The Sidebar | What is an Assignment of Mortgage

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  • May 15, 2008

Real Estate Radio USA

What is an Assignment of Mortgage and Why Is It Important In a Foreclosure Action?

UPDATE: If you are new to this article be sure to read and scroll all the way down. The meat of this article is in the tremendous information profided in the comments by mortgage professionals and attorneys.

Foreclosure is the process by which a financial institution (e.g., your bank/loan servicer) can reclaim your home and/or land if you fail to make timely mortgage payments.

In a foreclosure action, the bank files a complaint with the state court to foreclosure the property. Oftentimes, banks do not have the right to bring such action due to lack of an assignment of mortgage.

An assignment of mortgage is a written document which serves as proof of transfer of a loan obligation from the original borrower to a third party.

First and foremost, it is important for you to understand the legalities of foreclosure and your rights for mortgage foreclosure solutions. There are two basic documents involved in a bank loan transaction, the promissory note and the mortgage. The note is a contract that details the terms of a promise by you to pay a sum of money to the bank.

The terms of a note typically include the principal amount, the interest rate if any, and the maturity date. It also may contain provisions concerning the bank’s rights in the event of default, which may include foreclosure of your property.

The mortgage is a method of using property, real or personal, as security for the performance of an obligation, usually the payment of a debt. It gives the bank the right to take away your property if you do not pay as it is specified in the note. Essentially, the mortgage is what gives the bank the right to foreclose.

The note, by itself, is considered to be an unsecured debt. On the other hand, the note accompanied with the mortgage comprises a secured debt. The difference between these two is that a secured debt allows the bank to force sale of the property, which in turn permits satisfaction of the loan in case of default by you, the borrower. However, without the mortgage, banks cannot force sale of the property to satisfy the debt.

In many cases, when a bank lends you money to purchase a home, it will subsequently sell the note along with the mortgage to investors in the secondary market. The secondary market manages mortgages that were originated in the primary market. It consists of investors, both public and private, who buy the mortgage notes.

This allows the mortgage lenders to replenish the cash reserves, so that they can originate more mortgages to more consumers. In this way, the investors profit from the interests that the mortgages charge.

Furthermore, it should be noted that when a loan is sold in the secondary market, the bank is no longer the owner of the note and mortgage. However, the bank’s rights under the mortgage are not automatically assigned to the investors. In order to assign such rights, an assignment of mortgage is necessary.

Generally, a title search of the property is conducted to determine whether an assignment of mortgage has been recorded. If an assignment does exist, then a defense is available to delay your case and/or prevent foreclosure of your property.

Once your situation is completely assessed, a mortgage foreclosure solution can be recommended. We are here to work on your behalf to come up with the best course of action to prevent foreclosure. Our team of attorneys specializes in helping clients who have fallen behind on their mortgages payments and who wish to avoid foreclosure.

Erik Wesoloski, Esq.
Wesoloski Carlson, P.A.
777 Brickell Avenue, Suite 710
Miami, Florida 33131
Tel 305-329-1020
Fax 305-532-7804

The article is not intended to be legal advice. If you are faced with a foreclosure action please consult with an experienced real estate litigation attorney. Wesoloski Carlson, P.A. is a law firm based in Miami, Florida and its attorneys are licensed in the State of Florida.

Who Owns Your Mortgage? “Produce The Note” Movement Helps Stall … Sep 22, 2009 Modern-day home mortgages have been so sliced and diced by rapacious financiers that some homeowners are successfully delaying — or even

Mortgage Nightmare: Who Owns My Loan? – ABC News May 27, 2009 Countless mortgages once serviced by one company are now handled by another. The only notice that homeowners get is a new name or address on

Answer Desk: Who owns my mortgage? – Answer Desk- Jun 30, 2008 But that means figuring out who owns your mortgage — which is not as easy as it looks Don’t I have a right to know who owns my mortgage?  

Realty Times – Who Owns My Mortgage? Apr 27, 2009 Real Estate News And Advice – Who Owns My Mortgage?


About Barry Cunningham

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  • cynthia says:

    Thank you El,

    I read the the report, however I did not find where it says the trust was dissolved can you elaborate on that for me.
    also on the assignment chain the assignment was recorded twenty days before the complaint the notarization on it was for September of “06” in a sense back dated the position(conveniently).

    Would anyone like to have a group discussion on this? Let me know.

  • Dee says:

    The Assignment of Mortgage was just executed on April, 2009, and my question is that I am listed as a Mortgagor when it fact the loan is only under my husbands name. Is this correct? Thank you.

  • cynthia says:


    The trusts are dissolved because they are no longer trading. These are “the “toxic assets” that the media refers to. Investors dumped mortgage securities when the mortgage crisis escalated. Therefore, both the mortgages and mortgage securities are sitting on banks off or on balance sheets. While the “pool” of mortgages may still exist, the trusts are not trading and therefore, dissolved.

    Further, many of the trusts were issued under the subsidiary name of the subprime originator. The subprime originators are dissolved and therefore their subsidiary “issuer” – the depositor to the Trust – is also dissolved.

    Although Wall Street is trying to repackage these original trusts, trading is not successful, and these repackages are not the same as the original trusts. No one is buying these mortgages/mortgage securities. This is why government is stepping in to purchase these so called “legacy” (toxic) assets. When the trusts are unable to function as they were intended, their status is terminated.

    Government is not clearing presenting this to the pubic because they are afraid of further financial collapse.

    According to many states, no assignments may be backdated in any manner. My state is, however, very lenient. I do not know where Cynthia is from and hope someone else can answer this question for her.


  • You may be interested in a Texas court of appeals opinion I received in a pro bono case today. The court held that the trial court lacked jurisdiction in a post-foreclosure eviction action by MERS. There was no evidence presented to the trial court of MERS’ interest in the property, and therefore, title must be determined before possession. Email me if you want a copy of the opinion.

  • Drew says:

    On May 15, 2008, Dustin Miller asked Erik Wesoloski about defense tactics regarding an Assignment of Mortgage’s (AOM) “recording date” versus its “effective date”.

