President Of Metropolitan Money Store Pleads Guilty In Over $35M Mortgage Fraud Scheme Joy Jackson, 41, Fort Washington, Maryland, pleaded guilty to conspiracy to commit mail and wire fraud in connection with a mortgage fraud scheme. The accused promised to help homeowners facing foreclosure to keep their homes and repair their damaged credit.
According to her plea agreement, Jackson was a licensed mortgage broker, but was not licensed to provide credit repair. In May 2005, Jackson and coconspirator Jennifer McCall incorporated Metropolitan Money Store, located in Lanham, Maryland, which offered foreclosure consultation and credit services to financially distressed homeowners. Also at that time, Jackson and other coconspirators incorporated Fordham & Fordham Investment Group, Ltd. (F&F) based in Lanham and Greenbelt, Maryland to assist Metropolitan Money Store in its foreclosure consulting and credit servicing business.
From September 2004 to June 2007, Jackson, McCall and others conspired to fraudulently promise to help homeowners, who had substantial equity in their homes but were facing foreclosure because of their inability to make monthly mortgage payments, avoid foreclosure and repair their damaged credit. The homeowners were directed to allow title to their homes to be put in the names of third party purchasers (the straw buyers) for a year, during which time Metropolitan Money Store promised to improve the homeowners’ credit ratings, help them obtain more favorable mortgages, and eventually return title to their homes to them. The homeowners were told that the equity withdrawn from the properties would be used to pay the mortgage and expenses on their homes and to repair their credit. The straw buyers were paid up to $10,000 to participate in the scheme and allow the properties to be put in their names. Jackson also served as a straw buyer on several properties in Maryland.
Using the homeowners’ properties, the conspirators applied for mortgages to extract the maximum available equity from the homes, and prepared and submitted fraudulent loan applications to mortgage lenders to obtain inflated loans on the target properties in the straw buyers’ names. At settlements, the conspirators imposed numerous fees and required “seller contributions” which were far in excess of industry standards; they imposed fees for services which were not performed, disclosed or explained to the homeowners; and they transferred the sale proceeds out of the escrow accounts into the conspirators’ business and personal bank accounts and converted a substantial portion of those funds to their personal use.
In order to carry out the fraud scheme, Jackson and others obtained large cashier’s checks in the names of straw buyers and Metropolitan Money Store employees in order to conceal transactions from the lenders. Jackson misappropriated the license and bond numbers of other brokerage and credit repair companies and used them to broker loans and fraudulently improve homeowners’ credit scores by adding fictitious lines of credit to their credit histories.
During the conspiracy, Jackson and McCall provided a co-conspirator acting as a closing agent with more than $100,000 in kickback payments to process real estate closings quickly. Moreover, whenever Jackson requested, the closing agent permitted Metropolitan Money Store employees to close loans without him or any other closing agent being present. She directed others to prepare fraudulent settlement documents that contained false information. Jackson also paid bank employees to provide false income balances for straw buyers to lenders; add straw buyers and others onto accounts for lender verification purposes; transfer money into accounts to show a certain amount of money was in a bank account and thereafter return those funds to the original account; and shift money between Metropolitan Money Store and F&F accounts to facilitate loans in straw buyer’s names.
Finally, Jackson directed others to transfer the equity proceeds of homeowners into the general checking accounts of Metropolitan Money Store and F&F, as well as Jackson’s personal accounts. Jackson withdrew these funds and paid for goods and services for herself, including art, cars, clothing, credit card bills, homes, fur coats, furniture, airline trips, gambling expenses, jewelry, limousine services, student tuition and a luxury wedding for herself and a conspirator.
As a result of this scheme, the total loss attributable to Jackson, including the estimated losses to the mortgage lenders, is $16,880,884.86.
Jackson faces a maximum sentence of 30 years in prison and a $1 million fine for the conspiracy. U.S. District Judge Roger W. Titus scheduled sentencing for November 16, 2009 at 9:00 a.m. As part of her plea, Jackson has agreed to pay restitution for the full amount of the victims’ losses, and forfeit three residential properties in Oxon Hill, Capitol Heights and Laurel, Maryland, and three vehicles.
