Repurchase Solutions / Mortgage Fraud

Due to the national foreclosure crisis, many entities are facing an unprecedented wave of loan “put back” demands and loan repurchase litigation, including loan originators, lenders, loan servicers, GSEs, Federal Regulators, trustees of loan securitizations, and institutional investors.  One fallout from these loan defaults is that buyers of loans are more likely to scrutinize all aspects of the loan sale process to try and find grounds to compel the loan seller to buy back the allegedly defective loan -- often for more than what the underlying collateral is currently worth.  Some national lenders face tens, if not hundreds, of billions of dollars of repurchase demands.  In this challenging environment, lenders and third parties are issuing repurchase demands on originators of residential loans at an unprecedented rate.  Correspondent lenders are being forced to repurchase loans, pay on make-whole demands, or indemnify investors, even though the loans may be: (a) several years old, and only recently became non-performing (hence, seasoned); (b) fit the then existing underwriting guidelines at the time the loans were underwritten and approved; and (c) underwritten and approved by the investor's own underwriter.

 

Correspondent Lending Agreements between mortgage originators and lenders typically contain various representations, warranties, and indemnification requirements requiring the originator to buy back faulty loans in certain circumstances.  We know the industry and understand the key issues at play in loan repurchase disputes: legal standing, promptness of notice, interplay of mortgage loan purchase/sale and securitization documentation, the application and interpretation of representations and warranties, the determination of material and adverse effect on the loan's value, and other related issues.  Our attorneys have a wealth of knowledge in this highly specialized niche industry.  Unlike other law firms, PIB Law focuses on recovery solutions, with litigation only as a last resort.

 

Practice Areas
  • Mortgage Banking
  • Bankruptcy
  • Reinsurance / Insurance
  • Repurchase Solutions / Mortgage Fraud
  • Consumer Finance
  • Fair Lending
  • Commercial Litigation
  • Corporate Matters
  • Regulatory & Supervisory Matters
  • General Counsel
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