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mortgage mess redux:robo-signers returnA Reer ineiaion n ha many bank are ill employin he

onroerial orelore praie ha parke a major ory la year.

by Scot j. Paltrow

NEW YORK/IMMOKALEE,FLORIdA, JuLY 19

AMERIcAs LEAdINg MORtgAgElener owe in Marh o en he

bio orelore praie ha ae abriin anal la year.

B a Reer ineiaion n hamany are ill akin he ame hor

hey promie o hn, rom kehypaperwork o he e o robo-iner.

In i eor o eize he wo-beroom ranhhoe o 87-year-ol Marery gner in hiown-on-i-lk Floria own, OneWeBank reenly le a or omen haappear rile wih irepanie. Mr.gner, who ha lie in he hoe or 40year an e aron wih he ai o awalker, oppe payin her loan bak in

2009, her lawyer onee. to oreloe, hebank bmie o he collier cony lerkoe on Marh 3 a morae ainmen,a omen eenial o proin who owna morae one he oriinal lener ell io.

B OneWe paperwork i problemaiAmon he na: ae law permi lenero le o oreloe only i hey alreay leallyown a morae. Ye he key omen

july 2011

special report

m g h h ik, F, m 6, 2011. rEUtErS/joE SkiPPEr


2/8

ForEcloSUrES jUly 20

eablihin ownerhip wan inean oially reore nil monh aerOneWe le o oreloe on Mr. gner.OneWe eline o ommen on he ae.

Reer ha on ha ome o he bieu.s. bank an oher loan erier

onine o le qeionable oreloreomen wih or an ony lerk.they are in ai ha lae la yearriere an ory, mliple ineiaionan emporary moraorim on orelore.

In reen monh, erier hae lehoan o omen ha appear o haebeen abriae or improperly alere, orhae worn o ale a.

Reer alo ienie a lea i robo-iner, iniial who in reen monhhae eah ine hoan o moraeainmen -- leal omen whihpinpoin ownerhip o a propery. theeame iniial hae been ienie -- inepoiion, or eimony or or rlin-- a preioly hain ine a nmbero orelore omen ha hey neerrea or heke.

Amon hem: chriina carer, anemployee o Owen Loan seriin o WePalm Beah, Floria, a b-erier whihhanle roine morae ak or bank.Her inare -- j wo c -- ha appeareon hoan o morae ainmen an

oher omen hi year.In a ae inolin a orelore by HsBc

Bank usA, a New York ae or je himonh alle carer a known robo-ineran ai he on mliple ariaion oher wo-leer inare on omen,raiin qeion abo wheher oher werein her name. tha an oher re faprompe he je o ake he eraorinaryep o hreaenin o anion HsBc hieeeie oer.

In a phone ineriew, carer aknowleeinin lare nmber o moraeainmen hi year, b ai hey all wereleally one. to her knowlee, he ae,no one ele e her name.

cUttiNG corNErS

ONE OF tHE INdustRYs op repreenaieami ha he eeral elemen haenp a op o qeionable praie.

some loan erier onine o

orner, ai dai seen, preieo he Morae Banker AoiaioNearly all borrower ain orelore aelinqen, he ai, b he real qeionwheher he erier omplie wih all lereqiremen. the lo o a home i

mo riial ime in a amily lie, anorelore paperwork i aly homeownehol one i. Familie hol be ieery opporniy hey an o proe hrih.

Feeral bank relaor ine elemenin Marh wih 14 loan erier -- banan oher ompanie ha perorm aor morae ineor h a olleipaymen rom homeowner an whneeary, lin o oreloe. the 14 rmpromie rher inernal ineiaionremeiaion or ome who were harman a hal o he lin o ale omenAll h behaior ha oppe by he en 2010, hey ai.

O hee ompanie, Reer ha oa lea e ha in reen monh hale orelore omen o qeionabaliiy: OneWe, Bank o Ameria, HsBBank usA, Well Faro an gMAc Mora

so hae hal a ozen lare erier hweren pary o he areemen, inliOwen Finanial corp an ni o cresie grop Ag.