Jackson is the seventh defendant to plead guilty in the Metropolitan Money Store mortgage fraud scheme. Jennifer McCall, 47, Ft. Washington, Maryland, a chief executive officer of Metropolitan Money Store and owner of JC and JC Investments LLC; Katisha Fordham, 35, Washington, D.C., a loan processor at the Metropolitan Money Store. Richard Allison, 37, Camp Springs, Maryland, an attorney and employee of the U.S. Census Bureau; Clifford McCall, 47, Lanham, Maryland, president of Burroughs & Smythe Financial Services, Inc., based in Lanham and a director of the Fordham & Fordham Investment Group, Ltd., a foreclosure consulting and credit servicing business based in Lanham and Greenbelt, Maryland; Carlisha Dixon, 31, Hyattsville, Maryland, vice president and a director of Burroughs & Smythe Financial Services, Inc.; and Chandra Jones, 31, Lanham, Maryland, the daughter of co-defendants Jennifer and Clifford McCall, each. pleaded guilty to the conspiracy and are facing a maximum sentencing of 30 years in prison. Three defendants remain scheduled for trial on July 7, 2009.
United States Attorney for the District of Marylan. Rod J. Rosenstein made the announcement.
“Joy Jackson presided over a ‘money store’ that was in the business of ripping off homeowners and mortgage lenders by submitting fraudulent paperwork to support over $16 million of loans that were never intended to be repaid,” said U.S. Attorney Rod J. Rosenstein. “Instead of helping financially distressed homeowners keep their homes as promised, she secretly used their home equity to buy luxuries for herself, includin. furs, jewelry and over $800,000 on her wedding.”
“These types of crimes create a significant loss of tax revenue, drive buyers into foreclosure, and leave lenders burdened with bad loans,” stated C. Andre’ Martin, Internal Revenue Service-Criminal Investigation Special Agent in Charge. “IRS-CI is committed to pursuing individuals who create such havoc.”
United States Attorney Rod J. Rosenstein thanked the Federal Bureau of Investigation, U.S. Secret Service, Internal Revenue Service-Criminal Investigation and the Maryland Department of Labor, Licensing and Regulation’s Division of Financial Regulation Investigative Unit for their investigative work. Mr. Rosenstei. commended Assistant United States Attorneys James A. Crowell IV and Christen Sproule, who are prosecuting the case.
Thursday, March 26, 2009
How to Do Your Loan Modification Review for Violations?
How to Do Your Mortgage Documents Review?
For Loan Violations?
Fore best evaluation of your claim on any of the predatory lending violations, it is necessary to do a loan audit. A loan audit is a good thing: but by who? Too many claims an expertise in this field of art. It is a bit mathematics, and a bit law. But definitely not a forensic science which they label. Are they gradute of some forensic science laboratory? Forensic my foot! Too many of them are fraudster and former loan officers, blackjack dealers etc., who spread this mess in the first place. Some of them should have been behind bars. Check their resume, they are loan officers, valet parking lot attendants, and managers of loan companies, who were actually wolves, and now working in sheep’s clothing. No disrespect meant to these respectable professions but that experience is not material here.
Fortunately, we do not vouch for any speciality in this game, unlike lots of others despite having a strong background in loans, mortgages, real estate and other allied fields. Most of them have actually no expertise in it. Truthfully, even if they find anything, any sort of violations of any of the predatory lendign laws, what exactly they can do? They are not licensed to litigate or practice law. They still have to find an attorney willing and knowledgeable in this filed which again is very complex, to litigate and eventually win. Your loan audit, or so called forensic auditor cannot do that. He would charge a hefty sum of $900 or more and give you a computerized printout which may be more than half wrong, and half just assumptions which can be wrong or not.
