More On Massachusetts Supreme Court Decision


First Denial On MA SC Decision: US Bancorp


From the WSJ:

A spokesman for U.S. Bancorp said, “This judgment has no financial impact on U.S. Bancorp. Our role in this case is solely as trustee concerning a mortgage owned by a securitization trust. The issues addressed by the court revolved around the process of the servicing of the loan on behalf of the securitization trust, which was performed in this case by the servicer, American Home Mortgage Servicing. As trustee, U.S. Bancorp has no responsibility for the terms of the underlying mortgage or the procedure by which they were transferred to the trust and has no ownership interest in the underlying mortgages.”

True in the first part (the terms of the underlying mortgage) but as regards the second……


What does The PSA controlling this deal say about the procedure by which they were (or weren’t) transferred into the trust?

Now I have to go digging for that actual PSA and read it….. For those who are interested in similar ones, here’s what a Goldman securitization said The Trustee had done for the notes allegedly transferred into it:

In accordance with Section 2.02 of the above-captioned Trust Agreement (the Trust Agreement), the undersigned, as Trustee, hereby certifies that as to each Mortgage Loan listed in the Mortgage Loan Schedule (other than any Mortgage Loan paid in full or listed on the attached Document Exception Report) it has received:

(A) The original Mortgage Note, endorsed in the form provided in Section 2.01 of the Trust Agreement, with all intervening endorsements showing a complete chain of endorsement from the originator to the last endorsee.

(B) The original recorded Mortgage or a certified copy thereof.

No responsibility eh?  That would depend on whether language like the above is in that particular PSA – specifically whether there’s a certification in that PSA that the required transfers in form and substance were complied with, right?



PS: I’ll post a Ticker on this if I can find the PSA rooting around in EDGAR; the name of the particular trust isn’t unique enough for a quick look-see to locate it.  Unfortunately there’s no particular CUSIP or other identifying number in the opinion that makes this search easy……

Update: I cannot find the specific PSA.  However, one that is likely the form and substance of this deal’s PSA was found and I analyzed it in the comments for this Ticker.  If that’s the form and substance, US Bancorp is likely correct, but only because that PSA doesn’t require them to certify anything and in addition it specifies remedies for a breach – even by them – and limits it to repurchase (that is, “putting back” the bad paper that was not properly transferred.)  Amusing really, as the above PSA is far more consistent with the others I’ve seen, and those do have affirmative duties with regards to certifying that the actual terms were complied with.  This leaves open the question as to exactly why anyone would pay for what US Bancorp does in this case, but heh, it’s good work (or lack thereof) if you can find someone will will agree to this!

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MA SC Fraudclosure Ruling – More Analysis

Folks, you need to go read this…. Specifically, the Amicus Brief. 

It lays up on the table the exact argument I’ve been making and in fact documents proof that these notes were never transferred into the trusts.


 by genesis

The outside forensic fraud examiner looked at the remittance reports and determined that the loan was not claimed as an asset of the alleged trust that said they owned it.

Now, care to square this with the claims of the ASF that produced a press release minutes after the decision?  Best-a-luck on manufacturing an interest that the very trust that claimed authority to foreclose didn’t document that it had via its own monthly remittance reports!

With the Wells deal it’s worse because that deal with a public one and thus the PSAs and their representations are visible to all.  And as the outside expert submitted in the amicus brief:

 by genesis


The only entity permitted to transfer a loan into the trust is the Depositor, and that transfer has to happen on or before the closing date for the Trust.

Now about those claims that these were “mere paperwork errors” and are of “no material importance” and can be “easily corrected”……. maybe you can explain how you can “correct” a transfer that never happened and for which the trust is now closed.

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