How is your deed of trust VOID? The example herein will be using CA law, however keep in mind that there are 34 other states that use deeds of trust. Due to the nature of the foreclosure fraud that happens throughout the country in EVERY state, there is a sure chance that there are similar laws and rules that dictate a similar scenario in your state.
If someone lends you money it seems quite natural to pay them back for that action. This is the world we have all seemingly agreed to live within. In our global paradigm of capitalism it is natural to most people that it is honorable and just to pay the lending party back for the money that was borrowed. This seems fair and responsible to want to pay back the lending party for their generosity. This is something that I have heard from everyone that I have spoken to on this subject. Sometimes there are transactions that have the person who lent the money receive interest for the money that they lent the borrowing party. All of this seems quite natural in the order of things. People find it honorable and their personal responsibility and duty to return borrowed money. This seems to be human nature.
There are also times when money gets exchanged and there is a contract involved outlining the details of the exchange. In normal contract law, both parties must understand all of the details that are outlined within the documents. It is the obligation of the contracting party(lender) to make sure that the borrower understands all of the details that pertain to the contract. If there are certain details that are within the contract that the borrower does not understand it is the job of the lender to make clear of any questions or concerns for the borrower. There must be a “meeting of the minds”. Everyone must be “on the same page”. This means simply that the lender and the borrower must know and understand all of the terms of the contract and must agree to all of the terms of the contract.
Now, let’s put this into a context using real estate. In this context, the contract MUST be in writing. This dates back to a law called the Statute of Frauds, back to the year 1677. All of the terms and conditions of the contract MUST be clear and understood by the borrower, as we said that this is standard contract rules. In real estate, the contract, through the life of the contract, MUST be signed by all parties within the contract. This comes from the Statute of Frauds. If there are changes in a contract, then the changes or amendments create a new contract between the parties, therefore, all parties must sign off on any changes throughout the duration of the contract. Seems fair, right? If this doesn’t take place and there is confusion about any of the terms of the contract this means that the contract is voidable.
What if the lender does not inform the borrower of certain terms and conditions that are in the contract? This would mean there is never a meeting of the minds and the contract is voidable. However, what would happen if the lending party actually deceived the borrower, by hiding certain details that exist in some of the terms of the contract, in order to entice the borrower into signing a contract that if the borrower were to know that information would not sign the contract? These details that are withheld are paramount to the meaning of the contract itself and if the borrower were to have known the details of this withheld information prior to signing the documents they would have not agreed to the terms of the contract.
If this were to happen then the contract is not voidable, it is VOID. The contract is not worth the paper it is printed on. This is due to the fact that the lending party knowingly defrauded the borrower by not informing the borrower of imperative details of the contract agreement, so therefore through the actions and choices made by the lender in an attempt to deceive the borrower in order to create the transaction, the contract is VOID. The borrowed money doesn’t need to be paid back because it was created out of fraud. If a contract is created out of fraud it is not voidable, the contract is void. This is clear law. It is VOID because it was knowingly created in order to deceive one party over the other. So, the party who attempted to deceive the other is out that money due to the risk of deception they chose to enter into in order to orchestrate the contract agreement.
Everyone knows that there is some level of deception in a monetary transaction when they go to the table in Vegas to gamble. Everyone knows that the house always wins. However, in real estate we don’t normally think that we are being deceived when we borrow money to buy a property. In this case, your house doesn’t win, you lose your house.
This is what happens everyday, in every deed of trust contract, in CA, and all other states throughout the country. Again, we will use CA as an example for this, but there are another 34 other states in the United States that use deeds of trust. And many of the other states are attempting to pass legislation that will create deeds of trust states. If you are a homeowner then this is what happened to you, or your family, your neighbor and every homeowner you know who borrowed money using the regular avenues of institutional financing. This has been happening in the state of CA everyday, on nearly every deed of trust agreement since the year 1998. Whether the property is valued at $1 or $100,0000,000, or more.
How is that? Some of this is laid out in my previous post found here, but we’ll go over it again in order to make things clear. Do review the previous post as well for a broader scope of information and point of view.
It is hard for people to grasp that they have been swindled when they are still in their homes, are paying for their money that they borrowed and no one is knocking on their door demanding for their money. Life seems “normal”. It seems that all is okay and that they were not defrauded. I hear it every time I talk with people. They say, “Oh, that didn’t happen in my case, because everything is going well.” However, you have been swindled and the bank is betting on your moral compass that you will pay them for defrauding you. And the banks are winning. You’ve all been duped.
