Case Compilation of Standing Issues Where Trusts Were Not Able to Foreclose or Proceed in Bankruptcy
Case Compilation of Standing Issues Where Trusts Were Not Able to Foreclose Expeditiously
For anyone on this list who is working on standing issues, and for anyone who wants to know how mortgage trusts are harmed by the missing loan documents (despite the rants of the American Securitization Forum), here is the latest case compilation by Lynn Szymoniak and Lisa Epstein – real warriors.
The purpose of the representations in the Pooling and Servicing Agreements regarding conveyances of mortgages was to promise potential investors that the ownership of the loans and mortgages would be unassailable. In the event of any attack on the ownership by the trust, the trust could produce both the note, endorsed in blank or endorsed to the trust, and the mortgage, assigned to the trust, or, in the case of MERS mortgages, listing the trust as the owner of the mortgage on the closing date of the trust.
In the event of defaults by mortgagors, the trustee/servicer was supposed to have been able to foreclosure without any documents proving ownership of the mortgage by the trust other than the documents already in the mortgage files maintained by the document custodian of each trust.
The trust was not only supposed to be able to ultimately prevail in a foreclosure, the trust was supposed to be able to expeditiously prevail, without the expense of extended litigation regarding standing, real party in interest and the right to foreclose.
In the cases listed herein, the trust was not able to foreclose expeditiously because of loan documentation issues: