It is time for regulators to face the music. The current system of securitization is designed for one thing: to sell securities that are ABOUT data and not about ownership. This conflicts with centuries of law, custom, practices and statutes. The apocalyptic threats from Wall Street are not true. They have no ability to collapse the entire financial system, the economy, or our society. Securitization is the process of breaking up an asset and selling it pieces to investors who purchase the asset for value and exchange for ownership of a pro-rata share. No such sale occurs in the securitization of consumer debt and in particular transactions with homeowners. Therefore, all claims regarding the existence, ownership, or authority to enforce promises made by the homeowner are false if they rely upon the illusion that a debt has been securitized. This is not based upon theory or any matter subject to debate. It is memorialized in Article 9 Section 203 of the Uniform Commercial Code which has been adopted in all U.S. jurisdictions verbatim. In most actions designed to enforce the original promised to make payments issued by the consumer, none of the named claimants have paid value (money) for any underlying obligation nor have they received a legal transfer of ownership of any legal debt.
Article 9 of the Uniform Commercial Code (UCC) deals with secured transactions, which include the creation, perfection, priority, and enforcement of security interests in personal property and fixtures. Section 203 within Article 9 specifically addresses the “Attachment and Enforceability of Security Interest; Proceeds; Supporting Obligations; Formal Requisites.”
Here’s a brief overview of what Section 203 covers:
- Attachment of Security Interest: For a security interest to attach (become enforceable against the debtor with respect to the collateral), three conditions must be met:
- Value must be given by the secured party.
- The debtor must have rights in the collateral or the power to transfer rights in the collateral to a secured party.
- There must be an authenticated security agreement that describes the collateral or the debtor must have authenticated a security agreement that provides a description of the collateral, or the secured party must have possession of the collateral pursuant to the debtor’s security agreement.
- Enforceability: A security interest is enforceable against the debtor and third parties with respect to the collateral only if attachment has occurred.
- Proceeds and Supporting Obligations: The security interest automatically extends to identifiable proceeds unless the secured party agrees otherwise. It also extends to supporting obligations for the collateral if the security agreement so provides.
- Formal Requisites: The section specifies that a description of personal or real property is sufficient, whether or not it is specific, if it reasonably identifies what is described.
Please note, the UCC is subject to amendments, and state-specific versions might have slight variations or additional provisions. If you’re dealing with a specific legal scenario, it’s advisable to consult the version of the UCC applicable in the jurisdiction in question or seek legal counsel for precise interpretation and application.