Mortgage Securitisation - Preferred

[JonCris]

This is going to sounds like the mutual appreciation society, but I feel the comments made by JC in relation to "unfair relationships" rather than Superslueth's legal title arguments are the way to proceed.

 

If s.136 of the law of property act does apply to securitisation, then without a notice of assignment, legal / aboslute assignment cannot be achieved.

 

However, if we look at the unfair relationship angle, there are valid points that can be made.

 

Lets look at the information that is publically avaliable (prospectus)

 

"If, following a Product Switch of any Mortgage Loan in the Mortgage

Portfolio, such Mortgage Loan has caused the Seller, as a result of such Product Switch, to be in breach of any of the applicable representations and warranties and/or conditions contained in the Mortgage Sale Agreement, the Seller will, in accordance with and pursuant to the terms of the Mortgage Sale Agreement, be required to repurchase such Mortgage Loan from the Mortgages Trust on the immediately following Trust Determination Date."

 

This basically means that if a lender offers a fixed, tracker or discount rate etc (product / rate switch) to a consumer and that offer is accepted. The lender must buy back the equitable interest of that individual mortgage.

 

Now the question is, would this requirement make a lender less willing to offer a product switch if the mortgage had been securitised ?

 

It is does, then the securitisation process would have had an adverse effect on the lender borrower relationship.

 

I think your last comment hit's the nail on the head in that it must adversely affect the borrower in that there is no benefit whatsoever for the lender to change the status quo.

 

Now we only have to convince a judge which won't be easy as the determination of what constitutes an 'unfair relationship' has not yet, to my knowledge, been determined in a major case

[uneverdid]

Sorry if i've lost the plot here but does anyone else have any comments on the power of attorney documents i have posted. Are these going to have a major effect on me and others with a Preferred mortgage and if so then in what respect.

 

Thanks in advance for your responses

[Suetonius]

Now we only have to convince a judge which won't be easy as the determination of what constitutes an 'unfair relationship' has not yet, to my knowledge, been determined in a major case

 

I have been looking everywhere, since you first mentioned it.. Just can't find a case that says an unfair relationship is this.... I will keep looking

[JonCris]

I think there are favourable County Court Judgments in this regard usually based on exorbitant interest rates but none that have gone above CC level & of course some lenders where this argument has been put forward have settled out of court not wanting to publizise their defeat Nor wanting to take it further & set any kind of precedent

[littledotty27]

http://www.bankofengland.co.uk/statistics/ms/articles/artnov04.pdf

 

Just found this don't know if it will help with re to debate.

[Smarterchick]

http://www.bankofengland.co.uk/statistics/ms/articles/artnov04.pdf

 

Just found this don't know if it will help with re to debate.

 

 

It ALL helps Littledotty provide a picture just like this I found in the Evening standard (London Paper)...Now I might appear a Little dotty myself (no offence LD ) but what would happen if WE went and purchased OUR notes like this:...Don't you just love all this synergy?

 

“Canary Wharf buys back its debt for a song

HUGO DUNCAN-Evening Standard

THE owner of Canary Wharf today revealed it has bought back nearly £120 million of its debt for as little as 21p in the pound.

Canary Wharf Finance 11, a unit set up by Songbird Estates to finance its investment in the Docklands development, repurchased £119.8 million of securitised debt from bondholders.

It paid just £35.5 million to buy back the notes with the price varying between 21.6p in the pound, 30.3p in the pound and 46.8p in the pound.

The substantial discount highlights the lack of faith investors have in corporate debt and the property market.

There is very little liquidity in the market for such debt and prices have plunged as investors shun hard-to-value securities amid the fallout from the subprime crisis.

Canary Wharf said the deal represented “an attractive investment opportunity” and reduced the company’s debt. It is expected to keep the notes rather than cancel them, effectively paying interest to itself.

The 30 year notes were issued in April 2007 close to the peak of Britain’s commercial property market.

It follows a similar move by buyout firm Terra Firma Capital Partners which recently moved to profit from the credit - market turmoil by buying up its own debt at depressed prices.

Hugh Osmond, head of zombie fund Pearl Group, is considering an offer to buy back bonds at just 12.5p in the pound—around half the price of the Canary Wharf deal.

Songbird, which owns 16 of the 30 buildings at Canary Wharf last month admitted it has “minimal headroom” on its £880 million loan from Citigroup after the value of its properties lost £1.8 billion last year.