But, what if the contract were VOID and you didn’t have to pay back the bank for defrauding you out of your hard earned money? How would that change your life? How would that change our society? What would you do with all of that money? How different would your life be if you didn’t have to pay back the bank every month for their deceptive behavior? It was their actions, not yours, which dictated the result of them not receiving their money back because they lent the money through deceptive means. Why should the bank be rewarded the return of their money if the only way for you to borrower it was to deceive you?
What makes the banking industry immune to the rule of law? Why are they able to lie to every borrower in order to secure a contract? Why are they able to cheat every borrower out of hundreds, thousands or millions of dollars on a monthly basis? Every month, every year, for decades? Every month a property owner receives a statement requesting payment for a mortgage. Every month a property owner is deceived out of their money through this statement from the financial institution requesting payment for the VOID contract that they are collecting on. Every month, on every deed of trust real estate contract, the bank is defrauding you of your money. This is mail fraud, and this goes on for each contract throughout the country, month after month, year after year.
How are the banks able to steal homes when someone paid cash for their home and never had a bank in the transaction? How are banks able to steal homes from people who are current on their mortgage? If these actions can happen does this mean that the entire system is wrong?
No, actually. There are laws in place that are designed to orchestrate a proper real estate transaction. The laws just aren’t being followed or policed. What it means is that the entire system is corrupt, that’s all. The systems that pertain to real estate are the lending system and the judicial system. Both are corrupt in this transaction, otherwise we would have had solutions to this specific issue and I wouldn’t need to be writing this. But, this is not the case, and I am sitting here writing.
You see, in 1978, the CA Supreme Court issued a ruling in the Garfinkle v Superior Court for Contra Costa County, respondent being Wells Fargo Bank, specifically detailing the independence of the trustee in a deed of trust agreement. The independence is what makes the deed of trust work. They were clear on this, because the Trustee in the transaction is given the power of the court in the transaction. The independence is what makes the “court” fair and just.
In CA, the process of foreclosing on a borrower is called a non-judicial foreclosure procedure. The non-judicial foreclosure process was created in order to alleviate any burdens to the court system of any frivolous lawsuits and to help streamline the foreclosure process. So, if the Superior Court was taken out of the foreclosure process, then another party needed to be reinstated to act as the court in order to conduct a fair and just foreclosure procedure. So, as the “court” now being the trustee, which the CA Supreme Court ordered was to be independent to both the lender and the borrower in the real estate transaction, they are the rule of law. It is their position to act independent of all parties and to make sure that both parties in the transaction follow the rules of law as it pertains to a deed of trust agreement.
These rules are outlined in the CA Civil Codes. The Civil Codes create rules which dictate what is known as a Power of Sale clause that is in a deed of trust real estate agreement. This rule is CA Civil Code 2924. When the borrower defaults on the loan payments the Power of Sale becomes activated and the bank is able to begin the foreclosure process. However, there are also a set of rules with which the lender must comply with. They must comply each and every rule in order for the non-judicial foreclosure process to be done in accordance to the rule of law. If there is a rule that is missed or done incorrectly, it is the duty of the Trustee stop the foreclosure process. It is then their duty as “the court” to make the banks comply with the certain code that they failed to comply with. In other words, the foreclosure process must stop, the lender must make the efforts to comply with the rules of foreclosure and begin the foreclosure action again so that the lender then does in fact comply with all of the rules as they pertain to the foreclosure civil codes and rules of procedure.
So, if the bank doesn’t comply with the rules accordingly, the Trustee is able to stop the bank from wrongly foreclosing on the borrower. One would think, but no. It is this reason that people who have paid cash for their home are able to be foreclosed on. It is for this reason that someone who is current on their mortgage can be foreclosed on.
You see, in the year 1996, the bank lobbyists wrote Senate Bill 1638. It was brought to the table by then Republican Senator Ross Johnson and signed into law by then Republican Governor Pete Wilson. This bill became enacted law on January 1, 1998, to amend CA Civil Code 2934a, which is part of the Power of Sale. What was it that was in this bill that created every deed of trust to become VOID?
SB 1638, Johnson. Deeds of trust: trustee substitution.
Existing law sets forth the procedures for the substitution of
trustees under a deed of trust upon real property or an estate for
This bill would, as an alternative procedure, set forth the
procedures for the substitution of trustees under a deed of trust
upon real property or an estate for years, given to secure an
obligation to pay money, by the beneficiary or beneficiaries under
the trust deed who hold more than 50% of the record beneficial
interest of a series of notes secured by the same real property or of
undivided interests in a note secured by real property equivalent to
a series transaction. The bill would also establish a process
through which all of the beneficiaries under a trust deed can agree
to be governed by beneficiaries holding more than 50% of the record
beneficial interest of a series of notes in real property or
interests in a note equivalent to a series transaction, as specified.
