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What is securitization?


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Answered 2010-02-06 08:51:28

Securitization is the process of transforming collateral or obligations into traded securities. An easy way to understand this is through example. The mortgage backed securities market is one of the largest and most liquid in the United States. Through the process of securiization, mortgages are transformed into bond-like securities. Assume a bank has made 100 mortgage loans ranging from $150,000 to $350,000 each to new homeowners this month. The homeowners have agreed to pay interest rates from 6.00% to 6.50% for 30 years on their various mortgages. Instead of holding 100 different mortgage loans of different sizes and coupons, and having risk to the credit of these homeowner on their balance sheet, the bank can use expected cash flows on the mortgages to securitize the mortgages into a mortgage-backed-security (a bond backed by the cash flows of the mortgages). In this case, assume the average loan size was $200,000, and the average interest rate was 6.25%. The 100 loans could be packaged together to create a $20,000,000 security paying 6.25%. Such a security would have a prospectus, which outlined the terms of the bond, and also would get a credit rating. The process of securitization transforms those smaller loans into a larger, more uniform, liquid security. This security could then be sold to an investor, such as a hedge fund, insurance company, mutual fund, or even another bank.

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What is secrutization?

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Has anyone performed a mortgage securitization audit?

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For the Past 30 years, John Schepcoff has been mentoring and teaching other Real Estate Agents including Loan Officers and homeowners "how to understand the process of Short Sales, Foreclosure and past Foreclosure". When a person understands the process, the homeowner, Real Estate Agent or loan officer can now help the homeowner understand there is one more option. Instead of losing the home in a short sale or foreclosure, the owner can receive a securitization Audit. What will this prove? It will now prove that the bank does not own the loan but in fact the loan is now a stock. If the loan is a stock the bank can not force s short sale or foreclosure. John Schepcoff goes more into detail how this is done. If the homeowner still wants to sale the home, the agent will still be paid the commission and now the homeowner also will make money on their home. How about that! This becomes a more win/win for the agent as well as the homeowner. Most homes today have gone through securitization. You can learn more from John Schepcoff website. SavingYourHomeToday dot com. John Schepcoff also mentors and teaches how to do Lease Purchase or Rent to Own. If a person can control the property, they can make money.


Anyone know this guy John Schepcoff?

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I purchased my investment property in 2005 for $2.1 million dollars. Recently, (over the past 18 months) I've had a tremendously high vacancy rate due to the poor economy and it began taking a toll on all my reserves just to maintain the property. I tried to negotiate with my lender (Bank of America) for a modification. I went round and round with the bank, submitting documents and so on and in the end, Bank of America denied me for a modification. I couldn't understand why they wouldn't modify my loan when it was clear that the economy hamstringed my ability to service the debt. The only thing that Bank of America could tell me was that the investor was the one who declined the modification. I asked who the investor was and they would not tell me. It was then that I began to look closer at my original loan and I saw on the Deed of Trust that MERS was listed as the Beneficiary. With all the information about MERS in the news I decided to talk to an attorney. My attorney had an auditing company called Lighthouse Consulting Group review my documents for both a forensic analysis of my original loan documents as well as a Mortgage Securitization Audit. It turned out that my loan was securitized in a trust called "Structured Asset Mortgage Investments II Trust 2005- 8". It was in this trust; there is a pooling and serving agreement, which governs the rules of the REMIC Trust. In my loans pooling and servicing agreement, it said specifically that any loan modified would require a buy-back from the servicer. Now, it was about this time that I began to default on my loan and was looking at ultimately losing my investment property. I was already 6 months in default at this point. The individual I talked to that is an attorney and real estate broker immediately ordered a forensic audit for predatory lending. Commercial properties do not have TILA and RESPA violations. The attorney also ordered a securitization audit to verify if the lender that filed the NOD was actually in proper standing. Both audits reveled several issues about my loan. First, the forensic audit proved that my lender had wrongfully calculated my payment it was overstated by $350 per month. Secondly, the loan itself was an adjustable loan based off the Libor Index, which was dropping, but the loan always adjusted up. This was a major development in a very positive way for me. Then, I had the securitization audit show that my loan was never securitized properly and the note and deed were not even with the same party. My attorney drafted a complaint, outlining everything I have mentioned. As soon as the lender was served, they contacted my attorney and settled without going to court. The settlement I got was a principal balance reduction of $400,000; my interest rate was reduced to 4.5% fixed for 30 years. The auditing company that produced all of these discoveries was Lighthouse Consulting Group in Santa Ana, CA. My initial contact was Vic Pillai. I reached him at (714) 486- 0654.


