Credit Bids

SEE SCHEDULED AUCTIONS OF PROPERTY TO RISE FURTHER DEPRESSING HOUSING MARKET

 I keep thinking when someone is going to pick up on the fact that these "auctions" besides unlawful in their assumption are also unlawful in their performance. At the market, either someone will pay money or the "creditor" sends in a "Credit bid" instead of money. But the events posting the "credit bids" are not lenders and therefore have no right to publish a credit ratings bid. Thus the issuance a title following the "sale" of the property is gap.

SEE SCHEDULED AUCTIONS OF PROPERTY TO RISE FURTHER DEPRESSING HOUSING MARKET

By ALEX VEIGA

LOS ANGELES — Less U.S. houses joined the property foreclosed procedure or were taken returning by financial institutions in Nov, showing a periodic pullback in property foreclosed action by loan companies and house loan servicers.

But for some property owners already behind on their house, the end-of-year recession isn't likely to provide much of a liberation.

The number of houses in property foreclosed and scheduled to be sold hit a nine-month high last 30 days, property foreclosed list company RealtyTrac Inc. said Friday.

The increase came about because of a raise three months previously in houses coming into the property foreclosed procedure for the first time. And unless those debtors find a way to get current on their house, many of those houses will likely be sold at market or end up being taken returning by the loaning company.

"Despite a periodic recession similar to what we've seen each of the past four years, November's numbers recommend a new set of inbound property foreclosed surf," said RealtyTrac CEO Wayne Saccacio.

All told, property foreclosed auctions were scheduled on 96,540 U.S. houses last 30 days, RealtyTrac said. That's up 13 % from Oct, but still down 17 % from Nov last season.

Some declares published far higher monthly improves in scheduled house auctions last 30 days. In Florida, they were up 63 %, while in California they rose 56 %.

Those houses could end up returning in the marketplace as house foreclosures or brief revenue, when ahomeowner provides the house for less than what they owe on their house loan. And that means more stress on ideals, because house foreclosures and brief revenue generally sell for a lot less than other houses.

U.S. property foreclosed action stunted dramatically starting in Oct of last season, after problems appeared with the way many loan companies were managing house foreclosures. Specifically, deciding upon off on house home foreclosures without first confirming records — a practice termed as "robo-signing."

Many of the country's biggest financial institutions responded by momentarily stopping all house foreclosures, re-filing previously registered property foreclosed situations and returning to awaiting situations to avoid mistakes.

The speed of property foreclosed action ongoing to slowly much of this season as major loan companies proved helpful toward a possible agreement of govt probes into the sector's mortgage-lending methods.

SEE SCHEDULED AUCTIONS OF PROPERTY TO RISE FURTHER DEPRESSING HOUSING MARKET

I keep thinking when someone is going to pick up on the fact that these "auctions" besides unlawful in their assumption are also unlawful in their performance. At the market, either someone will pay money or the "creditor" sends in a "Credit bid" instead of money. But the events posting the "credit bids" are not lenders and therefore have no right to publish a credit ratings bid. Thus the issuance a title following the "sale" of the property is gap.

SEE SCHEDULED AUCTIONS OF PROPERTY TO RISE FURTHER DEPRESSING HOUSING MARKET (http://www.msnbc.msn.com/id/45684993/ns/business-real_estate/#.TuuC6UrOBhM)

By ALEX VEIGA

http://msnbcmedia3.msn.com/i/msnbc/Components/Sources/sourceAP.gif

LOS ANGELES (http://www.bing.com/maps/?v=2&where1=LOS%20ANGELES&sty=h&form=msdate)  — Less U.S. houses joined the property foreclosed procedure or were taken returning by financial institutions in Nov, showing a periodic pullback in property foreclosed action by loan companies and house loan servicers.

But for some property owners already behind on their house, the end-of-year recession isn't likely to provide much of a liberation.

The number of houses (http://www.msnbc.msn.com/id/45684993/ns/business-real_estate/#)  in property foreclosed and scheduled to be sold hit a nine-month high last 30 days, property foreclosed list company RealtyTrac Inc. said Friday.

The increase came about because of a raise three months previously in houses coming into the property foreclosed procedure for the first time. And unless those debtors find a way to get current on their house, many of those houses will likely be sold at market or end up being taken returning by the loaning company.

"Despite a periodic recession similar to what we've seen each of the past four years, November's numbers recommend a new set of inbound property foreclosed surf," said RealtyTrac CEO Wayne Saccacio.

All told, property foreclosed auctions were scheduled on 96,540 U.S. houses last 30 days, RealtyTrac said. That's up 13 % from Oct, but still down 17 % from Nov last season.

Some declares published far higher monthly improves in scheduled house (http://www.msnbc.msn.com/id/45684993/ns/business-real_estate/#)  auctions last 30 days. In Florida, they were up 63 %, while in California they rose 56 %.

Those houses could end up returning in the marketplace as house foreclosures or brief revenue, when a homeowner (http://www.msnbc.msn.com/id/45684993/ns/business-real_estate/#)  provides the house for less than what they owe on their house loan. And that means more stress on ideals, because house foreclosures and brief revenue generally sell for a lot less than other houses.