    I agree with James Hunter (on Aug 17, 2008 @ 10:39pm) that Erik’s May 16, 2008 @ 8:40am reply to Dustin’s question seems to contradict Florida Statute 701.02(1) which provides in pertinent part:

    (1) An assignment of a mortgage upon real property or of any interest therein, is not good or effectual in law or equity…………unless the assignment is contained in a document that, in its title, indicates an assignment of mortgage and is recorded according to law.

    According to Florida law, it appears that the recording date of the AOM is the date that’s applicable when determining a Plaintiff’s standing to file a foreclosure action. Futhermore, to allow Plaintiff to just simply back-date the so called “effective date” to a date that pre-dates the foreclosure filing would seem to undermind the intentions and requirements of F.S. 701.01.

    Finally, what would be the purpose of requiring the signature of a legal document (such as an assignment of mortgage) to be nortarized if the effectiveness, power and purpose of said document actually goes into effect before the very signature that makes it effective has occurred..?

    I’ve come across an AOM that was nortarized and therefore “executed” on March 12, 2009. The AOM was recorded on March 18, 2009. However, in the “Misc Comments” section of the AOM, its “effective” date was listed as January 6, 2009. Normally, back-dating the effective date of an AOM does not become a problem – that is, not unless a foreclosure is filed.

    On February 5, 2009, the Plaintiff filed to foreclose Mortgage in the above scenario. On March 5, 2009, the Borrower challenged the Plaintiff’s standing to file the foreclosure complaint. On March 12, 2009 (1 week after its standing to file the lawsuit was challenged), the Plaintiff just simply “created” an AOM and back-dated it to January 6, 2009 (approximately one month before the foreclosure was filed on March 5, 2009)..

    As Melissa Iozzi suggested on August 31st, 2008 @ 7:43 pm,…….
    ………..its like going back in time to get married so that you can hurry up and get a divorce today. If you are not married today, you cannot logically get a divorce today. If you do not have a Mortgage assigned to you today, you can not foreclose on that Mortgage today.

    In most foreclosure cases today, the Plaintiff and the Defendant at the begining were uncontrollable lovers and proceeded with the honeymoon before actually getting married. However, the Plaintiff never anticipated that the love affair would go sour so quickly and therefore, he never completed the formalities of marriage (licenses, weding, rings, etc..) – he just headed straight to the pleasures of honeymooning.

    Now that the love affair and honeymoon is rapidly ending, the Plaintiff wants a very quick and easy divorce. However, the Plaintiff now realizes that his lust-at-first-sight has caused him to neglect his duty to ensure the validity and formality of the marriage. The Plaintiff now wants to go back in time to get marry for the sole purpose of getting a divorce today. This is why F.S. 701.01 requires a Plaintiff to provide proof that he/she was married (assignment of mortgage) prior to filing for a divorce (foreclosure).

    Erik, James, John, Dustin…….any updates regarding “effective date” versus “recording date”…(2) can a Plaintiff just simply and conveniently back date the AOM to fit their standing needs….? what’s your take on all of this….?

    Sunny South Florida

  • John says:

    Keep in mind one thing….most of these assignments are done in blank so that they can be filed in the “event” of non-payment called a default.

    Please look at your Note and keep track of who owns your note. Most Notes say that only the Noteholder can contact you. If the NOTEHOLDER has not done the assignment then it is a bogus assignment.

    So, in some instances it does not matter when the assignment was filed but who had the authority to file it in the first place. For instance, I have found that the NOTE was owned by Fannie Mae and Countrywide did Assignment. Countrywide did not own the NOTE to assign it to anyone.

    Mortgage Audits

  • elle says:

    I am not in foreclosure. I am current on all mortgage payments. There are other issues involving my mortgage. They are now trying to assign the mortgage/note to a Trust that was closed in 2004. This is bogus and there is proof of the fraud. These trusts were organized as Real Estate Mortgage Investment Conduits (REMIC) which are regulated by the Internal Revenue Service. No mortgages/notes can be assigned beyond ninety days from the closing/cut-off date. Thus, mortgages/notes cannot be assigned years later to REMIC trusts that were closed many years ago. Further, any assignment cannot be backdated because of the REMIC rules and regulations. According to Securities and Exchange Commission filed documents, the assignment must have occurred at the time of inclusion of the mortgage in the REMIC trust. The SEC has verified this to me. Please read the 424B5 (prospectus), 8-K, and SE Registration Statement for the particular trust that is referred – it will divulge all information as to the conveyance of the mortgage loans to the trust and requirements for inclusion in the trust, recorded assignments, and sale of the certificates to the stated security underwriters. Lastly, any foreclosed properties are removed from REMIC securitized trusts with the rights to collection sold to the default swap holder to the particular trust tranche. Thus, the trustee has no authority to act on behalf ot the trust because the conveyed mortgage loan payments (and supporting mortgage) have been removed from the trust by the default swap – such removal is required by securities law as no cash payments are being made on the loan, but the default swaps are unregulated and unrecorded. This is the major problem of the current financial crisis and the courts are behind the eight-ball – not understanding exactly what is going on. The financial engineering of the structured products intended it to be this way. Credit default swaps are the problem and the government’s only concern is to save the US financial system. Many years from now, all that has occurred will be divulged to the public. Unfortunately, it is too late for the people that have lost their homes. And, few attorney generals are investigating the validity of the mortgage/mortgage loan in the first place – this was not the borrowers faults – false documents were submitted by the parties involved to secure the mortgage application (not the borrowers). We the people, have no place to go and no voice. I await the time that the people will join together to confront the government with current egregious situation.

  • sonya says:

    I also had an aom after the lis …by mers that has been inactive since 2002. Also the original mortgage comp has gone under 5 years ago and i hold the oringinal note signed in ink ,,but i have been in foreclosure brought on by jp morgan chase the bank of new york, the bank of new york mellon, asset backed securities ETc the list goes on but I do have the note that is stamped paid in full

  • sonya says:

    the servicer of the loan is emc mortgage, I have never missed a payment or been late. this is the 3rd foreclosure in 9 years. I have every bank statement every cancelled check to prove it.I have a story to tell and I could collaspe a mortgage pass through certificate series. I hope some news media looks at this site or investers happen to cross this. I have Proof!!!!!! There is a fraud upon alot of people.

