Mortgage Servicing Fraud
occurs post loan origination when mortgage servicers use false statements and book-keeping entries, fabricated assignments, forged signatures and utter counterfeit intangible Notes to take a homeowner's property and equity.
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Ed Cage

http://www.mortgagedaily.com/subscribe/login.asp?msg=Please%20Login

Lawsuit Alleges Predatory Servicing
In a lawsuit filed this week, Bear Stearns Companies and its servicing subsidiary are accused of charging frivolous fees, losing payments and mismanaging escrow accounts on loans with nonprime minority borrowers.

EMC Mortgage Corp. and Bear have been charged with "unfair and predatory servicing practices" that violated the Fair Housing Act and Civil Rights laws in a class action suit that was filed Dec. 10 and entered on Dec. 11.

Those practices "targeted and exploited nonprime borrowers," resulting in "a disparate impact on Hispanic and African American borrowers," according to the suit which was filed on behalf of an Hispanic couple, an African American couple and an African American woman in U.S. District Court in Connecticut…”

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Ed Cage
1804 Cross Bend, Plano Texas 75023
972-596-4363
ecagetx@tx.rr.com

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Ed Cage

http://feeds.feedburner.com/~r/TheTruthAboutMortgagecom/~3/200529690/

LendingTree Cuts 220 More Jobs

Posted: 14 Dec 2007 05:27 PM CST

 

For the third time in the last eight months, LendingTree has conducted mass layoffs amid ongoing troubles in the mortgage industry, leaving the company with roughly 1,000 employees. The Charlotte-based mortgage lender and lead provider laid off 220 employees, or about 20 percent of its remaining work force last week, with the bulk of the cuts [...]

 

Submitted by

Ed Cage / ecagetx@tx.rr.com / 972-596-4363

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Stephen

Good!

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Ed Cage
Caminero v. Bear Stearns Residential Mortgage Corp. et al
The two units, Bear Stearns Residential Mortgage and Encore Credit, will be merged ... mortgage fraud have been discovered in Arizona, California, Colorado, ...
http://blawgsearch.justia.com/search.aspx?q=Caminero+v.+Bear+Stearns+Residential+Mortgage+Corp.+et+al

 

Bear Stearns to Cut 310 More Jobs

The two units, Bear Stearns Residential Mortgage and Encore Credit, will be merged under the name Bear Stearns Residential Mortgage Corporation, [...]                                                                                                         http://www.creditsal.com/bear-stearns-to-cut-310-more-jobs-dealbook/

 
Just as I previously forecast, Bear Stearns Residential will fail right around Super Bowl 2008 time. The “merge” with Encore Credit is only a ruse to hopefully calm investors; the failure of Bear Stearns (Mortgage unit) is inevitable.

Submitted by Ed Cage / ecagetx@tx.rr.com / 972-596-4363

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Ed Cage

TheTruthAboutMortgage.com

 

Countrywide Subpoenaed by Illinois Attorney General

Posted: 13 Dec 2007 01:09 PM CST

Countrywide Financial has been subpoenaed by the Illinois Attorney General as part of a widening probe regarding sketchy lending practices that have trapped scores of borrowers in high-cost, adjustable-rate mortgages. Attorney general Lisa Madigan has subpoenaed documents from Countrywide in regard to its loan origination practices, and more specifically subprime and payment-option ARMs, a person briefed [...]
 
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Submitted by Ed Cage / ecagetx@tx.rr.com / 972-596-4363

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Stephen

I understand from a reliable source the the California AG will investigate the relationship between CWide and Landsafe (the appraisal company used exclusively by CW).  Identical to the WAMU/Eappraisit relationship.

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It is so hard to stay patient while the wheels turn excruciatingly slow to help borrowers who are stuck having to repay their loans to the charlatans.

First it seems they are after the brokers for awhile now.

Then lenders

Then appraisers

Secondary market and it's snakepit inhabitants.

Let's do what we can to make sure they hear about mortgage servicer
fraud.

I'm nervous they won't look at mortgage servicing fraud.

People that are being victimized should not be ignored by the current
investigations.

Dee
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Ed Cage
Dee wrote:
"I'm nervous they won't look at mortgage servicing fraud."

As usual you're right on target Dee..
Please take a look at the thread/subject "Who's on first...?" or
some such.  I just put up an extensive post on your above concern.
I'm hoping the Presidential candidates will give us more attention..

