"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."


mtgsherpa at 12:00 2008-05-28 said:
This is not good. Can the brokers be far behind in being asked to repurchase loans? What about Correspondents? It's rolling down hill fast and will take it's toll. Permalink

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