1 2 3 Do your own Securitization Audit!
April 30
2013 This basic how to manual explains what documents are evaluated in a Securitization Audit, what to look for in those documents, and provides case law on “standing” when a failure can be proven.
Know what you are getting
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PREFACE
With the massive foreclosure crisis gripping our country many experts and homeowners are
seeking to understand what happened. The unbelievable, massive fraud that has been
perpetrated by the financial institutions have lead many homeowners to take a stand against
what they now know has been unmitigated greed run amok.
One of the areas of attack in Foreclosure Defense is the Securitization Audit. A Securitization
Audit evaluates the Trust Documents that created the REMIC1 Trust and determines whether a
specific Note ever actually “made it into the Trust” as per the Trust document requirements.
Professional Audits can provide homeowners and their attorneys with certified documents that
detail the failure of the REMIC Trust to actually take ownership of the Note and Deed of Trust
/Mortgage as per the Trust Documents and provide testimony by the expert conducting the
Audit.
There are many firms providing Securitization Audits, and like any new service, there are good
audits and stupid audits. Before investing any money in a Securitization Audit, a homeowner
can do their own preliminary audit to see if there is a potential failure; then if there is, they are
better positioned to discuss the failure with their attorney in determining both an appropriate
legal strategy and vetting a qualified, professional auditor to help support their argument in
court.
This eBook is written in the hopes that it will prevent homeowners from being fooled again and
parted with precious dollars they need to ensure they get the outcome they are seeking in their
legal battle.
1 REMIC: Real Estate Mortgage Investment Conduit governed by Internal Revenue Codes 860A to 860G and
typically New York Trust laws. (Governing law is detailed in the Trust documents)
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Contents
Legal Disclaimer ............................................................................................................................................ 2
PREFACE ........................................................................................................................................................ 3
What Documents Do I Need In Order to Do a Securitization Audit? ............................................................ 5
Where do I get the documents I need for the Audit? ................................................................................... 6
Evaluation of the Pooling & Servicing Agreement ........................................................................................ 9
The Parties ................................................................................................................................................ 9
Conveyance Requirements ..................................................................................................................... 10
FAILURE ONE - BREACH OF CONVEYANCE REQUIREMENTS ............................................................... 11
Governing Law ........................................................................................................................................ 12
Identification of the REMIC Trust in Legal Documents ........................................................................... 12
FAILURE TWO – BREACH IN IDENTIFICATION OF REMIC TRUST ......................................................... 13
CLOSING DATE OF THE TRUST................................................................................................................. 13
FAILURE THREE – BREACH OF CLOSING DATE .................................................................................... 14
PURCHASE OF THE NOTES ...................................................................................................................... 14
FAILURE FOUR – The PSA calls to a different Purchase Agreement than what is recorded with the
SEC or may be presented in Court. ..................................................................................................... 14
EVALUATION OF THE PURCHASE SALES AGREEMENT ................................................................................ 15
SALES AGREEMENT DATE and PARTIES TO THE AGREEMENT ................................................................ 15
CONVEYANCE REQUIREMENTS ............................................................................................................... 15
FAILURE FIVE – BREACH OF CONVEYANCE REQUIREMENTS OF THE PURCHASE SALES AGREEMENT 16
EVALUATION OF THE MORTAGE SCHEDULES ............................................................................................. 17
FAILURE SIX – Violation of IRC § 860D(c)(2) in identification of the REMIC ASSETS .......................... 17
EVALUATION OF THE PROSPECTUS............................................................................................................. 18
There Appear To Be Failures, Now What? .................................................................................................. 18
Failure One – Breach of Conveyance in the PSA – .................................................................................. 18
Failure Three – Breach of the Closing Date............................................................................................. 18
Failure Five – Breach of Conveyance in the Sales Agreement ................................................................ 18
Failure Two – Identification of the Trust ................................................................................................ 19
Failure Four – PSA contradicts who purchased the Note ....................................................................... 20
Failure Six- Violation of IRC § 860D(c)(2) in identification of the REMIC ASSETS .................................. 20
CLOSING ...................................................................................................................................................... 20
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What Documents Do I Need In Order to Do a
Securitization Audit?
