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ORANTES LAW FIRM, P.C. Giovanni Orantes, Esq. 190060 3435 Wilshire Blvd. Suite 1980 Los Angeles, CA 90010 Tel: 213-389-4362 Fax: 877-789-5776 General Insolvency Counsel for Debtors and Debtors-in-Possession

UNITED STATES BANKRUPTCY COURT CENTRAL DISTRICT OF CALIFORNIA LOS ANGELES DIVISION Case No. 2:10-bk-50424-PC Chapter 11 Proceeding Hon. Chief Judge Peter Carroll, Presiding Debtor and Debtor-in-Possession. OPPOSITION TO MOTION FOR RELIEF FROM AUTOMATIC STAY FILED BY BANK OF AMERICA, N.A. AS SUCCESSOR BY MERGER TO LASALLE BANK NA AS TRUSTEE FOR WASHINGTON MUTUAL MORTGAGE PASS-THROUGH CERTIFICATES WMALT SERIES 2007-1 TRUST; SUPPORTING DECLARATION HEARING: Date: April 21, 2011 Time: 9:30 A.M. Place: United States Bankruptcy Court 255 East Temple Street Courtroom 1539, Los Angeles, CA 90012

In re: ROBERTO ALMARAZ,

TO BANK OF AMERICA, N.A. AS SUCCESSOR BY MERGER TO LASALLE BANK NA AS TRUSTEE FOR WASHINGTON MUTUAL MORTGAGE PASSTHROUGH CERTIFICATES WMALT SERIES 2007-1 TRUST, HONORABLE PETER
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CARROLL, UNITED STATES BANKRUPTCY CHIEF JUDGE; THE OFFICE OF THE UNITED STATES TRUSTEE AND ALL OTHER INTERESTED PARTIES: COMES NOW, Roberto Almaraz (the Debtor) in Opposition to that Motion for Relief from Automatic Stay (the Motion) filed by Bank of America, N.A. As Successor by Merger to LaSalle Bank NA as Trustee for Washington Mutual Mortgage Pass-Through Certificates WMALT Series 2007-1 Trust states as follows: I. FACTUAL BACKGROUND Roberto Almaraz filed a voluntary Chapter 11 petition commencing this reorganization case on September 22, 2010 (the Filing Date). The Debtor is an individual. The property of the estate includes 11 multi-family residential properties (duplexes, 3plexes and 4-plexes), a total of about 30 residential units. All are located within Los Angeles County. The debtor personally occupies one of the units of a triplex and the remaining two units are rental assets. The properties have a collective value of about $4.3 million and secure a total of 18 mortgages. Several of the properties have only one mortgage, most of them have two mortgages and one of them has three mortgages. The total debt is substantially in excess of the properties values. Some of the mortgages on debtors properties are adjustable. In hindsight, Debtor realizes that he should not have heeded the advice of the banks and mortgage brokers who convinced him to accept such mortgages, but, in any event, he needs to correct the problems caused by the fact that such mortgages were adjusting over the last several months prior to the petition and reduced the net income generated by the properties to the point where he needs to seek to reduce the monthly payments through this bankruptcy process. This Motion and opposition relates to the property commonly known as 3622-3626 West 110th Street, Inglewood, CA 90303 (3622 W. 110th Street). The Motion should be denied as 3622 W. 110th Street is essential to the Debtors reorganization and the Debtor already filed a disclosure statement and plan of reorganization, which may be confirmed within a reasonable

