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Theodore Arthur Woerthwein
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Theodore Woerthwein’s Answers

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  • Does New York Trust law address what's required about proper transfer for an Illinois foreclosure case?

    Does New York Trust law address what's required about proper transfer for an Illinois foreclosure case?

    Theodore’s Answer

    Great question for those confused between the Uniform Commercial Code (UCC) and New York (and Illinois) Trust Law.

    I recently had a federal foreclosure case dismissed by Judge Pallmeyer on October 11, 2011. As a nationally recognized leader in Mortgage Foreclosure Defense Education & Litigation, our firm successfully defeated Plaintiff Complaint by filing A Motion to Dismiss for Lack of Standing. See Deutsche Bank v. Bodzianowski (11 cv 1950)

    Judge Pallmeyer ruled that Deutsche, a major Wall Street bank, lacked standing to foreclosure on an Illinois homeowner. Standing is the threshold question in every federal case. Plaintiff was NOT the original lender and sought to establish standing by endorsing the Promissory Note and assigning the Mortgage directly to the Trustee . While Plaintiff pled that it was the legal holder of the Note and Mortgage, it failed to convey the mortgage file according to the terms creating Trust (Pooling and Servicing Agreement - PSA) and New York trust law.

    A Promissory Note is an asset of the trust and should have an "unbroken" chain of endorsements from the Originator (original lender) to Sponsor to Seller to Depositor and then to the Trustee, sequentially. In other words, the act of the Trustee receiving an instrument that does not have ALL of the intervening endorsements is void. Although Plaintiff argued that it has standing because the Promissory Note, a negotiable instrument, is governed by the Uniform Commercial. However, the UCC permits parties to agree to a more exacting method of transferring the notes to the trust and in this case the parties did so inside the private-label mortgage-backed security (MBS) trust.

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  • What does a Corporate Assignment of a Mortgage mean? Please read details and help me understand this letter my friend got.

    Assignor- MERS as nomiee for fremont investment & loan it's successors and assigns Assignee-Deutsche Bank as trustee. Sufficency of which is hereby acknowledged the said assignor hereby assigns unto the assignee the said mortgage having an origina...

    Theodore’s Answer

    Without looking at the entire document, it appears that Fremont Investment & Loan is the original lender and the mortgage nominated MERS as the lender's representative. The mortgage was likely securitized into a private-lable mortgage security trust (MBS) with Deutsche Bank named as a trustee for investors.

    Most of these Assignment of Mortgage while on the surface appear to give Plaintiff banks the right to foreclose, savvy homeowners are challenging the big Wall Street banks to prove they have "proper standing" to pursue the foreclosure action especially if the endorsements that appear on the bottom of their promissory note does NOT conform to the strict requirement of the Trust's PSA.

    I recently had a federal foreclosure case dismissed by Judge Pallmeyer on October 11, 2011. As a nationally recognized leader in Mortgage Foreclosure Defense Education & Litigation, our firm successfully defeated Plaintiff's Complaint by filing A Motion to Dismiss for Lack of Standing. See Deutsche Bank v. Bodzianowski (11 cv 1950)

    Judge Pallmeyer ruled that Deutsche, a major Wall Street bank, lacked standing to foreclosure on an Illinois homeowner. Standing is the threshold question in every federal case. Plaintiff was NOT the original lender and sought to establish standing by endorsing the Promissory Note and assigning the Mortgage directly to the Trustee . While Plaintiff pled that it was the legal holder of the Note and Mortgage, it failed to convey the mortgage file according to the terms creating the Trust (Pooling and Servicing Agreement - PSA) and New York trust law. A Promissory Note is an asset of the trust and should have an "unbroken" chain of endorsements from the Originator (original lender) to Sponsor to Seller to Depositor and then to the Trustee, sequentially. In other words, the act of the Trustee receiving an instrument that does not have ALL of the intervening endorsements is void. Although Plaintiff argued that it has standing because the Promissory Note, a negotiable instrument, is governed by the Uniform Commercial. However, the UCC permits parties to agree to a more exacting method of transferring the notes to the trust and in this case the parties did so inside the private-label mortgage-backed security (MBS) trust.

