Ponder This autostart="true" hidden="true" loop="false"

Ponder This?

When we quit thinking primarily about ourselves and our own self-preservation, we undergo a truly heroic transformation of consciousness - Joseph Campbell

         We are discussing the real estate mortgage loan consisting of note and deed of trust. We are not discussing “partial interests”. We are only discussing “The Note [Together with this security instrument] can be sold one or more times…”

          The borrower signs the note, and also signs a deed of trust as security for that note in the event of default to allow recovery of the real estate by the lender.

          The note and deed of trust are construed as one contract because they are both signed at the same time, relating to the same thing. This is considered the creation of a security interest for the note.

          The lender sells the note. The deed of trust is attached to the note at the time of sale. This is a temporary perfection of the chain of title.

         The sale is not an assignment. It is not a transfer. The only transfer that take place is when the lender “releases” the lien from grantee to grantor. Somewhat like the warranty deed. When the lender sells, it is a sale from one secured party to another potential secured party. The note should hold evidence of the endorsement from the original lender to the subsequent purchaser. However, for the note to continue to be secured, the new lender would need to re-file a deed of trust to reflect its perfected interest in the note which it purchased from the previous lender. This is the requirement of § 192.007(a), Texas Local Government Code. Of course, a “"Affidavit as Release of Lien” of the previous deed of trust would take place to ensure prevention of cloud on title, and reflect a transfer from grantee to grantor which allows for the “borrower” to sign another deed of trust as grantor. This is also a requirement of § 192.007(a), Texas Local Government Code.

         If “assignment” comes to mind, let us ponder the thought of “one” contract”? How does a 3rd contract legally fit into the “one” contract? Texas courts have clearly stated that the party’s named within the deed of trust are the party’s to enforce those contracts. How does a 3rd party contract invade the obligations of the “one” contract, the note and deed of trust signed at the same time, relating to the same thing? Is this not an impairment to the original obligation contract? Could this be why the “borrower” cannot challenge the third party’s assignment? Whom gave the authority to enforce the 3rd party contract over the “one” contract that is supposed to be binding? Stare Decisis?

     While we are speaking of 3rd party’s, Texas does have other laws which govern business organizations, and Texas finances. Are any of these “hidden” party’s registered or legally allowed to conduct business in Texas? Are these foreign entities allowed to use Texas law to support their cause?

According to the Texas Property Code, and according to Texas law, the well known imitator of “book entry system” is neither registered with the Secretary of State, Texas Department of Savings and Mortgage Lending, nor the National Mortgage Licensing System & Registry. In fact the Texas Finance Code defines the alleged “book entry system” as a “foreign corporation”. It was not created under the laws of Texas. Is this legal? Is it constitutional to create rights that allow a foreign corporation, a foreign person, which is considered a private “person” to have greater rights that a “domestic corporation”, or a citizen? Is it legal to allow a foreign corporation to conduct business in Texas without following Texas law? Is it moral? Is it in the best interest of the public?

Section 51.0001(4)(C) is unconstitutional as applied, and on its face.

Sec. 51.0001. DEFINITIONS. In this chapter:

(4) "Mortgagee" means:

(C) if the security interest has been assigned of record, the last person to whom the security interest has been assigned of record.

The security interest is created when the deed of trust is attached to the note. Both instruments are signed at same time, reflecting same transaction. Section 51.0001(4)(C) provides that a UCC 9 "security interest" has been assigned of record, whether it is lawful or not. Nonetheless, a UCC 9 filing is provided to the Secretary of State. In essense there would be two filings, one with SoS, and one with county clerk.  A Security interest is assigned when the deed of trust attaches to the note. It is assigned from the grantor [borrower], to the grantee, [holder of the note]. It can even be considered a transfer from grantor to grantee. When the grantee files the deed of trust, the deed of trust has been assigned of record. Book entry system filings seemingly violate 192.007(b), Tex. Local Govt Code by creating a new interest in a record they cannot prove interest in to begin with. If the book entry system was not governed by Texas law, how was the book entry system considered a lawful "mortgagee"?

So much to ponder.....


Ready Aim Fire Kevin MacLeod (incompetech.com)
Licensed under Creative Commons: By Attribution 3.0 License