Standing Up to the Banks: Make Them Produce the Note!

This is a followup to my post of July 30, 2008, “Standing Up to the Banks: How to Challenge Your Foreclosure.”  The make-them-produce-the-note defense has made it to prime time.  This clip is from “Good Morning America!” —

A lobby of many people prepared to bring this defense could have some significant clout in Congress.

24 Responses

  1. Dear All,

    I have a question… Under our current monetary system, can government print money without borrowing from anybody? Just print “fresh” money… (or what people say as money out of thin air)

    If it can, where does this fresh money came from? Is it from their central bank?

    If it is from central bank, then what is the status of that money? A debt, or a capital injection to government?

    If government receive from central bank, let’s say $1 trillion (fresh, out of thin air new money), how to write it into government balanced sheet?

    (A) + $1 trillion to asset & + $1 trillion to liabilities
    (B) + $1 trillion to asset & + $1 trillion to equity

    Which one it true? A or B?

  2. To make it simple, all we have to do is remember what real money is (Art 1. Sec 10 USC: No State shall…. make any Thing but silver and gold Coin a Tender in Payment of Debts.) This is the Supreme Law of the Land, and has never been rescinded! If this were still practiced today we would all have a small amount of silver and gold, and our Nation would be debt, and tax, free!

    As soon as we start to use paper debt certificates for money we begin to have problems. As those problems are ignored & whitewashed, they tend to become systemic, chronic & incurable. (Lincoln & JFK used “United States Notes” which indebted the people to themselves, disenfranchising the FED and signed their death notices, as the Cabal behind the Fed Reserve doesn’t take kindly to their own extinction.)

    If you create money out of nothing, as does the FED, then you must use your own imagination as to where it goes on the balance sheet.
    Like adding a series of negative numbers, you must keep track of who’s giving and who’s owed. Paper debt certificates show that our Country is in Bankruptcy Court, for where else can you pay your debts with a debt?
    If you ask the Federal Reserve what this piece of paper we call a dollar is, they will tell you it is “A non- interest bearing debt certificate.”
    So whoever is holding it is actually the one who is owed the sum shown. This is simple to understand, when you recognize the note is a bill, and hence a liability, or as a note, it is a bearer bond, payable to the holder.
    Where it goes on the balance sheet depends on where it came from and where it is going. If it is owed to someone, or if it is owed to you.

    But when the FED creates it, they BUY them from the Treasury which prints them, for about a penny each, regardless of denomination. They then SELL them to Congress AT FACE VALUE for a Bond, which indebts you, your children, and all the property and production in the Country.

    Read G. Edward Griffins “Creature from Jekyll Island” for a more in depth look at fiat money creation.

  3. So regarding the FED “print” 1 trillion to give to government, the answer of my question is : the money goes to government as liabilities. Correct?

    Government balanced sheet:
    Asset : $ 1 trillion
    Liabilities : $1 trillion (debt to the FED)
    Equity : $ 0

    FED balanced sheet:
    Asset : $1 trillion (loan to US government)
    Liabilities : $ 0
    Equity : $1 trillion (created out of thin air)

  4. “To make it simple, all we have to do is remember what real money is (Art 1. Sec 10 USC: No State shall…. make any Thing but silver and gold Coin a Tender in Payment of Debts.)”

    No, this is not a definition of “real money” nor does it have any relevance to what “real money” is. It is simply a statement that no state shall make any thing but silver and gold coin a tender in payment of debts. It is a limitation on the sovereign power of the states. It is not a limitation on federal power. For forty thousand years “real money” has been assignable or negotiable debt, as it is now. See the papers at

    Please learn to read.


  5. Ms. Brown, in the Globalresearch version of this article at
    you begin by “quoting” Thomas Jefferson:-

    “‘If the American people ever allow private banks to control the issue of their currency, first by inflation, then by deflation, the banks and corporations that will grow up around them will deprive the people of all property until their children wake up homeless on the continent their fathers conquered. The issuing power should be taken from the banks and restored to the people, to whom it properly belongs.’

    “– Thomas Jefferson, Letter to Treasury Secretary Albert Gallatin (1802)

    “Jefferson had it right.”

    But this supposed Jefferson quotation is a fabrication, according the the Jeffreson Encycolpedia at

    Among other things, “the words ‘inflation’ and ‘deflation’ did not come into use until 1864 and 1920, respectively.”