In order to properly evaluate a claim for mortgage litigation, it will become necessary to do audit you closing documents for violations of state and federal lending laws. We can audit your loan documents well before suit is file to give us the best chance at settlement prior to going to court. We can ask your lender to simply change the terms of your loans based on these violations, and they would listen because it is backed up with the forece of an attorney. When attorney talks, everyone listen–because they mean business, and of course litigations which is very expensive for all the parties. Many lenders will agree to make changes to your loan.
What documents do you need?
In most cases you can get all of the information you need from the following five or six loan documents:
Truth in Lending Disclosure Statement
–(3-Day) Notice of Right to Cancel
–HUD-1 (or HUD-1A) Settlement Statement
–Mortgage and Note (with any riders or attachments)
–Uniform Residential Loan Application
–HOEPA (or “Section 32″) Notice (if lender treated loan as a HOEPA loan)
What we look for?
Violations of the following federal and state laws may entitle the borrower to a reduction in the amount they owe on a refinance or home equity loan.
–Truth in Lending Act (TILA):
–Does the TILA Disclosure Statement clearly and conspicuously display each of the following?
–Annual Percentage Rate (APR)
–Finance Charge
–Amount Financed
–Total of Payments
–Payment Schedule
–APR
–Total of Payments
–Are the disclosures accurate given an independent analysis of the charges?
–Amount Financed (i.e., do we think the lender left out something)
–Did the borrower receive a proper (3-Day)Notice of Right to Cancel?
–Does this loan qualify for Home Ownership and Equity Protection Act protection?
–Real Estate Settlement Procedures Act (RESPA):
–Yield-spread premium (YSP) paid to broker (listed on HUD-1)
–Separate broker fee listed
Is three times the YSP enough to offset the amount the borrower was in default when sued?
–Equal Credit Opportunity Act (ECOA):
–Loan application sets forth requested terms (interest rate, loan amount, fixed-rate)
–No written counter-offer (within 30 days) to terms requested
–Loan includes terms worse than those requested in loan application
For Loan Violations?
Fore best evaluation of your claim on any of the predatory lending violations, it is necessary to do a loan audit. A loan audit is a good thing: but by who? Too many claims an expertise in this field of art. It is a bit mathematics, and a bit law. But definitely not a forensic science which they label. Are they gradute of some forensic science laboratory? Forensic my foot! Too many of them are fraudster and former loan officers, blackjack dealers etc., who spread this mess in the first place. Some of them should have been behind bars. Check their resume, they are loan officers, valet parking lot attendants, and managers of loan companies, who were actually wolves, and now working in sheep’s clothing. No disrespect meant to these respectable professions but that experience is not material here.
Fortunately, we do not vouch for any speciality in this game, unlike lots of others despite having a strong background in loans, mortgages, real estate and other allied fields. Most of them have actually no expertise in it. Truthfully, even if they find anything, any sort of violations of any of the predatory lendign laws, what exactly they can do? They are not licensed to litigate or practice law. They still have to find an attorney willing and knowledgeable in this filed which again is very complex, to litigate and eventually win. Your loan audit, or so called forensic auditor cannot do that. He would charge a hefty sum of $900 or more and give you a computerized printout which may be more than half wrong, and half just assumptions which can be wrong or not.
In order to properly evaluate a claim for mortgage litigation, it will become necessary to do audit you closing documents for violations of state and federal lending laws. We can audit your loan documents well before suit is file to give us the best chance at settlement prior to going to court. We can ask your lender to simply change the terms of your loans based on these violations, and they would listen because it is backed up with the forece of an attorney. When attorney talks, everyone listen–because they mean business, and of course litigations which is very expensive for all the parties. Many lenders will agree to make changes to your loan.
What documents do you need?
In most cases you can get all of the information you need from the following five or six loan documents:
Truth in Lending Disclosure Statement
–(3-Day) Notice of Right to Cancel
–HUD-1 (or HUD-1A) Settlement Statement
–Mortgage and Note (with any riders or attachments)
–Uniform Residential Loan Application
–HOEPA (or “Section 32″) Notice (if lender treated loan as a HOEPA loan)
What we look for?