PaPErwork:m g, (2-l) wh cp , q h l a e epz (l), a b (2-r) jK (r) h h ik, F m 6, 2011. rEUtErS/joE SkiPPEr

families shouldbe using every

opportunity theycan to protect

their rights.


3/8


spokemen or he bank an eriername in hi arile ai ha hey haleany wronoin aer ilore laamn o robo-inin le hem o reieheir praie, an hey enie lin aleomen ine hen.

In eneral, hey ai heir oreloreae were leiimae, b or a mall

nmber o eepion, an ha riiim byeene lawyer an je o ome ype oomenaion i bae on miinerpreaiono he law.

the periene o he paperwork mepoe a ilemma or Amerian poliymakeran oiey a lare.

the a majoriy o homeowner inorelore are in a elinqen on heirmorae paymen. Many banker an

je iew he ie a a ehnialiy.Rearle o leal nieie, hey ay, peoplehol pay p or loe he ollaeral on he

loan -- heir hoe an ono.Inreainly, hoh, or are holinha he r in o oreloe onaally own he morae. Je haerle ha oreloin bae on fawe ormiin eiene iolae lonanin lawmean o proe all Amerian properyrih.

In a lanmark eiion in Janary, heMaahe spreme Jiial coroerrne a orelore beae o a lak oproper omenaion.

the holer o an aine moraenee o ake are o enre ha hi lealpaperwork i in orer, wroe Jie Robercorry in a onrrin opinion. Alhohhere wa no apparen aal nairne hereo he (homeowner), ha i no he poin.Forelore i a powerl a wih inianoneqene, an Maahe law haalway reqire ha i proee rily inaor wih he ae ha oern i.

(u.s. bk n a, , .

a iz, 458 m. 637.)

a tHoUSaND QUEStioNS

REutERs REvIEWEd REcORds o

iniial ony lerk oe in e ae- Floria, Maahe, New York, anNorh an soh carolina - wih earhableonline aabae. Reer alo eaminehnre o omen rom or ae le,ome obaine online an oher proie byaorney.

the earhe on more han 1,000morae ainmen ha or mliplereaon appear qeionable: promiorynoe miin reqire enoremen or

by Scot Paltrow

NEW YORK, JuLY 19

ALIttLE-KNOWN INstItutION inReon, virinia, ha one mh o

help loan erier proe oreloreomen o qeionable leiimay,aorin o mliple reen or rlinan epoiion eimony.

Morae Eleroni Reiraionsyem, or MERs, ha only abo 50 llime employee. Ye i laim o own abohal o all morae in he unie sae,

rohly 60 million loan, an i inolein abo 60 peren o new moraeie.

Fannie Mae, Freie Ma an eerallare bank eablihe MERs in 1995, aa reiry mean o pee p he reorinan raner o morae. unil hen,hi ha o be one in iniial onylerk oe an he proe wa laial.the oner wen ahea een hoh noae law ahorize hem o bypa hereqire lin wih lerk.

the prpoe o MERs wa imple: to

make i poible o rak he owner anerier o eah iniial morae,an o make i eaier o rapily ranermorae. Lener einae MERsa eiher he moraee (he leal holero a morae, een hoh MERs haneer pai a penny o obain i), or aainee (an eniy o whih a moraei enre). In eiher ae, MERs warane power o ain morae ahey hane han rom one real owner(h a a bank) o anoher (h a amorae eriy r) een hoh

MERs iel in hae a nanial inerein any o he morae. MERs alo laimhe rih o raner promiory noe,een hoh i oen' own hem.

In epoiion eimony beinninin 2009, i emere ha MERs ownemployee i lile b mainain heomper aabae. the real work waone by loan erier -- bank anoher ompanie ha o roine work orr ha own he morae, inlinollein an rakin paymen rom

homeowner an lin o oreloewhen a borrower eal. For a $25ee, employee o any o he 3,000 loanerier ha belone o MERs ole hemele einae a a MERsie preien or aian ereary,ahorize o in oial omen onbehal o MERs.

thi April, pon annonin elemenwih 14 lener oer alleely improperorelore praie, eeral bankrelaor reqire MERs oo o in anareemen o reorm. the relaor ai

MERs ha aile o eablih aeqaeinernal onrol, an enae in naeor non praie in ranerrinmorae. Like he 14 lener, MERsneiher amie nor enie wronoin.

