Great news for foreclosure victims.........

[Joanne98]

CALIFORNIA BANKRUPTCY COURT HOLDS THAT MERS CANNOT TRANSFER NOTE FOR WANT OF OWNERSHIP; CITES BOYKO, LANDMARK (KANSAS), LAMY, AND VARGAS CASES
July 9, 2010

July 9, 2010

The United States Bankruptcy Court for the Eastern District of California has issued a ruling dated May 20, 2010 in the matter of In Re: Walker, Case No. 10-21656-E-11 which found that MERS could not, as a matter of law, have transferred the note to Citibank from the original lender, Bayrock Mortgage Corp. The Court’s opinion is headlined stating that MERS and Citibank are not the real parties in interest.

The court found that MERS acted “only as a nominee” for Bayrock under the Deed of Trust and there was no evidence that the note was transferred. The opinion also provides that “several courts have acknowledged that MERS is not the owner of the underlying note and therefore could not transfer the note, the beneficial interest in the deed of trust, or foreclose on the property secured by the deed”, citing the well-known cases of In Re Vargas (California Bankruptcy Court), Landmark v. Kesler (Kansas decision as to lack of authority of MERS), LaSalle Bank v. Lamy (New York), and In Re Foreclosure Cases (the “Boyko” decision from Ohio Federal Court).

The opinion states: “Since no evidence of MERS’ ownership of the underlying note has been offered, and other courts have concluded that MERS does not own the underlying notes, this court is convinced that MERS had no interest it could transfer to Citibank. Since MERS did not own the underlying note, it could not transfer the beneficial interest of the Deed of Trust to another. Any attempt to transfer the beneficial interest of a trust deed without ownership of the underlying note is void under California law.”

Read that again: “Any attempt to transfer the beneficial interest of a trust deed without ownership of the underlying note IS VOID UNDER CALIFORNIA LAW.” This conclusion was based upon California law cited in the opinion that the note and the mortgage are inseparable, with the former being essential while the latter is “an incident”, and that an assignment of the note carries the mortgage with it, “while an assignment of the latter alone is a nullity.” As MERS must own the note in order to assign the incident deed of trust, MERS is legally precluded from assigning the deed of trust for want of ownership of the note, and cannot assign the note in any event as it never owned it. MERS’ lack of ownership interest in promissory note is a matter of decided case law based on a record stipulation of MERS’ own lawyers in the MERS v. Nebraska Dept. of Finance decision.

This opinion thus serves as a legal basis to challenge any foreclosure in California based on a MERS assignment; to seek to void any MERS assignment of the Deed of Trust or the note to a third party for purposes of foreclosure; and should be sufficient for a borrower to not only obtain a TRO against a Trustee’s Sale, but also a Preliminary Injunction barring any sale pending any litigation filed by the borrower challenging a foreclosure based on a MERS assignment.

The Court concluded by stating: “Since the claimant, Citibank, has not established that it is the owner of the promissory note secured by the trust deed, Citibank is unable to assert a claim for payment in this case.” Thus, any foreclosing party which is not the original lender which purports to claim payment due under the note and the right to foreclose in California on the basis of a MERS assignment does not have the right to do so under the principles of this opinion.

This ruling is more than significant not only for California borrowers, but for borrowers nationwide, as this California court made it a point to cite non-bankruptcy cases as to the lack of authority of MERS in its opinion. Further, this opinion is consistent with the prior rulings of the Idaho and Nevada Bankruptcy courts on the same issue, that being the lack of authority for MERS to transfer the note as it never owned it (and cannot, per MERS’ own contract which provides that MERS agrees not to assert any rights to mortgage loans or properties mortgaged thereby).

We thank one of our dedicated readers for providing this opinion to us.

Jeff Barnes, Esq.;, www.ForeclosureDefenseNationwide.com

http://foreclosuredefensenationwide.com/?p=264

[flvegan]

1. We've had that very same ruling handed down here in Florida as well.

One famous (to me) judge in Pinellas County threw out every single foreclosure case involving MERS causing many lenders many headaches.

[Greyhound]

2. Three years too late for me, but great news nonetheless. K&R

[seafan]

3. There is hope for many homeowners who are under threat of foreclosure.

Thanks for the California update, Joanne98. These rulings are spreading across the country.


Kansas, Massachusetts, now California.....


CALIFORNIA BANKRUPTCY COURT HOLDS THAT MERS CANNOT TRANSFER NOTE FOR WANT OF OWNERSHIP; CITES BOYKO, LANDMARK (KANSAS), LAMY, AND VARGAS CASES, July 9, 2010



Here are some links to last fall's revelations about MERS' lack of standing as the "owner" of millions of mortgages. Matt Taibbi gave us the heads up then.




Taibbi: Waking up to discover the mortgage market was a giant criminal enterprise, September 22, 2009


The Mortgage Machine Backfires: MERS (Mortgage Electronic Registration System) under heavy scrutiny, September 28, 2009


Massachusetts ruling could undo thousands of foreclosures, October 15, 2009 (story excerpt at end of post)




The wheels of justice grind slowly.....

[xchrom]

4. Recommend

[MineralMan]

5. Show me the paper with my signature on it or

fuck off! No signature and you've got nothing.

The original trust deeds, in most cases, have disappeared into some sort of storage where they will never be seen again. A photograph of such a document is worthless, since the advent of computer photo alteration.

So, if they're trying to foreclose, get an attorney and force the forecloser to produce the original signed document. Odds are pretty good that they cannot do so.

[ms.smiler]

6. Thankfully, there have been a number of sensible rulings on issues

involving MERS.

Previously, courts recognized and ruled that MERS had no standing to foreclose on homeowners. MERS abandoned that foreclosure approach as a result.

Consider now, how many millions of Americans were wrongfully/fraudulently foreclosed by MERS over the past few years before those rulings. Consider how many clouded Titles are now in existence.

Presently, courts recognize and rule that a MERS Assignment of Mortgage is invalid and a nullity since MERS has no underlying beneficial interest in the Promissory Note.

Next, I’d like to see courts recognize and rule that MERS did not have, prior to any Assignment of Mortgage, any underlying interest in the Promissory Note.

My Promissory Note is made payable to the loan originator and my mortgagee is MERS. If you dig out your mortgage papers, you are likely to find the same circumstance.

If MERS should assign my mortgage to some other company, I now know that assignment would be invalid because MERS has no underlying beneficial interest in my Promissory Note which is payable to another company.

So, where does MERS presently have any beneficial interest in my Promissory Note prior to any Assignment of Mortgage? MERS is in the same position - as mortgagee on my mortgage and the loan originator is the owner of the Note. (I do know that the loan originator does not now own the Note as the purpose of a MERS mortgage was for the Note to be sold off to Wall Street for securitization.)

And there are 60 million mortgages in this country like mine?

I maintain that if MERS does not have the authority or ability to properly assign a mortgage & Note because they lack a beneficial interest in the Note - that the mortgage itself is invalid because MERS lacked such a beneficial interest in the Note since the inception of the mortgage.

[Fire1]

7. Thanks for this. MERS. Bookmarked for future reference. n/t