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Essence of Securitized Time

This writing begins with a quote from scripture: Father, forgive them, for they do not know what they do. -Luke 23:34 On the contrary, in the beginning of the mortgage meltdown there were those who knew exactly what they were doing. Is it beyond speculation that those in the beginning hoped they could achieve their mammon goal before the unlawfulness was comprehended? One hears that those of junior grade judiciary (state courts) are concerned with giving away a Free House. In accordance to law, any obliging prospective Real Estate owner should be able to secure a promise of a tangible monetary obligation and secure the purchase money with an alternate means of satisfying the tangible monetary obligation by means of granting a security interest in the property. Hence the House, as security, becomes an alternate source for the repaying of the tangible monetary obligation to the tangible creditor if all applicable laws are followed. When all applicable laws applying to the alternate means of collection are NOT in compliance, the tangible creditor (Tangible Obligee) (Lender or any other non-party) is left with no alternate method of collecting value for the tangible obligation. Truth be told, there is no such thing as a Free House, but only the loss of an alternate means to collect a homeowners tangible monetary obligation. For if a party has a valid tangible monetary instrument (the Note), such party could seek monetary relief utilizing the Note. Even in the days when Abraham Lincoln was practicing as an attorney, he ran into the bias favor of courts to creditors. This writer really has no issue with bias, but when a court rules in contradiction to statutory law, the court has in essence opined in opposite to the rule of law. Why are the courts ruling in contrary to statutory law? Simple most judiciaries are under the assumption that the creditor named in a tangible obligation suit is the creditor for a tangible obligation. In fact, in this modern day electronic digitized world, the creditor noted in many court pleadings is most often a creditor for the Account Debtor and not the creditor for the tangible obligation. When a court rules in opposite of statutory law, justice has failed. Reality is that no one likes to lose (real or imaginary) and if one can play a game of words, as attorneys commonly do before a court, the use of deception just might allow a deceiver to win on deception. One needs to only look at the world and see common-day me, me, now, now selfish shortsightedness. Such desire is evident in the securitization of tangible secured instruments commonly referenced as a homeowners mortgage (the Note secured by an interest in the real property, the security instrument). This writer, in explaining securitization, will refer to the attached chart titled: Subsequent Purchase Electronic Authoritative Copy. We begin at the three-directional silver arrow on the left side of the chart, which in many circumstances is when the seller of real estate executes a Warranty Deed with a Vendors Lien. We cant blame a seller of real estate for protecting his interest. If the seller of real estate does not get paid, then they have a legal lien method to reacquire the real estate. One such source of funding to pay the seller is a third party contract between the originating lender (L1) and whoever tendered the money. (Its interesting to ask, why would a seller of real estate want to assign his legal protection away to a lender financing the purchase of real estate for a buyer as noted in some of the Warranty Deeds?) Considering that sellers are almost always paid, a lien 2013 Mortgage Compliance Investigators Authored by Joseph Esquivel and Damion Emholtz

still remains in public record. But even if such vendors lien is not dissolved of record by the seller or sellers assigns, the sellers lien would expire by operation of law upon the seller of real estate being paid. We travel left from the three-directional silver arrow. For a lender to be more assured of being repaid for funding a buyers monetary obligation, the originating lender (L1) creates and attaches a security instrument (lien to provide alternate method of collection) in accordance to local laws of jurisdiction. In following local laws of jurisdiction, the originating lender (L1) permanently perfects the security instrument (makes the lien permanently enforceable as an alternate) by filing the security instrument into record. But in order for such perfection of enforceability of the security securing the Note to extend to subsequent purchasers of the Note, it requires a subsequent purchaser of the Note to file the security instrument in the subsequent purchaser of the Notes name to be a Secured Party of Record (Tangible Secured Party). If the originating lender failed to timely file of record the security instrument, attachment, and temporary perfection, the right of enforceability would expire by operation of law and the result would be the loss of an alternate method to collect an equal value to the Notes value. There is much confusion surrounding MERS because they have actually been recognized as being member-agents of many various parties, rather than one entity or employer. It may be possible for MERS to be filed in public records as being an agent of the originating lender (L1), or a beneficiary of the security instrument in lieu of the Originating Lender (L1), but such legal status should be decided by the proper court in ones jurisdiction. However, one fact is clear there is no way that MERS can properly be named as the Secured Party; the Secured Party is legally reserved for the lender for all applicable local laws of jurisdiction to be in compliance. At this point in time the legal actors that can be identified are the seller of the real estate, the buyer of the real estate, and the Originating Lender (L1) that funded the real estate purchaser for the buyer. Whether or not the Originating Lender (L1) is a tangible Secured Creditor is dependent upon whether or not local laws of jurisdiction and federal real estate laws have been complied with. Next, follow the silver three way arrow to the right and you will see that, beyond any reasonable doubt, the Originating Lender (L1) routinely places the Note, which is alleged to be an indorsement by the Indorser only (Originating Lender L1), on the face of the monetary obligation (Instrument the Note) as an attempt to have the Note become Bearer Paper in accordance to the Uniform Commercial Code Article 3 and/or each states equivalence. This writer has no issue with instruments becoming bearer paper and for such bearer paper to be negotiated by possession alone, but where a security instrument is attached, each negotiation in accordance to local laws of jurisdiction would require recordation of the subsequent purchaser to be identified of public record to remain a tangible Secured Creditor. Attempting to apply Intangible laws of perfection to a Tangible world creates absolute chaos; for if intangible perfection laws applied to the tangible, any negotiable instrument could be sold for less than full value in contradiction to Uniform Commercial Code Article 3, subsection 203, subsection (d), or each states equivalence. Going up from the silver three-directional arrow is the stripping of value from the Note and the creation of an electronic intangible obligation. This is the action that reduces the value of the Note, making the Note not eligible for subsequent negotiation. The account debtor, represented by the silver three-way arrow, creates the Intangible Obligation, which is the Intangible Payment Stream that would be under governance of the Uniform Commercial Code Article 9 and/or each states equivalence. Here, the Account Debtor is liable for the debts it creates and the homeowner is liable for the debts he/she creates. One only needs to look at the covenants in the tangible security instrument which is to secure a tangible obligation (the Note); the 2013 Mortgage Compliance Investigators Authored by Joseph Esquivel and Damion Emholtz

