ataons ‘The Securitization and Foreclosure Coverup by The Big Barks - Houston News and Breaking Wirld News - NewscastMea.com™ NewscastMedia com™ El ‘esas westicties| inal fe, Semee (sv) ‘Stepl. Homeowner receives loan fiom Bank-X. Step2, Bank-X sells the loan to SPV and is paid in fll Step8, SPV transfers note into REMIC trust and is paid in fll by ‘Trustees, Slepd, The note is now a Security, the process is reversible and complete ‘Steps. Investors (OWNERS) of the Certificates (BondsStocks) receive payment from the REMIC Trust "Newscast Media HOUSTON, Texas~The process of acquiring or selling homes in the past few years has been forever changed by the securitization process that has affected homes of over 60 million Americans, I receive many emails and questions regarding this pic, and since lam not an attorney {will direct the readers toa biliantly waiten article by Rodaben Esquire, that explains the whole process and by the end of the article, you'll be surprised as to what the hanks are hiding from you. I have also created the chart above to show you the flr of transactions Understanding Securitization and Foreclosure: Bank A issues a mortgage to Caprice to purchase a house. Two documents are produced, a promissory note and a trust deed. The trust deed is essentially the tle ofthe property thst is eld in tust until the promise to repay the loan (promissory note) is satisfied. Once the loan is paid in full Bank A releases its claim on the Trust deed and ownership passes in full to Caprice. That is what most of us believe happens in mortgages because you are not informed a to what happens after the paperwork i signed and hovr it impacts the litle and promissory note you are obligated to. This is inteational, and represents the entice scheme that allows securitization occur. Ifthe process that i now used is too complex it canbe used as & justification tallow the shenanigans that occur during a foreclosure process to happen while the judges and juris heeve that the process described above is what i actually happening, Lets look next at the basics of securitization, ‘Once the mortgage has been formed between Caprice and Bank A, Bank A wants to get rid of i as fast as possible and recoup its funds. To tke advantage of ths andthe tax benefits of securitization it has to form what is called an SPV, a (Special Purpose Vehicle) Thnk of ts a shell company atpsinewscatmeta comyb1097201102/Sthe securizatin anc foreclosure: coverup by-the-bg-banks! “ataons ‘The Securitization and Foreclosure Coverup by The Big Barks - Houston News and Breaking Wirld News - NewscastMea.com™ ‘This protects the mortgage if something happened and Bank A went out of business. The morigage would still exis, Italo theoretically reduces the liability of Bank A to the morgage default. Its important to realize one important thing here... the two documents that Caprice signed (the promissory note andthe title deed) are now SEPARATED. The trust deed remains with is trustee, The promissory note—the asset that pays money—is SOLD to the SPV. The original note is paid off by the SPV and the stream of payments becomes the property ofthe SPV. Bank A has ils money in full and no Tonger has ANY interest in the mortgage Now, the SPV forms a new trust entity. This trust entity is defined by the IRS as a REMIC (Real Estate Mortgage Investment Conduit) and must adhere tothe laws regarding such a trust ‘Te benefit of doing tis is thet when the SPV transfers the mortgages into the Trust NO TAXES MUST BE, PAID ON THE TRANSFER. This makes the tust i a much more ellicien! and profilable vehicle for investors. REMICS, in tua, cannot retain any ‘ovmership interest in any ofthe underlying mortgages. The Trust, then, i as ts hame states a Conduit where money flows in trom the person who pays ‘their morigage and out tothe investor as a payment. The right to receive those payments was purchased when the security (stock or bond) to the trast ‘was purchased. Proceeds from that went back to the SPV who used them to purchase the mortgages fom Bank A. [tsa giant figure 8 circular flow of money with the Trustee coordinating ial Lets see who OWNS the mortgage then: ‘The first ovmer was Bank A who took interest in the property as cllateral on its loan to Caprice. Simple enough. Wien Bank A sold the mortgage to the SPV its interest was extinguished, Ownership ofthe promissory note WAS transferred to the SPV sho is now the note holder. The SPV forms the [REMI trust and transfers the note into the tus, thereafter it mevocably changes the nature of Caprice’s mortgage. It becomes a Security. Once again, the SPV must transfer the note and pay taxes on the transfer. The mortgage now in the trust hecomes forall purposes a blended group of monthly payments. These payment steams become the source of funds that the iste pays out fo investors. In essence the tustee—when certificates, stocks or bonds tothe trust are sold—sells a beneficial interest inthe mortgage. That is not ownership of any portion or any segment ofthe revenue stream but rather is simply a security ust like a share of IBM or Google doesn't entitle you to any of the assets ofthe company. But who owns the rote? Because ofthe tax exemption ofthe REMIC itis PROJIIBITED fiom retaining any ownership ofthe underlying assets it no longer holds any ‘ownership tothe note on the day it is formed. The investors inthe trust do not hold any intrest the