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amount of time. Although objections to confirmation have been filed which are related to four of the 11 properties in the estate, the Debtor is confident that his plan of reorganization will be confirmed as the cashflow projections appended to the plan of reorganization, of which it requests that the Court take judicial notice, demonstrate that the plan is eminently feasible and, as will be further detailed in reply to the objections, the Debtor already has at least one vote from impaired classes that would allow him to confirm a plan under Section 1129(b). In any event, Movant has not made a prima facie case that its Motion should be granted under any circumstances as it has failed to comply with Rule 9014 and Rule 7004 of the Federal Rules of Bankruptcy Procedure, which require service of the Motion on the Largest 20 creditors of the Debtor pursuant to the requirements of Rule 7004. Here, for example, the entities guaranteed by the Federal Deposit Insurance Corporation should have been served to the attention of the appropriate President or Corporate Officer via certified mail. Since that was not done, the Court should deny this Motion out of hand. In addition, as further detailed below, Movant does not even have standing to bring this Motion as it has not presented competent evidence that it actually holds the note related to the property and Deed of Trust at issue herein. II. THE MOTION FOR RELIEF FROM THEAUTOMATIC STAY UNDER 11 U.S.C. 362 SHOULD BE DENIED BECAUSE THE PROPERTY IS NECESSARY FOR THE DEBTORS EFFECTIVE REORGANIZATION WITHIN A REASONABLE TIME. The Moving party cannot obtain relief from the automatic stay under section 362(d)(2) merely by establishing no equity for the purposes of section 362(d)(2)(A). The conjunction and connecting the no equity test of section 362(d)(2)(A) and section 362(d)(2)(B), means that a relief from stay cannot be granted unless subsection (B) is also satisfied. In this case, relief cannot be granted because, as explained in Mr. Alfaros declaration, the property is, in fact, necessary for the Debtors effective reorganization. Once a moving party shows that the debtor has no equity in the property, the burden shifts to the debtor to establish that the property is "necessary to an effective reorganization" and that
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there is "a reasonable possibility of a successful reorganization within a reasonable time." United Sav. Ass'n v. Timbers of Inwood Forest Assocs., Ltd., 484 U.S. 365, 376, 108 S. Ct. 626, 98 L. Ed. 2d 740 (1988) (internal quotations and citation omitted). The debtor must show "not merely that if there is conceivably to be an effective reorganization, this property will be needed for it; but that the property is essential for an effective reorganization that is in prospect." Id. (emphasis in original). 3622 W. 110th Street is essential to the Debtors successful reorganization as it contributes net monthly income of $672 to the Debtors plan of reorganization. III. ALTERNATIVELY, THE MOTION FOR RELIEF FROM AUTOMATIC STAY UNDER 11 U.S.C. 362 SHOULD BE DENIED BECAUSE THE DEBTOR CAN PROVIDE ADEQUATE PROTECTION UNDER 11 U.S.C. 361 TO THE MOVING PARTY Section 361 does not define adequate protection; rather, section 361 specified nonexclusive methods of providing adequate protection. The U.S. Supreme Court explained what adequate protection is warranted in United Savings Association of Texas v. Timbers of Inwood Forest Associates, Ltd. 484 U.S. 365, 109 S.Ct. 626 (1988) (Timbers) where a Chapter 11 debtor, an apartment complex with rental income and a deed of trust with an assignment of rents, owed more to the secured creditor than the value of the property. Even though the property was worth less than what was owed to the secured creditor, it was not depreciating in value. The secured creditor moved for relief from the automatic stay contending that adequate protection under section 362(d) included payment to it of lost opportunity costs. The U.S. Supreme Court in

