The article below points out that virtually all the mortgage loans made and sold off to Investors in the secondary market, were for the most part Fraudulent at best.
Unfortunately, most-if not all of the lenders who made these loans, are still in business (with tax payer help), and will, in the end get maybe a fine and a slap on the wrist.
Mathews Realty Group
Retirement Advisor
Self Direct IRA/401K Specialists
Investors Say Transparency is Necessary for a Recovery
The Association of Mortgage Investors (AMI) said on Wednesday they consider the Obama administration’s GSE reform white paper a good start, but the organization says the plan is missing a key ingredient: transparency.
In its statement, AMI says ample research confirms that the loans originated during 2005-2007 were often materially defective with respect to the reps and warranties:
• A complaint involving one of JPMorgan Chase & Co subsidiaries finds over 80% of the loans in certain deals breached representations.
• Fitch reviewed 45 early defaulting loans and found that the “result of the analysis was disconcerting at best, as there was the appearance of fraud or misrepresentation in almost every file”.
• Recovco, a mortgage consulting firm, has reviewed several thousand loan files and has found that over 50% of those files reviewed in the 2006-2007 vintage have material breaches of representations and warranties.
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