    • Yes, I saw that too. My article was written in June 2008. Since then I’ve used the more accurate quotes. Per your source:

      “The second part of the quotation (“I believe that banking institutions are more dangerous to our liberties than standing armies…”) may well be a paraphrase of a statement Jefferson made in a letter to John Taylor in 1816. He wrote, “And I sincerely believe, with you, that banking establishments are more dangerous than standing armies; and that the principle of spending money to be paid by posterity, under the name of funding, is but swindling futurity on a large scale.”[4]

      “The third part of this quotation (“The issuing power should be taken from the banks and restored to the people, to whom it properly belongs”) has not been found in any of Jefferson’s writings. In fact, he said something rather different in 1813: “The States should be applied to, to transfer the right of issuing circulating paper to Congress exclusively, in perpetuum, if possible…”[5]”

      They mean the same thing: the States weren’t issuing circulating paper, so it must have been the banks that were being excluded from that privilege. My question though is, why are you raising these points? The purpose of this blog is to try to find solutions. We are in critical times, when we don’t have time for hair-splittings and contentions over fine points. If Jefferson didn’t say it, William Jennings Bryan said it. If Bryan didn’t say it, I’m saying it: there is only one way out of this mess, and that is to return the power of issuing the national money supply to the nation and its people.

  6. Ellen:

    After a long delay, I am finally going to file my suit to see If I can find out what happened to my notes. I prepared the suit and will file it this week.

    I have discovered that UCC 3- 309 may be a critical part of this action. As you know, MERS and others have been filing lost note affidavits and this seems to be the section that covers under what circumstances these lost note affidavits will work. Most likely, MERS will have real problems under this section because you have to hold the note at the time of loss. MERS, which never holds the note, but is often the party seeking foreclosure, almost certain to be adjudicated not to have standing to sue. And if you are the service and have transferred the note, you wont have standing either.

    Of course, I am still current on my notes but still never received the second mortgage note I paid off. And my lender refuses to talk to me about the whereabouts of my first note. Since my first mortgage is a MERS mortgage, I am almost sure that note was sold so it will be interesting to see if my lender can come up with the necessary documentation to prove they are the agent of the holder of the note. This could get fun.

    I took a long time because I was in no hurry and I wanted to see if any more cases came down the pike. I also want ed to do some more study since this is not my field. I am fortunate that I have a good friend who has done lots of reals estate litigation and is helping me.

    MERS is taking different positions as well. In an Nebraska appellate case, MERS to avoid banking regulators, took the position it did not hold notes. Yet when it was having trouble in Florida with Lost Note Affidavits, it was arguing that it was the holder of the note when the note was lost. MERS is an apple one day and and orange the next.

  7. should have read:

    MERS, which never holds the note, but is often the party seeking foreclosure, is almost certain to be adjudicated not to have standing to sue. And if you are the servicer and have transferred the note, you wont have standing either.

  8. Filed my suit today. If you want a copy to post, I will be glad to send it in either word or pdf format if you tell me where.

    You can email me at

    It would be interesting to have the responses of other attorneys because inventing the wheel is no fun by yourself.

    Maybe it could be posted somewhere where lawyers might review.

  9. The Secondary Mortgage Market, M.E.R.S. & Price Fixing

  10. Update on my case. After giving the bank several extensions to answer suit, about ten days ago I was served with a motion to dismiss for failure to state a claim. In hindsight I guess I should not have been surprised.

    Yesterday, I filed my response. Under our rules of pleading, which mirror the federal rules, I was not required in my pleading to specifically cite legal authority for my claims. I believe that the motion to dismiss was really more in the nature of a motion for more definite statement because the gist of the motion was that I had not pled any authority to support my claims. But again, that is not a legal requirement.

    While I was preparing my response, in addition to UCC 3- 309, on lost, destroyed or stolen notes, I came across UCC 3-501 on presentment (of a demand for payment). Interestingly this provision, when demand for payment is made, gives the borrower the right to demand to the party attempting to enforce the note, to “exhibit the note.” Further it gives the borrower the right to demand that the party show reasonable evidence of authority to make the demand if the demand is made on behalf of another party. If further allows for refusal to pay, without dishonor, when presentment fails to comply with applicable law.

    The bank in its motion to dismiss relied on an arcane general statute that allows for the destruction of original documents, when the law does not require preservation of the original. Of course, the UCC makes it clear preservation is necessary and the only means to prove up a lost note is through UCC 3-309. So I do not think their provision will apply.

    So I pointed out both UCC 3-309 and UCC 3-501in response. I think I am in pretty good shape.

    If people want a copy of my response, email me at

  11. A few more things. UCC 3-501also requires that when presentment/demand is made for payment and the note is paid in full, the note holder is required to “surrender” the note to the borrower.

    You will recall that when I paid of my second mortgage, the lender refused to return my note to me.

    Under 3-309 regarding lost, destroyed or stolen notes, if the lender wants to prove up the note this way, then the court must order adequate protection for the borrower. I am requesting adequate protection, preferably return of all payments made, but alternatively whatever protection the court deems reasonable one the circumstances of my destroyed note (or possibly notes if they can’t find my first) are known.

    I did learn through correspondence from the bank’s house counsel that my first mortgage note was sold to fannie mae so that presents my original lender (now my servicer) and MERS with a serious agency problem. They must now show authority for any of the actions that they take.

  12. David, Keep up the good fight. And keep us posted.

  13. Update:

    Yesterday I sent a copy of my Amended Complaint to the Bank’s Counsel. I should hear within a few days whether they will oppose its filing or whether the bank will agree to it.

