Getting Through to Judges Unfamiliar with Securitization

Posted on September 30, 2009 by Neil Garfield

If I am right, then why are judges are not buying this? see msnbc discussion of “What’s in the Bag?”>
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The problem here is becoming increasingly apparent with Judges of many different
ideological persuasions. This all looks like a gimmick to them. And they are right. It’s
just that the one finessing the gimmick is the pretender lender and not the borrower.
That they don’t realize. These Judges have all been lawyers for 20 years or more. They
went to law school before securitization was ever discussed in legal circles. So they
approach a foreclosure from the standpoint of what they know. Here are their
assumptions —

1. The loan was made properly except for possibly a few technicalities
2. The lender is the party named as the lender
3. The beneficiary is the party named as beneficiary
4. The note is valid and in default
5. The mortgage is incident to the mortgage and is foreclosure even if the party
named on the mortgage is different than the party named on the note
6. Subsequent transfer of the note, securitization, insurance and federal bailouts
are distractions from the real issue: the homeowner took out a loan, can’t pay
and now wants to get out of the deal and keep his house.
THIS is why I keep harping on keeping it simple, staying with the basics, and
attacking point by point and building your case to the point where it is the
Judge who on his/her own comes to the conclusion that there might be
something wrong with the DOT or its enforcement. You don’t want to lead with
a direct challenge to the assumptions they are making because they are
resistant to believing it and the more you talk, the more you lose credibility.
You must concentrate on what they do understand and where they will most
likely agree with you. And you must do so with facts that are not in dispute —
like the fact that you sent a QWR, the date, the requirements of the statute, the
equivalent statute under state law, etc. Understanding securitization is
important for you as litigators or pro se litigants to know WHY you are doing
what you are doing — it isn’t a strategy of opening salvo at a judge who is
hearing your “theories”.

Keep in mind that with very few exceptions no judge is trying to be pig-headed
about this. They are applying their knowledge or the law and their experience of life
as they know it. Your job is to educate them in a way that achieves its purpose. Just
because you are right does not mean you win. If that were the case computers could
replace lawyers and Judges. The job you have is persausion and that means putting
yourself in the shoes of a judge who does not know what you are talking about and
is getting a feeling in the pit of his/her stomache that the borrower is simply a
deadbeat seeking to avoid the consequences of their own poor judgment.

First start with a QWR and DVL. Then attack them for not answering fully. Demand
an answer: who is my real lender and how much do I owe. I want a full accounting
of everything EVERYONE has received on this loan transaction not just what you
received from the borrower. This right is protected under federal and state statutes.
Go to state court if you can and make it that simple. Judge we want to pursue
modification, refinance or sale as per federal law and state law but we can’t do that
because we don’t know who the lender is and they won’t tell us. We also have
claims regarding the origination of the loan but we don’t know who to serve
because they won’t tell us. They will admit the loan was securitized which means
that the loan was sold off to hundreds or perhaps thousands of investors through
what they call a trust or special purpose vehicle, but they won’t give us names,
documents, contact information or anything else.

Simple common sense tells us that if we owe money we are entitled to know to
whom we owe it and how much is outstanding. TILA and RESPA state with great
clarity that they are required to give us the name of the true lender at the present
time along with the name of a person and a telephone number and address. While
we have our suspicions as to why they are refusing to comply with federal and state
law, we don’t want to make allegations we can’t prove. So we are asking for an
emergency mandatory injunction simply requiring that they answer the QWR and
DVL and specifically provide us with the parties who claim or possess an ownership
or other interest in this loan, along with the name and address of the person whom
we can contact at the entity which they say is the lender. We can’t even seek
alternative fianncing to pay off this loan because we cannot get a satisfaction of
mortgage or release or reconveyance from a party whom we know to be the lender.
Any such document is obviously intended to be executed by some other party who
will claim some sort of agency authority, which we also want to see.

This is why we are asking for declaratory, injunctive and supplemental relief. The
servicer here is (a) by definition not the lender and (b) required by law and common
sense to provide us with the information we are seeking. The only argument we
have heard against providing this infomration is that if they tell us, the whole
financial system will collapse again. Judge, if the system is in danger of collapse if
the homeowners know the truth about their loans, then that doesn’t mean the
homeowners should be denied their due process and suffer all the consequences of a
scheme they didn’t invent or even know about.

After a few rounds of appearing before the Judge with the pretender lender trying to
explain why they cannot or will not answer the question, the judge’s aspect will
change from incredulity about your position to annoyance with theirs.