A Securitization Audit is done to determine whether or not your Note and Deed of Trust (or
Mortgage) was ever actually conveyed to the REMIC Trust claiming rights to your Note and
conducting (or threatening) the foreclosure. There are six key documents you need to start
your audit:
1) A copy of your Note in its current state. The securitization of a Note typically involves
the sale of the Note from the originator to a seller to a purchaser (and/or aggregator) to
a depositor. You will need to look at the current state of your Note to determine if
there have been any endorsements on the Note (or on an allonge2) from the Originator
to the other parties; and if so, which endorsements3 were done.
2) A copy of any Assignments of your Deed of Trust and/or Mortgage. The first indication
that your Note was securitized is typically through the filing of an Assignment in your
county land records. This document will tell you the approximate date of when the
assignment took place and between which parties the assignment occurred.
3) A copy of the Pooling & Servicing Agreement. The Pooling and Servicing Agreement
(“PSA”) is the actual Trust Document that created the REMIC Trust. It details the
conveyance requirements and timelines for certain activities to have occurred in order
for an asset (your Note) to be a part of the REMIC Trust. It will also tell you which STATE
laws govern the PSA and who the parties are to the PSA.
2 Allonge (from French allonger, "to draw out"), a slip of paper affixed to a negotiable instrument, as a bill of
exchange, for the purpose of receiving additional endorsements for which there may not be sufficient space on the
bill itself
3 Endorsement (alternatively spelt indorsement) may refer to: A signature on a negotiable instrument (such as a
cheque) indicating a person's intent to become a party to the instrument.
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4) The Purchase Sale Agreement. The Purchase Sales Agreement (“SA”) details who sold
and purchased the Notes for the REMIC trust and what the conveyance requirements of
the Sales Agreement.
5) The Prospectus. The Prospectus is what was given to the investors which details the
loan path that was intended for the Note from its origination to being deposited
(securitized) into the REMIC Trust. The PSA typically shows only part of the path; and
the other part is detailed in the Sales Agreement – the Prospectus will show the whole
path that was intended during the securitization process.
6) The Mortgage Schedule. This is typically an excel spreadsheet containing all the
attributes and identification of which Notes are intended to go into the REMIC Trust.
Where do I get the documents I need for the Audit?
Promissory Note in its Current State: Calif. Civ. Code § 2943(5) (b)(1) mandates that within 21
days request, the beneficiary or its agent will deliver a true, correct, and complete copy of the
Note. You will need to write to your Servicer and quote the above Code, requesting a true,
correct and complete copy of your Note. Keep their response for your records.
If you are not in California, you will need to do a search on Google, or one of the legal
sites for your state and find out what the code is. You can just ask the Servicer but unless you
quote a statute they typically will tell you no. You may also have to request a copy of the Note
in discovery but the banks typically fight this tooth and nail for some reason. (This is
DIFFERENT from asking to look at the original; I am suggesting here at this stage, you ask for a
true, correct and complete COPY of the Note. Don’t confuse this with the Produce the Note
stuff). Also, the copy of the Note will not tell you the “current owner”
Current Owner of the Note: With all the confusion about who owns what and paying servicers
who don’t actually own the Note, Congress stepped up and added a new TILA requirement in
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place that now allows you to request the Name of the owner of your Note (no more --- an
“investor” garbage answers). You can source the owner of your note one of several ways:
MERS – if MERS is involved in your Note and/or Deed of Trust/Mortgage, then your
documents will have a MERS ID number. Go to www.mers.com and enter either your
MERS ID number, or property address. MERS will then provide the name of your
Servicer and the investor who owns your Note.