note either, they ony hold the security which was sold to them, So what happened to ovmership of the note? It was EXTINGUISHED when it entered into the tras in order fo abtain the flow of cash ‘back tothe original lender and the tax-prefered investment proceeds tothe investors. So, who does Caprice owe the money to? Who has authority to release the deed to Caprice when her mortgage has been satisfied? The answer? No one. ‘The trust is setup and cannot take an active role inthe collection ofthe funds. It is a shell entity ONLY. Therefore it appoints a servicer to collect the ‘payments every month, So what happens when Caprice defaults? ow is his property foreclosed upon? In this proveeding the servicer presents documents to the court (or the taste ofthe deed in a non-judicial foreclosure state) that state that THEY are the owner of the note and have a legal standing to foreclose. This isnot tue, is not legally possible, nd is fraudulent. The servicer isthe agent ofthe ‘Trust and will use that to claim that they are foreclosing on behalf ofthe trust. The problem? The Trust itself cannot hold ownership of the note ‘because of is tax-preferred REMIC status! What abou ifthe slate thal they ate representatives ofthe investors? The investors have no ownership interest inthe underlying morrgages, they only have ownership interest inthe secunties that were issued to fund the trust! So who does Caprice owe? ‘The answer is nobody. The process ofa note becoming a Security is final and irreversible. You cannot unscramble the eggs. A Security cannot be sed to foreclose. The Kansas Federal Court Ruling decided once a note was securitized it was no longer a note and would NEVER be a noe again. It ‘becomes a Security. (Landmark National Bank v. Kesler, 2009 Kan, LEXIS 834.) Bottom Line All Terms of Your Mortgage Were Fulfilled: ‘The Lender was paid fom the SPV upon sling the note “The SPV was pad fiom the Trustee who received money stom the sale of securities The Servicer was paid on schedule bythe Trust fom fees generated ‘Owners ofthe ceritiates (bonds or sock) received a payment from the Trust The REMIC Trust itself was insured by the SPV to protect investors. the terms ofthe mortgage wee fulilled (everyone was paid) To Whom Does Caprice Owe Any Money? “There sill exists Tien on the house that is unenforceable, You would have to go through a process to extinguish that lien by having an attorney file {or you a Quiet Til, that silences or quiets any more claims to the property. hlfp:/www.newscastmedia.com/securitization.himl 860 '5 Comments [Comments ere now closed for this post} Posted by Joseph Earnest - February 15, 2011 at 1:28 am. Written by Rondaben Esquire Edited by Joseph Ernest tegories: News Tags: Class Action Lawsuit, credit default swap, deed of ius, homeowner, how to stop foreclosure, mortgage hacked securities, smorlzage loan, mortgave security, mortgage seivicer, note, pro rv note, rea estate mortgage investment condut, REMIC, seeunlies and exchange commission, secuniy, special purpose vehicle, SPV, slop foreclosure, us, rust deed, musiee ‘Comments are closed atpsinewscatmeta comyb1097201102/Sthe securizatin anc foreclosure: coverup by-the-bg-banks! 2ataons ‘The Securitization and Foreclosure Coverup by The Big Barks - Houston News and Breaking Wirld News - NewscastMea.com™ + Recent Posts ficial Rand Paul announces his 2016 White House hi [hind the senes in the media industry with its journalists UK _Tran nuclear negotiators have reached twoad understanding n Kagers shot dead-US Embassy teror alert becomes se ulfilling prophesy in gan Patt I Evolution of cultural trends in sosiety-subeulture Pentagon declassifies documen's confirming lsael as nukes The evolution of cultural trends and their impact on soci Photos: Highlights of the 2015 Houston Livestock Show and Rodeo ‘Islamic State teleases 19 Christians 200 sul held captive Excleshian arst gives birth and tells how God fumed her life around + Archives April 2015 21s February 2015 January 2015 November 20 October 2014 ‘Seplember 2014 ‘August 2014 July 2014 ne2014 May 2018 ‘Apul20Le Marsh 2014 February 2014 January 2014 comber 2 wvember 20 ‘Dauber 2013 ‘Seplember 2013 ‘August 2013 iy 2013 ne 2013 May 2013 March 2013 ‘November 2012 Detoher 2012 September 2012 ‘August 2012 ly 2012 Sune 2012 May 2012 20 March 2012 February 2012 eae iovernber 2011 October 2011 September 2011 ‘August 2011 Jy 2011 Sune 2011 Apri 2011 March 201, February 2011 January 2011 December 2010 ‘November 2010 October 201 September 2010 ‘August 2010 tatpsinewscatmeta comyb1097201102/Sthe securizatin and foreclosure coverup by-the-bg- banks!ataons ‘The Securitization and Foreclosure Coverup by The Big Barks - Houston News and Breaking Wirld News - NewscastMea.com™ © July 2010, June 2010 + Tags Alani nastssess barack Obama Bashar Assad gato tion dolesis dahl cluaad noses foreclosure fim friends ‘of syria usstaus Hillary Clinton Hos: Mubamk houston news human trafficking wc txiscmy san news tan nuclear seogram 1S ISIL ISIS Islamic State juin ken kin unean M23 rebels mitt romney Mitt Romney 2012 Mitt Romney news morgage backed securities mortgage fraud muslim brotherhood Newscast Media North Korea Obamacare Rick Perry sunk tain SEC securities and exchange commission securities fraud Sergei Lavrov sus sila: Suiancws tie cis Viadmir Putin + Newscast Media » (HEADLINES! 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