The allonge is ONLY endorsed to: “Deutsche Bank National Trust Company, as Trustee” It does NOT specify which trust
“Deutsche Bank National Trust Company, as Trustee”
It does NOT specify which one of the many trusts that the bank is the trustee for that it should go to.
Since Deutsche Bank National Trust Company, as Trustee is the Trustee for many different Trusts it seems that it should specify the exact trust. So is it valid if it does not specify the exact trust it should go to?
3 attorney answers
Go speak with a foreclosure defense lawyer in your area and don't bother reading the general information on foreclosures or you might find yourself in trouble unnecessarily.
The defects you mention will probably be ignored by the courts in Florida
My comments are not intended to establish an attorney-client relationship, are not confidential, and are not intended to constitute legal advice. Proper legal advice can only be given by an attorney who agrees to represent you, who reviews the facts of your specific case, who does not have a conflict of interest preventing the representation, and who is licensed as an attorney in the state where the law applies.
General Uniform Commercial Code principles apply for the analysis, although only an attorney admitted in Florida can give you a precise answer. Most states have a Uniform Commercial Code. The situation arises under many of the Uniform Commericial Codes in which a trustee, who has a custodian who possesses the note with respect to many different securitized trusts, could theoretically have taken possession of the note on behalf of more than one securitized trust, can be called the "common baillee" situation. As the lender can establish standing either by Article 3 or Article 9, the defense has to defend against both possibilities. However, the concept for both route, while employing different language refers to a very similar concepts. Under Article 3, the question arises as to whether "constructive delivery" of physical possession occurred in that the custodian took steps which put the note into the sole custody, care, and possession of the trust. As a practical matter, this means steps have been taken whereby the note could not come back to the transferor, to be transferred to a different trust. The borrower may argue that the specific endorsee can transfer only by specifically endorsing forward, and therefore the name of the trust must appear on the note. For Article 9 purposes the custodian must, with or without having received possession of the note, have effectively segregated title into the trust by "authenticating a record". As a practical matter, this means the lender must present either a copy of the original mortgage loan schedule attached to the pooling and service agreement, or trustee/custodial records describing the specific note. If you are serious about wanting to defend against the prosecution, you likely need an attorney. Lenders often waive the article 9 theories by failing to plead them, leaving the borrower with the Pooling and Servicing Agreement as proof that the trustee who claims to have had physical possession of the note possibly didn't, and leaving the lender without having bothered to present proof on the existence of a relationship between the trustee and custodian. The point here is, that the outcome of your case depends less on the actual set of facts as they applied to your note, and more on your attorney-who should be admitted to practice in Florida- dynamically adapting to the banks submissions to the court. Even with a good attorney, you should assume that your chance of actually winning is low- the courts are looking for any reason whatsoever to rule on behalf of the bank- and use the leverage which a good argument can bring to give you the space to put into effect a separate exit strategy.... whether that be saving money to payoff arrears, a loss mitigation solution, or bankruptcy...
An allonge endorsed to the trustee that fails to identify the trust is probably not invalid altogether. However, you may raise the endorsement's lack of trust identification as a basis to challenge standing in a foreclosure action on this mortgage.
Under well-settled Florida law, a crucial element in any mortgage foreclosure proceeding is that the party seeking foreclosure must demonstrate that it has standing to foreclose. See Hunter v. Aurora Loan Servs., LLC, 2014 WL 847477 at *3 (Fla. 1st DCA 2014). The party seeking foreclosure must present evidence that it owns and holds the note and mortgage to establish standing to proceed with a foreclosure action. See Mazine v. M & I Bank, 67 So. 3d 1129, 1131 (Fla. 1st DCA 2011). This foreclosing plaintiff must show standing through evidence of a valid assignment, proof of purchase of the debt, or evidence of an effective transfer, prior to filing the complaint. See Hunter v. Aurora Loan Servs., LLC, 2014 WL 847477 at *3 (Fla. 1st DCA 2014); McLean v. JP Morgan Chase Bank Nat. Ass’n, 79 So. 3d 170, 173 (Fla. 4th DCA 2012). The plaintiff must have the requisite standing when the foreclosure complaint is filed, and nothing can alter the rule that a party’s standing is determined at the time the lawsuit was filed. See Lindsey v. Wells Fargo Bank, N.A., 2013 WL 692825 at *2 (Fla. 1st DCA 2013); McLean v. JP Morgan Chase Bank Nat. Ass’n, 79 So. 3d 170, 173–74 (Fla. 4th DCA 2012). The plaintiff’s lack of standing at the inception of the case is not a defect that may be cured by the acquisition of standing after the case is filed; thus, a party is not permitted to establish the right to maintain an action retroactively by acquiring standing to file a lawsuit after the fact. See McLean v. JP Morgan Chase Bank Nat. Ass’n, 79 So. 3d 170, 174 (Fla. 4th DCA 2012).
Importantly, where the name shown as the note owner and holder on the mortgage documents is different from, though similar to, the name of the bank that brought the foreclosure action, the foreclosing entity lacks standing. See Mazine v. M & I Bank, 67 So. 3d 1129, 1132 (Fla. 1st DCA 2011). Where the foreclosure complaint facially creates a contradiction between (i) who is the alleged owner of the promissory note, and (ii) who the attached note and mortgage identify as the owner, the Court should dismiss the complaint. See Wells Fargo Bank, N.A. v. Bohatka, 112 So. 3d 596, 600–01 (Fla. 1st DCA 2013).
Here, the failure to specifically identify the trust at issue erodes the evidence of a transfer to the trust. However, Deutsche Bank will likely argue that evidence of transfer to Deutsche Bank as trustee is unaffected, that Deutsche Bank thereafter properly segregated the note and mortgage as required under its trust agreement, and that Deutsche Bank thereby acquired standing to foreclose.
You should check the pooling and servicing agreement for the trust to determine the obligations of the loan originator and Deutsche Bank regarding transfer of the note and mortgage to the trust, including whether the originator was obligated to identify the trust in its allonge or endorsements, and whether Deutsche Bank was entitled to independently accept notes and mortgages on behalf of the trust. These pooling and servicing documents can usually be found online through the Security and Exchange Commission (SEC)'s EDGAR search system (https://www.sec.gov/edgar/searchedgar/companysearch.html). Just search the name of the trust and scan through the earliest documents (the prospectus often has an html version of the pooling and servicing agreement). If the allonge endorsement does not comply with the pooling obligations, you may raise this as evidence that the foreclosing plaintiff did not properly acquire standing before filing its mortgage foreclosure action. Hope this helps! Please feel free to contact my firm with any other questions.
Attorney answers to questions are for general purposes only and do not establish an attorney-client relationship nor constitute a legal opinion and may not be relied upon for such purpose.