Violations of the following federal and state laws may entitle the borrower to a reduction in the amount they owe on a refinance or home equity loan.
–Truth in Lending Act (TILA):
–Does the TILA Disclosure Statement clearly and conspicuously display each of the following?
–Annual Percentage Rate (APR)
–Finance Charge
–Amount Financed
–Total of Payments
–Payment Schedule
–APR
–Total of Payments
–Are the disclosures accurate given an independent analysis of the charges?
–Amount Financed (i.e., do we think the lender left out something)
–Did the borrower receive a proper (3-Day)Notice of Right to Cancel?
–Does this loan qualify for Home Ownership and Equity Protection Act protection?
–Real Estate Settlement Procedures Act (RESPA):
–Yield-spread premium (YSP) paid to broker (listed on HUD-1)
–Separate broker fee listed
Is three times the YSP enough to offset the amount the borrower was in default when sued?
–Equal Credit Opportunity Act (ECOA):
–Loan application sets forth requested terms (interest rate, loan amount, fixed-rate)
–No written counter-offer (within 30 days) to terms requested
–Loan includes terms worse than those requested in loan application
Show Me The Note Baby!
Show Me The Note!
To recover on a promissory note, the plaintiff (the lender in the case of foreclosure) must prove:
(1) the existence of the note in question;
(2) that the party sued signed the note;
(3) that the plaintiff is the owner or holder of the note in due course; and
(4) that a certain balance is due and owing on the note.
It is also true, in mortgage foreclosures, prove up of the claim requires presentment of the “ORIGINAL” promissory note and general account and ledger statement. Claim of damages, to be admissible as evidence, must incorporate records such as a general ledger and accounting of an alleged unpaid promissory note, the person responsible for preparing and maintaining the account general ledger must provide a complete accounting which must be sworn to and dated by the person who maintained the ledger.
1) the existence of the note in question
2) If the “ORIGINAL” note you signed in ink that contains your signature is claimed to be lost, stolen, missing and/or destroyed, then your defense is as follows:
3) the “named” Plaintiff is not the ‘holder in due course” of the note and only an agent or nominee for the true beneficial owners and holders in due course;4) there may be fraud upon the court in that the named Plaintiff may not have ANY interest to the note and that the supposedly lost note is not lost, but may have been intentionally destroyed due to missing assignments on the note which may have made it void and a legal nullity, thus they have exploited key and vital evidence;
5) there is no proof that the named Plaintiff ever held the note or took possession of the note and thus has no claim or right to bringing about the foreclosure;
6) there is no proof, without the note, that a proper chain of assignments took place and that the lien positions were properly perfected;
7) other unnamed and disclosed real parties in interest may have a claim to the note and be the rightful beneficial owners to the note and must be identified and brought before the court;
There may be several unnamed and disclosed real parties in interest may have a claim to the note and be the rightful beneficial owners of the note;
8) that the party sued signed the note
9) If the “ORIGINAL” note you signed in ink that contains your signature is claimed to be lost, stolen, missing and/or destroyed, then you need to notify me and also put on affirmative defenses that:
10) the note in question is not the note you signed and executed in ink and only the one you signed in ink that presumably contains your fingerprints can be relied upon by your handwriting analysis expert;
11) in an electronic age, it is a simple matter to place someone’s signature or image upon a document and that it is very difficult to imagine such a valuable negotiable instrument being lost or missing without a nefarious motive.
12) that the plaintiff is the owner or holder of the note in due course;
13) If the “ORIGINAL” note you signed in ink that contains your signature is claimed to be lost, stolen, missing and/or destroyed, then you need put on affirmative defenses that:a) the mortgage industry, investors, and GSE’s such as Fannie Mae, Freddie Mac, and FHLBs etc. have a requirement that the last endorsement to them be undated and “blank” leaving the payee line blank and making the negotiable instrument a sort of “bearer bond” and instrument. as such, any party finding or stealing the note can place their name on the payee line, claim ownership of the note, and sell the note to others who may make a demand upon you in the future. as such, you require money to be deposited in an escrow account or with the court in an amount equal to the amount claimed owed on the note, until such missing note is found or upon your death. notes have a life of their own…
14) if the note was destroyed or lost intentionally (the industry maintains this practice) then they may be trying to hide the beneficial owners and shield them from any assignee liability arising from the actions of the servicer who they hire, supervise and most importantly authorize to foreclose upon you. without the note, since subsequent endorsements are not recorded to avoid payment of taxes and t hide true and real beneficial interests, there is no possible way to determine who ever held a rightful interest in the note and who you may have claims or counter claims against and who should be presently before the court as a real party in interest.