Fannie Mae/Freddie Mac: Go to the following sites and enter your information to
source the owner of your Note.
http://www.fanniemae.com/loanlookup/
https://ww3.freddiemac.com/corporate/
Your Servicer: Under the Truth in Lending Act, or TILA, the government has stepped in
and told servicers that upon written request they must provide general investor
information to the borrower. Write a letter to your servicer, citing 15 U.S.C. §
1641(f)(2), a provision of TILA, and request that the servicer provide the name, address
and telephone number of the owner of the mortgage. They are required by TILA to
respond to you within 10 business days. If they choose not to reply to this request, 15
U.S.C. § 1640(a), coupled with the Helping Families Save Their Homes Act of 2009,
allows for recovery which can include actual and statutory damages, costs, and
attorney’s fees.
Assignment of Deed of Trust and/or Mortgage: Most states have a statute that requires that
the new beneficiary record an assignment of the Deed of Trust and/or Mortgage. The good
news is that you can go to your local county recorder’s office and look up the assignments
YOURSELF. In my land records office they have computers that let you look through the
documents online; then when you identify the ones you want, you fill out a request with the
document number and they print off a copy for you. (Get certified ones). Make sure that you
don’t stop at the first one, scan ALL the records on your property and see what has been filed.
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The Assignment will typically tell you who assigned the Deed of Trust/Mortgage to who, and
when. In my case, Wells Fargo N.A. acting as an attorney in fact for New Century, did the
assignment from New Century Mortgage directly to the REMIC Trust. This told me WHEN the
assignment occurred (important when we are looking at the PSA’s closing date) and between
which parties. NCM to the REMIC Trust wasn’t possible – according to the bank the Note had
been sold by NCM to NC Capital – so how could NCM assign it to the REMIC Trust? Also, a
deposit of the Note from NCM into the REMIC Trust is a violation of IRC (Internal Revenue
Codes). But I will get into that later.
The first thing you want to look at is the NAME of the REMIC Trust listed on the Assignment.
You need that to get the next documents. Also, the REMIC may be named in your Notice of
Default or the cover letter to the Notice of Default. You want the actual name of the REMIC
Trust, not a placeholder name as well. If you are unable to find the SEC documents based on
the REMIC Trust name on these documents, you will have to do a little research to figure out
which one it actually is – and that the use of a placeholder name on foreclosing documents is
something your attorney should take a look at for further state statute violations.
Pooling & Servicing Agreement, Purchase Sales Agreement, Prospectus and Mortgage
Schedule. These documents can be found on EdgarOnline. Enter the name of the Trust then
look for these four documents; keep in mind that a lot of the earlier REMIC filings did NOT
include the Purchase Sales Agreement or Mortgage Schedule; so don’t be surprised if you can’t
find those. If you can’t, you will have to ask for those in discovery. But you definitely should be
able to get a copy of the Pooling & Servicing Agreement and the Prospectus.
EdgarOnline has instructions of how to locate and download documents; if you are still have a
hard time figuring out EdgarOnline, our Who is Edgar? Gives step by step instructions with
screen captures of what you should be seeing on line when looking for the documents.
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You can also email [email protected]. and request a certified copy of the documents. This is
typically a FREE service by the SEC and can take several weeks to receive (I think 4 weeks is the
average I have seen). If there is a cost they will notify you.
Evaluation of the Pooling & Servicing Agreement
Now you have the documents to start your preliminary analysis of the securitization of your
Note. Typically the Pooling & Servicing Agreement is between two hundred to three hundred
pages. This is the actual Trust Document that created the REMIC Trust. It details everything
about the Trust and how it is it to be set up and managed. For purposes of this eBook we are
going to focus on a couple of key areas and I am going to give you brief descriptions of the roles
of the parties.
The Parties
At the beginning of every PSA is a description of who the parties are to the PSA. Familiar terms
are:
a. Depositor – this is the entity that is issuing (selling the certificates) to the investors. This is the party who created the REMIC Trust.
b. Purchaser – This is the entity that purchased the Notes to put into the REMIC Trust. This may be the depositor but often it is an affiliate of the Depositor.
c. Seller – This is the entity that sold the Notes to the Purchaser. This is typically an affiliate of the originator of the Notes.
d. Master Servicer – This is the entity that is responsible for collecting the Note payments from the property owners. A master servicer may do the servicing themselves or have a subservicer (in some PSA’s Wells Fargo is the Master Servicer and its dba division America’s Servicing Company is the subservicer)
e. Trustee – This is the entity that receives the payments from the Servicer and distributes the money to the appropriate investors/parties.
f. Document Custodian – This is the entity that maintains all the paperwork on the REMIC Trusts – the original Note and Deed of Trust /Mortgage, delivery receipts, etc. A lot of times the Trustee is also the Document Custodian. The Document Custodians have advanced document tracking systems that track every movement of every Note and Deed/Mortgage and any changes to these documents after the documents have been placed into their vaults.