Timbers rejected this argument and found that under 11 U.S.C. 1129(b), a secured creditor has a right under a plan the present value of their collateral. This entitlement arises, however, not from the phrase indubitable equivalent in 1129(b)(2)(A)(iii), but from the provision of 1129(b)(2)(A) )(i)(II) that guarantees the secured creditor "deferred cash payments . . . of a value, as of the effective date of the plan, of at least the value of such [secured claimant's] interest in the estate's interest in such property." (Emphasis added.) Under this formulation, even though the
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undersecured creditor's "interest" is regarded (properly) as solely the value of the collateral, he must be tendered payments that assure him that value as of the effective date of the plan. In 361(3), by contrast, the relief pending the stay need only be such "as will result in the realization . . . of the indubitable equivalent" of the collateral. (Emphasis added.) It is obvious (since 361 and 362(d)(1) do not entitle the secured creditor to immediate payment of the principal of his collateral) that this "realization" is to "result" not at once, but only upon completion of the reorganization. It is then that he must be assured of "realization . . . of the indubitable equivalent" of his collateral. To put the point differently: similarity of outcome between 361(3) and 1129 would be demanded only if the former read "such other relief . . . as will give such entity, as of the date of the relief, the indubitable equivalent of such entity's interest in such property." One method of adequate protection specified is periodic cash payments to the lien creditor equal to the decrease in value of the creditors interest in collateral. If no other option were available, Debtor can meet the adequate protection burden of section 362 by making cash payments equal to the depreciation on the property under section 361(1). However, since the value of the Debtor property is largely stable, no periodic payments are warranted. IV. THE MOTION FOR RELIEF FROM AUTOMATIC STAY UNDER 11 U.S.C. 362 SHOULD BE DENIED BECAUSE MOVANT FAILED TO SERVE THE MOTION AS REQUIRED BY RULE 4001-1 Rule 4001-1 states that a motion for relief from an automatic stay provided by the Code or a motion to prohibit or condition the use, sale, or lease of property pursuant to 363(e) shall be made in accordance with Rule 9014 [which requires compliance with F.R.B.P. 7004] and shall be served on any committee elected pursuant to 705 or appointed pursuant to 1102 of the Code or its authorized agent, or if the case is a Chapter 9 municipality case or a Chapter 11 reorganization case and no committee of unsecured creditors has been appointed pursuant to Sec. 1102, on the creditors included on the list filed pursuant to Rule 1007(d), and on such other entities as the Court may direct.
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Movant failed to comply with this Rule and as of today nothing has been filed to prove differently. Here, for example, the members of the largest 20 creditors of the Debtor whose deposits are guaranteed by the Federal Deposit Insurance Corporation should have been served to the attention of the appropriate President or Corporate Officer and via certified mail. Since that was not done, the Court should deny this Motion out of hand. V. IN ANY EVENT, MOVANT DOES NOT HAVE STANDING TO SEEK RELIEF FROM STAY For the sake of completeness, the Debtor must raise the issue that Movant does not have standing even to file this Motion as (1) Attachment 1 to the Motion (page 10-11 of 14 of the Motion itself) does not say anywhere that the Movant actually holds the Note in the transaction at hand as it is a declaration from a vice president of JPMorgan Chase Bank, N.A. that says that JPMorgans records show that Bank of America, N.A. holds possession of the original note needless to say, the Movant needs to submit competent evidence from a qualified witness that Movant actually holds the note the inadmissible declaration of a third party does not confer standing on Movant; and (2) its own Exhibit 3 shows that Mortgage Electronic Registration Systems, Inc. (MERS) purported to assign the Note in this case to the Movant on September 15, 2010 (!!), which is simply not possible as MERS has no authority to effect such assignment, and even if it had some semblance of authority, such assignment is fatally untimely by a few years under the Pooling and Servicing Agreement governing securitized loans such as the one in the instant case. Indeed, the recently thorough and well-reasoned opinion of In re Agard, 2011 Bankr. LEXIS 488 (Bankr. E.D.N.Y. Feb. 10, 2011), which analyzes MERS standing under the New York law governing transactions such as the one at hand, and in which MERS had ample opportunity to brief this complex issue, the Court ruled that MERS had no standing to effect such assignments under any of its absurd theories: The legislative history of Section 362 "suggests that, notwithstanding the use of the term 'party in interest', it is only creditors who may obtain relief from the automatic stay." Id. at 573-74. (citing H.R.
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Rep. No. 95-595, 95th Cong., 1st Sess. 175, reprinted in 1978 U.S.Code Cong. & Ad. News 5787, 6136); see also Greg Restaurant Equip. And Supplies v. Tour Train P'ship (In re Tour Train P'ship), 15 B.R. 401, 402 (Bankr. D. Vt.1981) (finding that a judgment creditor of the debtor was not a "party in interest" because the judgment creditor was not itself a direct creditor of the bankrupt). In the context of a lift stay motion where the movant is seeking to commence or continue with an action to foreclose a mortgage against real property, the movant must show that it is a "party in interest" by showing that it is a creditor with a security interest in the subject real property. See Mims, 438 B.R. at 57 (finding that as movant "failed to prove it owns the Note, it has failed to establish that it has standing to pursue its state law remedies with regard to the Mortgage and Property"). Cf. Brown Bark I L.P. v. Ebersole (In re Ebersole), 440 B.R. 690, 694 (Bankr. W.D. Va. 2010) (finding that movant seeking relief from stay must prove that it is the holder of the subject note in order to establish a 'colorable claim' which would establish standing to seek relief from stay). Under New York law, Movant can prove that U.S. Bank is the holder of the Note by providing the Court with proof of a written assignment of the Note, or by demonstrating that U.S. Bank has physical possession of the Note endorsed over to it. See, eg., LaSalle Bank N.A. v. Lamy, 12 Misc. 3d 1191[A], 824 N.Y.S.2d 769, 2006 NY Slip Op 51534[U], 2006 WL 2251721, at *1 [N.Y. Sup. Ct. 2006]. The only written assignment presented to the Court is not an assignment of the Note but rather an "Assignment of Mortgage" which contains a vague reference to the Note. Tagged to the end of the