How a Bloomberg Report and REMIC Analysis Strengthen Your Foreclosure Case

Most people assume that when they are having to deal with foreclosure, the lender has their documents in proper order. In reality, many of today’s mortgage loans are backed by a complicated securitization process that can lead to massive errors in identifying parties to the original mortgage loan documents. In my experience, the Bloomberg Report and REMIC analysis are two very important investigative tools for identifying errors in mortgage documents to help support your foreclosure defense.

The Bloomberg report is a very detailed analysis of the financial cycle of a mortgage loan within the secondary mortgage market. The report is based on the data provided by Bloomberg L.P. and is a way to follow the ownership and transfer of your mortgage loan in the secondary market back through securitization to determine who the true owner is, where the loan was transferred, and if it was put into a mortgage-backed security.

Homeowners can use a Bloomberg report to determine:

• Who is the true owner of the loan (the investor)

• The history/timeline of the loan’s transfers and securitization

• If the loan is part of a mortgage-backed security, and

• If the claimed owner matches the actual records.

The use of the Bloomberg report will afford a greater knowledge of your mortgage by revealing many factors that are often not available in foreclosure actions to expose inaccuracies in the chain of title.

REMIC: What’s the Real Deal?

A REMIC is a type of investment vehicle known as a Real Estate Mortgage Investment Conduit (REMIC). The purpose of a REMIC is to create one large “Trust” (a legal entity) that allows investors to pool their mortgage investments into a security investment to sell to other investors. A REMIC is subject to strict IRS regulations regarding the use of trust assets, including the time frames by which mortgages must be transferred into the REMIC from investors.

The purpose of conducting a REMIC Analysis is to review whether your mortgage loan was transferred into the REMIC properly in accordance with IRS regulations. If your loan was transferred into the REMIC after the cut-off date or in violation of the terms of the REMIC, your mortgage loan may be deemed invalid.

This is problematic for people who are attempting to foreclose because they will not be able to prove their ownership interest in the property based on their claims as the holder of the REMIC.

Possible Issues

Combining a Bloomberg report with a REMIC Analysis often reveals specific issues or “red flags.” Examples of these issues include:

• Mortgages were transferred into REMICs after the cut-off date.

• Assignment of mortgage documents was not signed properly or was incomplete.

• Conflicts between the servicing rights of a mortgage and the ownership of the mortgage

• Violations of the mortgage compliance provisions and REMIC documents

• Robo-signing or fabrication of documents

One or more of these findings may provide evidence of mortgage fraud and/or procedural violations and be helpful in defending against foreclosure actions.

The Usefulness of These Tools Will Aid Your Case

If a Bloomberg Report or REMIC analysis indicates inconsistencies, they will go a long way to challenging or supporting the standing of foreclosure.

Homeowners and their legal teams can use this information to:

• Dispute the right of the party foreclosing to enforce the loan.

• Delay or stop a foreclosure proceeding.

• Be used as evidence in a lawsuit to support claims such as quiet title or slander of title.

• Negotiate for a better loan modification or settlement.

In many cases, a detailed forensic report generated as a result of these analyses is an important piece of evidence in court.

The Role of a Forensic Loan Auditor

The complexity of the fraudulent nature of financial data and legal interpretation requires that homeowners obtain the assistance of a forensic loan auditor or foreclosure expert. They can do a full mortgage securitization audit, interpret Bloomberg data, and find violations of terms of use that homeowners may not be able to identify.

In Closing

Foreclosure isn't always as simply black and white as it appears. By using tools such as a Bloomberg Report and a REMIC analysis, homeowners can identify potential defects in the lender's claim and create a basis to defend themselves in court against a foreclosure.

Those who seek help with a foreclosure will benefit from knowing where their home loan was throughout its life and whether the loan was processed and treated appropriately.