  • John says:

    Please give me a call or email me with a phone number as I would like to speak with you with my expert witness on the line…

    Mortgage Audits

  • Carrie says:

    I refinanced my loan in June 2005 with Fremont Investments and Loan. Sometime in late 2005 or early 2006 they sold my mortgage/note unbeknownst to me to Ocwen Loan Servicing LLC. I found out that Ocwen had my loan because they called saying my payment was late. I had been sending my payments to Fremont still.

    To make a long story short….. I have been trying since last year to get hardship assistance through Ocwen on my loan. They always seemed to lose my paperwork. Early June 2009 I began the loan modification program and was in contact with Ocwen regarding their program. Later part of June 2009 I was served Lis Pendens, complaint for foreclosure and lost note affadavit by HSBC. I have not been able to find any assignment of mortgage to Ocwen or HSBC from Fremont.

    I also looked up on MERS website my home physical address, my social security number and name for an assignment of mortgage. I am no where to be found in their system…… and my original mortgage papers with Fremont states their MERS number and that they are a member of MERS. However, my mortgaged property is no where to be found in their database. There is no recording in the local courthouse where I reside of any assignments since the refinance with Fremont in 2005.

    Where do I stand?

    Can I have my foreclosure dismissed and my title cleared?

  • Carrie says:

    How does Article 9 pertain, if it does at all, the all the above cases and situations? I have read somewhere in Art. 9 that they do not have to show proof they were assigned your mortgage. Is this true? Or did I read it wrong?

  • elle says:


    Massachusetts has settled a large claim against Fremont, however, if you live in another state – you will need a lawyer. Unfortunately, there are not many lawyers who understand mortgage securitization and “scratch and dent” mortgages, and there are not many consumer protection lawyers. Many mortgages were FALSELY labeled as “scratch and dent” mortgages due to “early payment default”, missing documents, breach of representation, and other classifications for non-compliance, and therefore, rejected by the original mortgage backed trust. When the mortgages were sold to trusts they were purchased, in the process, only by financial institutions associated with Wall Street. Many “debt buyers” intercepted these mortgages and conceal ownership claiming that the mortgage is still part of the original targeted trust when in fact the mortgage was removed as a “scratch and dent” mortgage.

    In order to proceed with foreclosure, the plaintiffs must prove that they are the real party in interest with legal standing to pursue the foreclosure. Most challenges to foreclosure proceed pro se without the benefit of attorney representation and judges do not question authority because the pro se victim is without ability to challenge legal standing and real party in interest. In addition, even if foreclosure is successful legal title to the home must be established. It appears that MERS dropped your home in their database because the mortgage may have been sold as a “scratch and dent” non-compliant mortgage (now converted to a default debt).

    I have been told, from someone in the “know”, that the government is concerned primarily with investors and does not have empathy for subprime victims. Investors and financial institutions have the power and voice in Washington. The consensus appear to be that victims were very “bad” because they signed a contract and are not continuing to pay high interest rates to support the portfolios of the financial institutions/services and investors. For over a decade, the US Government has relied on financial services to promote economic growth. President Obama has forsaken the plight of the mortgage victims to promote health care.

    Without voice in Washington, Carrie’s problem will continue and many, many people will continue to be – victims.

  • carrie says:

    That sure makes my stomach turn. (I live in Florida) But I have to believe there is hope out there and that my attorney knows the ropes and pray the judge does too. I have been doing alot of research on cases myself where the homeowner wins in cases like mine. The law is the law, lets hope the judge goes by it.

    I have retained an attorney who has filed a dismissal of foreclosure since HSBC did not provide proof they were the owner of the note. I am waiting the courts decision. In the meantime, as soon as my attorney filed for the dismissal, I get an approved loan modification in the mail (I had not even completed all the required documents to begin one) dated two days after the dismissal request. I have until Aug 19 to sign and send in my first “trial period” payment. The thing is, they want you to sign this agreement even though they do not know what the new loan modification agreement is going to be; and with the new loan modification- it will void the original loan documents, making them the owner of the note. How can they modify something that does not legally belong to them in the first place. I have not signed anything and am waiting for the next step. I am planning to meet with my attorney about filing for a “quiet title” action once we get the courts decision on the dismissal if it is in my favor.

  • elle says:

    Please do not sign anything until you are sure that you contracting with the real party in interest. Do not give up “hope”, but inform your attorney that any contract must be legally valid – and that includes identifying the name of the real party you are contracting with. I cannot emphasize enough that many will take advantage of a system that has been abused. “Quiet Title” is good idea – but must be done before you sign any documents.

  • carrie says:

    Thanks for returning the reply so quickly.

    I have been researching all these loan modification scams on the internet and it seems the only thing the government is currently worried about is if the scammers charge you an upfront fee. What about the scammers who say they own your loan when legally they do not. What about the scammers that give you an incomplete loan modification agreement and expect you to sign it and hope for a favorable outcome? How can the government allow these types of instances to go on. I would rather pay an upfront fee for a completed legal loan modification agreement. I have sent an email to the Florida AG loan modification fraud office about these instances, maybe it will get someones attention. I thought it was illegal to have someone sign an incomplete document anyway, especially if it concerns the home you reside in and the legal owner of the note. So far, everything I have read concerning these incomplete loan modifications from consumers is that once you sign the incomplete paperwork and complete your three month trial period, the then completed loan modification has a monthly payment higher than your original defaulted one, that puts the homeowner right back into foreclosure again…… and since you signed that loan mod- they are now the owners of your new note!!! Smart, eh!!!!

    I have not signed anything and will not until my attorney reviews the paperwork. I do not see where I can agree to sign anything due to the fact we are dismissing their foreclosure complaint because they are not the legal party to my mortgage. It seems if I were to sign such an agreement it would contradict what we are stating in court. Maybe that is what they are hoping for.

    I have read cases in my local courthouse of the same instances I am in with the same company and the outcome was beneficial to the homeowner. However, I have yet to find anyone who has filed for a quiet title. I just wonder though, after the foreclosure is dismissed, what happens next? Do you just sit and not make payments for months on end? What happens to your mortgage balance/payments? If the court dismisses the complaint due to lack of legal standing, whats next? What are the homeowners doing in the process of a mortgage balance sitting out there on their homes? What about your credit? Can the company who does not legally own your mortgage continue to report you as delinquent further damaging your credit? I have been trying to research what happens after the dismissal but there is nothing out there. Does everything just drop dead after that? Or is there a waiting period for the other party to come up with proper documentation to prove they own the note? Whats the deal?