    As such, we are encouraging all Illinois homeowners to check to see if their loan was securitized in a private-label MBS anytime between 2003 - 2007. If you do not know the answer to this question, we would be happy to help.

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  • How long after nonpayment can a person file notice of default on a home?

    After two months of nonpayment, I received a notice of default. Is that legal? What is my remedy if they move to foreclose and served me with a premature notice of default?

    Theodore’s Answer

    Notice of Default (NOD): The initial document (non-judicial) filed by a trustee that starts the foreclosure process, usually after the occurrence of a default under the deed of trust, or mortgage. Both LIS and NOD are part of the PRE-foreclosure process.

    Lis Penden (LIS): Notification of pending lawsuit. The initial document (judicial) filed by an attorney or trustee that starts the foreclosure process after the occurrence of default under the deed of trust or mortgage. Both LIS and NOD are part of the PRE-foreclosure process.

    Typically, these are done after three missed payments. Have you called the bank for clarification and verification? Perhaps they did not apply your last payment. In any event, it is best in these situation to seek skilled practitioners in your area and determine if the bank / entity foreclosing on you even has proper standing to foreclose.

    you need to get ahead of the situation

    More and more Plaintiff bank are pursuing a "duel track"

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  • What does mortgage electronic registration systems mean? In the real estate world who is the grantor and grantee mean?

    If a house was up for foreclosue and it said the grantor with the person's name and the grantee with the bank's name what does that mean? And now it say's for the grantor mortgage electronic registration systems inc and for the grantee the banks n...

    Theodore’s Answer

    Mortgage Electronic Registration Systems, Inc. (MERS) is an American privately held company that operates an electronic registry designed to track servicing rights and ownership of mortgage loans in the United States. MERS is owned by holding company MERSCORP, Inc.

    The real estate law and real estate transactions in the US are subject to state regulations and county level recordation requirements, since the time of the establishment of the US as an independent country. That made it quite cumbersome for financial companies to develop a smooth operation of a market based on US mortgages in the early 1980s. This is because every time a financial instrument containing mortgages is sold, various state laws may require that the sale of each such mortgage (or deed of trust) be recorded in the local county courts in order to preserve certain rights (e.g., the right to foreclose non-judicially), which triggers an obligation to pay corresponding recording fees.[citation needed] So, the financial industry, eager to trade in mortgage-back securities, needed to find a way around these recordation requirements, and this is how MERS was born to replace public recordation with a private one.[citation needed]. By 2007, MERS registered some two-thirds of all the home loans in the US.

    The company asserts to be the owner (or the owner's nominee) of the security interest indicated by the mortgages transferred by lenders, investors and their loan servicers in the county land records. MERS maintains that its process eliminates the need to file assignments in the county land records which lowers costs for lenders and consumers by reducing county recording fee expenses resulting from real estate transfers and provides a central source of information and tracking for mortgage loans. The company's role in facilitating mortgage trading was relatively uncontroversial in its early days a decade ago but continued fallout from the subprime mortgage crisis has put MERS at the center of several legal challenges disputing the company's right to initiate foreclosures. Should these challenges succeed, the US banking industry could face a renewed need for capitalization.

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  • Does New York Trust law address what's required for proper transfer for an Illinois foreclosure case?

    Does New York Trust law address what's required for proper transfer for an Illinois foreclosure case?

    Theodore’s Answer

    Great question for those confused between the Uniform Commercial Code (UCC) and New York (and Illinois) Trust Law.