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Conveyance Requirements
The financial firms typically wanted to do “true sales” between entities so they did not have to
be accountable for any fraud in the origination of the Note and to be “bankruptcy remote” so
that the bankruptcy of one of the parties (like the predatory lenders Countrywide, WaMu, New
Century) would not subject them to having the assets pulled back into the estate of the
bankrupt company. Because of the desire to have these true sales they implemented
conveyance requirements between all the parties of the PSA. In almost ALL of the PSA’s this is
section 2.01 of the PSA.
Following is an example of the conveyance requirements in one PSA. Notice that the PSA calls
for each and every party in the chain to endorse the Note to the next party in the chain; there is
nothing that states a “blank endorsement” is allowed. You will have to read your PSA to see if
blank endorsements are allowed or note.
2.01 Conveyance of Mortgage Loans. (a) The Depositor, concurrently with the execution
and delivery hereof, hereby sells, transfers, assigns, sets over and otherwise conveys to
the Trustee for the benefit of the Certificateholders, without recourse, all the right, title
and interest of the Depositor in and to the Trust Fund, and the Trustee, on behalf of the
Trust, hereby accepts the Trust Fund.
(b) In connection with the transfer and assignment of each Mortgage Loan, the Depositor
has delivered or caused to be delivered to the Trustee for the benefit of the
Certificateholders the following documents or instruments with respect to each Mortgage
Loan so assigned:
(i) the original Mortgage Note (except for no more than up to 0.02% of the mortgage
Notes for which there is a lost note affidavit and the copy of the Mortgage Note) bearing
all intervening endorsements showing a complete chain of endorsement from the
originator to the last endorsee, endorsed “Pay to the order of _____________, without
recourse” and signed in the name of the last endorsee. To 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
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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]“;
So in my case, the Note was originated by New Century Mortgage, then according to the PSA,
New Century apparently at some point intended to sell the Note to the “Seller” NC Capital, who
then intended to sell it to the “Purchaser” – the Morgan Stanley Mortgage Capital, who then
intended to sell it to the “Depositor” Morgan Stanley Capital 1, Inc. (don’t you love how all the
names are so similar?). Based on the PSA – there should be at a minimum FOUR
endorsements! 1) New Century to NC Capital; 2) NC Capital to Morgan Stanley Mortgage; 3)
Morgan Stanley Mortgage to Morgan Stanley Capital; 4) Morgan Stanley Capital to the REMIC
Trust. So one would expect to see an endorsement chain from New Century to NC to Morgan
Stanley Mortgage to Morgan Stanley Capital with a final indorsement to the REMIC Trust.
Instead here is what is on my Note:
As Professor Levitin says, “A single endorsement in blank ain't gonna do it if this PSA means
anything. And there were a lot of MBS investors who assumed that it was going to be
followed.”
FAILURE ONE - BREACH OF CONVEYANCE REQUIREMENTS
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NOTE: Also, Fannie Mae and Freddie Mac are sticklers about the indorsement process. First, they
typically require that the first indorsement, if there is space, UNDER the borrower’s signature NOT on
the back of the signature page. The signature page should not be used until all of the space under the
borrower’s signatures is used up.
Also, Fannie Mae and Freddie Mac require that the endorsement be a live, wet ink signature –
NOT a stamped endorsement. The only exception is the LAST indorsement (which could be a
blank indorsement I suppose? ) may be stamped. IF a stamped indorsement is used, the
Document Custodian is required to hold the corporate resolution authorizing the use of
facsimile signatures and indentifies the individual and/or titles that are authorized to use the
facsimile signature.