  • carrie says:

    MORTGAGE AUDITS. I would like to have a mortgage audit performed but do not know who to trust. You read so many things out there about the “auditors” who once were brokers gone bad. And then there are the ones who just use software to audit your loan. I would like to speak to someone who actually reviews your documents one by one. I was looking through my loan docs and could not find the appraisal, loan application, among others. Also found where they charged me upfront for insurance after I provided proof I had coverage, and my loan was not to be escrowed. I never received that money back. ($2100)!!!! In the settlement statement it shows the $2100 they charged me. But in the loan fee disbursements, that $2100 is not recorded anywhere as a premium reserve or anything. WHERES MY MONEY??!!!!

  • John says:

    I have now completed several audits on individuals mortgages and their investment properties and can provide you with references if need be. I have been extremely busy on these cases and have stopped the foreclosures and working to get the cases dismissed to move forward on Quieting the Title.

    I also now have several attorneys that I am working with. We are working together to understand the steps necessary to Quite a Title.

    Let me know if I can be of help.

    Mortgage Audits

  • carrie says:

    Thanks John. I will definitely want to speak to you about the audit process and so forth. I just came across some strange instances that have me a bit confused with my loan and the closing process. Here goes…

    Signed a loan application with Fidelity Mortgage Direct (Chris Wolf as the application interviewer) in May 2005. MY COPY of the original loan application, good faith estimate, TIL disclosure statement, mortgage broker business contract, etc etc etc, have our loan as a fixed rate loan for $200,000 for 30 years.

    I contacted the Title company who closed on the loan and had them forward to me THEIR copy on file of our loan application. Ok, this is where is gets crazy….

    The first page of their copy that “Chris” faxed to them on June 2007, 2005 has a loan amount of $170,000 at a ARM rate of 8.3%. Now at the bottom of that page, the bottom half of the application is missing. It either was not copied correctly or was left intentionally that way.

    On the second page of their loan application copy our income increased by $2000 a month, and our proposed monthly payment increased by $220 a month, and… our liquid assets are $50,000 less than on our copy. Not again, the bottom half of that page is missing as well.

    Onto the third page…. this page shows a list of our monthly obligations that followed from page two. The bottom of this page is missing that has our signatures and date signed.

    The fourth page of their copy is the actual matching page of our fourth page. Now what makes that interesting is… our present market values are set back to $250,000 where are page two it stated they were only $200,000. The loan amount is also for $200,000 where on page one of their copy it is only $170,000.

    Needless to say, Chris no longer works for Fidelity Mortgage and they have no record on file of our application, not that it matters, we have the two that are different but made by the same person.

    I am not sure where all this fits in, if it does at all. I just thought it was strange how his paperwork reflected so many differences from ours, and then to have the loan amount $30,000 more than what was actually financed. Oh, that reminds me, the broker fee was $800 more on our copy as opposed to his. At any rate, the bottom line is…. we ended up with the 8.3% arm on $170,000 note. I am not sure how we got there exactly or even why he would give an application to the closing agent that was opposite of what we signed in the first place.

    Maybe someone can shed some light here for me. This game is all new to me. I used to work at a bank ten years ago….. these type of things never crossed our minds.

  • carrie says:

    the loan application was faxed on June 27, 2005 (I typed June 2007, 2005 earlier). Also forgot to mention that our loan document date per the title company was June 24, 2005 with a loan disbursement date of June 29, 2005.

    My head is spinning. Would like to have some clarification of this process and how things can change midstream.

  • John says:

    You and millions like you got duped. I recently rescinded my refinanced loan. They failed to provide me with two (2) copies of my Notice of Right to Cancel and my copy of the Truth in Lending Statement.

    Citimortgage is saying that I did get two copies and provided me a copy (letter size not Legal Size) which has a signature of both my wife and mine’s signature. The problem with this is that my signature is a copy and paste signature and date on to the document. I have an appointment with the FBI in the morning with my attorney where we are going to file a criminal complaint against Citimortgage and the person who responded to my rescission letter.

    Also, this morning my clients in Atlanta, Georgia with their attorney argued in front of the Appellate (3 judge panel) Court on the issue of a lower court’s decision on the rescission.

    Part of the argument was, there was no provision in 15 USC Section 1635(b) that allows a Lender to not comply with a consumer’s (obligor’s) rescission other than to file a lawsuit to stop the rescission as would be the case if a consumer in a non-judicial foreclosure state would have to file a lawsuit to stop a foreclosure action by a lender.

    I look forward to hearing from you…

    Mortgage Audits

  • elle says:


    You are one smart little cookie. Keep at it and do not give into fraud. Government, sooner or later, has to acknowledge what has been going on. Got call from someone today who wants advise as to handle loan modification on his own. No way this is possible. Need reliable law firm to find out who really owns the mortgage. Keep working, Carrie, victims need to assert power against fraud and government officials who have kept quiet. Time for people to take back what has been given away in Washington.

  • John says:

    To All On This Blog:

    Here is a recent case on the issue of rescission decided in favor of the homeowners. Enjoy….

    [from Real estate Radio USA : the link John posted to this case was flagged by google for some reason so we downloaded it and scanned it to make sure no viruses were attached to the file…we have re-posted the document here in its entirety… John thanks for providing such valuable information – Barry]

    Mortgage Audits

  • Christy says:

    This maybe a strange question, but I have several school loans and I have noticed they too have been sold and resold. If they say Sallie Mae or Direct Loans sell the loan and the new investor tries to call the loan-what happens if the new investor does not show assignment of the school loan. This may not even pertain to school loans, but just fed up with the scare tactics they try to use, when after spending all that money to be educated we cannot even find decent paying jobs to justify the educational loans. I wish I knew of a way to sue the government for luring us to go back to school only to get us in debt because there are no jobs.

  • Mark says:

    I have a question regarding MERS

    Can MERS be the mortgageee or nominee for the original lender that is no longer in business and state that they sold or transferred the mortgage to a loan servicer via an Assignment of Mortgage?

    If MERS is the mortgagee (nominee) for the original lender and that lender closes shop, when does that relationship legally expire?

    I cannot believe the a legal relationship between an existing firm can continue with a firm that is legally non-existent.