    I recently had a federal foreclosure case dismissed by Judge Pallmeyer on October 11, 2011. As a nationally recognized leader in Mortgage Foreclosure Defense Education & Litigation, I successfully defeated Plaintiff Complaint by filing A Motion to Dismiss for lack of standing. See Deutsche Bank v. Bodzianowski (11 cv 1950)

    Judge Pallmeyer ruled that Deutsche, a major Wall Street bank, lacked standing to foreclosure on an Illinois homeowner. Standing is the threshold question in every federal case. Plaintiff was NOT the original lender and sought to establish standing by endorsing the Promissory Note and assigning the Mortgage directly to the Trustee . While Plaintiff pled that it was the legal holder of the Note and Mortgage, it failed to convey the mortgage file according to the terms creating Trust (Pooling and Servicing Agreement - PSA) and New York trust law. A Promissory Note is an asset of the trust and should have an "unbroken" chain of endorsements from the Originator (original lender) to Sponsor to Seller to Depositor and then to the Trustee, sequentially. In other words, the act of the Trustee receiving an instrument that does not have ALL of the intervening endorsements is void. Although Plaintiff argued that it has standing because the Promissory Note, a negotiable instrument, is governed by the Uniform Commercial. However, the UCC permits parties to agree to a more exacting method of transferring the notes to the trust and in this case the parties did so inside the private-label mortgage-backed security (MBS) trust.

    See question 
  • What is a Motion to Dismiss for Lack of Standing in an Illinois foreclosure case?

    What is a Motion to Dismiss for Lack of Standing in an Illinois foreclosure case?

    Theodore’s Answer

    A Motion to Dismiss is an legal action take by defendant attorney counsel action to challenge whether a Plaintiff bank has standing to foreclsoure on an Illinois homeowner.

    I recently had a federal foreclosure case dismissed by Judge Pallmeyer on October 11, 2011. As a nationally recognized leader in mortgage foreclosure defense education & litigation, I successfully defeated Plaintiff Complaint by filing a Motion to Dismiss for Lack of Standing. See Deutsche Bank v. Bodzianowski (11 cv 1950)

    Judge Pallmeyer ruled that Deutsche Bank, a major Wall Street firm, lacked standing to foreclose on an Illinois homeowner. Standing is the threshold question in every federal case. Plaintiff was NOT the original lender and sought to establish standing by endorsing the Promissory Note and assigning the Mortgage directly to the Trustee . While Plaintiff pled that it was the legal holder of the Note and Mortgage, it failed to convey the mortgage file according to the terms creating Trust (Pooling and Servicing Agreement - PSA) and New York trust law. A Promissory Note is an asset of the trust and should have an "unbroken" chain of endorsements from the Originator (original lender) to Sponsor to Seller to Depositor and then to the Trustee, sequentially. In other words, the act of the Trustee receiving an instrument that does not have ALL of the intervening endorsements is void. Although Plaintiff argued that it has standing because the Promissory Note, a negotiable instrument, is governed by the Uniform Commercial. However, the UCC permits parties to agree to a more exacting method of transferring the notes to the trust and in this case the parties did so.

    See question 
  • What does Lack of Standing mean for an Illinois Foreclosure case?

    what does Lack of Standing mean for an Illinois Foreclosure case?

    Theodore’s Answer

    Great question and it means that you have already done some excellent due diligence as a homeowner. Following the financial crisis that began in 2008, more and more people learned that certain banks failed to properly convey the promissory not and mortgage in a private-lable mortgage security (MBS) trust according to the Pooling & Servicing Agreement (PSA). This has given rise to savvy foreclosure defense attorneys to challenge foreclosure complaint base upon Lack of Standing.

    I just had a federal foreclosure case dismissed by Judge Pallmeyer on October 11, 2011. As a nationally recognized leader in Mortgage Foreclosure Defense Education & Litigation, I successfully defeated Plaintiff Complaint by filing A Motion to Dismiss for lack of standing. See Deutsche Bank v. Bodzianowski (11 cv 1950)

    Judge Pallmeyer ruled that Deutsche, a major Wall Street bank, lacked standing to foreclosure on an Illinois homeowner. Standing is the threshold question in every federal case. Plaintiff was NOT the original lender and sought to establish standing by endorsing the Promissory Note and assigning the Mortgage directly to the Trustee . While Plaintiff pled that it was the legal holder of the Note and Mortgage, it failed to convey the mortgage file according to the terms creating Trust (Pooling and Servicing Agreement - PSA) and New York trust law. A Promissory Note is an asset of the trust and should have an "unbroken" chain of endorsements from the Originator (original lender) to Sponsor to Seller to Depositor and then to the Trustee, sequentially. In other words, the act of the Trustee receiving an instrument that does not have ALL of the intervening endorsements is void. Although Plaintiff argued that it has standing because the Promissory Note, a negotiable instrument, is governed by the Uniform Commercial. However, the UCC permits parties to agree to a more exacting method of transferring the notes to the trust and in this case the parties did so.

