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    The REMICs have failed! The REMICshavefailed!

    Posted onNovember 4, 2011

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    If Paul Revere were alive

    today he would be riding through the town

    warning TheREMICs have failed!

    However, the government these days would

    go, Shhhhhh!

    Most average homeowners have no idea what a REMIC isactually most attorneys have no clue

    . so, you know many of the Judges are completely in the dark. REMICs are a form of IRS tax

    shelter sold to investors as part of the mortgage-backed securities package (Real Estate MortgageInvestment Conduit (REMIC) pursuant to I.R.C. 860A-G).

    The documents that killed the REMICs may actually help save your home.

    Anew report by Oppenheim Lawreveals the Black Magic of Securitized Trusts. The largest

    key to REMICs is that they are required to be passive vehicles, meaning that

    mortgages cannot be transferred in and out of the trustonce the closing date has occurred, unless the trust can meet very limited exceptions under the

    Internal Revenue Code. I.R.C. 860G. The 90 day requirement is imposed by the I.R.C. to

    ensure that the trust remains a static entity. However, since the mortgage-backed securities

    http://www.oppenheimlaw.com/pdfs/Securitization_Crisis.pdfhttp://www.oppenheimlaw.com/pdfs/Securitization_Crisis.pdfhttp://www.oppenheimlaw.com/pdfs/Securitization_Crisis.pdfhttp://deadlyclear.files.wordpress.com/2011/11/oppenheimlaw-logo1.jpghttp://deadlyclear.files.wordpress.com/2011/11/paul_revere_s_ride.jpghttp://deadlyclear.files.wordpress.com/2011/11/oppenheimlaw-logo1.jpghttp://deadlyclear.files.wordpress.com/2011/11/paul_revere_s_ride.jpghttp://www.oppenheimlaw.com/pdfs/Securitization_Crisis.pdf
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    trust controlling documents, the Pooling & Servicing Agreement (PSA), requires that the trustee

    and servicer not do anything to jeopardize the tax-exempt status; PSAs generally state that any

    transfer after the closing date of the trust is invalid.

    What does that mean to the average homeowner in foreclosure? Check the recordation office and

    look for the Assignment of Mortgage on your property generally found just before the Noticeof Foreclosure is filed with the State if your loan was securitized. Looking through hundreds of

    these beauties there have been few, if any, that were timely assigned to the trusts. How can youquickly tell if the Assignment of Mortgage has failed to make it timely to the trust?

    The Assignment of Mortgage [below] shows a 2006 Trust and a fraudulent assignment in 2009

    3 years AFTER the Trust had CLOSED! Not only was it too latebut the Trust could not

    accept it pursuant to the REMIC ofRFMSI 2006SA4 PSAand as further defined in the

    Oppenheim Law report. Assignments of Mortgage are public documents.

    What was not known until very recently, in fact Delaware Attorney General Beau Biden brought

    it out in his caseDelaware v. MERS, lenders generally failed to follow the PSA and properly

    assign the mortgage loans to the Trusts. In thetranscriptsthat AG Biden cited fromIn re Kemp,440 B.R. 624, 626 (Bankr. D.N.J. 2010) (No. 08-18700) (Aug. 11, 2009), an employee for Bank

    of America responsible for servicing the securitized Countrywide mortgage loans testified under

    http://www.sec.gov/Archives/edgar/data/1356490/000135649006000013/s4ssfinal.htmhttp://www.sec.gov/Archives/edgar/data/1356490/000135649006000013/s4ssfinal.htmhttp://www.sec.gov/Archives/edgar/data/1356490/000135649006000013/s4ssfinal.htmhttp://deadlyclear.wordpress.com/2011/10/28/complaint-state-of-delaware-v-merscorp-inc-go-go-beau/http://deadlyclear.wordpress.com/2011/10/28/complaint-state-of-delaware-v-merscorp-inc-go-go-beau/http://deadlyclear.wordpress.com/2011/10/28/complaint-state-of-delaware-v-merscorp-inc-go-go-beau/http://deadlyclear.files.wordpress.com/2011/11/261.pdfhttp://deadlyclear.files.wordpress.com/2011/11/261.pdfhttp://deadlyclear.files.wordpress.com/2011/11/261.pdfhttp://deadlyclear.files.wordpress.com/2011/11/barroga-assignment.jpghttp://deadlyclear.files.wordpress.com/2011/11/261.pdfhttp://deadlyclear.wordpress.com/2011/10/28/complaint-state-of-delaware-v-merscorp-inc-go-go-beau/http://www.sec.gov/Archives/edgar/data/1356490/000135649006000013/s4ssfinal.htm
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    oath that Countrywide did not have a practice of delivering original documents such as the note

    to the Trust and was not in the habit of endorsing notes at the bottom, but favored allonges thatthey made as they went along. She further testified that allonges are typically prepared in

    anticipation of foreclosure litigation, rather than at the time the mortgage loans are purportedly

    securitized. Both of these facts are contrary to the requirements of the PSA that the note be

    endorsed in blank and delivered to the trustee at the time of securitization. Thanks to foreclosuredefense attorney, Bruce H. Levitt, of South Orange, NJ - Bankruptcy Chief Judge JUDITH H.

    WIZMUR totally got it! See herOpinionhere.

    The trust investors have been suing Countrywide and other Wall Street banks for inflated

    appraisals, systematically abandoning underwriting guidelines and over-rated bonds. Theinvestors did not yet know that many of the mortgage loans failed to make it timely into the

    trusts and that the REMICs had been damaged. In fact, recently the IRS has taken notice and

    already initiated an investigation into the active activities of these trusts and the tax

    implications from them. Scot J. Paltrow,Exclusive: IRS Weighs tax penalties on mortgage

    securities, REUTERS, April 27, 2011.