    I have a problem with MERS assigning a mortgage to a servicer using an Assignment of Mortgage and state the original lender (again is closed down)
    has sold, transferred, etc to X servicer well after that orignal lender is gone.

    Does anyone want to take a swing at this one?

  • elle says:

    Think this is an issue that belongs before the Supreme Court of the US. Florida has come down hard that MERS is not the real party in interest. NY has clarified that MERS discharges must include reference to all assignments – but does not state that MERS can be the assignor. Other states have supported MERS as the nominee and real party in interest – but, again, do not see any cases where MERS can be the assignor – they are only supposed to hold the assignments (for other parties) as the nominee.

    Fact that MERS is assigning a mortgage is a unique question and appears to unaddressed in courts. MERS is supposed to only be a nominee to hold assignments – not a party to assign mortgages.

    Think you might have a higher court issue – but only an opinion. Under what Power of Attorney did MERS derive its authority to assign a mortgage?

    Very qood question by Mark – any attorneys want to volunteer an opinion?

  • John says:

    To All Who Post on this Blog,

    I am taking a somewhat new position on the issue of Securitization. There are a number of references that I can list but I will point to this one source of evidence.

    Go to the Federal Register, Vol. 70, Friday, January 7, 2005. You will learn that a Note is “converted” into a Securitized Instrument (bond, share of stock) so that it can be traded or put into a asset-back security.

    Now when the Note is “converted” it no longer an enforceable instrument.

    You will also learn that your student loans, auto loans and credit card debt is also securitized.

    We recently got a Florida mortgage foreclosure thrown out and have a default judgment on a case in Arkansas.

    Mortgage Audits

  • elle says:


    Interesting. I would only add that according to Securities and Exchange Commission only “current receivables” can be securities. The mortgage loan (long term asset) cannot be securitized and only serves as collateral for the receivables. Also, all certificates to SPV trust are sold to the security underwriters – who then repackage the “pool” of loans into securities to be sold to subsequent investors. These investors are only entitled to a pro-rata in the pool of mortgage receivables and have no rights to individual mortgage loans.

    Always find it odd that foreclosure actions are usually done by the ” ABC trustee for certificate holders of a specified trust”. The certificate holders are the security underwriters – and you will find them at top of prospectus and under “Conveyance of Mortgage Loans”. Need courts to “get it.”

    We need your good work – thank you.

  • John says:

    Thanks for your comment and yes we all need to get our information together and educate a few attorneys who have cases ongoing and start shutting down the pretender lenders.

    Another thought on what I am working on is that there has to be someone with a Securities License to convert the Note into a security instrument. Someone was paid a fee to do this and I have yet to be able to pinpoint this person or firm but I am getting really close.

    It is fix’en to get bad and dirty which comes hand in hand to what is going on in our Congress.

    Mortgage Audits

  • elle says:


    The security underwriters were investment banks. Thus, they purchased the mortgages, placed them in off-balance sheet conduits (special purpose vehicles) (SPVs), purchased the certificates to the trust (except for residual tranches), repackaged the certificates into securities (which was just fthe pass-through of “pro-rata” share in pool of receivables that was removed from the balance sheet of the investment bank/security underwriter/mortgage loan purchasers) such as Collateralized Debt Obligations (CDO/CDOs). They then obtained credit enhancement on the securities by credit default swaps (which they also traded themselves – see ABX Indices), and leveraged the CDOs/CMOs again and again. CMOs/CDOs and CDS are synthetic “securities” – derivatives.

    Hope this helps.

  • John says:

    Hi Elle:

    Yes, I would like to that you for this information some of it is known and understood by me.

    Let’s keep some precise A to B, B to C and so on kind of path….

    You are saying that the Investment Banks purchased the mortgages? When I hear Mortgage I see the security (collateral) of the Note. So, would you not say the NOTE is that what they have purchased?

    Now the reason that I say this as I have found through discovery in several of my cases that the Note went one way and the Mortgage/Deed of Trust went another way. There you have admission that the Note and Mortgage/Deed of Trust has been separated. The Bank or whoever sent the Notice of Default has to have both in their possession to foreclose.

    In the Non-judicial foreclosure States how is it that one can simply say that a default has occurred and no due process by a court of law making a determination that a default has in fact occurred.

    Now, while all this is going on and filing a suit to stop the foreclosure is the time to get this information as to whether or not there is a Note that can in fact be used to foreclose on someone.

    So step two is to show the the conduit is used to defer paying a tax on the money.

    Am I following you so far?

    Mortgage Audits

  • elle says:


    Nice to be conversing with you. There seems to be conflicting presentations by banks across the country. As far as I know, and I am not an attorney, the law seems to acknowledge that the Note follows the mortgage and vice versa.
    As I mention, only current receivables, according to SEC may be securitized. But receivables are supported by long term assets – the mortgage. Without the collateral – there can be no receivables. Thus, mortgages, and the note, I believe, had to have been both sold to security underwriters – who then, as investment bank, securitized the Note (receivables). The mortgage had to also be conveyed to the trust SPV for it to be a “true sale.” (unless it was not a true sale – which is a whole other question that has not been thoroughly addressed in US Courts)

    Example from typical SPV for conveyance of mortgage loans is:

    In connection with such transfer and assignment, the Depositor does hereby deliver to, and deposit with the Trustee or the Custodian, as applicable, a copy of the related Mortgage Loan Schedule in an electronic, machine-readable medium, and the following documents or instruments with respect to each Mortgage Loan so transferred and assigned (each, a “Mortgage File”):


    the original Mortgage Note, endorsed in blank or in the following form: “Pay to the order of U.S. Bank National Association, as Trustee under the applicable agreement, without recourse,” with all prior and intervening endorsements showing a complete chain of endorsement from the Originator to the Person so endorsing to the Trustee or a copy of such original Mortgage Note with an accompanying lost note affidavit executed by the Seller;


    the original Mortgage with evidence of recording thereon, and a copy, certified by the appropriate recording office, of the recorded power of attorney, if the Mortgage was executed pursuant to a power of attorney, with evidence of recording thereon;


    an original Assignment of the Mortgage in blank;


    the original recorded Assignment or Assignments of the Mortgage showing a complete chain of assignment from the Originator to the Person assigning the Mortgage to the Trustee or in blank;


    the original or copies of each assumption, modification, written assurance or substitution agreement, if any; and


    with respect to any first lien Mortgage Loan, the original lender’s title insurance policy, if available, together with all endorsements or riders which were issued with or subsequent to the issuance of such policy, insuring the priority of the Mortgage as a first lien on the Mortgaged Property represented therein as a fee interest vested in the Mortgagor, or in the event such original title policy is unavailable, a written commitment or uniform binder or preliminary report of title issued by the title insurance or escrow company, if available. – — end.

