Allstate Files Suit Against Chase, WaMu, Bear Stearns

Allstate today filed suit in New York state court alleging that JP Morgan Chase, WaMu and Bear Stearns had materially misrepresented just about everything in selling more than $750 million in mortage loans to the insurer.  Specific misrepresentations alleged involved underwriting standards and practices, owner occupancy statistics, loan-to-value and combined loan-to-value ratios, debt-to-income ratios, credit ratings, credit enhancements, underwriting exceptions, …

Bear Stearns Trust Files Against EMC to Force PSA Compliance

Earlier this week, we reported on an investor suit against Countrywide. While the claims against Countrywide may have reached into new territory, the suit isn’t the only recent example of the mortgage industry breaking ranks and shining a light on the misrepresentations, faulty processes and other flaws in an effort to cover their own investments and point the finger elsewhere. …

The Lawsuit to be Heard ‘Round the World?

Investors, including New York Life, have filed a 194-page complaint against Countrywide and Bank of America, alleging…essentially, what homeowners and consumer attorneys have been pointing out all along.  You can read an excellent summary at Mandelman Matters, but this allegation is worth spotlighting again here: Countrywide routinely failed to comply with the requirements of applicable state laws and the PSAs for valid transfers of …

Mortgage Transfers Are Valid, Group Argues as Foreclosure Hearings Begin

Via Bloomberg by Jody Shenn and Prashant Gopal – Nov 16, 2010. A trade group for companies that help package loans and leases into securities rejected claims that mortgage-bond trusts can’t prove ownership of debt they hold as Congress began hearings on the foreclosure crisis. The securitization industry, which is claiming the existence of the PSA in itself shows that the loans were …

One Mess That Can’t Be Papered Over

By Gretchen Morgenson of the New York Times. Is the banks’ sloppy paperwork a matter of simple technicalities that are relatively easy to cure, as the banks contend? Or are there more far-reaching consequences for banks and the institutions that bought mortgage-backed securities during the mania? Oddly enough, the answer to both questions may be yes. According to real estate …

Are Homeowners in Default to Blame for Foreclosure Crisis?

Boot Camper April Charney in the news, interviewed by ANNIE LOWREY of the Washington Independent. … servicers have in many cases resisted helping homeowners in foreclosure with principal write-downs, modifications or other solutions. The system did not work to keep families in homes. It worked to process foreclosures as fast as possible. To get a sense of how that happened, …

Are You PSA Literate?

We are pleased to present this guest post by April Charney. If you are an attorney trying to help people save their homes, you had better be PSA literate or you won’t even begin to scratch the surface of all you can do to save their homes. This is an open letter to all attorneys who aren’t PSA literate but …

The Alphabet Problem and the Pooling and Servicing Agreement

The Pooling and Servicing Agreement (PSA) is the document that actually creates a residential mortgage backed securitized trust and establishes the obligations and authority of the Master Servicer and the Primary Servicer. The PSA also establishes that mandatory rules and procedures for the sales and transfers of the mortgages and mortgage notes from the originators to the Trust. It is …