In order to substitute trustees or agree to be governed by the
majority interest holders, all parties to the transaction would be
required to sign and record a document containing specified
So, as an alternative procedure, the new law set forth the procedures for the substitution of trustee under a deed of trust upon real property. So, this new law pertains to the party (beneficiary) or beneficiaries under the deed of trust who hold more than a 50% control of the record beneficial interest of the note or a series of notes secured by the property. In other words, this new law allows the beneficiary to be the party to dictate the substitution of a trustee under a deed of trust. It goes on to state that in order to substitute a trustee that all parties to the transaction would be required to sign and record a document containing specified information.
Let’s tear this apart.
If the bank is the beneficiary, which in many cases is so, then this gives the bank the power to substitute a new trustee. So, this means that if an original or other substituted trustee is not allowing the bank to perform illegal actions against the borrower, this law gives the bank the right to substitute to a trustee who will allow the bank to perform illegal actions on behalf of the bank in order to wrongly foreclose on someone. It also means that every borrower must be a party to sign the substituted trustee when the bank is attempting to do this action.
Now, let’s tear this apart further.
If a bank chooses to foreclose on a borrower who is current on their mortgage and the Trustee is not allowing the bank to file the necessary fraudulent documents into the court, or the County Recorder’s Office, because the bank is unable to prove that the borrower has defaulted on their obligation, then the new law has now given the bank the right to change that Trustee to a party who will comply with the illegal activities of the bank who is choosing to illegally foreclose on someone. So, let’s take this a bit further. If someone has paid cash for their home and the bank’s computer spits out an address through their foreclosure software, or a human being puts in an address 222 instead of an 888 into the address of the party to be foreclosed, and there is no independent trustee to put a stop to the wrongdoing, then the wrong home will be foreclosed on.
So, when the bank offers the borrower a deed of trust agreement in the real estate transaction, it would be only natural for you as a borrower to assume that there is an independent Trustee that is in the transaction to make sure that the bank complies with all of the appropriate rules and regulations of the foreclosure process in order to protect your title, your home, your asset. The fact that the bank does not inform the borrower that they know that they can replace a Trustee who acts in the interests of the bank, and holds no interest to act on behalf of the borrower in order to protect the borrower’s title, is fraud. Because this is fraud, the contract is VOID.
Would you sign a real estate contract if the bank, or realtor, told you that the trustee will not act on your behalf and will not protect your title if the bank were to decide to foreclose on you whether you defaulted, or whether you were current on your payments? No, nobody would.
The courts have also allowed, because of this rule, the banks the ability to substitute the trustee in all deed of trust real estate transactions for decades. They have also allowed this action to take place without the borrower’s signature, as it was outlined in the new law, as well as, the Statute of Frauds rule dating back to 1677.
The Trustee is a strawman. Black’s Law Dictionary defines a strawman as a third party used as a cover in illegal or shady deals; a weak or flawed person with no standing. So, if the banks know that they have the power to create a strawman for a trustee then there is in fact no independent trustee in the transaction as it was defined by the CA Supreme Court in 1978.
So, the law states that there is to be an independent party, named Trustee, in a deed of trust agreement. But, the banks have the power to substitute a new trustee. The courts have allowed the banks to levy this power without the borrower’s signature since 1998.
So, it is very clear that every deed of trust contract agreement that has been signed since the year 1998 is fraudulent.
How did I find this out?
When the very first documents in my non-judicial foreclosure action had incorrect information in them allowing Wells Fargo bank to quickly and illegally foreclose on me, I began to look into the computer archives at the county recorder’s office for a legitimate deed of trust agreement and a legitimate Substituted Trustee that was signed by all parties involved in the transaction, as the 1996 law stated was to be the case, I had to go back into the archives to the year 1997. It was only then when I began to look into why.
When I began to understand the gravity of this specific issue, I realized that this was the needle in the haystack that no one is talking about.
When I formulated my argument in the court for the 4th Amended Complaint, Judge McGuiness of Superior Court in Alameda County looked me straight in the eyes and told me he understands what I am trying to state. That he now fully understands my argument. He stated that he gets my points of fact and he would need to take this into consideration.
Why didn’t he simply rule on my case then? Because the courtroom was filled with people. Because it would become precedent and common knowledge that all deeds of trust, in CA, were fraudulent and illegal and VOID. Since 1998…This would have created a situation that would have made every real estate contract either go into litigation and become VOID dating back to 1998, or certainly some other repercussion that was to be measured only as astronomical in our capitalistic paradigm. But, I believed it is necessary for us to make these type of changes since the entire system is actually based on fraud. And this is only the beginning.
My case was immediately dismissed and my court files were quickly silenced.
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