15) Furthermore, if there are missing assignments of the original note and the assignment went from Lender A to Lender B to Lender D without an intervening assignment from Lender B to Lender C and From Lender C to Lender D, then the note may be void and a legal nullity in your state.
16) It is industry practice to not name the GSE, investor, or real party in interest in foreclosure and to use as a front for the Plaintiff:
i) The very original lender who may or may not even be in business any more or sold their interest in the note long ago, only to have a claim made upon them for repurchase;
ii) A Servicer of even “special servicer” who is acting as an agent for the investors, GSE’s or real party in interest, but has no beneficial ownership in the note since they are only being paid to collect and foreclosure by the real parties in interest
iii) A “nominee” such as MERS who has no legal authority to foreclose upon you and do business in your state and who according to their own written documents and verbal assurances never hold the note or own “any” beneficial interest in the note!!!!!
17) Notes are pledged, sold, bifurcated, and traded in various derivative transactions.
Only possession of the actual original note can prove the actual owner and holder in due course of the note and who you can make an offer of payment to for purchase of the note by yourself, another family member or partner.
You have a right to know the rightful owner of the note so an offer for payment of the note at a discount and at fair market value can be made. If the note has been pledged and encumbered, then that party must be made aware of the foreclosure and your right to negotiate with them a payment and release of the note by you, other lien holders or private parties;
18) Notes are traded often and you need to inspect the physical note to see who the real prior parties were that held and endorsed your note since you may have counter and cross claims against them and need to bring them before the court for the action, since they may have improperly inflated your principal balance, amount owed or escrow account by not applying your payments correctly; adding fees not legally owed by you to the principal balance; miscalculating the interest and not properly amortizing your loan; fraudulent selling your loan or misreporting you on your credit report.
19) Federal Circuit Courts have ruled that the only way to prove the perfection of any security [including promissory note] is by actual possession of the security. Current or prior possession must be proved up.
20) that a certain balance is due and owing on the note.
21) You must have the master transaction histories and general ledgers for the account since a “dump,” “summary,” or redacted record cannot be relied upon to determine the rightful amounts owed by having a complete audit of your account. In order to conduct a proper audit, master records and all prior records must be compiled, reviewed, analyzed, and reconciled. In is not you responsibility to prove each payment was made. It is your responsibility to say a payment was made and provide evidence, including your word that it was made. It is the note holder’s duty and responsibility to validate the claims being made on the note and the amount owed. If they have the master records or claim that the records of prior servicers are missing, then there is no rightful way for anyone to prove up the balances and amounts they claim are owed!!!! Furthermore, you must claim:
a) That the principal balance claimed owed, is not owed, and is the wrong amount.
b) That the loan has not been properly credited and amortized;
c) That the current servicer cannot be relied upon to testify and certify that prior amounts, transactions, credits, debits, charges and fees added by prior servicers were indeed proper and correct and that the account they were transferred was properly amortized and credited. As such, the person holding the ledgers at the prior servicer must come and testify as to the amounts owed on the note.
d) dumps and summaries of amounts owed cannot be relied upon and only original ledgers and master records and the keeper of those records cant testify as to the amounts claimed owed and due.
Supporting Case Law
Where the complaining party cannot prove the existence of the note, then there is no note.
See Pacific Concrete F.C.U. V. Kauanoe, 62 Haw. 334, 614 P.2d 936 (1980), GE Capital Hawaii, Inc. v. Yonenaka 25 P.3d 807, 96 Hawaii 32, (Hawaii App 2001).
