Patt Morrison on Southern California Public Radio
Listen to the recorded version of the Patt Morrison’s show on scpr.org
Guests:
Katherine Porter, visiting professor of bankruptcy, consumer finance & secured credit at the Harvard Law School
Daniel Edstrom, head of the securitization auditing firm DTC-Systems
Securitization issues related to foreclosures and paperwork is discussed.
Katherine Porter states that Wrongful foreclosure is when the house is foreclosed on and there is no default. This is an interesting definition because in nearly all cases in securitization, the loans are current. The obligation is not in default because the Securitization Trustee and the investors have received all payments. So nearly all Securitization foreclosures are wrongful foreclosures? That is the elephant in the room that nobody wants to look at.
Why are the loans current in securitization? Because the servicers and securitization trustees are required and obligated to make the payments whether or not they receive the payment from the homeowner.