Let's pretend you walked onto a used car lot and saw a parked car which you wanted to buy. The dealer, himself having just accepted the car on a trade, accepted your offer and handed you its keys and what he claimed was the car's title or certificate of ownership commonly called a pink slip. You don't question the validity of the title because it was indeed, pink and looked OK. You register the car at DMV and think all is well. Then, a few days later a policeman knocks on your door and advises you are in possession of stolen property - the car now parked in your driveway. "But I paid for it and here is my proof of ownership," you state in protest. "Yeah, well, the car was stolen and you have a fake pink slip." The car had been financed by its real owner and was about to be repossessed by the bank for lack of payment when it was stolen. It turns out the dealership didn't own the car and didn't have the right to sell it to you. The crook who stole the car and faked the pink slip is long gone.
Millions of mortgage notes may have been faked. The claims of their "alleged" owners are worthless. The perpetrators of the scheme are long gone and beyond the arm of the law. Too big to fail. Too big to nail. Maybe, but why pay them again?
The Public will only pay for valid claims for compensation
The program should NOT be left in the hands of private, for profit interests. The "Re-Redistribution of Housing Wealth in America Program" requires multiple specially created and empowered Public Authorities, tightly managed by and for the Public, ideally under the direction of a State Public Bank. These specially created and empowered community or regional authorities would challenge the validity of mortgage noteholders' claims, respond to lawful claims for compensation, as well as identify and rule on unlawful claims predicated on alleged noteholders' misrepresentation, and fraud.
These local authorities can condemn mortgage notes but, before paying out a dime in "just compensation" to the alleged property owners for title to the condemned mortgage notes, the Public Authority demands that "alleged" noteholders provide "proofs" of entitlement to collect "just compensation" as required by law as embodied in the US Uniform Commercial Code as adapted by each State.
When an alleged owner of condemned property seeks lawful compensation the Public Authority says, "We'll happily pay for valid claims, but we just can't take your word that you own the condemned property. Please show us your receipt for the rights you need to receive payment for the condemned property. Show us proof you are who and what you claim to be. "If you can't show us proof, or point to the last person or entity which had the rights you now claim... then hit the road!" we tell the gangster bankers' lawyers.
Situations in which the alleged property owner (loan servicer/lender) can't prove it has all the rights needed to enforce the mortgage note, and the true holder of the rights to the mortgage note cannot come forward or does not now exist, or may have never existed or the debt may have been satisfied by a third party (insurer), the mortgage note must be invalid and cannot be used to foreclose a mortgage and steal another home from its lawful owner. Once a mortgage note has been determined invalid, program homeowners would then ask the court to "quiet title" which legally removes the orphan mortgage lien from title" leaving the premises free and clear.
[Quiet title action: A lawsuit to establish a party's title to real property against anyone and everyone, and thus "quiet" any challenges or claims to the title. Such a suit usually arises when there is some question about clear title, there exists some recorded problem including an invalid mortgage lien.]
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