Its called derecognition according to GAAP. Tender of the note for other condideration alleges the note is REGISTERED into another recognized marketable shape or form. Generally, when a security instrument is transferred,the transferee will deliver the endorsed instrument to the issuer or its transfer agent, who in turn will issue a new certificate in the transferee’s name. UCC article 8 mandates that the issuer REGISTER the transfer. So an issuer of a promissory note that is found to be a security instrument will be obliged to REGISTER the transfer and issue new notes/securities upon a transferee’s request. Guess what entity serves this purpose? If your loan has a MIN#, your note has been divested.

So as you can see, there is no note anymore by operation of law. Moreover, there cannot be an agent of nominee granted a capacity to enforce the note. Because the note has been divested and is essentially worthless, the banking interests had no incentive to meticulously archive them. This is why so many lost note affidavits have been used in the foreclosure process. Would-be-creditors have furiously attempted to reverse engineer the securitization process using robosigners and fake documents. All of that is futile because an accounting audit would reveal the destruction of the note and the charge off the creditors balance sheet. The only way a would-be-creditor recaptures the liability is to fraudulently credit bid at foreclosure auction but actually fund the bid with a loan. That would re-establish a basis in the asset and put it back on the balance sheet.

Without knowledge of the creditors identity,the debtor has no way to investigate this. The servicing rights are sold seperately to a debt collector as if the debt still exists, the debtor non the wiser.

creditor = the entity that accounts for the debt on its balance sheet.

Mers = securitization