Reynoso

I. Background

In April 2004, a forged grant deed was recorded purporting to transfer Reynoso’s property from her to Moonlien L. Reynoso (Moonlien). At the same time, a deed of trust was recorded on Reynoso’s property purporting to secure a $70,000 promissory note. The deed of trust purported to be an agreement between Patel, as the lender, and Moonlien, as the borrower. One clause in the deed of trust addressed attorney’s fees. This clause appeared under the heading “9. Protection of Lender’s Interest in the Property and Rights Under this Security Instrument.” It stated: “If . . . there is a legal proceeding that might significantly affect Lender’s interest in the Property and/or rights under this Security Instrument . . . , then Lender may do and pay for whatever is reasonable or appropriate to protect Lender’s interest in the Property and rights under this Security Instrument . . . . Lender’s actions can include, but are not limited to . . . paying reasonable attorneys’ fees to protect its interest in the Property and/or rights under this Security Instrument . . . .” “Any amounts disbursed by Lender under this Section 9 shall become additional debt of Borrower secured by this…