The latest in My Securitization Audits

I have spotted a trend, I announced to one of my friends this morning!

My 'Findings' in the last half dozen files I audited is so glaring, nobody could miss it (if they had their eyes open). How this pattern got past the folks that check this sort of stuff for securitizers beats me, EXCEPT to say they must have felt nobody would check their homework ... ever!  Wrong, I AM.

Although it takes some digging and an understand of what you're looking at; here it is in a nutshell:
Mortgage securitizations have a "Closing Date" and normally the Trust's 'Pooling and'Servicing Agreement' or elsewhere in the (500+ page) Prospectus, it spells out individual loans must be included in the Trust by Closing.

Therefore when I review a file that shows the Mortgage has been securitized, the number one thing I look to determine, is to find evidence both the Note and the Deed of Trust (Mortgage) have been properly assigned to the Trust before its "Closing Date."

Time and time again, I discover Lenders (like the Big Four Banks), Trustees, and others trying to assign the Mortgage Loan's Note & Deed of Trust (Mortgage) months, and frequently years after this final date! Then the Trustee of the Securitization proceeds with a faulty Foreclosure and Sale of the borrowers property! Yet, they have no standing to lawfully proceed!

With my Audit in hand, Borrower Lawyers are getting the guilty/sloppy parties to come to the table and workout a solution to the defective foreclosure process along, with the payment arrangement to settle the default status of the loans.

This has happened in my opinion, because these players hoped nobody would ever check!