covenants will provide the evidence to support the intention to create an intangible obligation, for the security instrument contains notice that the Note (tangible obligation) is to be sold OR an interest in the Note will be sold. Notice that the security instrument is to follow the intangible obligation, which is in opposition to all statutory and case law. For a Trustee of an intangible trust to declare a tangible obligor in default, is flawed logic, as the Trustee of an intangible trust could only declare the Account Debtor (Intangible Obligor) in default. One has to consider, if an intangible trustee is attempting to collect an intangible debt from a tangible obligor in lieu of the intangible obligor, how many collection laws, both state and federal, are being violated? Is this an attempt to collect another debt from a party not liable? The creation of the intangible obligation in nearly all instances involves scanning the tangible Note into an intangible digitized form, whereby this original scanned copy is then declared to be the Authoritative Copy as being a transferable record in accordance to E-SIGN (15 USC 7001) and UETA. Except E-SIGN as well as UETA both exclude items governed by Uniform Commercial Code Article(s) 3 & 9, E-SIGN exclusion are noted in 15 USC 7003. In following the right turn after leaving the upward travel of the silver three-way arrow, we find how the creation of the Intangible Obligation is defined, as the Electronic Digitized Authoritative Copy. In the old tangible days, a copy of the tangible obligation was provided to establish a rating factor and the facts are clear that in this electronic digitized world an intangible copy (Unauthoritative Copy) could also be presented for rating. This brings a serious question into play about current ratings: Does the rating agency take into account whether the process and procedure in converting a Tangible Uniform Commercial Code Article 3 instrument into an Intangible Transferable Record is lawful or not? The process of the Tangible Instrument being indorsed In Blank and/or with an allonge being added to convert the Instrument from Bearer Paper to a party by Special Indorsement does not overcome the fact that the Instrument, being for less than full value, was not eligible for negotiation. Therefore, logic provides that the addition of an allonge or adding the name of a subsequent Payee to the instrument is willful, intentional, and lacks supporting statutory law. A second intangible can be created by a subsequent Account Debtor (Securitizer/Depositor, etc) after the Account Debtor creates the Intangible Obligation. The Trust Certificates that investors routinely purchase are the Intangible Obligations. Whether there are one, two, or three subsequent Account Debtors really is not a factor. In the creation of the second Intangible Certificate Obligation (Certificate Trust) the Tangible Obligation (Instrument) is negotiated as a secured instrument to the Certificate Trust. Here there is an attempt to apply intangible Uniform Commercial Code Article 9 laws, to pre-exempt state laws, to assign a subsequent purchaser of the tangible instrument a Secured Party status. The original Account Debtor is, at best, the only party that could possibly be a secured party of the tangible obligation and here is where the Account Debtor wears two hats: one being, at best, a secured tangible creditor and the other is an Intangible Obligor, obligated to any subsequent Intangible Obligee such as a private trust or Fannie or Freddie, even that of Ginnie Mae. There have been reports that under New York law two instruments involving the same debt obligation cannot exist at the same time, which is suggested as one reason for the destruction of the tangible Note. If statutory law was still being complied with, the tangible Note could exist at the same time as an intangible Note. In fact, we have two different obligations, executed by two different obligors, to two different obligees, where destruction of the tangible would only serve to destroy any collateral the intangible was privy too. 2013 Mortgage Compliance Investigators Authored by Joseph Esquivel and Damion Emholtz

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