David Faber: Bank Of America NOT Out Of The Woods, Still Faces MASSIVE Mortgage Liability Risk - Video
Video - David Faber - Jan. 3, 2011
Yesterday's settlement...
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Monday’s settlement does little to deal with a liability that could far exceed the settlement with the GSE’s - the so called “private put-back” of mortgage securities by their holders to Bank of America.
Some may take the settlement as a sign that BofA is more open to reaching a settlement with holders of private securitizations. That’s the hopeful position being taken by Talcott Franklin, an attorney leading the charge against mortgage securitizers such as BofA on behalf of holders of such mortgage securities.
The issue is complex and it remains far from clear that much can be gleamed from Monday’s action. Franklin, in an interview on The Strategy Session earlier today, told me he expects to become much more aggressive on this issue as the year progresses.
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Related reading...
- UH OH!: Bank Of America Could Be Forced To Pay $20 Billion To Bond Insurers For Mortgage Loan Put-Backs
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Jan 9, 2011 at 5:41 PM
Reader Comments (5)
The two stories related to mortgages we have been following closely at CNBC do not have a great deal in common, other than tracing their lineage to the home loans of dubious provenance that were doled out to anyone with a pulse between 2005-2007 and quickly packaged up into securities and sold by Wall Street to accounts around the planet.
It is the frenzy of that time period that links the mortgage foreclosure story and the so called “put-back” story.
As detailed in our documentary "House of Cards" and in my book And Then the Roof Caved In, the participants in the chain of mortgage origination and securitization were not dwelling on the future when they seized on the unquenchable desire amongst investors to buy higher yielding securitized mortgage products.
The originator who was extending a home loan to someone they knew was lying about their income was not thinking about what would happen to that loan, the house it was financing or the foreclosure process that would ensue if that loan was not paid back. All they were thinking about was getting that loan signed and making sure the homeowner made good on their first three payments, after which it could be packaged up into a mortgage backed security (MBS).
http://www.cnbc.com/id/39868956/?The_Carnage_of_Wall_Street_s_Mortgage_Frenzy
http://www.huffingtonpost.com/2011/01/04/paul-bint-fraud-fake-bank_n_804434.html
http://www.rawstory.com/rs/2011/01/obama-spokesman-gibbs-may-leave-weeks/
http://www.marketwatch.com/story/private-payrolls-leap-297000-in-december-adp-2011-01-05
adp numbers up big this morning...
dumbest assassin in history...