Regards and MC&HNY!
Mr Ed

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Ed Cage

http://www.nationalmortgagenews.com/fraud/
 
Mortgage Fraudsters Find New Twists

Scamsters get Scammed themselves
 
When it comes to mortgage fraud, there are not many new ways to separate lenders and homeowners from their money. But there are sometimes new twists to old favorites. In a recent case of equity skimming, federal investigator Herschell Harvell Jr. found a group of 10-12 people who were running a foreclosure rescue scam. In an effort to save his home, and in return for the promise that the "investor gang" would bring his delinquent loan current, the troubled owner put all their names on the title and then paid the group rent while he continued to live in the property. Of course, the group didn't make any payments, but it did collect rent from the owner, Mr. Harvell told SourceMedia's Fraud and Risk Conference in Las Vegas Monday. Each time the lender started foreclosure proceedings, one of the group of con men filed for bankruptcy, according to Mr. Harvell, the assistant special agent in charge in the Department of Housing and Urban Development's Office of the Inspector General. And the day before a foreclosure hearing was scheduled, one con man would file for bankruptcy, delaying the proceedings. Then, the day before a hearing was scheduled, the con man would drop his bankruptcy claim and another one would file a new proceeding. The switch continued time and time again, according to the HUD official, while the owner went blindly along making his "rent" payments to the gang of charlatans. Mr. Harvell, who has successfully investigated numerous white-collar cases during his 11-year career at HUD, told the conference that despite lenders' best efforts to stop fraud, con men "continue to search for weaknesses in the system and take advantage of them."
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Ed Cage

http://financialservices.law360.com/Secure/ViewArticle.aspx?id=42440

Citigroup Wants To Merge ERISA, Securities Actions

Portfolio Media, New York (December 14, 2007)--Citigroup Inc. has asked a New York federal court to consolidate 16 cases that collectively accuse the financial conglomerate of ERISA and securities law violations for alleged losses incurred from Citigroup's mortgage securitization business.

Citigroup filed a response on Thursday in the U.S. District Court for the Southern District of New York to consolidation motions by four plaintiffs that sought to combine 11 purported class actions claiming Employment Retirement Income Security... 
 

 

Submitted by Ed Cage / ecagetx@tx.rr.com / 972-596-4363

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Ed Cage



WaMu Employee Admits to Bribes
A former loan coordinator at Washington Mutual F.A.'s subprime unit was bribed with $100,000 in payments from a mortgage broker to help process fraudulent loan packages. He also was paid by in-house loan officers to fund mortgages with fraud.

John Ngo pleaded guilty Monday to lying under oath to a grand jury in September about whether he had received money from a mortgage broker while he was a senior loan coordinator at WaMu subsidiary Long Beach Mortgage, according to an announcement from U.S. Attorney McGregor W. Scott.

Ngo, who worked at Long Beach from September 2001 through May 2006, was responsible for verifying information from packages submitted by brokers and inside originators.
read full story

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srsd
Wow Mr. Ed,   I really liked reading the above......it looks like the scum are starting to tell the truth for a change.  If all of them would do this, it would turn the tide in our favor.  We all know what has been done and a lot of people have came out with what has happened and I really like reading about things like this.  It gives me faith that things will eventually get better.
Thanks for the great post!!
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Ed Cage

Is Integrity Really Needed In Business Today: Just another Real ...
Once again another appraiser was involved in a mortgage fraud campaign and once again I realized how easy it is for one to be numb to the press these days. Yep just another example of how appraisers are crooks, only this time to the ...
Table Talk With Apella - http://apellatabletalk.spaces.live.com/

HEDGE FUND NEWS @ 19 December 2007
By Finbar Taggit
yahoo. Few people knew at the start of 2007 the meaning of "subprime" real estate loans or how they might affect the US and global economies. Today, worries are growing that the crisis that began with mortgage failures and spread to ...
FiNTAG - Daily Hedge Fund News,... - http://fintag.com

Morgan Stanley Getting $5B Investment From China Investment Corp ...
Source: Yahoo Finance Investment bank Morgan Stanley said Wednesday it sold a portion of itself to China Investment Corp., an investment arm of the Chinese government, for $5 billion to raise capital after taking $9.4 billion in ...
Democratic Underground Latest... - http://www.democraticunderground.com

Home Buying: You Don't Have to Pay Private Mortgage Insurance or PMI
By dennis
You can eventually cancel private mortgage insurance if you can prove that you owe 80% or less of your home's value. Getting your mortgage balance down to 80% of the home's value can take many years. The good news is that you can have ...
All Mortgage News - http://www.allmortgagenews.com

 

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Ed Cage

Probe of Insider Trading at Bear Stearns

http://images.businessweek.com/story/07/370/1217_bear_stearns.jpg 
 Mario Tama/Getty Images

 

                                          _     _     _

 

More on the imminent collapse of EMC / Bear Stearns Residential later..