What are the Process of securitization?

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You lost your home to foreclosure how do you get it back?

The best way to get your home back is to have the foreclosure documents analyzed. That's what i did. My house was foreclosed on and I heard that judges awarding foreclosures without the homeowners having much defense. I live in a Trustee state which is even worse for homeowners because there is no judge involved. It's simply a court recording. So, a friend told me to contact Lighthouse Consulting Group, i did, and they looked over my foreclosure documents and preformed a Trust Deed Verification audit and it turned out the the Foreclosure process was not done incorrectly. My sale was reversed. Then, I went one step further and had Lighthouse perform a securitization audit and that turned-out that the foreclosing party didn't have the legal right to even begin the foreclosure. This whole foreclosure situation is a mess and if your on the verge of losing or have lost your home call Lighthouse Consulting Group 800-678-0419


Can co-operative banks under the securitization act in andhra pradesh take action for recovery of amount against borrower.?

There are diffrent views of the Hon'ble Karnatak High Court and Hon'ble Munbai High Court about the application of the securitisation act to co op banks. Hon'ble Supreme Court clearly stated that if the act of the bank (secured creditor) is fradulent and the claim is untenable then the limited jurisdiction is open to civil court to entertain the suit. (That means in case of co op bank the limited limited jurisdiction is open to co op court). There are some cases pending before the Hon'ble High Courts and Hon'ble Supreme Court in which the notification dated on 28.01.2003 is challenged and Hon'ble Courts stayed the process of the co op banks initiated under the securitisation act. Thank you. My email address : rajkumarpol@rediffmail.com Cell : 9850755276


Who are the Major actors in international relations?

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What are the actors of International Relations?

Most classical IR theory (i.e., realism, liberalism and world systems theory) considers that the actors (main participants/decision makers) in the international sphere are the states. That means that decisions are considered as being aggregated at state level and that the international system is the creation of the states. Constructivists and structuralists (as well as a few neorealists and neoliberals) add other actors, such as non-national entities (multi-national corporations, large NGOs), subnational entities (such as structures of government competing for ideological dominance, federal regions, lobby and pressure groups and even individuals in power) and transnational entities (such as international organizations in themselves as opposed to being just expression arenas for states) as well as ideatic structures (such as securitization complexes, social constructs, social norms and laws, ideologies etc.). In these schools, defining what an actor is is left to the author, so it is best to read carefully so that you can understand what the actor considers.


How can you stop foreclosure once it has started?

Save up money and reinstate the mortgage.Work with the lender to put together a forbearance agreement.Work with the lender to modify the terms of the loan.Refinance the loan with a traditional or hard money lender.Get a partial claim from the FHA (FHA loans only).Sell to a private investor and lease the home back.File bankruptcy to stop foreclosure.Sell the property at a short sale for less than what is owed.Sell the property outright at full market value.Offer the bank a deed in lieu of foreclosure.Simply abandon the home before being evicted and leave it to foreclosure.If you have a loan tied to MERS you need to sew the lender for being a liar lender and not have the legal grounds to foreclose. Lighthouse consulting Group helped me get into a joinder lawsuit and the bank agreed to not foreclose during the process. During a securitization audit it uncovered that the money I borrowed came from a foreign country (Patriot Act Violation).Call my representive Vic Pillai @ 714 486-0654


How effective was the Glass-Steagall Act?

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