Daily Finance | Court: Busted Securitization Prevents Foreclosure – Phyllis Horace vs Lasalle Bank National

Court: Busted Securitization Prevents Foreclosure


On March 30, an Alabama judge issued a short, conclusory order that stopped foreclosure on the home of a beleaguered family, and also prevents the same bank in the case from trying to foreclose against that couple, ever again. This may not seem like big news — but upon review of the underlying documents, the extraordinarily important nature of the decision and the case becomes obvious.

No Securitization, No Foreclosure

The couple involved, the Horaces, took out a predatory mortgage with Encore Credit Corp in November, 2005. Apparently Encore sold their loan to EMC Mortgage Corp, who then tried to securitize it in a Bear Stearns deal. If the securitization had been done properly, in February 2006 the trust created to hold the loans would have acquired the Horace loan. Once the Horaces defaulted, as they did in 2007, the trustee would have been able to foreclose on the Horaces.

And that’s why this case is so big: the judge found the securitization of the Horace loan wasn’t done properly, so the trustee — LaSalle National Bank Association, now part of Bank of America (BAC) — couldn’t foreclose. In making that decision, the judge is the first to really address the issue, head-on: If a screwed-up securitization process meant a loan never got securitized, can a bank foreclose under the state versions of the Uniform Commercial Code anyway? This judge says no, finding that since the securitization was busted, the trust didn’t have the right to foreclose, period.

Since the judge’s order doesn’t explain, how should people understand his decision? Luckily, the underlying documents make the judge’s decision obvious.

Check out the rest of this nice little victory here…

You can also take a look at Naked Capitalism’s post on it here…




Order – Phyllis Horace vs Lasalle Bank National
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Note – Phyllis Horace vs Lasalle Bank National
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Tom Adams Affidavit – Phyllis Horace vs Lasalle Bank National
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Bank’s argument – Phyllis Horace vs Lasalle Bank National
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8 Responses to “Daily Finance | Court: Busted Securitization Prevents Foreclosure – Phyllis Horace vs Lasalle Bank National”
  1. I hope homeowners understand they are going to have to fight for themselves in this brawl!

    We must all fight individually to compel a fair settlement at home. Educate and arm yourself then please step into the ring! The Banks may have unlimited resources but Americans have an unlimited will to fight for justice! Use all the leverage you can, please let us help!


    American Middle-class Homeowner


  2. Flex says:

    My Fellow Americans,
    Please pay attention and listen good! This is your chance to blow the whole mess of foreclosure out of the way by doing a forensic audit of your loan documents and a forensic audit of the securitization if you have a trust certificate series in your loan documents. First you must find out if your mortgage loan was securitized and if it was transferred legally by assignment and recorded under the Trustee’s name.
    If your loan was sold at Wall St. several times to private investors (as more than 90% of the loans were securitized) then a certificate trust was issued with some numbers and letters as series. Most of the time, you would not know this information unless you do a securitize audit. You can also go to the county records were your property is located and ask the clerk to give you a copy of the note and the deed of trust.
    If the records show that the last lender recorded the note, but by now your note was sold several times and now you are making payments to a servicer, chances are that you are throwing your money away. As we all know, hundreds of banks went out of business and many were bought by the too big to fail, the last five banks running the show in America today. The point made here is, if you don’t know who the investor is and you don’t know who is the Trustee, and if the Trustee is also a pretender assigned Trustee by the lender, and what is worse, if the Trustee shows a certificate series of a Trust from a Securitize note, The Trustee can not legally foreclose your home, because the trustee is not the real note holder and the note was not recorded, assigned, or transferred during the legal period of 90 days per the SEC rules under the REMIC Act. Please look it up in google if you don’t know about this. Or if you would like to find out more in deep detail and analysis, please go to http://www.livinglies.wordpress.com
    You will meet one of the very best Litigator for the last 35 years in this country. Mr. Neil Garfield, a retired Attorney with a mission to help people to cope and understand their rights as a home owner. I am an advocate and a concern citizen who has gone through the same things like you.
    God Bless You! God Bless America, and God Bless all of us.

    • Bruce Eaton says:

      You sound like you have been dealing with this issue for a while. For my family and I, this is the 3rd time that the pretender lender has tried to forclose on us. I have been studying Garfield’s stuff at living lies and doing the best I can but we need the help of an attorney who gets this stuff. Unforturnately, there are zero of these attorneys in our state of Wyoming. What would you suggest??

  3. Lit Gant says:

    Glory be to God. A winner. A free house. Justice but not in Florida. Our judges are still brain-dead. They are still playing by the rule book provided to them by the banks. The chief judges are still pushing their robo-courts. Any chief judge who reads this case and does not instruct his judges to follow the proper rule of law as this judge handed down should be tarred and feathered and run out of town on a rail. If he was a man of honesty and good character, he would instruct his judges to check their docket for any Lasalle cases and see if any of them materially are the same as in this case. Not only dismiss them, but also with prejudice. And if fraud has been used to sanction Lasalle and or its attorneys with an amount equal to the mortgage trying to be foreclosed upon and defendant’s attorney fees. This or simple rule they cannot as plaintiffs come back into the court against this defendant.

    Well glory be to God. Thanks Mr. Redman. This case will give me lots of hope. You are a great American.

  4. B Anderson says:

    Thank you so very, very kindy for posting this data == this is just terrific.

  5. Officer of the Law says:

    Fortunately, there are some honest judges, but obviously, there are no honest regulators or prosecutors.

  6. Stupendous Man - Defender of Liberty - Foe of Tyranny says:

    This is essentially the argument, made by the same attorney, as was in the US Bank v Congress case of about one (1) month ago. That case didn’t work out as well as this one. I believe it is going to be appealed.

    But this case was obviously in front of a more intelligent jurist, who seems to have come to the right decision.


    • Cindy says:

      Sounds like the same, exact stuff as we have…..except we are in the “good ole boys” state of Georgia. These hillbilly judges just Won’t get it at all!! And people say Alabama is redneck, ha, GA blows them right off the map!.
      We are up against US Bank, ASC/Wells Fargo. They keep transferring everything out of the smaller courts and into federal court. There are now 3 pending cases on the same thing. Wish we could get an affidavit from this guy. We almost have the same closing date as the Horace’s, just two days earlier. I have a trust audit and loan audit. Have been repeadedly denied due process in All the courts. The sharks just keep piling up the paperwork…..and so do I!!!!!

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