But first of all sincere thanks to Blossom for posting the entire BusinessWeek

article thereby saving me $4.95.  And now for the first three comments on

the BusinessWeek article that Blossom posted:

 

  • Barry Cohen Dec 18, 2007 4:57 PM GMT -  The authors fail to raise the issue of Bear Stearn's ongoing appeal against a court ruling regarding its handling of the Manhattan Fund scandal almost 8 years ago. Clearly, the firm's hedge fund troubles go back some way.

 

  • thomas Dec 18, 2007 3:29 PM GMT -  Worked for Bear 24 years, was laid off 2 years ago, just glad I sold my stock when I did. It was downhill after Ace gave up his post.

 

  • MICHAEL KAY Dec 18, 2007 6:55 AM GMT -  THIS IS KNOWN AS CRIME PAYS. WHEN WILL THE PUBLIC STOP GIVING THEIR MONEY TO THESE THIEVES ON WALL STREET? FRAUD AFTER FRAUD. FIRST JUNK BONDS THEN ENRON, THEN OPTION SCANDALS, SUB PRIME. THIS COUNTRY IS FOR THE WALL ST ESTABLISHMENT RIPPING EVERYONE OFF. NOW LET'S BAIL OUT THE CROOKS.

 

Submitted by Ed Cage  / ecagetx@tx.rr.com  / 972-596-4363

 

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Ed Cage

http://www.kvoa.com/global/story.asp?s=7519499

State, lenders promote availability of
mortgage changes
 
Associated Press - December 19, 2007 2:04 PM ET

PHOENIX (AP) - Major lenders in Arizona are agreeing to promote new "workout" arrangements to allow many borrowers to get more favorable mortgage terms.

Gov. Janet Napolitano says state agencies have reached agreements with lenders consistent with terms of a recently announced federal initiative. Napolitano says the Arizona effort includes a publicity push so borrowers know they may have options that allow them to avoid foreclosure.

Napolitano says the initiative applies to borrowers with so-called "subprime" loans that are still current but with interest rates poised to jump higher.

She says borrowers still have to repay their loans, but they'll be under more favorable terms."

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Submitted by Ed Cage / ecagetx@tx.rr.com / 972-596-4363
 


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Ed Cage
http://www.attorneyinformations.com/2007/12/24/attorney-general-sues-mortgage-companies-the-naperville-sun/
 
Attorney General sues mortgage companies 
The Naperville Sun

Attorney General Lisa Madigan filed three lawsuits Friday against mortgage rescue companies for allegedly violating the Illinois Mortgage Rescue Fraud Act, which she initiated in 2006, and the Consumer Fraud and Deceptive Business ...
attorneyinformations.com - http://www.attorneyinformations.com 

 
 
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I understand that Lisa is also going to be having meetings with individual victims of Litton Loan!!!!!
 
 
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Ed Cage

All of the following are subscription based excerpts
but are still worthy of note. For more info on all of these see: http://www.mortgagedaily.com/

 
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States are pushing and passing legislation designed to stiffen oversight of originators and stem foreclosures. (Dec. 27)

Mortgage Market Weakens

Mortgage rates were mixed this past week, though loan applications were clearly lower. (Dec. 27)

WaMu Employee Admits to Bribes

A former loan coordinator at Washington Mutual F.A.'s subprime unit was bribed with $100,000 in payments from a mortgage broker to help process fraudulent loan packages. He also was paid by in-house loan officers to fund mortgages with fraud.

John Ngo pleaded guilty Monday to lying under oath to a grand jury in September about whether he had received money from a mortgage broker while he was a senior loan coordinator at WaMu subsidiary Long Beach Mortgage, according to an announcement from U.S. Attorney McGregor W. Scott.

Ngo, who worked at Long Beach from September 2001 through May 2006, was responsible for verifying information from packages submitted by brokers and inside originators.

read full story



Best Mortgage Companies

An annual study of mortgage originators identified the best companies and found that borrowers are more satisfied when dealing with a direct lender than with a mortgage broker or online lead generation company.

