Investors Putting Bad Loans Back To Lenders - This Is Only The Beginning.

"The auditing of defaulted loans looking for fraud or lender negligence is escalating at a feverish pace. This is being spearheaded in many cases by the mortgage insurer but even Fannie and Freddie are in the game. If any sign of fraud is found on a defaulted loan, in most cases the originating or selling lender/investor is liable. If the originating lender is no longer in business, as is the case with most middle market mortgage bankers and brokers, then the original ‘investor’ or loan purchaser carries the burden. In most cases, these are your big named banks and Wall Street banks."