    See question 
  • I am responding to a foreclosure summons and want advice on what affirmative defense to claim?

    I am currently in default on my mortgage. I can pay the arrears but that won't stop the foreclosure process. The mortgage is not in my name, I do not hold the note. The person who does has died. I am named on the summons because I was granted "lif...

    Theodore’s Answer

    You likely need to better understand the exact nature of the foreclosure complaint and the promissory note and assignment of mortgage attached to the complaint. The key is quickly determining who the real plaintiff bank is and their basis for standing. If your note was originated between 2003-2007, your loan was likely bundled and sold to a securitized trust. While most Plaintiff banks claim to have standing, many do not.

    I just had a federal foreclosure case dismissed by Judge Pallmeyer on October 11, 2011. As a nationally recognized leader in Mortgage Foreclosure Defense Education & Litigation, I successfully defeated Plaintiff Complaint by filing A Motion to Dismiss for lack of standing. See Deutsche Bank v. Bodzianowski (11 cv 1950)

    Judge Pallmeyer ruled that Deutsche, a major Wall Street bank, lacked standing to foreclosure on an Illinois homeowner. Standing is the threshold question in every federal case. Plaintiff was NOT the original lender and sought to establish standing by endorsing the Promissory Note and assigning the Mortgage directly to the Trustee . While Plaintiff pled that it was the legal holder of the Note and Mortgage, it failed to convey the mortgage file according to the terms creating Trust (Pooling and Servicing Agreement - PSA) and New York trust law. A Promissory Note is an asset of the trust and should have an "unbroken" chain of endorsements from the Originator (original lender) to Sponsor to Seller to Depositor and then to the Trustee, sequentially. In other words, the act of the Trustee receiving an instrument that does not have ALL of the intervening endorsements is void. Although Plaintiff argued that it has standing because the Promissory Note, a negotiable instrument, is governed by the Uniform Commercial. However, the UCC permits parties to agree to a more exacting method of transferring the notes to the trust and in this case the parties did so.

    See question 
  • Why would a bank file foreclosure action in a Illinois Northern District court instead of Cook County (state) court or vice ve

    trying to help a friend.

    Theodore’s Answer

    • Selected as best answer

    While many Illinois homeowners might think Federal Courts favor major Wall Street bank, I just had a federal foreclosure case dismissed by Judge Pallmeyer on October 11, 2011. As a nationally recognized leader in Mortgage Foreclosure Defense Education & Litigation, I successfully defeated Plaintiff Complaint by filing A Motion to Dismiss for lack of standing. See Deutsche Bank v. Bodzianowski (11 cv 1950)

    Judge Pallmeyer ruled that Deutsche, a major Wall Street bank, lacked standing to foreclosure on an Illinois homeowner. Standing is the threshold question in every federal case. Plaintiff was NOT the original lender and sought to establish standing by endorsing the Promissory Note and assigning the Mortgage directly to the Trustee . While Plaintiff pled that it was the legal holder of the Note and Mortgage, it failed to convey the mortgage file according to the terms creating Trust (Pooling and Servicing Agreement - PSA) and New York trust law. A Promissory Note is an asset of the trust and should have an "unbroken" chain of endorsements from the Originator (original lender) to Sponsor to Seller to Depositor and then to the Trustee, sequentially. In other words, the act of the Trustee receiving an instrument that does not have ALL of the intervening endorsements is void. Although Plaintiff argued that it has standing because the Promissory Note, a negotiable instrument, is governed by the Uniform Commercial. However, the UCC permits parties to agree to a more exacting method of transferring the notes to the trust and in this case the parties did so.

    See question