The 2007 Primary Mortgage Origination Study was conducted by J.D. Power and Associates on 4,378 borrowers who closed on their mortgages between September 2006 and August 2007, according to an announcement today.

The report analyzed customer satisfaction with application approvals, interaction with loan representatives, loan closings and problem resolution.

read full story

The State of Foreclosures

Mortgage loan servicers have partnered up with local governments and charitable organizations to help delinquent borrowers avoid foreclosure. Among potential solutions are loan modifications and short sales. (Dec. 27)

Billions to Bankruptcy

A New York-based mortgage banking firm that just two years ago handled nearly $2 billion in loans annually has closed and filed for bankruptcy. (Dec. 27)

$3.1 Billion in 2005 RMBS Downgraded

Changes to subprime forecasting assumptions led Fitch Ratings to downgrade more than $3 billion in classes from residential mortgage-backed securities issued in 2005. But deals from 2006 and even 2007 were also impacted from the move. (Dec. 26)

Losses Continue

As two banking mergers managed to progress, a number of other financial institutions disclosed losses while one ratings agency took negative debt ratings actions in response to losses. (Dec. 26)

Branch System Shutting Down

A Florida mortgage company that at one time topped the list of fastest growing mortgage companies, operated nearly 300 branches and employed nearly 1,000 people, will close its doors on New Year's Eve. (Dec. 26)

Over $1 Billion in Recent Commercial Deals

Apartment properties financed by the dozens racked up over $260 million in loan deals recently. But it was one $500 million hotel transaction that trumped the rest in this latest journal of commercial mortgage activity. (Dec. 26)

Market Drastically Altered in Past 14 Months

In prophetic comments delivered just over a year ago, Freddie Mac's chairman and chief executive officer warned mortgage bankers that too much capital was chasing too little product. Since that time, the residential subprime sector has unraveled -- destroying an industry that, during the past quarter century, had gone from the shadows of mortgage lending to the forefront. Losses, which have spread far beyond U.S. subprime lenders and have wiped billions of dollars off the balance sheets of international financial institutions, may continue into 2009. (Dec. 24)

OH Servicers to Face Barrage of Lawyers

An Ohio chief justice is pleading with lawyers in the state to offer their services free to assist in that state's foreclosure crisis. (Dec. 21)

M.I. Class Action Against Wells

A California lawsuit against Wells Fargo alleging the company illegally referred borrowers to its affiliate for mortgage insurance has been certified as a class action. (Dec. 21)

Fannie Business Declines

Fannie Mae announced a monthly decline in secondary loan purchases, though there was a healthy gain from a year earlier. Delinquency worsened, however. (Dec. 21)

Mixed Mortgage Data

A new report on mortgage activity during the first half of this year indicated that while the subprime share of overall originations has tumbled, the proportion of subprime loans with higher loan-to-values and lower credit scores has risen. Meanwhile, total loan volume has risen from the second half of last year -- though the number of loans fell. (Dec. 21)

Freddie Purchases, Delinquency Edge Higher

Monthly secondary purchases inched higher at Freddie Mac, though so did delinquency. (Dec. 21)

RMBS, CMBS & CDO's Downgraded

Negative ratings actions have been taken on residential mortgage-backed securities and residential collateralized debt obligations, while negative actions are likely on $376 million in commercial mortgage-backed securities that have seen rising delinquency on the underlying loans secured by Texas multifamily properties. But $680 million in CMBS deals saw upgrades. (Dec. 21)

Massive Wave of 2nd Lien Downgrades

Based on worsening performance recently, Standard & Poor's Ratings Services lowered ratings on more than $20 billion in second lien deals. (Dec. 21)

Impac Shareholder Equity Wiped Out

Impac Mortgage Holdings Inc. reported a quarterly loss of more than $1 billion -- completely wiping out shareholder equity. (Dec. 20)

Debt Forgiveness Now Law

Legislation temporarily waiving income tax liability for borrowers who have been foreclosed on is now law. (Dec. 20)

Alt-A Performance Rapidly Deteriorating

A new ratings agency report indicates the performance of Alternative-A loans backing recently issued residential mortgage-backed securities is "deteriorating rapidly." The study analyzed the best and worst performance by issuer. (Dec. 20)

Apps Tumble, Rates to Improve

Mortgage application activity sank as fewer borrowers sought refinances amid a slight increase in rates. But a forecast of falling rates may stimulate activity in the new year. (Dec. 20)
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Submitted by Ed Cage  /  ecagetx@tx.rr.com  /  972-596-4363
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http://www.dailybulletin.com/ci_8122409

 

UBS sees loss of $11.45B

Article Created: 01/30/2008 06:55:38 PM PST

SUBPRIME MORTGAGE woes deepened for Swiss banking giant UBS AG, which Wednesday said it expects a $11.45 billion hit in the fourth quarter and its first annual loss.