If you have a Fannie Mae/Freddie Mac loan and want to read about their “indorsement”
procedures, go to www.Infotofightforeclosure.com and go under our Tools for FREE Docs to
down load, “Fannie Mae/Freddie Mac Procedures” and go to page 16 of the document.
Governing Law
The next thing you want to look for is the “governing law” of the contract, New York laws are
very well settled on following the terms of a Trust so you have to know which Trust laws to
research for determining the failures in the Trust documents and the impact of those failures.
The quickest way to find the governing law is to do a search in the document for “governing
law” – if not you will need to scan the document and find it. The majority of the REMIC Trust
name New York State law as the governing law because the Trust laws are so ancient and
settled. The other common state is Delaware.
Identification of the REMIC Trust in Legal Documents
This section will detail WHAT name should be used on any legal documents done on behalf of
the REMIC Trust . I found this under the Article II section of the PSA. My PSA calls for the use
of the Name “Morgan Stanley Capital 1, Inc. Trust 2006-NC2” but in the foreclosure documents
they used the name, “Morgan Stanley Loan Trust 2006-NC2” which one can assume is a
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DIFFERENT REMIC Trust. (and in my case, I have a lot of supporting evidence such as Quit Claim
Deeds and assignments between these two different Trusts).
FAILURE TWO – BREACH IN IDENTIFICATION OF REMIC TRUST
CLOSING DATE OF THE TRUST
This is when the REMIC Trust closes. The Internal Revenue Codes mandate that all Notes must
be legally and validly conveyed (deposited) into the Trust by the Cutoff Date of the Trust; and
that all paperwork must be completed no later than 90 days after the close of the Trust. (See
Internal Revenue Codes 860A to 806G) This means no Notes in or out of the Trust (except for
replacements) after this date. Failure to adhere to this means that the Note cannot be a part of
the Trust. You will typically find three different dates, the date of the creation (which is usually
the Cutoff date) of the REMIC Trust and on the first page of the PSA, the Closing Date and Cut
off Dates can usually be found under the “terms” section of the PSA – as well as other places
but this is the quickest way to find the dates.
In the PSA for the MSC1 Trust, the closing date is March 30, 2006, which meant all paperwork
needed to be completed (all endorsements and assignments) by approximately June 30, 2006.
However, the assignment of Deed of Trust wasn’t done until March 28, 2008 and that
Assignment was done directly from New Century to the REMIC Trust – a violation of Internal
Revenue codes!
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FAILURE THREE – BREACH OF CLOSING DATE
Interesting enough, the PSA called for both Wells Fargo (the master servicer) and Deutsche
Bank National Trust Company (the Trustee) to CERTIFY to the investors all the Notes were safely
tucked away into the vaults of the Document Custodian with ALL required endorsements and
assignments.
The PSA is 200 to 300 hundred pages long so there is certainly more that can be evaluated for
legal improprieties, but for an initial audit, the above three areas are the KEY items for
consideration.
PURCHASE OF THE NOTES
The PSA will also detail where the Notes came from. In my PSA it states very clearly that the
Notes were acquired through a Purchase Sales Agreement between Morgan Stanley Capital 1
and NC Capital – which is in direct conflict with the actual Purchase Sales Agreement which
claims the parties are the OTHER Morgan Stanley Company – Morgan Stanley Mortgage Capital.
FAILURE FOUR – The PSA calls to a different Purchase Agreement than what is
recorded with the SEC or may be presented in Court.
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EVALUATION OF THE PURCHASE SALES
AGREEMENT
This document may be 50 to 100+ pages long. It details the sale of the Note between the
parties – most typically it is between parties 2 and 3 of the chain of title– which I find
fascinating. So in my case the only Purchase Sales Agreement with the REMIC’s SEC documents
is the intent of NC Capital to sell the Notes to Morgan Stanley Mortgage Capital. There is no
sales agreement in the SEC documents of New Century selling the Note to NC Capital; and there
is no sales agreement between Morgan Stanley Mortgage Capital and Morgan Stanley Capital 1.