    Me again – Most investment banks, through their own subsidiaries, funded and purchased the loans at mortgage closing – but the mortgage had to follow the note in order to securitize the receivables. Thus, the mortgage had to also be conveyed to the trust.

    However, at some point along the way, I do believe the note and mortgage may have been separated. Many loans never made it to securitization because they were deemed “scratch and dent” or non-compliant. At this point, the mortgage was assigned to distressed mortgage debt buyers – as were the collection rights to the note. But the mortgage servicer will falsely claim to continue to represent that the loan is with the original “earmarked” SPV trust – even though it has long been removed. This is the same process with loans that did remain in the trust – once the loan is in default, it is removed by default swaps with collections rights sold to the swap holder/distressed debt buyer/hedge fund. But the servicer will claim that the SPV trust “certificate holders” are the assignee – even though the note’s collection rights have long been removed. When the note/loan is removed from SPV trust, by swaps or sale to third party – it is a “default” – the loan itself is not sold – nor does the security change hands. All that happens is that the collections rights are “swapped” to a third party. The loan is in default – period. SEC has verified this process to me.

    With debt collection, the plaintiff law firm will often tell you that the “account” has not been sold – when in fact the collection rights have been swapped/sold. The “account” itself is charged-off and no longer exists, thus, the account, itself, cannot be sold.
    Further, assignments are simply not updated, out of date, too late for inclusion in trusts, and executed by defunct companies, and often executed with false power of attorneys.

    Feel the real problem is that foreclosures are being executed without authority and with false standing/real party in interest and false documents. And the debtor has no chance to even request a loan modification with the real creditor because the creditor is not identified – all in violation of this year’s Congressional acts to enforce Tarp recipients to modify loans. Of course, when collection rights are swapped/sold elsewhere, and that party is not a TARP recipient – there is no requirement to oblige.

    Non-judicial foreclosures, as I understand, are a nightmare. But with so much fraud, I believe homeowners can succeed by challenging claims.

    Need to use everything we have got. If what you are saying is true – that the note and mortgage was separated from the onset – this is a big problem – and likely indicates that no “true sale” ever occurred.

  • Mark says:

    Here is a good article by Pew Mortgage Investigation regarding documents produced for foreclosures focusing on Scott Anderson/ Ocwen/MERS signing assignments and documents used to expedite the process

  • Deontos says:

    Thank you very much for all the IMPORTANT info here!

    I look forward to contributing where I can. Although
    unfortunately my current role in this Drama IS AS A

  • Angel says:

    Hello Elle,
    I need some help please.
    I was just on the SEC website doing a search for the assignment on my property. “Adjustable rate mortgage trust 2007-2″ which is the name of the trust does not exist. I also tried adjustable rate mortgage trust. This brought up a list but 2007-2 was no where to be found. Adjustable rate mortgage trust 2006-2, adjustable rate mortgage trust 2007-1, adjustable rate mortgage trust 2007-3, no 2007-2… In your experience what does this mean?
    I am trying to stop a foreclosure sale for this Friday the 13th.
    Looking forward to hearing from you – thanks.

  • Deontos says:


    Your time is a bit short.
    But there are even strategies
    to RECOVER your property
    after a foreclosure occurs.


    it’s an eye opener!

  • elle says:


    Found this. Are you just missing it?


    Prospectus Supplement (To Prospectus Dated April 20, 2007)

    Sponsor and Seller


    Issuing Entity

    SERIES 2007-2


    But I see no Mortgage Schedule attached ( as was common). But in 2006 Securities law Regulation AB was enacted to provide STATIC FUND DISCLOSURE. The form used is SEC 10 D/A. Try looking for that.

    Remember, that many mortgages/notes were earmarked for inclusion in trusts -but never made it because they were deemed “scratch and dent” due to missing documents/breach of representation etc. Thus, even if your mortgage is found initially included in a specific trust it many not now be there due to “scratch and dent” and due to fact that delinquent mortgages (right to collect) are removed by derivative swaps. A securitized trust can only be for current receivables. Any mortgage-backed security must be backed by current cash payments – foreclosure rights are not securitized but removed by swaps – attached by derivative to trust – BUT TRUST DOES NOT OWN the SWAPS and the trustee does not/should not act on behalf of swap holders.

    Good luck.

  • joe says:

    Does a assignment of mortgage need the correct legal description and parcel number on it to be valid?

  • elle says:


    Posted comment – but never showed up. Found 2007-2. Look again. Credit Suisse was buyer.

  • Cynthia says:

    Elle or John;
    I am looking to get clarity on the note and the allonge mainly if the allonge could be considered material alteration after the fact since the signor of the original note was never given the notice of allonge and/or transfer…which is not the same as the servicing notice.

  • elle says:

    This is a serious issue. Many mortgages were “table funded” by the actual lender and this was not disclosed to borrowers in violation of RESPA. In addition, many loans were sold before closing – also violation. What is date of Allonge? Hope you have an attorney. Yes, it is not the same as servicing notice.

  • n.mena says:

    I have a quick question Im in doubt about please bear with me…

    I have not paid my mortgage in about 6 months, after trying several times with Citibank to refinance, modify, repay it has all been a failed attempt they would lose papers,,make me resubmit.etc… When I called last week, they told me it was in foreclosure status.
    I went onto the clerk of Courts website in Miami, FL and found that infamous AOM from MERS as a nominee for Equity Financial Inc, which has gone under was submitted on Jan 11, 2010. The AOM has been assigned from me to CitiMortgage with a signature of a Vice President of MERS as nominee for Citi as Scott Scheiner…no seal, just a notary

    I imagine that they are preparing to file Lis Pendens and since the AOM was never filed they are trying to file one now????