Switzerland's largest bank said full-year net losses will amount to 4.4 billion francs ($4.03 billion).

Some analysts fear there may be even greater fallout as the bank tries to free itself from extensive holdings of bad U.S. debt.

THE FBI on Tuesday said it is investigating 14 companies for possible accounting fraud, insider trading or other violations in connection with home loans made to risky borrowers.

Agency officials did not identify the companies under investigation but said the wide-ranging probe, which began in spring 2007, involves companies across the financial services industry, from mortgage lenders to investment banks that bundle home loans into securities sold to investors.”

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wwwwwwwwwwwwwwwwwwwwwwwwwwwwwwwwwww   January 31, 2008

Submitted by Ed Cage  |  Plano Texas  |  972-596-4363  |  ecagetx@gmail.com

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Fraud Exceeds $4 Billion in 2007
Mortgage fraud activity jumped past $4.0 billion last year -- with California and Ohio leading the way.

During 2007, an estimated $4,004,127,260 in mortgage fraud was identified nationwide by FraudBlogger.com. The activity brought the FraudBlogger Index to 6550.

The dollar volume was soared from $1,593,572,894 in 2006, when the index stood at 5020.
read full story


Countrywide Accused of Firing Whistleblower
A former regional vice president of a Countrywide Financial Corp. affiliate has filed a lawsuit against the company alleging that he was fired for alerting executives that he wouldn't approval fraudulent loans.

60,000 Reports of Fraud Likely in 2008
This year, reports of mortgage fraud are on track to reach 60,000, according to the Federal Bureau of Investigation -- which had more than 1,000 open cases last year.


Mortgage Fraud News | Mortgage Fraud Blog
Mortgage broker, originator and banker criminal cases.
Real estate flipping and appraisal fraud. Mortgage
fraud prevention, studies and analysis.

Layoffs, Consolidations Continue
Nearly 100 mortgage jobs have been cut in the wake of two companies cutting back on their California operations. And a Wisconsin brokerage that employed 45 and did more than $1 billion in loans just two years ago has also closed.

B.F. Saul Mortgage, a division of Maryland-based Chevy Chase Bank, has closed three California lending offices that employed 50 people. The offices were in Orange County, San Diego and San Ramon, Drew Young, who managed the California offices, told MortgageDaily.com.

Mortgage brokers who visit B.F. Saul's Wholesale Lending's Web site are instructed to send all new loan files to in Bethesda, Md., where Chevy Chase Bank Wholesale Lending is located, or visit Chevy Chase's wholesale lending Web site.
read full story

Mortgage Jobs Continue Contraction
Driven by more industry consolidations and closings, mortgage jobs declined by more than 5,000 in December from 30 days earlier -- though they were down by more than 100,000 from the prior year.

Mortgage Employment News
Job additions, layoffs and employment lawsuits. Employment data from the Department of Labor, state tracking, reports and analysis. Job finding tips.

HUD Terminates Georgia Lender
The U.S. Department of Housing and Urban Development has eliminated the ability of a Georgia-based mortgage company to originate government-insured loans.

BoA Names New Chief for Mortgage Unit
Bank of America Corp. has announced a new leader for its mortgage operation once it completes its upcoming acquisition of Countrywide Financial Corp.

Beazer Mortgage Done
Embattled Beazer Mortgage Corp. is calling it quits.

Refis Strong, Rates Worse
Refinance applications headed higher as purchase activity fell and mortgage rates worsened.

COFI Down Again
The Cost of Funds Index fell for the third consecutive month.

Mixed Results at Flagstar
Flagstar Bancorp Inc., which had another quarterly loss, saw quarterly originations ease and delinquency jump. But the company said its mortgage market share improved and noted a number of positive developments.

Mortgage Spam is Back
A recent decline in mortgage rates has caused a surge in e-mail Spam activity. The unwanted messages could wind up hindering legitimate communications between originators, lenders and prospective borrowers.

Rough Outlook for CMBS Servicers
Amid continued downgrading of subprime residential mortgage-backed securities, commercial MBS servicers face a challenging environment as delinquency is expected to double over the next year and the ability to unload assets deteriorates.

