Tonight! FED CARES ACT FUNNELS MONEY TO SERVICERS 3PM PDT 6PM EDT

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with Charles Marshall and Bill Paatalo

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We will discuss on Today’s Show how the recently enacted federal CARES ACT, otherwise known as the Coronavirus Relief Bill, has unsurprisingly been commandeered by Big Bank lobbyists to direct monies to mortgage servicers servicing securitized loans backed by Fannie Mae and Freddie Mac. Under the arrangement, servicers are directed to pay investors to the trusts for 4 months, then Fannie and Freddie through the stimulus money will pay the same investors for a period of 8 months after the 4 month period expires.

Yet why would servicers be directing any monies to mortgage securitization certificate holders? The servicers are not a party to the indenture on certificates purchase by investors. We hear a lot in court proceedings involving securitized mortgage borrowers that they the borrowers have limited or even no legal challenge rights re the securitization process, as they the borrowers were not a party to the original securitization–just so here with the servicers.

Bill Paatalo returns to discuss the concept of tracing financial proceeds, and how borrowers can use this principle in both plaintiff and defense cases. Bill continues to uncover reports from law enrichment to congressional committed seeking reduce the epidemic of fraud, Ponzi schemes, and money laundering — all involving the use of sham entities in which the beneficial interest is held by unknown third parties.

Note from the Editor: I am currently working on this issue of “borrowers are not parties to the securitizations scheme” and therefore have no rights. Really? So when they sign transactional documents that unleash the sale of their personal loan data, without which the transaction would never have been completed, they were not part of the scheme of securitization? —- OK let’s take them out of the securitization scheme — What’s left?

And just for good measure, if borrowers are not part of the securitization scheme, why is the securitization scheme suing them for foreclosure? Are they all part of the same deal or not? You can’t pick up one end of the stick without picking up the other.

3 Responses

  1. Ian — you are 100% correct. And remember — the PLMBS was a “pilot program” – shut down before the collapse even exploded!! This is because “secondary market’ was concealed and fraudulent – as determined by MASTER SERVICERS – the security underwriters themselves – who once posed as servicer to F/F. .Nothing was compliant.

    Sorry Rick S — this was not about “buying too much house with a second bathroom.”

  2. On HousingWire today it was reported that mortgage servicers will only have to advance 4 months of payments to the “investors” (presumably Freddie and Fannie)
    Also a boilerplate explanation of forbearance agreements by an industry shill. Interesting reading on some of these trade journals. My favorite is DS News. (default servicing news)
    The default servicing industry began when securitization started to gain as mortgages were sold into the secondary market. Before then no one had ever heard of a default servicer.

  3. “So when they sign transactional documents that unleash the sale of their personal loan data, without which the transaction would never have been completed, they were not part of the scheme of securitization? —- OK let’s take them out of the securitization scheme — What’s left”
    …if borrowers are not part of the securitization scheme, why is the securitization scheme suing them for foreclosure? Are they all part of the same deal or not? You can’t pick up one end of the stick without picking up the other…

    If borrowers are not part of the securitization scheme, who is? Their payments are paying certificate holders are they not? No borrowers – no trust, no mortgage, no investment, no profits, …their contract is what needs to be adhered to, in order to have any rights. And the REMIC is very, very specific about that and the parties who can act, what they do and don’t do….it is not ambiguous.

    These debt collectors, which is all they are, have breached the very contract they agreed to. I have found nothing that indicates any of them have authority to act in any capacity…the dots just don’t connect.

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