Siwooganock Bank in Lancaster NH, in alleged foreclosure suit, failed or refused to produce the actual note which Siwooganock alleges Eva J. Lovejoy owed.
To recover on a promissory note, the plaintiff must prove: (1) the existence of the note in question; (2) that the party sued signed the note; (3) that the plaintiff is the owner or holder of the note; and (4) that a certain balance is due and owing on the note. See In Re: SMS Financial LLC. v. Abco Homes, Inc. No.98-50117 February 18, 1999 (5th Circuit Court of Appeals.)
Volume 29 of the New Jersey Practice Series, Chapter 10 Section 123, page 566, emphatically states, “…; and no part payments should be made on the bond or note unless the person to whom payment is made is able to produce the bond or note and the part payments are endorsed thereon. It would seem that the mortgagor would normally have a Common law right to demand production or surrender of the bond or note and mortgage, as the case may be. See Restatement, Contracts S 170(3), (4) (1932); C.J.S. Mortgages S 469, in Carnegie Bank v, Shalleck 256 N.J. Super 23 (App. Div 1992), the Appellate Division held, “When the underlying mortgage is evidenced by an instrument meeting the criteria for negotiability set forth in N.J.S. 12A:3-104, the holder of the instrument shall be afforded all the rights and protections provided a holder in due course pursuant to N.J.S. 12A:3-302″
Since no one is able to produce the “instrument” there is no competent evidence before the Court that any party is the holder of the alleged note or the true holder in due course. New Jersey common law dictates that the plaintiff prove the existence of the alleged note in question, prove that the party sued signed the alleged note, prove that the plaintiff is the owner and holder of the alleged note, and prove that certain balance is due and owing on any alleged note. Federal Circuit Courts have ruled that the only way to prove the perfection of any security is by actual possession of the security.
Supporting Case Law
Unequivocally the Court’s rule is that in order to prove the “instrument”, possession is mandatory.
See Matter of Staff Mortg. & Inv. Corp., 550 F.2d 1228 (9th Cir 1977). “Under the Uniform Commercial Code, the only notice sufficient to inform all interested parties that a security interest in instruments has been perfected is actual possession by the secured party, his agent or bailee.” Bankruptcy Courts have followed the Uniform Commercial Code. In Re Investors & Lenders, Ltd. 165 B.R. 389 (Bankruptcy.D.N.J.1994), “Under the New Jersey Uniform Commercial Code (NJUCC), promissory note is “instrument,” security interest in which must be perfected by possession.
To recover on a promissory note, the plaintiff (the lender in the case of foreclosure) must prove:
(1) the existence of the note in question;
(2) that the party sued signed the note;
(3) that the plaintiff is the owner or holder of the note in due course; and
(4) that a certain balance is due and owing on the note.
It is also true, in mortgage foreclosures, prove up of the claim requires presentment of the “ORIGINAL” promissory note and general account and ledger statement. Claim of damages, to be admissible as evidence, must incorporate records such as a general ledger and accounting of an alleged unpaid promissory note, the person responsible for preparing and maintaining the account general ledger must provide a complete accounting which must be sworn to and dated by the person who maintained the ledger.
1) the existence of the note in question
2) If the “ORIGINAL” note you signed in ink that contains your signature is claimed to be lost, stolen, missing and/or destroyed, then your defense is as follows:
3) the “named” Plaintiff is not the ‘holder in due course” of the note and only an agent or nominee for the true beneficial owners and holders in due course;4) there may be fraud upon the court in that the named Plaintiff may not have ANY interest to the note and that the supposedly lost note is not lost, but may have been intentionally destroyed due to missing assignments on the note which may have made it void and a legal nullity, thus they have exploited key and vital evidence;
5) there is no proof that the named Plaintiff ever held the note or took possession of the note and thus has no claim or right to bringing about the foreclosure;
6) there is no proof, without the note, that a proper chain of assignments took place and that the lien positions were properly perfected;
7) other unnamed and disclosed real parties in interest may have a claim to the note and be the rightful beneficial owners to the note and must be identified and brought before the court;
There may be several unnamed and disclosed real parties in interest may have a claim to the note and be the rightful beneficial owners of the note;
8) that the party sued signed the note
9) If the “ORIGINAL” note you signed in ink that contains your signature is claimed to be lost, stolen, missing and/or destroyed, then you need to notify me and also put on affirmative defenses that:
10) the note in question is not the note you signed and executed in ink and only the one you signed in ink that presumably contains your fingerprints can be relied upon by your handwriting analysis expert;
11) in an electronic age, it is a simple matter to place someone’s signature or image upon a document and that it is very difficult to imagine such a valuable negotiable instrument being lost or missing without a nefarious motive.