    Can Mers do this AOM legally even if it has been 3 years since Citibank has had the mortgage and Equity is not even in Business?

    Your thoughts and answers would be greatly appreciated.

  • n.mena says:

    sorry …nominee for Equity as Scott Scheiner…not Citi

  • elle says:

    to n.mena – Citibank likely no longer has your mortgage. After 6 months of default, your mortgage was charged-off with collection rights sold to a distressed debt buyer. Only collection right can be sold because the account was dissolved at charge-off. Need to find out who is your new creditor.

  • Baywatch says:

    Any answers would be GREATLY appreciatted.

    I am not in default or behind on mortgage payments. Mortgage originated from Argent in 2005. It’s an 80/20 ARM. I’ve been trying to work with the various servicers over the past 3 years to restructure the terms, as that is what was “promised” me by the original broker. My home is now worth $0.50 on the dollar it was paid for, and will probably not recover for at least 15 years or so. Mortgage was a No Doc in my wifes name, because even though she didn’t work, the broker said her scores were better. So he told us the numbers to put down. (I actually earn more than that, but my wife doesn’t work).

    I had a title search performed. The results assert that the mortgage wasn’t recorded until well over 4 years after the closing. The Originator and Depositor are long gone out of business (Argent Mortgage and Argent Securities).

    There is only one assignment recorded and it is from Citi Residential as Attorney-in-fact for Argent Securities to Deutsche Bank.

    There is no recorded assignment from Argent Mortgage to Argent Securities or to Citi Residential. So I am questioning the validity of the assignment.

    I also have in my possesion a seperate assignment (not mine) dates 29 days after my assignment, signed by the same VP of Citi Residential, but on this other assignment her title is listed as VP of a totally different bank.

    I live in a non-judicial state and do not want to risk being evicted before I could fight the foreclosure, so letting the house fall into foreclosure is probably not an option. Do I have cause to file a petition with the court? What would I say? Would I just file for quiet title and dispute that Deutsche or Citi has any claim to my note because chain of title is broken? Does this thinking have any merit?

    An aquintance of mine recommended that I stop making payments to the servicer and instead place those payments in escrow, letting the foreclosure process begin and then filing for a dismissal based on the broken chain of title and fraudulant signatures on the assignment. He said a judge may be more compelled to hear the actual merits of the case if I had put the money in escrow because I would have “Clean Hands”, is there any substance to any of these ideas?

    Again, any feedback is GREATLY appreciatted.

    feel free to email me directly or reply here:

  • Mary LeDoux says:

    Deutsche is the “Trustee” that has filed foreclosure. I have filed injunction pro se and it stopped the sale. Hearing is set for August 12. My question is in Louisiana is an assignment of mortgage required? The promissory note was endorsed to Deutsche, I went to court house to check, but there is no assignment of mortgage. Must they have this and can I ask to ” produce the assignment” like someone would ask to “produce the note”?

  • Hi Mary,

    Let me start by saying I am not an attorney and have never done a deal in Louisiana, so I would definitely contact an attorney experienced in LA real estate.

    From my understanding, in any case you have to show standing. In a foreclosure, they are trying to foreclose off any and all interests in the MORTGAGE. Remember, the note and the mortgage are 2 separate legal documents. They can be the holder of the new note via endorsement, but without an assignment, I would contend that they do not own the mortgage. Being the owner of the note, they have every legal right to try to collect under the terms of the note, but I would say you must own the mortgage before you can foreclose on it. You may want to check the language in the note as it may say that they are legally connected in some way and all right are conveyed when one is transferred.

    Let’s put it this way, as you are representing yourself, it won’t cost you anything but time and all the judge can say is…. no.

  • John says:

    Hi Mary LeDoux:

    I have not posted in a while to this blog as I have been busy winning cases and can say I have not lost a foreclosure case in Florida, Arkansas and MA. in the last 2 years.

    Now to address your question as per Deutsche Bank as “Trustee” of a ‘trust’.

    As the Trustee, they do not own the ‘trust’. Thus, there has to be something in the Prospectus that says what their duties are as the Trustee. So you need to see if in the Prospectus they have the authority to foreclose on the Property. In most of the cases I have audited, they have no authority and who knows if the Investors or Certificate Holders even know that a loan is in default????

    Who knows if Deutsche Bank even had the authority to hire the Servicer to service the loan for the ‘trust’????

    Be aware of Article III of the Constitution of the United States of America as it relates to STANDING and who is the CREDITOR!!!!!

    There is so much information that needs to be gathered up and then handed over to the Attorney on a Silver Platter for him to win your case and then when you win and stop the foreclosure action sue for Quiet Title to clear all the liens off of YOUR property.

    Finally, be knowledgeable on the issue of the endorsement in blank on the Note and Mortgage/deed of trust….

    I am not an attorney and I do not give legal advice but all information could be used by you and/or your assistance of council to keep an unlawful entity from getting your house for free….

    Forensic Mortgage Audits and Foreclosure Defense

  • John says:

    I hope this will help those that need the help and understanding…sorry for such a large post.

    Forensic Mortgage Audits and Foreclosure Defense

    MERS and civil code 2932.5 and Bankruptcy code 547 here is how it comes together

    26 05 2010

    CA Civil Code 2932.5 – Assignment”Where a power to sell real property is
    given to a mortgagee, or other encumbrancer, in an instrument intended
    to secure the payment of money, the power is part of the security and
    vests in any person who by assignment becomes entitled to payment of the
    money secured by the instrument. The power of sale may be exercised by
    the assignee if the assignment is duly acknowledged and recorded.”

    Landmark vs Kesler – While this is a matter of first impression in
    Kansas, other jurisdictions have issued opinions on similar and related
    issues, and, while we do not consider those opinions binding in the
    current litigation, we find them to be useful guideposts in our analysis
    of the issues before us.”

    “Black’s Law Dictionary defines a nominee as “[a] person designated to
    act in place of another, usu. in a very limited way” and as “[a] party
    who holds bare legal title for the benefit of others or who receives and
    distributes funds for the benefit of others.” Black’s Law Dictionary
    1076 (8th ed. 2004). This definition suggests that a nominee possesses
    few or no legally enforceable rights beyond those of a principal whom
    the nominee serves……..The legal status of a nominee, then, depends
    on the context of the relationship of the nominee to its principal.
    Various courts have interpreted the relationship of MERS and the lender
    as an agency relationship.”