Those we had to ask for in discovery.
The three key items you want to look at in the Purchase Sales Agreement are the date of the
agreement, the parties to the agreement and the conveyance requirements.
SALES AGREEMENT DATE and PARTIES TO THE AGREEMENT
Did the sales agreement occur in time for the parties to both have a valid conveyance of the
Note in order to sell the note? In my case, the Sales Agreement (we have two of them!)
occurred on either December 1, 2005 or January 1, 2006 depending on which agreement you
go by. The challenge here is there is no evidence that NC Capital actually had
possession/ownership of the Note in order to sell the Note! Now this information on the
breach of the sale date came from other discovery activities not through this evaluation. What
this evaluation DID tell me was that we needed to ask when NC Capital (the seller) acquired the
Note in order to be able to sell it through this agreement.
CONVEYANCE REQUIREMENTS
Just as the PSA’S have conveyance requirements, so do the Purchase Sales Agreements. In my
case Reynaldo Reyes testified that this agreement allowed for a “blank endorsement” – as you
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can see, he lied. This is a two step identification process. First under Section 9.02 of the Sales
Agreement is the following little diddy:
Note the reference to Exhibit A of the “complete Mortgage File” When you to Exhibit A – the
conveyance requirements are spelled out as follows:
I have read these several times…where does it say it can be an indorsed in blank without the
intervening indorsements? We were given this document on the day of trial and did not get a
chance to evaluate the document to challenge Reyes testimony. Make sure you don’t make
that mistake! If you get Reynaldo Reyes at your trial..nail the bastard..he lies.
FAILURE FIVE – BREACH OF CONVEYANCE REQUIREMENTS OF THE PURCHASE SALES
AGREEMENT
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EVALUATION OF THE MORTAGE SCHEDULES
In every REMIC there are a series of Mortgage Schedules; these are typically excel spreadsheets
that document the attributes of the Notes that are being sold in the Purchase Sales Agreement
and are being deposited into the REMIC Trust. The schedule usually includes the address of the
property, the name of the Promissory Note signer, the amount of the Note, and details of the
Note.
The banks use the Mortgage Schedule to show there was an intention to sell the Note to the
parties (i.e. Purchase Sales Agreement and/or the REMIC Trust). The schedule of loans are
integral to the formation of the REMIC Trust. IRC § 860D(c)(2) Identification of assets.
Formation of the REMIC does not occur until (i) The sponsor identifies the assets of the REMIC,
such as through execution of an indenture with respect to the assets; and (ii) The REMIC issues
the regular and residual interests in the REMIC.
You should be able to find your Note on the schedule. My Note was on the schedule; if your
Note is not on the schedule this is a failure. However, remember these schedules are EXCEL
spreadsheets that can easily be manipulated with whatever information they want to put on it.
So in your discovery you will want to ask for the “chain of custody” of the record and what
precautions were used in confirming the Note was on the schedule when they banks says it
was! In my case they CREATED a schedule to give us in discovery; then at trial brought one in a
different one claiming it was the original. We were denied access to this obviously and did not
get to investigate the authenticity of the document and its contents.
FAILURE SIX – Violation of IRC § 860D(c)(2) in identification of the REMIC ASSETS
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EVALUATION OF THE PROSPECTUS
This is the document the Wall Street entity used in promoting the REMIC Trust to the Investors.
In my case the Depositor and seller of certificates to the investors was Morgan Stanley Capital.
In the Prospectus some of the things you want to look at are:
1) The Loan Path the Prospectus claims the Notes took from origination to securitization into the REMIC Trust
2) The REMIC Trust creation date and estimated closing date
This information serves to confirm what you are seeing in the PSA and Sales Agreement. There
are other potential aspects of evaluating the Prospectus for help in a foreclosure defense, but I
would recommend that be discussed with a professional auditor.
There Appear To Be Failures, Now What?
