Mortgage-bond investors represented by Dallas lawyer Talcott Franklin will send letters to securities trustees complaining that they shouldn’t bear the costs of loan servicers’ so-called robo-signing.
The investors, who Franklin has said own more than $500 billion of the securities, are “pretty disturbed” that mortgage-bond trusts are being forced to pay penalties after loan servicers including Detroit-based Ally Financial Inc. filed false affidavits in foreclosure cases, he said. Judges are forcing the trusts to cover homeowners’ attorney fees when servicer misdeeds are discovered, he said.
“Look who got sanctioned,” Franklin said today at a conference in New York organized by law firm Grais & Ellsworth LLP. “It wasn’t the servicer, it was the holder of the note.”
Franklin said the group of investors coordinating through his firm’s RMBS Investor Clearing House now own more than 25 percent of so-called voting rights for about 2,600 mortgage securitizations, and more than 50 percent for about 1,150 deals.
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