Subprime Performance Deteriorates
Two major ratings agencies reported further deterioration has been observed on subprime loans backing securitizations from 2006 and 2007 -- leading one of the agencies to take negative actions on over $270 billion in residential mortgage-backed securities.

Negative Ratings Actions on Over $139 Billion MBS
A third major ratings agency has taken sweeping negative actions on subprime residential mortgage-backed securities from 2006 and 2007. Meanwhile, commercial activity also deteriorated.

Mortgage Backed Securities
RMBS news. Changes to servicer ratings. Studies and reports about the performance of securitizations and problem vintages and classes. Subprime, Alt-A, home equity and jumbo analysis.

Pain Felt Domestically and Abroad
The Federal Bureau of Investigation has joined class action law firms in accusing financial services firms of misrepresenting financial results. Meanwhile, overseas banks continue to feel the pain from U.S. mortgage investments.

Lenders Expand Tech Services
Recent technological innovations include the integration of compliance functions into a widely used loan origination system, the launch of an LOS that converts standard loan files into reverse loan files and the adoption by one mortgage company of a loan search engine with over 12,000 programs.

M.I. Activity Worsens
The number of mortgage insurance policies written last month fell as defaults rose.

Prudential Volume Up 32%
Commercial mortgage production jumped last year at Prudential Mortgage Capital Co.

Offices & Apartment Deals Arranged
Among the latest commercial mortgage loans tracked by MortgageDaily.com were $150 million in multifamily mortgages and $132 million in loans secured by office buildings. In addition, a Canadian company financed a New York industrial property.

photo of Dallas office building

Read the full text of these articles and many more at: http://www.MortgageDaily.com

.................................................

Thanks,
Sam Garcia
Publisher
www.MortgageDaily.com
Mortgage Industry News
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o-

manburnedbypredatorylender.jpg Man Badly burned by Ameriquest Roland Arnall picture by Markie_090

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To Nutburger     -o "

or whatever your name is we are just now finally

gaining credibility for the many mortgage servicing

fraud victims across the country who are suddenly

no longer perceived as "deadbeats who got in over

their head."

 

Please don't post 3rd grader stuff like that. And if you

insist on doing childish things that indirectly hurt the

cause at least have the decency to attach your name

to it.

 

 

Ed Cage

1804 Cross Bend, Plano Texas 75023  |  972-596-4363

ecagetx@gmail.com

 

 
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I’m posting this because when I announced that EMC was defunct several

months ago one reader began futilely scurrying around in hopes that this

meant their home would suddenly become theirs without any further payments. 

An incredible but true story.

 

To the contrary since EMC went under the king of Gestapo hard ball collection

tactics, Bear Stearns took over and EMC customers who thought it couldn’t get

any worse found out different in a hurry.

 

Let me emphasize that there are things in Pamela Yip’s Dallas Morning News

article that I certainly do not agree with.  I’m posting it because it’s from my local

newspaper, not as a guide or roadmap as to what to do as more and more

lenders and servicers go out of business. Also the article was on topic for MSF.

 

Ed Cage |  1804 Cross Bend, Plano TX 75023  | ecagetx@gmail.com  |  972-596-4363

http://www.guidelive.com/sharedcontent/dws/bus/stories/012808dnbusperfi.2b6d7b0.html

If your mortgage lender goes bankrupt,

don't panic

The law protects you, but you must keep making payments

07:24 AM CST on Monday, January 28, 2008

By PAMELA YIP / The Dallas Morning News
pyip@dallasnews.com

With all the turmoil that's going on in the mortgage markets these days, there's one question that homeowners don't want to ponder but need to:

 

What happens if your mortgage lender or mortgage-servicing company files for bankruptcy or goes out of business?

The subprime mortgage implosion has taken down several lenders. Of the top 40 mortgage lenders in 2006, eight went bankrupt or closed in 2007, according to Inside Mortgage Finance, a mortgage-industry publication.

If that happens with your lender or mortgage servicer, don't panic. You have protection under federal law, but you must continue to fulfill your obligations under the loan contract.

Also Online

Contact your mortgage loan servicer about troubles

"One should first contact the lender and find out if the loan is going to be sold or if they are going to continue to service the loan," said Scott A. Satine, partner at The Loan Shrink in Flower Mound, home loan consultants.

