Supporting, Informing & Connecting People in Foreclosure
EPTL 7-1.1 & 7-1.2 apply to real and personal property.
Here is what I have surmised. Section 40a - Trust Purpose - defines a passive trust:
A. Passive Trusts
1. Every person who is entitled both to the actual possession of property and to the rents and profits thereof, shall be deemed to have a legal estate therein, of the same quality and duration as his beneficial interest. EPTL 7-1.1
2. Every disposition of property shall be made directly to the person in whom the right to the possession and income is intended to be vested and not to another in trust for such person. If made to any person in trust for another, no estate or interest vests in the trustee. EPTL 7-1.2
3. EPTL 7-1.1 & 7-1.2 apply to real and personal property.
The section I bolded is what I believe is applicable. REMIC's are passive trusts - they must be pasive in order to obtain REMIC status and be bankruptcy remote and tax exempt.
According to this statute, IMHO, the mortgages and the notes have to be assigned to the trust - not the trustee. This is the only way that the trustee can claim any interest.
However, I have read and have heard from testimony by Levitin, that under New York Trust Law, the trust documents rule. If that is the case, then the PSAs allow for indorsements in blank for the notes. The PSAs also state that all intervening assignments and indorsements must be present, meaning the A-B-C-D rule. This has not been followed. Every assignment I have seen, including my own, is from the originator to the trustee with no intervening assignments. Additionally, the notes are indorsed in blank or they have attached a blank allonge (which is not permitted in under NY law because NY is a No-Space Test state). Here is a link to Levitin's testimony today - http://financialservices.house.gov/Media/file/hearings/111/Levitin1...
Either way, an argument can be made that the transfer into the trust is invalid therefore the trust holds no enforceable interest in the loans.