    Each time I am forced to study the issue and work on the problem, I come up with better arguments and better legal support for my position.

    I sure wish other lawyers were doing what I am doing.

    I am beginning to think I might very well prevail because the law is very much in my favor.

    The bank’s lawyers have already told me my note was sold to Fannie Mae.

    A recent Arkansas Supreme Court case really helped me out. I now think I have a good chance of getting the Deed of Trust lien removed from my house. Attempting to make MERS my lien holder until the loan was paid off seems like a very serious mistake that won’t fly, if the Arkansas Court’s analysis is correct.

    Applying the Arkansas Supreme Court’s holding to my case means that neither my bank nor MERS have had any interest in my Deed of Trust since the bank sold my note to Fannie Mae. And there has never been any assignment of it. Result — nobody has an interest in my Deed of Trust now and my bank can probably not effectively transfer an interest in my Deed of Trust to Fannie Mae that they no longer have. It seems pretty clear that the assignment of my lien had to take place simultaneously with the selling of my note and that didn’t happen. If both aren’t done together, the new noteholder cannot acquire the lien even by subsequent transfer.

    If I can get the lien removed, that makes my home loan unsecured and the note worth much less. I will own my home free and clear but will still be responsible for the note.

    But I might even be able to get the court to force the bank to cease and desist from sending me payment demands WITHOUT DISHONOR of the note! If the bank can’t come up with my note it could prove to be a real problem for the bank. The bank’s lawyers tell me they have the note but I will believe it when I see it.

    Since the bank sold my note to Fannie Mae, the bank now can only act as Fannie Mae’s agent and it remains to be seen what kind of agency agreement there is between them. The bank may not be able to prove it has the authority to demand payments of me on behalf of Fannie Mae.

    My email has changed. If anyone would like a copy of my Amended Complaint email me at

  14. I should have posted the Arkansas Supreme Court case. It is worth reading because they really slam MERS.

    Click to access 08-1299.pdf

  15. In reading my Deed of Trust today, I picked up on something I had missed. I thought my Deed of Trust said that both my lender and MERS were the beneficiaries of my Deed of Trust. I was wrong. Only MERS is the beneficiary. And the Arkansas court clearly held that MERS can’t be a beneficiary at least in Arkansas because it has no right to payments.

    Upshot is my Deed of Trust has no beneficiary if I can get a Tennessee Court to hold that MERS does not have beneficiary status for the same reason.

  16. I think the bank’s attorneys are worried stiff. They wanted to file a motion to dismiss my second amended complaint. I told them it was time to see the judge since they never prosecuted their first motion to dismiss. I filed a motion to strike their motion to dismiss and to require them to answer the lawsuit and to require them to answer my discovery. My motion will be heard on Friday August 28. I can’t for the life of me believe the judge will think I have failed to state a claim. I am hoping he thinks they are just trying to jack me around and lets them have it.

    I have also decided that I am going to orally ask the court to allow me from now on to make my payments into the registry of the court until such time as they can prove I have to pay them. I think that offer will convince the judge this is a justiciable controversy and if the judge allows me to do it beginning in September, that ought to really make them nervous.

    My lawyer friends who are advising me say that if they had my first mortgage note they would have produced it by now to show me they can prove I have to pay it. Since they haven’t produced it yet and are still trying hard not to produce it, there is a very good possibility they just can’t.

    I am concerned about representing myself and keeping objective and my emotions in check. But if the judge is on my side, this could be a real hoot.

  17. Update: Judge postponed the hearing for two weeks; he had too long a docket and wanted a special setting. In the meantime, I have come up with a good idea for getting around the lender’s motion to dismiss — a motion to realign the parties. The lenders have the burden of proof not us. So I will present my motion on this two weeks from now.

  18. Update: Hearing put off for six weeks. Judge allowed bank’s counsel to ask for time to file new motion to dismiss since I had just filed an Amended Complaint.

    I filed an Amended Complaint which alleges the banks have the burden of proof to show that the documents are enforceable.

    • Please let us know what happens. I too have found discrepancies in our deed paper work and certain paper work not filed with the county, when stated it must be. WF refuses to modify so we may try this tactic to push for a mod or buy more time. There are so many mixed reactions from attorneys about UCC 3-501. We consulted a very good attorney who said “don’t make the bank mad, they have the money to sue you. It’s all legal.” Huh? Improper filing per deed of trust, lost note is legal?

  19. Sounds good, David. Keep on Keeping on!

  20. Hi David.

    Hi David.
    I’m in the same predicament you found yourself into when you started fighting against the bank to make them produce the note. It would be really interesting to see how you prepared your documentation prior to filing each of them. I’m going to file my suit probably next week but I’d like to compare it to yours prior because I’m going to do it Pro-per. Please, Could you be so kind to send me copy of your filings as of the latest? I will really appreciate it David.

    Also I wish you the best of lucks with your case.

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