Bad News for MERS − Good News for Homeowners − Jeff Barnes, Esq. article

by Ken Kappel on June 7, 2011

Robo Signing and Foreclosure Gate
We missed this story regarding our birth home state, Oregon, but, fortunately it caught up with us. This is another gold brick in our (you too) wall providing legal relief for those under threat of foreclosure.  One way or the other.  As in a legal foreclosure, OR, an illegal foreclosure. Believe it or not, it is beginning to appear that most foreclosures in the United States are and have been illegal − on their face, and, according to law, which is finally developing in high places.

Bank Lender Fraud
Shocking??? Not so much any more. Finally state courts at the highest levels are relying on the law, the facts, and most importantly, precedent (decisions by other state high courts they can point to and fall back on − a good thing − creates an ongoing national consensus) being established by the highest state level courts across the land. State Supreme Courts, making decisions that should have our Federal Department of Justice in deep shame. However, as the Justice Department are handmaidens to the Administration, which in turn is handmaiden to the Financial Elites, who have destroyed the middle class and the housing market in America − we are not shocked − not dismayed, just amazed that the Rule of Law in America is being upheld − even if at the state level. That though is becoming more and more of a good thing as the Federal Government is no longer to be trusted.

But, first, a brief primer − from our friends at MERS (Mortgage Electronic Registration System) taken from their web site, which can be accessed here.

“Welcome to MERS!
“MERS is an innovative process that simplifies the way mortgage ownership and servicing rights are originated, sold and tracked. Created by the real estate finance industry, MERS eliminates the need to prepare and record assignments when trading residential and commercial mortgage loans.” [Emphasis Added.]

In other words MERS:

  • took the law into their own hands;
  • repeatedly violated state foreclosure laws (and got away with it);
  • enabled the Financial Elites to avoid federal taxation on entities they created (REMICS) to accumulate and securitize loans, which were put into Asset Backed and Mortgage Backed Securities (MBS);
  • avoided paying multi-billions of state title recording fees;
  • were at the heart of illegal fraudulent Robo Sighing; and, if that is not enough;
  • foreclosed on properties when they did not have the legal standing to do so.

Jeff Barnes, Esq., brilliant attorney and the brain behind, Foreclosure Defense Nationwide wrote the article that appears below.  His title for the piece was: “Oregon Federal Bankruptcy Court Adopts Reasoning Of Kansas, Nebraska, And Arkansas Supreme Courts: MERs Not A “Beneficiary” Even Through Designated In Deed Of Trust.” Please read this very carefully, AND, don’t be worried about not understanding every term. There will not be a quiz. When you get to the bottom very closely read our admonishment (in a good way) to you, and read it again.  We’re prepping you up for Homeowner’s Law School.  No joke!!! You’ll see why at the bottom.

To the article.

“In an extremely significant decision, the U.S. Bankruptcy Court for the District of Oregon has issued an opinion dated August 24, 2010 in the matter of In Re Allman, 2010 WL 3366405 (Bkrtcy.D.Or.) which has adopted the anti-MERS decisions of the Supreme Courts of Kansas, Nebraska, and and Arkansas in holding that MERS is not “beneficiary” despite claiming to be so in Deeds of Trust. Although the case involved the issue of whether MERS was to entitled to receive, under Oregon statutes, a notice of intention to record a trust deed release which is required to be given to the “beneficiary of record” and “the party to whom the full satisfaction of payment was made”, the Court examined the role of MERS and concluded that it is not a beneficiary, and thus not entitled to such notice.” [Emphasis Added.]

“The Court highlighted the standard MERS language in the trust deed which listed MERS as the beneficiary “solely as nominee for the Lender and assigns” and that “MERS is a separate corporation that is acting as nominee for the Lender and Lender’s assigns”, and further that MERS holds only legal title. The first important conclusion reached by the Court was that under the statutory definition of “beneficiary” of the Oregon Trust Deed Act that the lender (and not MERS) is the “person for whose benefit” the deed of trust was given. This vitiates and should render null the recent arguments made by counsel for foreclosing parties that “because the Deed of Trust says MERS is the beneficiary that MERS is thus the beneficiary”. In other words, just because MERS says so does not mean it is so.” [Emphasis Added.]

“The Court then went on to cite the definition of a “nominee” as cited by the Arkansas Supreme Court in the MERS v. Southwest Homes of Arkansas, Inc. case, and what MERS is and does as found by the Nebraska Supreme Court in the MERS v. Nebraska Dept. of Banking case.”

“The Court concluded that the relationship of MERS to the lender was ”more akin to a straw man than to a party possessing all the rights given to a buyer“, citing the quotation from the Landmark v. Kesler case from the Supreme Court of Kansas, and ultimately concluded that ”It is apparent that the listing of MERS as a beneficiary in the deed of trust is merely to facilitate its ownership tracking function. It is not in any real sense of the word, particularly defined in ORS 86.705(1), the beneficiary of the trust deed.” [Emphasis Added.]

“As such, the Oregon Federal Court has joined the ever-growing ranks of those courts which have truly examined the inconsistent claims and self-appointed titles of MERS in Deeds of Trust and has concluded, as have the state courts of Kansas, Nebraska, Arkansas and others and the Bankruptcy Court of Nevada, that MERS is not, never was, and cannot be a “beneficiary”. Thus, as MERS is not a “beneficiary” by statute, every purported assignment of a Deed of Trust or Substitution of Trustee in Oregon by MERS claiming to be the “nominee” or “beneficiary” is now suspect and should be challenged based on the holding of this extremely important and well-reasoned decision.”  [Emphasis Added.]

Ken here.  Way more than enough said.  Thank you very much Jeff Barnes, Esq. If you’re scratching your head, because you don’t understand these legal terms, we strongly strongly urge you to read it again. Yes, we are sending you to Homeowners Law School.  It’s a tiny specialty in the law, but, you need to get this stuff in order to be able to assess the basic real estate knowledge and competence for any attorney you may choose to hire in the future. You already know the banks aren’t going to help. Just ask someone you know who has lost their home.

You need to have learned enough to have creative and knowledgeable input into any case you may bring against the lender.  In short, you need to become a professional client. If any attorney you talk to doesn’t appreciate and respect input from you − get another attorney. It’s as simple as that.

We’re going to hold your hand through this process – so − stay tuned. Heck later on, when you get your learning up to speed, we will offer you some “tools” to defend and protect your family and your home.  In part, we will be able to refer you legal resources, and, in particular how to obtain a Securitization Audit, which show clearly beyond any doubt the illegal trail they put your documents through after the “closing” table. This is the evidence you will require to force the lender, to the “settlement table.” As many of you learned the hard, good faith path to application for a loan mod, was often a fruitless and painful process.  The Banksters did not play it straight with you.  They make more money by foreclosing on you.  Your interest is aligned with the investor in your property who holds the Mortgage Backed Security.  They would prefer to take a hair cut, reduce the principal, and even interest rate on your loan, so that it once again becomes a performing loan — that you can afford.  Capiche?

Remember, never short sale, walk away or strategically default. Stay tuned, and over time, if you read this stuff you’ll know exactly why we’re saying that. Utilizing housing litigation, specifically, Foreclosure Law, you can be the victor.

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