provisions which purport to assign the Mortgage, there is language in the Assignment stating "To Have and to Hold the said Mortgage and Note, and also the said property until the said Assignee forever, subject to the terms contained in said Mortgage and Note." (Assignment of Mortgage (emphasis added)). Not only is the language vague and insufficient to prove an intent to assign the Note, but MERS is not a party to the Note and the record is barren of any representation that MERS, the purported assignee, had any authority to take any action with respect to the Note. Therefore, the Court finds that the Assignment of Mortgage is not sufficient to establish an effective assignment of the Note. the parties in this case have adopted a process which by its very terms alters this practice where mortgages are held by MERS as "mortgagee of record." By MERS's own account, the Note in this case was transferred among its members, while the Mortgage remained in MERS's name. MERS admits that the very foundation of its business model as described herein requires that the Note and Mortgage travel on divergent paths. Because the Note and Mortgage did not travel together, Movant must prove not only that it is acting on behalf of a valid assignee of the Note, but also that it is acting on behalf of the valid assignee of the Mortgage. MERS argues that notes and mortgages processed through the MERS System are never "separated" because beneficial ownership of the notes and mortgages are always held by the same entity. The Court will not address that issue in this Decision, but leaves open the issue as to whether mortgages processed through the MERS
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system are properly perfected and valid liens. See Carpenter v. Longan, 83 U.S. at 274 (finding that an assignment of the mortgage without the note is a nullity); Landmark Nat'l Bank v. Kesler, 289 Kan. 528, 216 P.3d 158, 166-67 (Kan. 2009) ("[I]n the event that a mortgage loan somehow separates interests of the note and the deed of trust, with the deed of trust lying with some independent entity, the mortgage may become unenforceable"). There are several published New York state trial level decisions holding that the status of "nominee" or "mortgagee of record" bestowed upon MERS in the mortgage documents, by itself, does not empower MERS to effectuate an assignment of the mortgage. These cases hold that MERS may not validly assign a mortgage based on its nominee status, absent some evidence of specific authority to assign the mortgage. See Bank of New York v. Mulligan, 28 Misc. 3d 1226[A], 2010 NY Slip Op 51509[U], 2010 WL 3339452, at *7 [N.Y. Sup. Ct. 2010]; One West Bank, F.S.B. v. Drayton, 29 Misc. 3d 1021, 910 N.Y.S.2d 857, 871 (N.Y. Sup. Ct. 2010); Bank of New York v. Alderazi, 28 Misc. 3d 376, 900 N.Y.S.2d 821, 824 (N.Y. Sup. Ct. 2010) (the "party who claims to be the agent of another bears the burden of proving the agency relationship by a preponderance of the evidence"); HSBC Bank USA v. Yeasmin, 27 Misc. 3d 1227[A], 911 N.Y.S.2d 693, 2010 NY Slip Op 50927[U], 2010 WL 2089273, at *3 [N.Y. Sup. Ct. 2010]; HSBC Bank USA v. Vasquez, 24 Misc. 3d 1239[A], 901 N.Y.S.2d 899, 2009 NY Slip Op 51814[U], 2009 WL 2581672, at *3 (N.Y. Sup. Ct. 2009); LaSalle Bank N.A. v. Lamy, 12 Misc. 3d 1191[A], 824 N.Y.S.2d 769, 2006 NY Slip Op 51534[U], 2006 WL 2251721, at *2 (N.Y. Sup. Ct. 2006) ("A nominee of the owner of a note and mortgage may not effectively assign the note and mortgage to another for want of an ownership interest in said note and mortgage by the nominee."). See also MERS v. Saunders, 2010 ME 79, 2 A.3d 289, 295 (Me. 2010) ("MERS's only right is to record the mortgage. Its designation as the 'mortgagee of record' in the document does not change or expand that right..."). But see US Bank, N.A. v. Flynn, 27 Misc. 3d 802, 897 N.Y.S.2d 855 (N.Y. Sup. Ct. 2010) (finding that MERS's "nominee" status and the mortgage documents give MERS authority to assign); Crum v. LaSalle Bank, N.A., No. 2080110, 2009 Ala. Civ. App. LEXIS 491, 2009 WL 2986655, at *3 (Ala. Civ. App., Sept. 18, 2009) (finding MERS validly assigned its and the lender's rights to assignee); Blau v. America's Servicing Company, et al., No. CV-08773-PHX-MHM, 2009 U.S. Dist. LEXIS 90632, 2009 WL 3174823, at *8 (D. Ariz. Sept. 29, 2009) (finding that assignee of MERS had standing to foreclose). the rules of membership do not grant any clear authority to MERS to take any action with respect to the mortgages held by MERS members, including but not limited to executing assignments. The rules of membership do require that MERS members name MERS as "mortgagee of record" and that MERS appears in the public land records as such. Section 6 of Rule 2 states that "MERS shall at all times comply with the instructions of the holder of mortgage loan promissory notes," but this does not confer any specific power or authority to MERS. The Court finds that the record of this case is insufficient to prove that an agency relationship exists under the laws of the state of New
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York between MERS and its members. According to MERS, the principal/agent relationship among itself and its members is created by the MERS rules of membership and terms and conditions, as well as the Mortgage itself. However, none of the documents expressly creates an agency relationship or even mentions the word "agency." MERS would have this Court cobble together the documents and draw inferences from the words contained in those documents. For example, MERS argues that its agent status can be found in the Mortgage which states that MERS is a "nominee" and a "mortgagee of record." However, the fact that MERS is named "nominee" in the Mortgage is not dispositive of the existence of an agency relationship and does not, in and of itself, give MERS any "authority to act." In re Agard, 2011 Bankr. LEXIS 488 (Bankr. E.D.N.Y. Feb. 10, 2011), *29-*56. Although the Debtor in this case believes that there is no cause for the Court to grant relief from stay as the property at issue is essential to his plan of reorganization which is reasonably anticipated to be confirmed and the initial hearing on it is to take place on April 21, 2011. If the Court is inclined to entertain the Movants motion, the Debtor prays that the Court postpone the hearing on the Motion approximately 90 days to conduct discovery to allow Debtor to brief fully the complex but important issues involved in this case regarding whether this particular Movant can even request relief from stay, especially since even the investors in these transactions (the true parties in interest as to all these properties), to whom Movant owes fiduciary duties, are themselves defending themselves against lenders who seek to dispossess them of their investments instead of agreeing to reasonable loan modifications which would maximize the return on the investors capital instead of lining the pockets of greedy banks.

