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Further investigations into mortgage fraud
Further investigations into mortgage fraud
JP Morgan and Chase have announced it will resume the processing of foreclosures in a few weeks. This comes after the probing of lender's practices, in how they were foreclosing on property. Bank of America and Ally Financial (GMAC) have already resumed the foreclosure process and have already stated they have found no fault in how they have been processing homes that have gone into foreclosure.
There is however concerns on how mortgages were sold to investor's and two possible problems may have been linked by a common thread: concern that the fraudulent foreclosure practices were a cover-up for a deeper problem in identifying and documenting the ownership of many mortgages.
Question is: Where mortgage backed securities properly assigned to mortgage trustees?
If a trustee wasn't assigned to the mortgage note, the investors who purchased the bonds maybe able to claim that the mortgage was not eligible to be solid, possibly forcing banks to buy them back. If perhaps enough mortgages are tainted, purchasers may have the right to put back the entirety of the bond to the bank that securitized it. So this is what started the foreclosure fiasco and has lead into the put back panic.
As we move forward and the problems continue for the large banks, it will only be a matter of time before a revamping of the entire housing assistance program is revised. With the Republicans taking control of the House it may or may not lead into a stall of the housing market. We can only wait and see how things progress from this point forward.