Loans Claimed to be Owned by Fannie Mae Have Probably Been Sold to Private Investors

There is a shroud of mystery around the entire role of the FHA. Its purpose is to guarantee loans, which was expanded to buy loans. It was never a lender. But the process of buying loans was just as complicated as everything else where securitization of debt is claimed. In most cases it “bought” loans from parties who never owned the debt and therefore had nothing to sell.

Furthermore the purchase was “funded” by a complex process which culminated in giving “certificates” issued by so-called REMIC trusts in which Fannie or Freddie was the “Master Trustee.” Whether such transactions constituted payment of value for anything is up for debate since we here do not know if Fannie or Freddie ever paid for the certificates.

Following the trend of “resecuritization” we have found that most nonperforming and reperforming loans are being sold by the GSE’s at a brisk pace. But foreclosures are proceeding as if the the loans were never sold at all. So we conclude here that many if not most foreclosures in which the names of Fannie and Freddie are invoked are merely cloaks for further weaponizing foreclosure procedures to obtain revenue instead of restitution for an unpaid debt. Restitution could only go to someone who lost money. That can only mean someone who paid value for the debt as required by Article 9 §203 UCC as adopted in all U.S. jurisdictions.

Practice Note: Both lawyers and pro se litigants fall into the trap: They assume that there has been a default despite the fact that nobody who has paid for the debt has suffered any financial injury — nor are they the claimant in any foreclosure action. That is because they do not own the debt and have in fact disclaimed such ownership in exchange for a promise of unsecured payments from a third party (securities brokerage firm). The default is a fiction and the foreclosure results in forced sale of property to produce revenue for the foreclosure participants.

This is why it is so important to establish in discovery that the opposition cannot produce a shred of evidence of payment for the debt. There was no payment “for the debt.” Since this is so counterintuitive as to be dismissed by most practitioners they ignore it and go on to admit in judicial proceedings that the lawsuit is a foreclosure when in fact, it is not. By admitting that the action is a foreclosure you are tacitly admitting that this is about restitution of an unpaid debt through a contract in which the claimant is a party, when in fact it is not.

Check this out:

Non-performing Loan Sales

Fannie Mae’s sales of non-performing loans, which are part of the Federal Housing Finance Agency’s 2015 Conservatorship Scorecard, are intended to reduce the number of seriously-delinquent loans that Fannie Mae owns, to help stabilize neighborhoods and to help meet the portfolio reduction targets required under the Senior Preferred Stock Purchase Agreement with the United States Treasury.

On March 2, 2015, the Federal Housing Finance Agency (FHFA) announced guidelines for these sales to encourage broad buyer participation and provide safeguards for borrowers. These guidelines require the buyers of non-performing loans to offer loan modifications to borrowers and provide foreclosure alternatives whenever possible. If foreclosure cannot be prevented, property sales to owner-occupants and non-profit agencies must be prioritized.

Fannie Mae will work to sell these loans to investors, nonprofits and public sector organizations. The company anticipates bringing pools of loans to the market on a regular basis. Fannie Mae intends to offer a mix of both larger and smaller pools that may be more attractive to nonprofits, smaller investors and minority- and women-owned businesses.

Reperforming Loan Sales

On October 11, 2016, Fannie Mae began marketing its first sale of reperforming loans as part of the company’s ongoing effort to reduce the size of its retained mortgage portfolio as indicated above. Reperforming loans are mortgage loans that were previously delinquent, but are performing again because payments on the mortgage loan have become current with or without the use of a loan modification plan.

see https://www.fanniemae.com/portal/funding-the-market/npl/index.html

 

9 Responses

  1. Ohh – and Charles — Freddie (and Fannie) securitized Ginnie loans into their own REMICs. Oh – but from where??? Private label.

  2. Guys — Freddie Mac and Fannie Mae invested in the private label so called “trusts.” EVERYTHING is traced to Fannie Mae or Freddie Mac in some form or fashion. However, the private label trusts were set up with no compliance under Regulation AB — a pilot program for RMBS set up well over a decade ago (circa 2002 or 2003). Why not in compliance? Because the “ultimate pool” segregated loans into separate pools and REMICs. (read the prospectus) – in violation of Regulation AB. Some of the these segregated pools (REMICs) were NOT offered for security sale, but, rather , went elsewhere to third party. Many loans that were in the “offered for sale” (REMICs) were also later subordinated to another “pool” or REMIC not offered for sale but also then sold to a “third party.” A back door.

    Shortly thereafter non-compliance with Regulation AB, the financial crisis, hit the streets,. Most were shut down. However, today, the fraud continues. Freddie Mac and Fannie Mae are not obligated to report to the SEC. And they do not. They still segregate loans for their “REMICs” for non-performing loans (by whose standards is unknown)– despite non-compliance for RMBS under Regulation AB. Why? F/F (the government) does not have to answer to anyone – including SEC. Whoops — are not we the people the government?

    Ask yourselves – how did market share during financial crisis shift from F/F ownership to private label- and why? Profit. F/F invested in the private label, because they were stuck in fixed interest rates and not making a profit. They worked out a “profit” deal. Massive “back door” business. .

    SO — who knows about this?? Everyone in authority but the judge you are before.

    Go forward Ian, Charles, Java, and Bob G. In palm of your hands. All will eventually come forward.