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VI. CONCLUSION The Debtor prays that the motion for relief from stay be denied as the property is necessary to an effective reorganization and there is a reasonable possibility of a successful reorganization within a reasonable time. Indeed, even though the Debtors would be willing to make adequate protection payments to the Movant, if necessary, since there is no evidence that the Propertys value has depreciated in any perceptible way post-petition, no payments are warranted prior to confirmation of a plan of reorganization, which the Debtor anticipates in the near future. Date: April 9, 2010 ORANTES LAW FIRM, A PROFESSIONAL CORPORATION

By: /s/ Giovanni Orantes Giovanni Orantes, Esq. Attorney for Debtor and Debtor-In-Possession

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DECLARATION OF ROBERTO ALMARAZ I, ROBERTO ALMARAZ, hereby declare and state as follows: 1. I am over 18 years of age. I am the Debtor and Debtor-In-Possession in a

Chapter 11 proceeding, Case No. 2:10-bk-50424-VK. Except when based on information and belief, I make this declaration based on facts within my personal knowledge and if called as a witness, could and would testify thereto. 2. I filed my voluntary petition under Chapter 11 of Title 11 of the United States

Code (the Bankruptcy Code) on September 22, 2010 (the Petition Date). 3. The property of the estate includes 11 multi-family residential properties

(duplexes, 3-plexes and 4-plexes), a total of about 30 residential units. All are located within Los Angeles County. I occupy one of the units of a triplex and rent the other two. 4. The properties have a collective value of about $4.3 million and secure a total of

18 mortgages. The total debt is substantially in excess of the properties values. 5. Some of the mortgages on my properties are adjustable. In hindsight, I realized

prior to filing this petition that I should not have heeded the advice of the banks and mortgage brokers who convinced me to accept such mortgages, especially since I had a superior credit rating at the time, but, in any event, I need to correct the problems caused by the fact that such mortgages were adjusting over the last several months prior to the petition and reduced the net income generated by the properties to the point where I need to seek to reduce the monthly payments through this bankruptcy process. 6. This Motion relates to the property commonly known as 3622 through 3626

West 110th Street, Inglewood, CA 90303 (3622 W. 110th Street). This Motion should be denied as 3622 W. 110th Street is essential to my reorganization as it generates net monthly income of approximately $672 and I already filed a disclosure statement and plan of reorganization, which may be confirmed within a reasonable amount of time as I already have the vote of one impaired class. While relatively small in amount, when aggregated, it is important.