Mortgage Debt & Home Equity

Insurance Redlining and Transparency

07/07/11

Insurance nerds like to point out that insurance coverage is a pre-requisite to a wide range of activities, from starting a business to practicing medicine to driving a car.  In this sense, insurers often serve as gatekeepers to fundamental social privileges.  Nowhere is this more starkly illustrated than in the residential real estate context.  As one court succinctly put it: “No insurance, no loan; no loan, no house; lack of insurance thus makes housing unavailable.”  

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A Template for MBS Settlements and How Safety-and-Soundness Regulation Is Incompatible with Law Enforcement

07/02/11

Over the past couple of years, the Massachusetts Attorney General's office has reached settlements with a number of major banks regarding mortgage securitization. These settlements has received very little notice in the press, but I think they provide a real template for future AG settelements and are worth examining. 

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BoA Settlement and Servicing

07/01/11

Yves Smith has a provocatively entitled post about the BoA MBS settlement.  Yves appropriately excoriates Bill Clinton for saying some plain old stupid things about the settlement (namely that it is going to have a meaningful impact on principal reduction mods--it ain't and can't.

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The BoA MBS Settlement

06/30/11

The $8.5B dollar figure of the Bank of America settlement with a cohort of MBS investors has gotten all the attention, but I think there's a bunch of more interesting things going on than the price tag.  Still, it's hard not to talk about the price tag, so let's get that out of the way.

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Switching Foreclosure Rules in the Middle of the Game

06/25/11

Yves Smith has an interesting post up on Naked Capitalism about Florida Governor Rick Scott suggesting that Florida could switch from judicial to nonjudicial foreclosures as a way to solve its foreclosure overload.

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Do We Have a Fraud Problem? The Case of the Mysteriously Appearing Allonge

06/19/11

I have generally been willing to give mortgage servicers, servicer support shops (like LPS), and foreclosure attorneys the benefit of the doubt when it comes to documentation irregularities (to put it mildly) in foreclosures.

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More on Allonges

06/19/11

My post on allonges generated quite a bit of response, on and off the blog. But here's what's troubling me--if allonges are being fabricated ex post, who is doing it?

  • The servicer?
  • The default management shop (e.g., LPS)?
  • The network firm (sort of the foreclosure GC)?
  • Local counsel? 

I'm curious to hear any insights anyone has on where the document production is taking place. 

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For the Servicers: Is It Better to Rob Peter or Paul?

04/27/11

The U.S. mortgage servicing industry is in deep doo-doo. To foreclose on a mortgage, you must own the note and the mortgage. That's a lot of paperwork to keep track of, especially when you're trying to package as many mortgage loans into as many securitizations as you can before the market dries up. If we have learned nothing else in the past four years, it is a lot to ask Wall Street to make sure they get things right when there is money to be made.

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The Morality of Strategic Default

04/25/11

Professor Curtis Bridgeman (FSU College of Law) has an article on The Morality of Jingle Mail:  Moral Myths About Strategic Default.  I have a fundamental philosophical disagreement with the article, but it's got a lot of very good, clear analysis of arguments about strategic default, including a very useful typology of argument.  

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Clash of the Titans: RMBS Edition

01/27/11

And so it begins. We're about to witness the main event in financial institution internecine warefare: investment funds (MBS buyers) vs. banks (MBS sellers). 

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