    Read the prospectus and Regulation AB rules – came down around 2005 — MASSIVE. Will put you to sleep, but have to pursue. Then look at why F/F does not follow.

    Thanks to all of you (and Neil of course).

    We are not done.

  3. What do we know about MBS? We know that for Ginnie Mae pooled loans that they are all pooled using the same regulation that requires every Note to be endorsed in blank per UCC3. Why is this important? Its because US Congress does not allow Ginnie to create a debt for the Federal Government as a lender, because Ginnie like Fannie & Freddie are not lenders/ Ginnie is only a insurer of the Ginnie MBS, which they insure the MBS at 100% of the principal investment of the investors that are investing in and not purchasing mortgage loans.

    Washington Mutual Bank (WAMU) cannot take a loan out of the Ginnie MBS until it pays back the “draw” to took out against the mortgage loan that was advanced by the investor in the post borrower home loan closing which is a total separate financial deal that did not include the mortgage borrower who were not informed or require to sign obligations.

    WAMU collapsed on Sept 25, 2008 without advance knowledge that the OTS was seizing it, as the outcome where 1.3 million Fed Gov loans Wells Fargo was servicing that were pooled into their Ginnie MBS could not pay off their advances.

    WAMU who owed billions in advance draws which was part of the $300 billion losses taken by the bank as WAMU does not have the monies to slip to Ginnie to gain back the Notes to sell off the loans that have equity to settle these debts. The reason Ginnie requires relinquishing the blank Notes so that the bank does not sale from under the securities the loans.

    WAMU no longer exist and Wells Fargo Bank who does not actually receive the bulk of proceeds of the illegal foreclosures that they had Kozeny & McCubbin LC create forged Notices of Defaults and Assignment of Deeds of Trusts to makes it look as if they purchased the debt and perform a phony non-judicial foreclosure, while not addressing UCC9 which demands that proof of purchase be provided to the court in calling the due.

    Why is the FHA purchasing $70 billion in defaulted loans in 2009-2010 when there is a FHA HAMP program available? FDR created the HOLC in 1933 that purchased i million homes and refinanced them all at a 80% success rate through 1938, however, Obama Administration does not make the lenders perform the underwriting and Ginnie Mae is demanding foreclosure. Take the Dept of VA loans where it was mandatory to perform the HAMP and VA HAMP underwriting after Feb 1, 2010, had zero success as the banks refused to underwrite and instead illegally foreclosing on the 20,000 Troops in 2010!

    The Dept of VA was not out a dime and had a requirement under loss mitigation regulation to ensure the underwriting was done, however the non lender was purchasing the properties with bad “titles” and reselling the properties “Sell of Stolen Goods”!

  4. ian-forget the discovery nonsense. they never comply. use the subpoena on everybody instead.

  5. Just talked with the Dept of VA about this with Washington Mutual Bank VA loan in Ginnie Mae MBS how was it that Wells Fargo Bank foreclosed saying it was working for Ginnie Mae as the owner of the debt when Ginnie Mae is not a lender and cannot buy or sell a mortgage loan as it is not a lender!

    FHA took a $70 billion loss for 2009-2010 that was reported to Congress in Dec 2012 by HUD Secretary Donovan. Obama help over 800,000 citizen lose homes because he allowed the FHA and VA to purchase loans from that did not review these FHA HAMP and VA HAMP. The now there is a trick with the FHA loan and VA loans is that the originators of the loans don’t have to provide proof under UCC9 for ownership, however, if that loan was purchased then proof of purchase must be provided.

    Washington Mutual Bank originated and purchased a total 1.3 million FHA & VA loans that Wells Fargo Bank was the mortgage servicer and custodian of record. The mortgage servicing agreement stopped when WAMU stopped existing as it could not longer accept payments because it was dead. Fed Gov loans are two party only and if the lender as with WAMU becomes defunct and losses $300 billion as WAMU did, the borrower who were current on their loans have a windfall in there no legal avenue to call the loans due.

    The FDIC should have required all those blank endorsed note to be surrendered to the bankruptcy court to ensure the property were not stolen as they were.

    Wells did not have titles and got an outside firm forge Notice of Defaults and Deed of Trusts as in the Holm v. Wells & Freddie Mac.The Dept of VA was not obligated to purchase the Troops properties from Wells as Wells did not purchase the loan and stop having a service agreement arrangement because the interest party in WAMU not longer existed.

    What I cannot understand is there is billions to recover and millions of home to be returned or restitution. The Independent Foreclosure Review Board was suppose to handle this but Obama canceled the “No Standing” category that was agreed to in Apr 2011!

  6. Bob-
    That’s one of the best approaches I think I’ve seen on this site.

  7. SLS is the agent that Fannie appointed for the purpose of foreclosing. But drop a subpoena on SLS demanding their servicer agreement, not their LPOA, with Fannie. Also demand in the subpoena to have them produce any law firm retainer agreement that they have with the mill doing the foreclosing.

  8. Java- did you ask specialized loan servicing why? Let us know what they say , and while you have them on the phone, ask them if they have proof that they purchased the debt-

  9. If Fannie Mae owns my loan, as it says on their website, how are debt collector lowlifes Specialized Loan Servicing fraudclosing in their name ??????

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