Balancing the Scales of Justice for Pro Se Homeowners

What is the big deal about a couple of lies and a few forged documents?

Posted by on Feb 2, 2012

What is the big deal about a couple of lies and a few forged documents?

Last year many of the major banks halted foreclosures in judicial foreclosure states because, as they claimed, they had hit a little “road bump”.  This little road bump was the Courts demanding that any entity wanting to do a foreclosure provide documentation of actual ownership of the Promissory Note and Mortgage/Deed of Trust on the property.  Low and behold, the banks were unable to do so because they had misplaced paperwork on the houses they were foreclosing.  Furthermore, some of the banks (most) that could not find the documents just created new documents that were then signed by “robo signers”.  Robo signers are  individuals who sign affidavits, in bulk,  testifying to the accuracy and authenticity of the default information and/or assignments of Deed of Trusts/Mortgages even though the robo signer never saw the information.  These documents were then notarized, in bulk, by some Notary who never saw who was signing the documents.

First, let me just say that losing an Original Promissory Note is mind boggling.  Not just because of the carelessness it suggests in the management of promissory notes, but most banks have document custodians with very advanced document management systems which track  the storage and management of every single piece of paper it ever receives.  Second, this is the banks we are talking about – you know – Bank of America, Wells Fargo, Chase, Citibank, Deutsche Bank.  If they can’t keep track of a Note worth 100’s of thousands of dollars, what can they keep track of?  Your investment or retirement portfolio?  Your cash deposits?

In some cases the banks actually have lost the actual Promissory Note.  There are stories of the banks presenting several different versions of the “original” promissory Note (especially in Florida) during litigation.  In others, most, it is a matter of the banks not being able to prove a clear “chain of title”.  Chain of title is showing how the Note was sold between the different entities; usually this is easily demonstrated with a series of endorsements on the back of the Note, or through a series of assignments for the Deed of Trust or Mortgage.  Many of the banks do not have this clear chain of title, ergo the introduction of the “robo signers” who sign assignments in mass production to manufacture the “chain of title” for the foreclosure process.

Second, as I discussed in yesterdays blog, “When is forgery not forgery?” (See here)  the 3rd party firms supporting the banks in their foreclosure processes rationalize the use of forged documents  with the simple explanation that – what does it matter if it is forged?  It doesn’t invalidate the documents.  Not only is this preposterous, it does not explain WHO the actual owner is.  What evidence do the banks have that the bank IS the owner? They are asking the public to take their “word for it” and to take a leap of faith that the actual owner will never come around asking for payment on the Note.  (Yes, there are reports of this happening as well).

In essence what the banks and their 3rd party foreclosure firms are doing is the same as if you tell your neighbor you missed a payment.  Your neighbor hires a 3rd party like Ndex West, Northwest Trustee Services, Recon, or LPS and tells them to file a Notice of Default and create an assignment.  Your neighbor then files a Substitution of Trustee to make Ndex West (his paid agent) the Trustee.  The new Trustee then has someone make up an assignment of Deed of Trust to your neighbor from your original Lender/creditor and files it in the land records.  Presto – your neighbor can now foreclose on you!   If you are in a non judicial state the only way to stop this madness is to file a lawsuit because all of the filed documents, which robo signers signed sworn affidavits that the information is true (information that the signer has never seen), and had it notarized by some Notary (who wasn’t present when the document was signed) is prima facie evidence of your neighbors right to foreclose on you.  Sounds crazy but this is EXACTLY what the banks are doing.

Now in judicial states, your neighbor (the bank) has to file this in the court and have it approved by the court; the courts in those states are getting wind of the hinky nature of this paperwork and demanding that the banks show how they came into possession of the Note and Mortgage/Deed of Trust – and the banks can’t.  This is why the banks halted the process in judicial states and not the non judicial states.  In non judicial states it is a rubber stamped process that does not receive any scrutiny from the courts; unless the homeowner initiates a lawsuit to stop the process they are steamrolled right on out of their house.  I mean seriously, you didn’t think it was just because they lost paperwork only in the judicial states, right?

I realize this is an oversimplification of the process, there is much more to this mess than what I can ever hope to cover in one blog.  In our experts section there is a listing of white papers that explains this debacle in much clearer details and explains how “securitization” has mucked this up.   (See  Must Reads)

The bottom line is that the paperwork has not been lost.  That is a lie.  The truth is that there never was any paperwork..  [nonmember]  The remaining content is for members of our site.  Register for FREE! Scroll to the bottom of our membership page and register for FREE!

 [/nonmember] [ismember]The  banks and Wall Street firms buying up the Notes never bothered with actually conveying the Notes between the entities and because some of the parties in the chain of title are now gone (New Century, Countrywide, etc.) the banks have to now manufacture documents to show the chain of title.  And the banks argument is just because they are manufacturing the documents it doesn’t mean they (the banks) don’t have rights to the Note and Mortgage/Deed of Trust.  In theory one could almost buy into this; I mean these are respected financial firms that don’t lie, right?  Well okay, they lie but in general the public trusts these banks and Wall Street firms so we should just “go with it”.  Nevermind that they do not have documentation to actually PROVE they really did buy the Note.  So what is the big deal about a few little lies and a few forged documents?  Homeowner borrowed money and homeowner needs to pay it back..  Which by the way, I have yet to meet a homeowner who did NOT want to pay it back; typically the homeowner is asking for consideration on the TERMS of the repayment not for forgiveness of the debt.


In my case – this probably is an exception (NOT!)  – the originator was New Century Mortgage.  New Century never actually sold my Note.  Their sister company, NC Capital intended to sell it to Morgan Stanley Mortgage, who intended to sell it to its affiliate, Morgan Stanley Capital I, who intended to convey it to a REMIC Trust.  The only problem is, New Century never actually sold the Note to NC Capital; so NC capital, which intended to sell the Note in TWO different purchase sales agreements, did not have ownership of the Note to sell it to anyone.  All the other entities in the chain of title that intended to buy it, bought nothing.  Now the problem here is that Wells Fargo (servicer), Deutsche Bank (trustee and document custodian) and Morgan Stanley Capital 1 (depositor) certified to the investors of the REMIC Trust that they had indeed bought the Note and had indeed had a full chain of title to the property.  Whoops…another little lie.  So when Morgan Stanley Capital was taking money from investors and issuing certificates for the REMIC Trust that supposedly held the Notes, there was nothing in the REMIC Trust.  They lied to the investors, the IRS, and themselves.   They took money for nothing. 

In addition, New Century, who is arguing with me in Delaware, wants to wipe their hands clean of the mess.  They do not want to retain ownership of the Note.  This would be because I have evidence that the appraisal on my property was fraudulent;  New Century’s appraiser overvalued the property by  FIFTY TO NINTY THOUSAND dollars;  New Century committed violations of TILA/RESPA, and lied about funding the Note.  New Century wasn’t the actual creditor/lender – so there is fraud in the origination of the Note.   Just a few more little lies.   If you did this, wouldn’t you like to wipe your hands clean and take no responsibility?

Funny how the banks complain, saying homeowners are deadbeats – totally ignoring that the Notes are predatory loans that no one wants responsibility for; and totally ignoring that the banks ALSO LIED to the investors.  This isn’t just about homeowners not paying their loans; this is about massive fraud on the investors whose money they took, which is a much bigger problem than some homeowner not paying the loan.  It is also why they need to tell a few BIG lies and forge documents by the 1,000’s.[/ismember]






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  1. Aferry

    Incredible information and facts relating to this subject, thanks
    so much for posting about it.


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