This is where a really good attorney comes in handy! These failures all suggest that the Note
did NOT make it to the REMIC trust and therefore, if that is who is claiming to be the
beneficiary of your Note and Deed of Trust by the foreclosing entities, then they lack standing
and the REMIC Trust is an interloper – a stranger with no vested interest in your Note, your
payments on the Note or in your property. YOU have a potential claim to fight and defeat your
foreclosure!
Failure One – Breach of Conveyance in the PSA – Failure Three – Breach of the Closing Date Failure Five – Breach of Conveyance in the Sales Agreement
If you read the Adam J. Thomas Affidavit filed in US Bank v Congress (I am not kidding here!) or
Adam Levitin’s papers (google their names and their documents will come up) they both discuss
the “failure” of the REMIC Trust to acquire the Notes a prescribed by the PSA document. The
failure of to convey the Notes properly and on time is a violation of both Internal Revenue
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Codes and New York Trust Laws (the PSA is governed by New York). Cases where the Courts
found truth in these allegations are (Google the names of the cases and you can find the
pleadings and rulings):
Mass. Supreme Court: US Bank v Ibanez (also includes Wells Fargo v LaRace)
Oklahoma: Deutsche Bank National Trust v. Brumbaugh Deutsche Bank National Trust v. Byrams California: Richie Walker v. BAC Alabama: US Bank v. Congress
Also, go to www.msfraud.org and visit their Legal Lounge for an extensive listing of cases. One
of the biggest challenges that needs to be considered is that the homeowner is not a party to
the PSA so a homeowner cannot enforce the PSA nor should the homeowner try; pleadings
have to accurately articulate the homeowner is demonstrating the PSA violations as evidence
that the REMIC does NOT hold the Note and therefore cannot be a proper party foreclosing on
the Note and Deed of Trust/Mortgage.
ADDITIONAL CONSIDERATIONS: if there IS an endorsement in blank, then case law needs to be
researched to understand the impact of a “blank endorsement” and one may want to consider
asking for evidence of who affixed the blank endorsement, when they affixed the
endorsement and under what authority. Some indorsement cases to review:
Colorado 10th Circuit Court BAP: Miller v. Deutsche Bank National Trust
Failure Two – Identification of the Trust
Calif. Civ. Code § 1558 mandates, “it is essential to the validity of a contract, not only that the
parties should exist, but that is should be possible to identify them.” This Statute can be further
extended to include that a party claiming beneficial rights should also exist; here in my Case the
Morgan Stanley Loan Trust – which is on 100’s of assignments of Deeds of Trust, Notice of
Defaults, Trustee Deeds Upon Sales – is a nonexistent entity.
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Calfiornia: Jackson v. Grant In re Ramsey v. Vista Mortgage
Failure Four – PSA contradicts who purchased the Note
The Purchase Sales Agreement states the Note was sold by NC Capital and then sold to Morgan
Stanley Mortgage Capital; the PSA states the Sales Agreement was between NC Capital and
Morgan Stanley Capital, I. Is there another Sales Agreement? Is the one that was submitted
during trial the real Sales Agreement, or is there another one between NC Capital and MSC1?
Does it matter? It is another inconsistently and impacts the chain of title requirements.
Failure Six- Violation of IRC § 860D(c)(2) in identification of the REMIC
ASSETS
Refer back to the conveyance issues as those cases also deal with the failure of the banks to
identify the assets on the schedules.
CLOSING
If you have been able to identify some or all of the above failures and the key failures are the
conveyance and closing date breaches, then I would definitely consider having a conversation
about attacking the Standing of the Parties foreclosing with an attorney. An attorney who
understands what they are looking at will be able to articulate to you what the causes of
actions are for your state, will determine if there is justification for having an EXPERT do a
professional audit and then provide the audit, an affidavit and have the credentials to testify in
court what they found in the audit.
The audit ONLY has value if you have the expertise of an Expert who can provide
documentation and evidence that may be used in a court of law; otherwise why bother with an
audit? They are going to tell you what you already know – that is not what you pay for; you pay
for a credible witness who can testify on your behalf, or at the minimum give you an affidavit
for your pleadings.
