I posted the quoted text below back on Nov ’10… I wonder who exactly signs off for MERS, if this is so?
The standard modification agreement is between the Borrower and the Lender. The agreement amends and supplements (1) the Mortgage, Deed of Trust or Deed to Secure Debt (Security Instrument) and (2) the Note bearing the same date as, and secured by, the Security Instrument. Prior to MERS, the standard agreement worked because the Lender was the mortgagee of record and could modify the mortgage and also had the authority to modify the Note.
The Obama Administration Friday announced it is expanding its flagship mortgage modification program and will now encourage lenders to reduce the principal loan balance for Fannie Mae and Freddie Mac loans.
The announcement comes just three days after President Obama said he would do more to support the struggling housing market and two days after Federal Reserve Chairman Ben Bernanke said housing is holding back the economic recovery.
Assistant Secretary for Financial Stability Timothy Massad in a blog post Friday outlined the changes to HAMP — including extending the end-date by one year and refocusing on principal reductions.
Massad said Treasury notified the Federal Housing Finance Agency, the regulator for Fannie Mae and Freddie Mac, that they will pay principal reduction incentives to the GSEs if they allow servicers to forgive principal — if done in conjunction with a HAMP modification.
Massad also said Treasury will triple the incentives for HAMP principal reduction modifications by paying from 18 to 63 cents on the dollar, depending on how much the loan-to-value ratio is reduced.
THE COMMONWEALTH OF MASSACHUSETTS
OFFICE OF THE ATTORNEY GENERAL
ONE ASHBURTON PLACE
BOSTON, MASSACHUSETTS 02108
617) 727-2200
(617) 727-4765 TTY
www.mass.gov/ago
OVERVIEW OF ATTORNEY GENERAL MARTHA COAKLEY’S INITIATIVE TO COMBAT THE SUBPRIME LENDING CRISIS
During the Economic Crisis, AG Coakley’s Office has secured more than $563 million in relief for investors and borrowers, recovered nearly $52 million in taxpayer funds to the Commonwealth and ensures mortgage relief to more than 24,700 homeowners in Massachusetts
In August 2011, Attorney General Coakley settled her office’s 2008 enforcement action against Option One Mortgage Corp., a subsidiary of H&R Block, which alleged predatory lending and discriminatory lending. The settlement provides a loan modification program for certain ultra-risky loans, which will provide an estimated $115 million in value to Massachusetts borrowers in principal write-downs and reduced monthly payments. Coakley also obtained a $9.8 million payment for restitution and the Commonwealth’s litigation costs.
In June 2010, Attorney General Coakley’s Office reached a $102 million settlement with Morgan Stanley over its role in financing and securitizing subprime loans, which contributed to the housing crash in Massachusetts.
In March 2010, Attorney General Coakley’s office secured $3 billion in loan modifications for homeowners nationwide with Countrywide Financial Corporation. The agreement secured an estimated $18 million in loan modifications for Massachusetts homeowners, $3 billion in loan modifications for homeowners across the country, and a $4.1 million payment to the Commonwealth. Countrywide is now owned by Bank of America.
In February 2010, Attorney General Coakley’s office, together with the SEC, reached a $310 million settlement with State Street Bank to resolve allegations that the financial giant misled fund investors, including numerous Massachusetts charities and retirement funds, regarding the extent of the funds’ subprime exposure.
In June 2009, Attorney General Coakley’s office reached a $10 million settlement with Fremont Investment & Loan and Fremont General Corporation in which Fremont resolved claims that it wrote 15,000 Massachusetts mortgages that were considered “doomed to foreclosure.” The agreement also secured an injunction affording state officials the opportunity to review any of Fremont’s 2,200 remaining Massachusetts mortgages before the initiation of foreclosure proceedings.
In May 2009, Attorney General Coakley’s office reached a first-in-the-nation $60 million settlement with Goldman Sachs in which the company agreed to provide loan restructuring for over 700 Massachusetts homeowners.
During 2008, the Attorney General’s Office recovered more than $77 million for Massachusetts cities, towns, and other government entities under the state’s civil False Claims Act in connection with misleading and unlawful investment marketing to local governments. These recoveries included settlements with investment banks Merrill Lynch, UBS, Morgan Stanley & Company, and Citibank.
The Attorney General’s Office has also brought civil and criminal actions against local lenders and brokers who engaged in fraudulent lending activity, or who perpetrated foreclosure rescue or loan modification scams.
In addition to the enforcement component of her initiative, Attorney General Coakley has also taken regulatory and legislative action to address predatory lending:
In January 2008, the Attorney General’s Office implemented new consumer protection regulations governing mortgage brokers and lenders.
In June 2007, the office enacted emergency Consumer Protection Act regulations which barred “foreclosure rescue transactions” to protect homeowners from losing their homes in these scams.
In October 2007, Attorney General Coakley testified before the U.S. House of Representatives Committee on Financial Services about racial and ethnic disparities in mortgage lending:
Attorney General Coakley, State Senator Karen Spilka, and State Representative Steven Walsh sponsored state legislation which requires that creditors take reasonable steps to avoid foreclosure and prohibits foreclosures without appropriate documentation. The legislation will also prevent additional foreclosures by mandating loan modifications in certain circumstances.
This according to Straight Talk by Sharon Horstkamp, MERS Vice President and Corporate Counsel. Below is an excerpt of the newsletter:
The standard modification agreement
is between the Borrower and
the Lender. The agreement amends
and supplements (1) the Mortgage,
Deed of Trust or Deed to Secure
Debt (Security Instrument) and (2)
the Note bearing the same date as,
and secured by, the Security
Instrument. Prior to MERS, the
standard agreement worked
because the Lender was the mortgagee
of record and could modify
the mortgage and also had the
authority to modify the Note.
However, if MERS is the mortgagee
of record, the Lender can’t
modify the mortgage without the
“mortgagee’s” consent. Therefore,
Fannie Mae and Freddie Mac
changed the modification agreements
to reflect MERS as the mortgagee
of record.
Their change states the Agreement
amends and supplements the
Mortgage, Deed of Trust or Deed to
Secure Debt (Security Instrument)
granted or assigned to Mortgage
Electronic Registration Systems,
Inc., as nominee for the Lender.
The change also recommended a
signature line be added for MERS to
sign the agreement in its mortgagee
capacity. A MERS certifying officer
can sign the Agreement. It is important
to note that a MERS signature
doesn’t replace the Lender’s signature,
because MERS isn’t modifying
the note. Therefore, the Lender and
MERS must sign the document.
Recent Comments