12) that the plaintiff is the owner or holder of the note in due course;
13) If the “ORIGINAL” note you signed in ink that contains your signature is claimed to be lost, stolen, missing and/or destroyed, then you need put on affirmative defenses that:a) the mortgage industry, investors, and GSE’s such as Fannie Mae, Freddie Mac, and FHLBs etc. have a requirement that the last endorsement to them be undated and “blank” leaving the payee line blank and making the negotiable instrument a sort of “bearer bond” and instrument. as such, any party finding or stealing the note can place their name on the payee line, claim ownership of the note, and sell the note to others who may make a demand upon you in the future. as such, you require money to be deposited in an escrow account or with the court in an amount equal to the amount claimed owed on the note, until such missing note is found or upon your death. notes have a life of their own…
14) if the note was destroyed or lost intentionally (the industry maintains this practice) then they may be trying to hide the beneficial owners and shield them from any assignee liability arising from the actions of the servicer who they hire, supervise and most importantly authorize to foreclose upon you. without the note, since subsequent endorsements are not recorded to avoid payment of taxes and t hide true and real beneficial interests, there is no possible way to determine who ever held a rightful interest in the note and who you may have claims or counter claims against and who should be presently before the court as a real party in interest.
15) Furthermore, if there are missing assignments of the original note and the assignment went from Lender A to Lender B to Lender D without an intervening assignment from Lender B to Lender C and From Lender C to Lender D, then the note may be void and a legal nullity in your state.
16) It is industry practice to not name the GSE, investor, or real party in interest in foreclosure and to use as a front for the Plaintiff:
i) The very original lender who may or may not even be in business any more or sold their interest in the note long ago, only to have a claim made upon them for repurchase;
ii) A Servicer of even “special servicer” who is acting as an agent for the investors, GSE’s or real party in interest, but has no beneficial ownership in the note since they are only being paid to collect and foreclosure by the real parties in interest
iii) A “nominee” such as MERS who has no legal authority to foreclose upon you and do business in your state and who according to their own written documents and verbal assurances never hold the note or own “any” beneficial interest in the note!!!!!
17) Notes are pledged, sold, bifurcated, and traded in various derivative transactions.
Only possession of the actual original note can prove the actual owner and holder in due course of the note and who you can make an offer of payment to for purchase of the note by yourself, another family member or partner.
You have a right to know the rightful owner of the note so an offer for payment of the note at a discount and at fair market value can be made. If the note has been pledged and encumbered, then that party must be made aware of the foreclosure and your right to negotiate with them a payment and release of the note by you, other lien holders or private parties;
18) Notes are traded often and you need to inspect the physical note to see who the real prior parties were that held and endorsed your note since you may have counter and cross claims against them and need to bring them before the court for the action, since they may have improperly inflated your principal balance, amount owed or escrow account by not applying your payments correctly; adding fees not legally owed by you to the principal balance; miscalculating the interest and not properly amortizing your loan; fraudulent selling your loan or misreporting you on your credit report.
19) Federal Circuit Courts have ruled that the only way to prove the perfection of any security [including promissory note] is by actual possession of the security. Current or prior possession must be proved up.
20) that a certain balance is due and owing on the note.