    Heres a fine example of a (too) late Countrywide Assignment of Mortgage made in 2010 to aCWABS 2005-3 Trust. Did they just figure the courts were going to be oblivious

    http://deadlyclear.files.wordpress.com/2011/11/25.pdfhttp://deadlyclear.files.wordpress.com/2011/11/25.pdfhttp://deadlyclear.files.wordpress.com/2011/11/25.pdfhttp://www.reuters.com/article/2011/04/27/us-usa-mbs-taxes-idUSTRE73Q7UX20110427http://www.reuters.com/article/2011/04/27/us-usa-mbs-taxes-idUSTRE73Q7UX20110427http://www.reuters.com/article/2011/04/27/us-usa-mbs-taxes-idUSTRE73Q7UX20110427http://www.reuters.com/article/2011/04/27/us-usa-mbs-taxes-idUSTRE73Q7UX20110427http://www.reuters.com/article/2011/04/27/us-usa-mbs-taxes-idUSTRE73Q7UX20110427http://www.reuters.com/article/2011/04/27/us-usa-mbs-taxes-idUSTRE73Q7UX20110427http://www.reuters.com/article/2011/04/27/us-usa-mbs-taxes-idUSTRE73Q7UX20110427http://deadlyclear.files.wordpress.com/2011/11/25.pdf
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    forever?

    This is FIVE (5) years too late! Oh yeah, the REMIC has or should have failed. And it appears

    there are thousands, if not millions of these gems filed all across America in every state property

    recordation officeyou just have to look.

    http://deadlyclear.files.wordpress.com/2011/11/bateman-assignment1.jpg
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    Law Professor Adam Levitin, Georgetown University, describes the

    conflict the following way in theOppenheim Law report:

    The trustee will then typically convey the mortgage notes and security instruments to a master

    document custodian who manages the loan documentation, while the servicer handles thecollection of loans. Increasingly, there are concerns that in many cases the loan documents have

    not been properly transferred to the trust, which raises issues about whether the trust has title tothe loans and hence standing to bring foreclosure actions on defaulted loans. Because, among

    other reasons, of the real estate mortgage investment conduit (REMIC) tax trust of many

    private-label securitizations (PLS) . . . it would not be possible to transfer the mortgage loans

    (the note and the security instrument) to the trust after the REMICs closing date without losing

    REMIC status.

    Levitin further points out:

    As trust documents are explicit in setting forth a method and date for the transfer of the

    mortgage loans to the trust and in insisting that no party involved in the trust take steps that

    would endanger the trusts REMIC status, if the original transfers did not comply with themethod and timing for transfer required by the trust documents, then such belated transfers to

    the trust would be void. In these cases, there is a set of far-reaching systemic implications from

    clouded title to the property and from litigation against trustees and securitization sponsors for

    either violating trust duties or violating representations and warranties about the sale and transfer

    of the mortgage loans to the trust.

    Without valid assignments, attorneys say that standing and jurisdiction issues rise to the top andmay be asserted at any timeeven first time on appeal. If the pretender lender did not have astanding to non-judicially foreclose because the assignment of mortgage is void, logically

    everything thereafter would be a nullitythat could open up a can of worms beyond the

    pretender lenders/servicers repair.

    http://www.oppenheimlaw.com/pdfs/Securitization_Crisis.pdfhttp://www.oppenheimlaw.com/pdfs/Securitization_Crisis.pdfhttp://www.oppenheimlaw.com/pdfs/Securitization_Crisis.pdfhttp://deadlyclear.files.wordpress.com/2011/11/adam-levitin.jpghttp://www.oppenheimlaw.com/pdfs/Securitization_Crisis.pdf
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    These documents appear to have been fraudulent and as lawsuits assert were

    intentionally prepared and executed to unlawfully confiscatethe property from the homeowners. It appears it was easier to create the fraud and get paid bydefault insurance or credit default swaps than it was to modify they loans with the homeowners.

    Not only was there fraud on the homeowners, but also on the investors.

    But could REMICs be why the investors dont partnerup with the borrowers? They were both

    duped. The borrowers unwittingly relied on the [inflated] appraisals and had no idea that the

    underwriting guidelines had been systematically abandoned just like the investor claims. Butthere is one big difference

    If the investors include the borrowers, the fraudulent assignment of mortgages will surface and

    the REMIC fraud will float to the top like a dead body in a botched murder case. andsomebody will be stuck with paying the IRSeven if the investors win the case and get their

    investments back.

    Could these fraudulent assignments save your home or undo the foreclosure? Thats a question toask a competent foreclosure defense attorney and have him review your file.

    Next, we need to follow the money who actually got paid, how much and when??

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    This entry was posted inUncategorizedand tagged"Adam Levitin",assignment of mortgage,

    Beau Biden,Bruce H. Levitt,Countrywide,Credit Default Swaps,CWABS,Delaware v. MERS,

    Foreclosure,Fraud,GMAC,I.R.C. 860A-G,JUDITH H. WIZMUR,MERS,Mortgage

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    Electronic Registration Systems,Oppenheim Law,PSA,REMIC,RFMSI,Securitized Trusts,

    TrustbyDeadly Clear. Bookmark thepermalink.

    5 thoughts on The REMICs have failed! The REMICs

    have failed!

    1. Ron Margolis (@RealtorRon)onNovember 9, 2011 at 6:17 amsaid:NIcely done

    Reply

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