A mortgage-servicing company collects, processes and credits your mortgage payment, and handles your escrow account, if you have one. The servicer can be your original lender, but many times it isn't because loans and the rights to service them often are bought and sold.

If your mortgage servicer is different from your original lender and your original lender goes out of business, continue to make your payments to the mortgage servicer by the due date.

"Even though the company [the original lender] is broke, the payments are still due and still being collected in trust, and the loan is payable," said Craig Jarrell, president of the Dallas Region of Pulaski Mortgage Co. "The old lender will contact you as well to let you know where to start sending the payments."

Your mortgage payment won't increase because of the change.

"If you do receive a transfer letter, your loan number, payment amount, and rate should be disclosed," Mr. Satine said. "These [original] terms will never change."

You also shouldn't have trouble with your mortgage payment being properly credited to your account.

"The processing of the payment is automated, so the lender's status should not affect your payment being credited properly," Mr. Jarrell said.

If your mortgage servicer files for bankruptcy or goes out of business, it's very likely it will sell its assets under the supervision of the bankruptcy court to another financial institution and transfer the servicing of your loan to another company, according to the Federal Trade Commission, the nation's consumer-protection agency.

During this transition, be aware of scams.

Read your mail and your e-mail, and pay attention to phone calls and messages that deal with a change of lender, a late payment or a payment that wasn't received.

Call to confirm the new loan servicer before you send a payment.

If your loan is transferred to another servicer, you should get two notices: one from your current servicer and one from the new servicer.

"It takes two contacts to make it official," Mr. Jarrell said. "Anyone can send a letter saying they bought your loan. You need the companion and authenticating letter from the lender who sold the loan to make sure all the loan numbers and information match up."

The current servicer must notify you at least 15 days before the effective date of the transfer unless you got a written notice at your settlement.

The effective date is when the first mortgage payment is due at the new servicer's address. The new servicer also must notify you within 15 days of the transfer.

By law, the notices must include:

•The name and address of the new servicer.

•The date your current servicer will stop accepting your payments.

•The date the new servicer will begin accepting your payments.

•Telephone numbers for both the current and the new servicer that you can call toll-free or collect for more information.

•Information on whether you can continue any optional insurance, such as life or disability insurance, whether you need to do anything to maintain coverage, and whether the insurance terms will change.

The notices also must include a statement that the transfer won't affect any terms or conditions of your mortgage contract, except those directly related to the servicing of your loan.

For example, if your mortgage contract has an escrow account to pay property taxes and insurance premiums, the new servicer can't close the escrow account.

In addition, you have a 60-day grace period after a transfer to a new servicer. That means you can't be charged a late fee if you send your mortgage payment to the old servicer by mistake, and your new servicer can't report that payment as late to a credit bureau.

"The FTC advises all mortgage holders to read their monthly statements," the agency said. "If your statement is late – even by just a few days – call the mortgage company to track it down."

Keep records of your payments, including billing statements, canceled checks, bank account statements, or online account histories, if appropriate.

If you have a dispute, continue to make your mortgage payments, but challenge the servicing in writing and keep a copy of your letter and any enclosures for your records.

Send your letter by certified mail, and request a return receipt, or send it via fax, and keep the transmittal confirmation.

Escrow accounts

An escrow account is a fund held by your servicer. You pay into the fund to cover charges like property taxes and homeowners insurance.

Typically, your payments are included as part of your monthly mortgage payment, and the servicer pays your taxes and insurance from this fund as they come due.

Even if your servicer files for bankruptcy or goes out of business, it's responsible for making the escrow payments in a timely way.

If your mortgage servicer administers an escrow account for you, it's required to make escrow payments for taxes, insurance, and any other charges when they're due.

The mortgage servicer also is required to give you a free statement every year that details the activity of your escrow account.

"This statement should show your account balance and reflect payments for your property taxes, homeowners insurance, and other charges," the FTC said. "But it is your responsibility to review the statement to make sure the appropriate entities and payments are made."

If one recipient of escrow funds lets you know that a payment is overdue, call the others that are supposed to be paid from your escrow account – for example, state or county governments for property taxes, insurance companies, or homeowners associations – to make sure the funds are being transferred in a timely way.

Pending loans

If you've been pre-approved for a mortgage and learn that the lender has filed for bankruptcy, call to find out if or when the company intends to make good on your loan.

"If the lender can't or has gone out of business altogether, start shopping around for another mortgage immediately," the FTC said.”

