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BANKING & MORTGAGE LENDING LITIGATION | SETTLEMENTS:
assignee liability
- Wall Street is not sitting around waiting to lose-their-shirt in this recent SubPrime Default & Foreclosure meltdown. If Wall Street implements a policy of demand and litigation against the Lenders for buy-backs of bad loans, the lenders/brokers and consumers may end up holding the loss. This may result in substantial BuyBack and Assignee Trust loan litigation or liability. This move has the potential to allow Wall Street to buy the bad and good loan portfolios for pennies on the dollar in bankruptcy court. The kicker is, they may try to do so without the liability exposure, leaving the risk and liability to the Lenders/Brokers and Consumers. Talk about follow the money. That area itself will be subject to huge litigation challenges for “public policy violations” to say the least.
Who in the funding and lending process knew that the price/risk formula was corrupt? Did investors know or understand the affect that mal-priced non-mitigated piggybacks (ARMs, etc.) would have on long term affordability? Did investors know or understand, or intend to accept or assign (bad) loans?
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