It is now in talks over how to overcome the debt burden and has appointed Rothschild to advise on its options.

 

 

Now, where was that sales document I was looking for...

 

SC 12.5p in the pound for my house mmmm..sounds appealing..

[Suetonius]

http://www.bankofengland.co.uk/statistics/ms/articles/artnov04.pdf

 

Just found this don't know if it will help with re to debate.

 

Good find

 

 

This looks interesting,

 

Securitisations and loan transfers pass on the monetary and legal interest in all the loans within the portfolio to the purchaser.

 

Not sure if that just refers to legal title in equity or not though..

[Smarterchick]

Good find

 

 

This looks interesting,

 

huh, didn't like my find then?

[littledotty27]

And here is another

 

http://www.isda.org/demosite/c_and_a/ppt/ISDASecurOverviewNY012405.ppt#0

[Smarterchick]

And here is another

 

http://www.isda.org/demosite/c_and_a/ppt/ISDASecurOverviewNY012405.ppt#0

 

 

Oh you little angel, where did you find that one

[Suetonius]

And here is another

 

http://www.isda.org/demosite/c_and_a/ppt/ISDASecurOverviewNY012405.ppt#0

 

Boy you are a busy bee.. Another good find..

 

Slide 14 stands out;)

Originator transfers the residential mortgages to the SPV by equitable assignment, at an agreed upon value plus an amount of deferred consideration;

Edited April 9, 2009 by Suetonius

[Suetonius]

huh, didn't like my find then?

 

[littledotty27]

Improvements to securitisation transparency

 

Section 6 is quite interesting.

found it on google by typing residential mortgage backed securitisations.

Tbh ive not been searching much lately...brain can't take it or register what im reading!!!

[littledotty27]

eh might be a littledotty,but not just pretty faced you know!!!

[JonCris]

Now this IS getting interesting........well done folks ...........Incidentally as an aside re Canary Wharf did you know that it's alleged that much of the Brinks Mat robbery gold (approx 21m) was laundered through it's building contracts....... so you see now'ts changed

[JonCris]

Good find

 

 

This looks interesting,

 

Securitisations and loan transfers pass on the monetary and legal interest in all the loans within the portfolio to the purchaser.

 

Not sure if that just refers to legal title in equity or not though..

 

Irrespective of equity surely the passing of the legal interest means just that in that the true owner should be the one to litigate

[Suetonius]

Irrespective of equity surely the passing of the legal interest means just that in that the true owner should be the one to litigate

 

On the basis that a legal interest is "good against the world'', I would have to agree.

[JonCris]

Or is the passing of legal interest a one way street subject to the whims of the bond holder?

[JonCris]

Sorry seu posted my last message before reading yours....... so you agree in these circumstances equity may not be relevant??

[Suetonius]

Sorry seu posted my last message before reading yours....... so you agree in these circumstances equity may not be relevant??

 

I do, as it clearly says legal interest. However, I will keep looking

[littledotty27]

http://www.res.org.uk/economic/freearticles/2009/March09.PDF

 

This interesting aswell!!

[Suetonius]

I have found this.. Although not an ideal source, still a source nonetheless

 

Loan securitisation and risk transfer

 

It does seem to imply that a notice would need to be sent to the borrower

[Suetonius]

I have found this.. Although not an ideal source, still a source nonetheless

 

Loan securitisation and risk transfer

 

It does seem to imply that a notice would need to be sent to the borrower

 

 

Taking into consideration the size of Lovells and the fact that they advise all the parties involved in the securitisation process. I think the above should be read carefully and the content noted.

[littledotty27]

Just a thought whilst reading what you have found Suetonius.

 

When last in court we questioned the assignment from matlock to spml.

Spml's legal reps stated and I quote 'The borrowers where sent a letter and a copy of the assignment on 20th May 2006'

DJ asked if a copy was available,the answer was no but one can be obtained.

[Suetonius]

Just a thought whilst reading what you have found Suetonius.

 

When last in court we questioned the assignment from matlock to spml.

Spml's legal reps stated and I quote 'The borrowers where sent a letter and a copy of the assignment on 20th May 2006'

DJ asked if a copy was available,the answer was no but one can be obtained.

 

The notice is one of the important things that make an assignment legal / absolute.