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IAC/InterActiveCorp, parent company of LendingTree, posted a fourth quarter net loss of $369.9 million, or $1.31 a share, compared to profit of $15.3 million, or 5 cents per share, a year ago.

The loss was largely related to a $475.7 million impairment charge the company took for its ailing LendingTree unit, a mortgage lead aggregator.

Excluding the LendingTree writedown and other one-time gains and charges, IAC earned 46 cents a share.

“There is good news and bad news this quarter — the mix of which is another reason why our previously announced plans to reorganize IAC into five independent public companies makes more and more sense,” Chairman and Chief Executive Barry Diller said.

During the quarter, revenue at LendingTree fell 55 percent thanks to ongoing housing woes.

The unit swung to an operating loss of $508.1 million, including the impairment charge, from a profit of $7.2 million during the same period a year ago.

In recent months, LendingTree has cut down their staff considerably, laying off 220 employees, or about 20 percent of its remaining work force in mid-December.

The company had previously laid off 440 employees in May and 250 employees during September.

Two years ago, LendingTree employed more than 2,000 workers nationwide and had plans to hire more.

Despite that, it’s been reported that LendingTree is in fact hiring again, running ads that say “no mortgage experience necessary”.

IAC/InterActiveCorp, which owns a slew of businesses ranging from Ask.com to Ticketmaster to the Home Shopping Network, is currently seeking to spin off the companies into five separate firms.

Shares of IAC were down 72 cents, or 2.93%, to $23.83 in early afternoon trading, hitting a fresh 52-week low of $23.10 during the session.

If you’re interested in staying abreast of the latest mortgage news, consider our free e-mail updates!

 

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Read the full text of these articles and many more at: http://www.MortgageDaily.com

 

Mortgage Industry News
view headlines online | RSS feed | Podcast

Wholesaler Hiring, Growing
A California-based wholesale lender should have no problem finding qualified employees for its planned expansion this year.

Federal Licensing Bill Proposed
A Democratic Senator and a former Bush administration Republican have come together to propose federal licensing for mortgage brokers and lenders.

Employee Claims Fired for Reporting Fraud
A former SunTrust Banks employee alleges in a lawsuit that he was fired in retaliation for alerting superiors to occurrences of mortgage fraud and other illegal activities -- a violation of the state's Whistleblower Act. The suit is one of two filed since December alleging a large U.S. lender fired an employee for reporting fraud.

Servicer Sued Over Fees, Hazard Policies
A GMAC mortgage subsidiary has been sued for allegedly charging illegal fees and force placing homeowners insurance. Attorneys for the plaintiffs say the case is a nationwide class action.

2007 Mortgage Litigation Report
Mortgage lawsuits last year were dominated by investors accusing companies of financial fraud, according to a new mortgage litigation report. Other types of lawsuits frequently filed against lenders involved mortgage fraud, secondary marketing and employment.

Bank Regulator Praises Brokers
Most mortgage brokers have acted responsibly in originating loans, a banking regulator said today. And while many parties -- including borrowers, Realtors, investment bankers and originators -- are responsible for the current chaos, inaccurate reports of failing companies have only made things worse.

Jumbo Activity Stabilizes
Third quarter securitizations of jumbo mortgages held up, according to a new ratings agency report. And while a major jumbo lender is optimistic about upcoming activity, activity at one luxury home builder suggests further softening is ahead.

Firms Manage Earnings, Liquidity
Several financial firms continue to grapple with mortgage-related losses and liquidity.

Purchase Apps Up
Mortgage rates were mostly unchanged during the latest week, though purchase activity picked up.

Cashout Transaction Volume Tumbles
The dollar volume of cashouts during the latest quarter fell by more than half from a year earlier.

Foreclosure Prevention Data, Resources
Two reports have been released on foreclosure prevention detailing recent activity and projecting the impact of proposed legislation. Meanwhile, resources for delinquent borrowers continue to expand.

Read the full text of these articles and many more at: http://www.MortgageDaily.com

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      http://www.mortgagenewsdaily.com/2112008_Short_Sale_Tax.asp

       MORTGAGENewsDaily
 

 

Two Changes in Tax Code May Benefit Some Homeowners

 

Mon, 11 Feb 2008 13:12:12 EST

There are two small changes in the tax code this year that may benefit some homeowners.

The first change deals with the deduction of premiums for private mortgage insurance while the second helps homeowners whose homes were foreclosed in the last year or who gave a deed in lieu of foreclosure or had a short sale approved by their lender...



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