DEUTSCHE DISCLAIMS ANY ECONOMIC INTEREST IN THE LOANS

Jul 8, 2010

COMMENT FROM READER: I received a printed copy from the Deutsche Bank, in reply to a complaint I filed against Deutsche Bank to Federal Reserve Bank New York. Title of the Page is “ROLE OF THE TRUSTEE IN THE US MORTGAGE MARKET”

Under the TRUSTEE; It says ” Performs a variety of functions, among them acting as TRUSTEE for the Securitization Trust and sometimes CUSTODIAN FOR THE MORTGAGE DOCUMENTS. A corporate trustee for the mortgage backed securities (MBS) only serves an administrative role, but has no ownership stake nor beneficial interest in the underlying loans of the securitization.

ROLE OF TRUSTEE IN A FORECLOSURE
Deutsche Bank in its capacity as trustee holds certain mortgage loans for MBS transactions. The BENEFICIAL OWNERS of these loans are INVESTORS in MBS, typically large institutions such as pension funds, mutual funds and insurance companies. Although the trustee of MBS is legal owner of record of mortgage loans. THE TRUSTEE DOES NOT ITSELF HAVE AN ECONOMIC INTEREST IN THE LOANS. Moreover the trustee is only NOMINALLY involved in the foreclosure process.

RESPONSE: I thank the reader for bringing this to my attention and would like copies of the documents sent to ngarfield@msn.com. Here the largest (by far) originator of foreclosure process in the country who is now doing so in its own name is, in writing,. disclaiming any interest, ownership or rights to the loans, much the same as MERS.

This is in direct contradiction to actual testimony and proffers by counsel in the courtroom. I’ve been there and I’ve heard it. It’s a lie. The ONLY real parties in interest are the investors and really IS that simple. The only parties that advanced money to fund this scheme are the investors. THEY created a pool of money first that was then replaced with a complex web of collateralized debt obligations, synthetic CDOs etc.

The ONLY other parties that LEGALLY received any benefit of the money in that pool of money were the homeowners who put their house up as collateral — collateral that overstated, just as the value of the mortgage backed securities was over-stated. Until we all get on the same page about this we can’t fix it. Both the investors and the borrowers were cheated and defrauded through outright lies, deception and hundreds of pages of documents with conflicting provisions. The only provisions in use wer ethose that benfited the itnermediaries to the detriment of both the borrowers and the ivnestors.

The page we need to be on is that there was single transaction between the investor and the borrower. everyone else was an intermediary agent, fiduciary or intervenor unwanted by either the investor or the borrower.

The only people who actually lost money were the real parties in interest — the investor and the borrower. Deutsche Bank and others like it are doing their best to keep the borrowers and investors as far apart as possible just like they did when they did the loan. If the borrowers and investors ever get together and compare notes, they will BOTH file suit against ALL the intermediaries for fraud, breach of contract and breach of fiduciary duties. At that point Deutsche Bank will have no place to hide because they cannot say they are the real party in interest when the real party in interest is standing right there in court.

When we are all on that page, the mortgage mess will unravel along with the death grip that Wall Street has on our economy and millions and homeowners. Investors will recover far more money than they have been offered or paid and borrowers will get to keep their homes with a new mortgage that reflects the realities of the history of their transaction and the true fair market value.