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Find your Promissory note and Security Deed (or Deed of Trust as used in states like California) in your closing papers (if you do not have them, you can contact the company who did the closing or lastly, your Lender.
Promissory note: a mortgage note associated with a specified mortgage loan. It is a written promise to repay a specified sum of money plus interest at a specified rate and length of time to fulfill the promise. It obligates the borrower, who signs the note, personally responsible for repayment.
Security Deed: This deed is used, rather than a mortgage, to give a lender a security interest in the property. A security deed passes legal title to the land while reserving unto the debtor (Borrower) the equitable title to use and enjoy the conveyed land subject to compliance with debt obligations. (Some states use Deeds of Trust instead).
IMPORTANT: in the Promissory Note notice the wording that the Borrower promises to pay the "note holder".
We have recently discovered that Borrowers are paying the wrong entity and perhaps 90% foreclosures are being intiated by entities that do not own the note. This is illegal!
In addition, when a loan is sold to another entity, by law there must be a signed and notarized ASSIGNMENT OF BENEFICIAL INTEREST recorded with the county clerk's office in sequence from one entity to the other.
Research your records now, either online at your county clerk's office (see lesson below). The following items should be recorded with the clerk:
> Security Deed (or Deed of Trust)
> Assignments (see example), signed/notarized showing each entity. If you see a break in sequence and/or you do not see the entity you are paying, stop and question. (We will provide more self-help lessons coming soon. In the meantime, please contact the mission.)
How do you find your records? (See the lesson below). This is important as you could be a victim of fraud. Your note may have been sold as a security on Wall Street, meaning the "note holder" has been paid. Question: is the "Servicer" illegally collecting funds?
Also in order for a foreclosure to legally take place, the foreclosing entity must have:
(1) The original wet ink (your signature) promissory note, not a copy*. See sample promissory note endorsed (signed/notarized) in sequence from the mortgagee to the plaintiff (foreclosing party). Note: Many times, because of lack of space on the promissory note, an allonge is used (separate piece of paper) to show endorsements. This has to be attached to the note, acting as a legal extension of the document, and both the allonge and the note have to show reference to each other. See example allonge.
(2) Assignments of Beneficial Interest (mentioned above) have to be in sequence from the mortgagee to the foreclosing entity (and information recorded in the clerk's office needs to show this). See below lesson. Caution: Docx in Alpharetta, GA was closed for fraudulently manufacturing over 1 million assignments to assist foreclosing entities to illegally foreclose. See article here.
(3) Signed and notarized Deed of Trust or Security Deed (with recording information).
See example Security Deed. Some states use Security Deeds while others use Deeds of Trust. These have to accompany the Promissory Note. Important: This is critical because if the note was bundled and sold on Wall Street, it may have been destroyed - be aware.
(4) Copy of modifications of the Note (with recording information).
(5) Accurate accounting of payments and charges.
(6) Security Deed or Deed of Trust has to have a legitimate Power of Sale provision.
*Note 1: The right to foreclose belongs ONLY to the person who has legitimate POSSESSION OF THE ORIGINAL NOTE – not a copy, not an electronic entry. Pertaining to (1) above, it is critical that a judge does not accept a "copy" of the promissory note. It is the Borrower's right to demand proof that the foreclosing entity is the legal noteholder. Why? In the event the judge illegally allows a "copy" to be submitted, the Borrower will be at risk because the original noteholder could later come forward demanding payment.
*Note 2: If the lender claims it does not have the original note because that note has been lost or destroyed, what does the law require the lender to prove?
The Uniform Commercial Code (UCC contains a specific provision on this subject. (See Section 3-309 here). Most states have adopted the UCC code pertaining to this subject. Click here for details and scroll down to Article 3. Note comment about South Carolina and New York.
You will see that a person can enforce a promissory note without having the original ONLY IF ALL OF THE FOLLOWING ARE PROVEN:
(1) The person has to claim that it no longer has the original note;
(2) The person has to prove that it was properly in possession of the note and entitled to enforce it WHEN it lost possession of the note;
(3) The person has to prove it did not “lose” possession simply because it transferred the note to someone else (i.e., it is not really lost); and
(4) The person has to prove that it cannot produce the original note, because the instrument was destroyed, or its whereabouts cannot be determined, or it was stolen by someone who had no right to it.
All of these matters have to be proven by the person trying to foreclose on the property. It is not the obligation of the borrower to prove or disprove any of this. The borrower can challenge the right of the person trying to foreclose and demand proof.
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We recommend that you practice with the following example: (Florida Public Records are used for this example):
Step 1 Google your county's recorder, the county clerk's office. "Hillsborough clerk of the court". Look for ONLINE SERVICES and Online Searches. Click on link: Search Official Records. Click to agree to usage conditions.
Step 2 At "Name" type last name, first name (example: Muneton Michael)
Set the date range: For Begin Date give date one (1) year before the purchase.
For End Date, let it default to current date.
Click "Search Records" and the results should show mortgages, assignments, deeds, lis pendens, etc. (Scroll down the court screen).
Here is a screen shot of Hillsborough County.
Here is the screen shot that shows the result (results are at the bottom of the search page):
FRAUD: Assignment was filed and dated after the Lis Pendens (this means law suit). Florida is a "judicial" state meaning that the foreclosing entity has to file a law suit to recover a property. See the lesson: Judicial/Non-judicial states.
Step 3: To pull up the Assignment, click on the blue name next to the Assignment.
Things that are not correct:
* Missing address for lender:
First National Bank of Arizona
* Barbara Hindman and Shelley Thieven sign as VP's of
Mortgage Electronic Registration
Systems (MERS) nominee for
First National Bank of Arizona
BUT research showed they were actually a Section Managers for
JP Morgan Chase.
Barbara Hindman and Shelley Thieven were actually employees of JP Morgan Chase. In other words, they were fraudulently "assigning" the note to themselves - JP Morgan Chase to JP Morgan Chase.
* There is no corporate seal.
* Notaries can be fraudulent. (You can research these).
FRAUD: Illegal assignment (signatures are forged) (see example Florida statutes on forgery 831.01, 831.02, 831.06). Googe your state, example "Florida statutes forgery".
Step 4: (Not necessary unless you want to do more investigative work). To learn people who are signing assignments over to the lender, go back to the original search screen. Change Party Type to "Reverse Name" and type in the lender. For this example, we will use JP Morgan Chase NA.
Note: Review of several Assignments will reveal that you may find the same signatures signing for MERS as nominees for various lenders, not just First National Bank of Arizona (remember our example showed Section Managers of JP Morgan Chase signing for MERS and they were actually employees of JP Morgan Chase assigning mortgage to JP Morgan Chase.)
Here is a sample screenshot of search results. You can choose several examples to research and compare signatures.