Foreclosure Defense Florida

SMOKING GUN (sort of) Banker's Association Admits- Notes Are Not Negotiable….

 
Bankers-documents
Hat tip to a reader who forwarded this document to me that was submitted by the Illinois Banker’s Association.   Read the whole thing carefully…what they’re saying is that if the Fannie/Freddie notes are not negotiable, they’re in a world of hurt:
A case in point would be arguments asserting that many if not most mortgage notes which conform to the fixed requirements of Fannie Mae and Freddie Mac are not negotiable instruments because they contain undertakings and conditions that disqualify them from the definition of ” negotiable” in Article 3 of the Uniform Commercial Code.
and then I love this…it’s the “Uh, Oh, we totally screwed this up and if we’re forced to follow the law, we’re in big, big trouble”…
Advocates of this result apparently are not concerned with its implications beyond the context of a given lawsuit or class of lawsuits, but the rest of us should be, for obvious reasons. Fannie Mae and Freddie Mac together hold over $5.3 trillion in home mortgages, nearly half the entire residential mortgage market in the United States. Viewed on a prospective basis, Fannie and Freddie presently are issuing more than 95% of all mortgage-backed securities in the country.
And so, if you don’t relieve us of our Class A, major screw up, we’re in a world of manure……
Chew on the letter and think about the impact…..
iba
 

3 Comments

  • Mike Dillon says:
    July 8, 2012 at 11:38 am

    It’s not that advocates are making these arguments simply to implode the housing market and economy. If these arguments are correct, as we believe they are, they are made so that the LAW will be followed. If the consequence of that is that the markets contract severely that should be laid at the feet of those who allowed the law to be ignored in favor of greed.
    “Deadbeat borrowers” are NOT the ones at fault here. 10 Million people simply did not collectively decide to game the system. Financial products were offered to them under guidelines and promises that they could make the mortgages work given their financial situations at the time of closing – which may have been true. But that’s where lender UNDERWRITING comes into play. No, borrowers did not have guns held to their heads to take out mortgages. Likewise, lending underwriters didn’t have the same guns at THEIR temples. What underwriting had pointed at them was loaded dollar signs.
    Bottom line is that, before you can even begin to contemplate the “deadbeat borrower” argument, you have to figure out who owns and, therefore, can collect on the debt. If you can prove THAT then it doesn’t really matter if a borrower is in default. It’s simply not good enough to say, “Well, you borrowed the money. You owe it to SOMEbody so you may as well pay this guy.” If that really is how “ownership” is going to work now, I’ve got a list of properties that I need to start foreclosing on – not that I own the notes on any of them but it would be nice to have a beach house… And a ski chalet… Oh and a place for fishing… Maybe a new office space…. Hmm… I wonder if this will work on car loans too because I’d really love a new Maserati… And maybe that ’65 GTO my father used to own… And… And…

    Reply
  • SandyLynn Timms says:
    July 8, 2012 at 11:56 pm

    Oklahoma Supreme Court recently handed down a decision with this statement: The plaintiff’s business practices must conform to the law; the law does not conform to the plaintiff’s business practices.
    It is absurd to allow Fannie/Freddie/MERS business practices to dictate the rule of law.
    We constantly hear the argument that the courts don’t want to comply with centuries-old property law because 95% of mortgages would be unenforceable, but imagine the jobs created, goods bought, and debt paid off if millions of Americans suddenly had no mortgage payment.
    Politicians should understand well the effect this would have on our economy; after all, they thought a one-time $250 payment would help stimulate the economy a few years ago.

    Reply
  • Roger Rinaldi says:
    July 10, 2012 at 1:42 pm

    Matt: thanks for all that you’re doing.

    Reply

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