    “LaSalle Bank Nat. Ass’n v. Lamy, 2006 WL 2251721, at *2 (N.Y. Sup.
    2006) (unpublished opinion) (“A nominee of the owner of a note and
    mortgage may not effectively assign the note and mortgage to another for
    want of an ownership interest in said note and mortgage by the

    The law generally understands that a mortgagee is not distinct from a
    lender: a mortgagee is “[o]ne to whom property is mortgaged: the
    mortgage creditor, or lender.” Black’s Law Dictionary 1034 (8th ed.
    2004). By statute, assignment of the mortgage carries with it the
    assignment of the debt. K.S.A. 58-2323. Although MERS asserts that,
    under some situations, the mortgage document purports to give it the
    same rights as the lender, the document consistently refers only to
    rights of the lender, including rights to receive notice of litigation,
    to collect payments, and to enforce the debt obligation. The document
    consistently limits MERS to acting “solely” as the nominee of the

    Indeed, in the event that a mortgage loan somehow separates interests of
    the note and the deed of trust, with the deed of trust lying with some
    independent entity, the mortgage may become unenforceable.

    “The practical effect of splitting the deed of trust from the promissory
    note is to make it impossible for the holder of the note to foreclose,
    unless the holder of the deed of trust is the agent of the holder of the
    note. [Citation omitted.] Without the agency relationship, the person
    holding only the note lacks the power to foreclose in the event of
    default. The person holding only the deed of trust will never experience
    default because only the holder of the note is entitled to payment of
    the underlying obligation. [Citation omitted.] The mortgage loan becomes
    ineffectual when the note holder did not also hold the deed of trust.”
    Bellistri v. Ocwen Loan Servicing, LLC, 284 S.W.3d 619, 623 (Mo. App.

    “MERS never held the promissory note,thus its assignment of the deed of
    trust to Ocwen separate from the note had no force.” 284 S.W.3d at 624;
    see also In re Wilhelm, 407 B.R. 392 (Bankr. D. Idaho 2009) (standard
    mortgage note language does not expressly or implicitly authorize MERS
    to transfer the note); In re Vargas, 396 B.R. 511, 517 (Bankr. C.D. Cal.
    2008) (“[I]f FHM has transferred the note, MERS is no longer an
    authorized agent of the holder unless it has a separate agency contract
    with the new undisclosed principal. MERS presents no evidence as to who
    owns the note, or of any authorization to act on behalf of the present
    owner.”); Saxon Mortgage Services, Inc. v. Hillery, 2008 WL 5170180
    (N.D. Cal. 2008) (unpublished opinion) (“[F]or there to be a valid
    assignment, there must be more than just assignment of the deed alone;
    the note must also be assigned. . . . MERS purportedly assigned both the
    deed of trust and the promissory note. . . . However, there is no
    evidence of record that establishes that MERS either held the promissory
    note or was given the authority . . . to assign the note.”).

    What stake in the outcome of an independent action for foreclosure could
    MERS have? It did not lend the money to Kesler or to anyone else
    involved in this case. Neither Kesler nor anyone else involved in the
    case was required by statute or contract to pay money to MERS on the
    mortgage. See Sheridan, ___ B.R. at ___ (“MERS is not an economic
    ‘beneficiary’ under the Deed of Trust. It is owed and will collect no
    money from Debtors under the Note, nor will it realize the value of the
    Property through foreclosure of the Deed of Trust in the event the Note
    is not paid.”). If MERS is only the mortgagee, without ownership of the
    mortgage instrument, it does not have an enforceable right. See Vargas,
    396 B.R. 517 (“[w]hile the note is ‘essential,’ the mortgage is only ‘an
    incident’ to the note” [quoting Carpenter v. Longan, 16 Wall. 271, 83
    U.S. 271, 275, 21 L. Ed 313 (1872)]).

    * MERS had no Beneficial Interest in the Note,
    * MERS and the limited agency authority it has under the dot does
    not continue with the assignment of the mortgage or dot absent a
    ratification or a separate agency agreement between mers and the
    * The Note and the Deed of Trust were separated at or shortly
    after origination upon endorsement and negotiation of the note rendering
    the dot a nullity
    * MERS never has any power or legal authority to transfer the note
    to any entity;
    * mers never has a beneficial interest in the note and pays
    nothing of value for the note.

    Bankr. Code 547 provides, among other things, that an unsecured
    creditor who had won a race to an interest in the debtor’s property
    using the state remedies system within 90 days of the filing of the
    bankruptcy petition may have to forfeit its winnings (without
    compensation for any expenses it may have incurred in winning the race)
    for the benefit of all unsecured creditors. The section therefore
    prevents certain creditors from being preferred over others (hence,
    section 547 of the Bankruptcy Code is titled “Preferences).” An
    additional effect of the section (and one of its stated purposes) may be
    to discourage some unsecured creditors from aggressively pursuing the
    debtor under the state remedies system, thus affording the debtor more
    breathing space outside bankruptcy, for fear that money spent using the
    state remedies system will be wasted if the debtor files a bankruptcy

    . Bankr. Code 547(c) provides several important exceptions to the
    preference avoidance power.

    Bankr. Code 547 permits avoidance of liens obtained within the 90 day
    (or one year) period: the creation of a lien on property of the debtor,
    whether voluntary, such as through a consensual lien, or involuntary,
    such as through a judicial lien, would, absent avoidance, have the same
    preferential impact as a transfer of money from a debtor to a creditor
    in payment of a debt. If the security interest was created in the
    creditor within the 90 day window, and if other requirements of section
    547(b) are satisfied, the security interest can be avoided and the real
    property sold by the trustee free of the security interest (subject to
    homestead exemption). All unsecured creditors of the debtor, including
    the creditor whose lien has been avoided, will share, pro rata, in the
    distribution of assets of the debtor, including the proceeds of the sale
    of the real estate.

  • John..never worry about the size of yur posts. You provide TREMENDOUS information and I for one am extremely appreciative of your contribution. I find it EXTREMELY valuable and I am sure our readers do as well. I only wish we could publish your profile so that people can see who you are because I’m sure there would be MANY potential clients who would contact you…keep it coming!

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