Posted in Mortgage Repurchase, Too Big to Fail No Wrongdoing Required for Inclusion on Wells Fargo’s Exclusionary List Loose Underwriting Standards Imagine that you work at a company that has originated residential mortgage loans for years, following the documentation and verification requirements and guidelines established by the major banks to which your company typically sells those loans. Imagine that Wells Fargo is one… Continue Reading
Posted in Mortgage Repurchase The Financial Crimes Enforcement Network (“FinCEN”), a bureau of the U.S. Department of the Treasury, released its full-year 2011 update of mortgage loan fraud suspicious activity reports (MLF SARs) on April 23rd, 2012. The update shows that financial institutions submitted 92,028 MLF SARs last year, a 31 percent increase over the 70,472 submitted in 2010. SARs… Continue Reading
Posted in Mortgage Repurchase, Too Big to Fail, Uncategorized Misrepresentation? We have long held the view that investors’ buy-back demands based on allegedly inaccurate appraisals are about the weakest type of buy-back demand imaginable. Think about it: the two fundamental components of such a demand are that the loan originator made a “misrepresentation,” and that the misrepresentation concerned the appraised value of the property… Continue Reading
Posted in Fannie Mae/Freddie Mac, Mortgage Repurchase, Too Big to Fail Aggregator Banks and Repurchase or Make Whole Claims As most correspondents/originators are now painfully aware, aggregator banks are unleashing a barrage of “repurchase” or “make whole” claims related to loans sold by the correspondent years ago. The aggregators cite supposed loan level breaches of representations and warranties in the applicable mortgage purchase and sale agreement or… Continue Reading
Posted in Legislation/Regulation, Too Big to Fail Consent Order Issued Morgan Stanley may have sold off its mortgage servicing unit, but that did not stop the Federal Reserve from holding the company accountable for robo-signing and other improper foreclosure proceedings which occurred during 2009 and 2010. The Federal Reserve announced on April 3rd that it had issued a consent order against Morgan Stanley,… Continue Reading
Posted in Legislation/Regulation, Too Big to Fail SECOND CIRCUIT COURT OF APPEALS ISSUES STAY IN LITIGATION BETWEEN S.E.C. AND CITIGROUP In a sharply worded opinion, the Second Circuit Court of Appeals issued a stay to the district court proceedings in S.E.C. v. Citigroup, in the Southern District of New York. There, Judge Rakoff had previously refused to approve a proposed $285 million settlement… Continue Reading