Summary:
In the first of these two unrelated cases, Ephraim Demons, representing himself, alleged that his mortgage lender (among others) committed fraud related to his mortgage based on Demons' belief that he created “money” when signing his mortgage.
Similarly, Aalaam alleged fraud and claimed his mortgage loan was invalid under the "vapor money" theory, arguing that banks create money by recording promissory notes as assets and therefore loans don’t need repayment.
The vapor money theory, which asserts that loans funded by credit rather than cash are unenforceable, has been widely rejected by courts as frivolous as it was in these two cases as well.
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