21) You must have the master transaction histories and general ledgers for the account since a “dump,” “summary,” or redacted record cannot be relied upon to determine the rightful amounts owed by having a complete audit of your account. In order to conduct a proper audit, master records and all prior records must be compiled, reviewed, analyzed, and reconciled. In is not you responsibility to prove each payment was made. It is your responsibility to say a payment was made and provide evidence, including your word that it was made. It is the note holder’s duty and responsibility to validate the claims being made on the note and the amount owed. If they have the master records or claim that the records of prior servicers are missing, then there is no rightful way for anyone to prove up the balances and amounts they claim are owed!!!! Furthermore, you must claim:
a) That the principal balance claimed owed, is not owed, and is the wrong amount.
b) That the loan has not been properly credited and amortized;
c) That the current servicer cannot be relied upon to testify and certify that prior amounts, transactions, credits, debits, charges and fees added by prior servicers were indeed proper and correct and that the account they were transferred was properly amortized and credited. As such, the person holding the ledgers at the prior servicer must come and testify as to the amounts owed on the note.
d) dumps and summaries of amounts owed cannot be relied upon and only original ledgers and master records and the keeper of those records cant testify as to the amounts claimed owed and due.
Supporting Case Law
Where the complaining party cannot prove the existence of the note, then there is no note.
See Pacific Concrete F.C.U. V. Kauanoe, 62 Haw. 334, 614 P.2d 936 (1980), GE Capital Hawaii, Inc. v. Yonenaka 25 P.3d 807, 96 Hawaii 32, (Hawaii App 2001).
Siwooganock Bank in Lancaster NH, in alleged foreclosure suit, failed or refused to produce the actual note which Siwooganock alleges Eva J. Lovejoy owed.
To recover on a promissory note, the plaintiff must prove: (1) the existence of the note in question; (2) that the party sued signed the note; (3) that the plaintiff is the owner or holder of the note; and (4) that a certain balance is due and owing on the note. See In Re: SMS Financial LLC. v. Abco Homes, Inc. No.98-50117 February 18, 1999 (5th Circuit Court of Appeals.)
Volume 29 of the New Jersey Practice Series, Chapter 10 Section 123, page 566, emphatically states, “…; and no part payments should be made on the bond or note unless the person to whom payment is made is able to produce the bond or note and the part payments are endorsed thereon. It would seem that the mortgagor would normally have a Common law right to demand production or surrender of the bond or note and mortgage, as the case may be. See Restatement, Contracts S 170(3), (4) (1932); C.J.S. Mortgages S 469, in Carnegie Bank v, Shalleck 256 N.J. Super 23 (App. Div 1992), the Appellate Division held, “When the underlying mortgage is evidenced by an instrument meeting the criteria for negotiability set forth in N.J.S. 12A:3-104, the holder of the instrument shall be afforded all the rights and protections provided a holder in due course pursuant to N.J.S. 12A:3-302″
Since no one is able to produce the “instrument” there is no competent evidence before the Court that any party is the holder of the alleged note or the true holder in due course. New Jersey common law dictates that the plaintiff prove the existence of the alleged note in question, prove that the party sued signed the alleged note, prove that the plaintiff is the owner and holder of the alleged note, and prove that certain balance is due and owing on any alleged note. Federal Circuit Courts have ruled that the only way to prove the perfection of any security is by actual possession of the security.
Supporting Case Law
Unequivocally the Court’s rule is that in order to prove the “instrument”, possession is mandatory.
See Matter of Staff Mortg. & Inv. Corp., 550 F.2d 1228 (9th Cir 1977). “Under the Uniform Commercial Code, the only notice sufficient to inform all interested parties that a security interest in instruments has been perfected is actual possession by the secured party, his agent or bailee.” Bankruptcy Courts have followed the Uniform Commercial Code. In Re Investors & Lenders, Ltd. 165 B.R. 389 (Bankruptcy.D.N.J.1994), “Under the New Jersey Uniform Commercial Code (NJUCC), promissory note is “instrument,” security interest in which must be perfected by possession.
Subscribe to:
Posts (Atom)