U.S. property foreclosed action stunted dramatically starting in Oct of last season, after problems appeared with the way many loan companies were managing (http://www.msnbc.msn.com/id/45684993/ns/business-real_estate/#)  house foreclosures. Specifically, deciding upon off on house home foreclosures without first confirming records — a practice termed as "robo-signing."

Many of the country's biggest financial institutions responded by momentarily stopping all house foreclosures, re-filing previously registered property foreclosed situations and returning to awaiting situations to avoid mistakes.

The speed of property foreclosed action ongoing to slowly much of this season as major loan companies proved helpful toward a possible agreement of govt probes into the sector's mortgage-lending methods.

Why litigation can never resolve MBS put-back crisis

On Wednesday, the bond insurer Syncora filed its latest brief in its three-year-old litigation with Countrywide over $6 billion in Syncora-insured securities backed by Countrywide mortgages. Like its fellow bond insurer MBIA, Syncora was quick to assert claims that Countrywide breached the representations and warranties it made about underlying mortgage loans. Syncora’s lawyers at Debevoise & Plimpton sued Countrywide way back in 2009. Since then, according to a Sept. 16 Countrywide brief, Bank of America has spent millions of dollars locating, processing, and producing documents to Syncora. In the first round of discovery, the bank produced 18 million pages on the 114,000 loans underlying the five offerings at issue in the case. After New York state supreme court judge Eileen Bransten ruled that Syncora can rely on a statistical sample of underlying loans and Syncora identified a representative sample of 2000 mortgages, Countrywide ran a second, court-ordered sweep of its files and produced thousands of hard-copy archives on each of those 2000 loans.

Nevertheless, Countrywide and Syncora have only just begun their fight over missing documents in the loan files. Rememer, this particular fight isn’t about what the scores of pages in each loan file say about the underwriting on each individual underlying mortgage. This is a fight simply over missing pages. Countrywide and Syncora engaged in full-on briefing and oral argument over which side bears responsibility for identifying the missing documents. Then, after the judge said complete document production was Countrywide’s problem and Countrywide found a batch of documents that supposedly filled loan file gaps, Syncora protested that the discovery came too late.

Countrywide believes that Syncora intends to argue that any missing document amounts to a breach of Countrywide’s reps and warranties. Syncora’s response, filed Wednesday, is unfortunately sealed, although Syncora’s final summary judgment brief isn’t. Syncora has asked Judge Bransten for a declaratory judgment that it doesn’t have to show reps and warranties breaches were responsible for defaults on underlying mortgage loans in order to demand Countrywide buy back the deficient loans. That low standard would make the pending issue of whether a mere missing document amounts to a breach all the more important.

To understand why it’s so hard to assemble the underlying loan files, I talked Thursday to the head of mortgage operations at a company that evaluates mortgage loans for both banks and MBS plaintiffs in connection with reps and warranties claims. Typically, he said, his company receives pdf or tif images, either directly from a bank or mortgage originator or from a plaintiff’s discovery. Through at least five successive rounds of review, his teams log what’s in the files-which average 200-220 pages-and identify what’s missing. “It’s a mess out there,” he said, explaining that at the height of the housing boom, mortgage originators were simultaneously writing loans as fast as they could and switching from paper to electronic recordkeeping. Sometimes the loan files are incomplete because lenders didn’t conduct adequate underwriting, he said. More often they’re incomplete because of paperwork snafus.

Documents are missing from about one-third of the loan files his teams have reviewed. Typically, his company contacts mortgage lenders to ask them to search for the specific missing information, and usually, he said, the banks find it once they know what they’re looking for. Only when his company has done all it can to put together the missing pieces does he check for errors in the files. And then, he said, his group has found an average error rate of 60 percent.

I asked whether it was fair for plaintiffs to foot the bill when his company calls mortgage lenders to ask about missing documents. He agreed that it’s not, that banks should be searching for files on their own. “We shouldn’t be doing their job for them,” he said. “Plaintiffs shouldn’t be paying for it.”

Let’s step back for a second, though, to think about the implications of the sort of effort his company pours into assembling and reviewing individual loan files. Syncora’s Countrywide case is relatively small by MBS standards, and the judge overseeing it has approved sampling. There are still 2,000 loan files (comprising at least a dozen documents and scores of pages) at issue. Extend that sampling rate across pending reps and warranties claims, and assume that both sides in each case are doing the sort of re-review my mortgage friend describes. They have to: Depending on how Judge Bransten rules in the Syncora and equally ripe MBIA cases against Countrywide, banks could end up liable for every loan file that’s missing a document.

Now imagine that Bank of America’s proposed $8.5 billion reps and warranties settlement falls through. And imagine that, as I’ve predicted, securitization trustees and MBS investors step up their breach of contract demands. We’re looking at breathtaking legal fees and costs. If you’re a lawyer working on either side of the MBS litigation or a business specializing in re-underwriting mortgage loan files, maybe that’s a good thing.

But if you’re just someone wondering how the economy can recover with MBS liability looming overhead, it’s definitely not.