind of an important concept. Without a wet signature there is nobody you can go to who made the claim via their signature that this was correct and that was correct and that this is therefore a valid mortgage. It had the effect of hiding the identities of people who should have been responsible in the loan underwriting process. And that made it almost impossible to confirm or verify that certain procedures were properly followed. In the rush to securitize these loans, meaning to bundle them into large amorphous packages so they could be sold to institutional investors, a lot of crappy loans were shoved into great big loan packages, and this had the effect of not just enabling, but encouraging the hiding of some of the loans of terrible quality that were made during that era. The word most often used by Bill black during this era was “criminogenic”. Meaning, encouraging fraud, encouraging criminal activity.
Absolutely.
MEARS has also made it impossible for some people to get a clean clear title once they have paid off their notes.
^This Title to real property is supposed to have a searchable chain of encumberences such as liens or mortgages. Since MERS title searchers cannot prove many deeds are an accurate reflection of lien holders since MERS plays fast and loose with transfers. Once search you can’t even find the parties authorizing the transfers. Totally ilegal, at least in this state.
And the “companion ruse” here was for banks to refuse to foreclose, because in so doing, they had to take the underlying defaulted mortgage onto their books as bad debt.
We have friend who “lost” their primary residence when a number of rental properties they owned “went under water” and they walked away from them. They moved into a rental property and lived there for a year. Then suddenly the bank holding the note on their home “asked them” to move back into it, rent free. Since the property also has a guest house, they have moved back into it, and are renting the main house.
In another instance a friend finally told their bank that they were moving out of their foreclosed property because the bank refused for more than a year, to take possession.
The banks have been like a bunch of cats covering $hit when it comes to foreclosing because the foreclosures make their balance sheets look bad.
All of the Bankers should have been rounded up and executed when this all came to light years ago.
Borrower signed the note and security instrument, got the money, and now doesn't want to pay it back.
I worked as a loan broker during that period, briefly. I remember very well a Countrywide Funding meeting, in which for loan “products” were presented. Product one was a conventional 20% down 38% income conforming loan. Product 2, the borrower left out information regarding his income. Product three the borrower left out income and where that income might have come from. Product number 4, the borrowers submitted a blank application with only their name on it.
Depending upon whether the Countrywide regional manager had enough loans to fill their quarterly quota, such a loan would be approved. In effect, they would approve a loan for your dog, or for your lawn ornament. I remember very well walking out of that meeting kind of in a daze, wondering what the implications were, for the entire lending system, and I don’t claim that I fully understood them at the time. But it was clear that astronomical numbers of really, really bad loans were being made.
I worked as a loan broker during that period, briefly. I remember very well a Countrywide Funding meeting, in which for loan “products” were presented. Product one was a conventional 20% down 38% income conforming loan. Product 2, the borrower left out information regarding his income. Product three the borrower left out income and where that income might have come from. Product number 4, the borrowers submitted a blank application with only their name on it.
Depending upon whether the Countrywide regional manager had enough loans to fill their quarterly quota, such a loan would be approved. In effect, they would approve a loan for your dog, or for your lawn ornament. I remember very well walking out of that meeting kind of in a daze, wondering what the implications were, for the entire lending system, and I don’t claim that I fully understood them at the time. But it was clear that astronomical numbers of really, really bad loans were being made.
You’ve been here since 2002 and you don’t know about MERS?
Prolly don’t remember hydroshock either.
Thank you for the elaboration. Probably less than 5% of the 90% of mortgagees are aware that MERS is on their loan (made after 1999). The bank law changes allowed investment banks to create ‘trusts’ composed of real estate collateral (mortgage loan notes) to be cut up into ‘shares’ of the trust, with the income stream paid to the ‘investors’. Because individual loans were not available for inspection by the investors, these investors had no clue what the actual risk was. But it was a good way to absorb municipal and state bonds invested in such trusts, along with their retirement funds, because both commercial and retail banks colluded to provide the liars’ loans (extremely likely to default) who took decimated trusts and collected them into yet another REIT (Real Estate Investment Trust) and marketed them. As long as the banks could hide the actual beneficiary / note owner from the borrower, they could change servicrers, trustees, beneficiaries indiscriminately to instantiate late payments and fees and other tactics to elicit a default / foreclosure.
The bottom line is that the scheme to sell shares of trusts composed of loans, whether it be consumer, educational, auto, or real estate, the commercial banks can siphon off the payment stream and leave an empty shell that passes investor scrutiny, and has the judiciary help in covering up the crime. MERS has been under legal attack since 2010.
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