In praie, when erier neee oreae morae ainmen o replaemiin one or orelore ae, heirown employee, inin a MERs oial,prine o newly mine omen anine heir name o hem. MERs haere in ee a an inan eller mahineor morae ainmen. serier

imply hae heir own employee in heneee omen a MERs oial.

For ome ime, mo or aron heonry rejee homeowner halleneo MERs an phel he moraeainmen. B reen eiion by aean eeral appellae or hae beenrlin ha MERs oen hae he rih oraner promiory noe an morae.A New York sae appellae or in Jnerle ha MERs, beae i oe noown he noe, ha no power o ranero erier he rih o oreloe. Feeral

iri an bankrpy or in mlipleae reenly hae ie imilar rlin.(Bank o New York silerber, 2011 slipOp 05002, New York sae Appellaediiion, seon deparmen.)

A pokewoman noe ha je inmliple ae onine o phol MERspower. In repone o prere romrelaor an he or, MERs ha aii i rerain ome o i proere.

(Eiin by Mihael William)

paperwork pickle:archive is at centerof mortgage mess


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bearin aly one; an omplain (heleal omen ha lanh orelorei) ha appear o onain mlipleinorre a.

thee are praie ha he 14 bank anoher loan erier ai ha orre onlyon a mall ale an were hale more hani monh ao.

the elemen inle he or larebank in he unie sae -- Bank o Ameriacorp, Well Faro, JP Moran chae & co,an ciirop In. the oher parie werelenin ni o Ally Finanial In, HsBcHolin PLc, MeLie In, PNc Finanialserie grop In, sntr Bank In, u.s.Banorp, Arora Bank, EerBank, OneWeBank an soerein Bank.

the pa were rk wih he Oe ohe comproller o he crreny, he mainrelaor o naional bank, a well a wihhe Feeral Reere, he Feeral depoi

Inrane corp. an he Oe o thrisperiion.some ae an eeral oial hae

alle he elemen weak. Ahoriie areill workin o nanial penalie o beimpoe on he 14 rm. the bank inami or eny wronoin, an many ohe praie banne were preioly illealanyway, h a lin ale aai anmakin ale noarizaion. An relaorle i o he bank o oeree heir owninernal ineiaion.

the Occ onrme i ha reeieomplain ha qeionable praie

onine. B pokeman Bryan Hbbarai he elemen are inene oare many o he roo ae o improperorelore aion, h preenin reharm.

waVE oF ForEcloSUrES

tHE cOLLAPsE OF tHE hoin boom in lae2006 le o a wae o orelore. FeeralReere aa how ha ome 4.5 peren ou.s. morae are in orelore. In 2010,2.5 million orelore were iniiae, wih aimilar nmber epee hi year.

In he hoin boom, lener reaemillion o new morae, pakae hemino pool, an eriize hem rapily orale o ineor in o-alle morae-eriie r.

the areemen ein p he r,alle poolin an eriin areemen,reqire ha key omen, properlyeee an enore, be rne oerimmeiaely or eah morae when ar i eablihe. the wo mo imporan

one are a promiory noe an moraeainmen.

A morae really ha wo par. One ihe aal morae (in ome ae alle aee o r). I prpoe i o plee hehome a ollaeral or he loan. to ranerownerhip o hi ollaeral plee, he ellerm ie a omen alle a moraeainmen. the oher i he promiorynoe, whih i he loan areemen iel.the homeowner in i, promiin o payprinipal an inere.

the Reer eaminaion rne phoan o inane --more han 2,000in Floria alone -- inolin reenly lemorae ainmen whih oeniblyranerre morae o hee r yearaer hey were orme.

the problem, aorin o georeown

unieriy law proeor Aam Leiin, aneper on eriizaion: Abo 80 peren oall r areemen proie ha New Yorksae law applie, an ner New York law,any morae ainmen mae laer hanpeie in he areemen wol be oi.

Reer ha alo noere problem wihhe oher key omen e in oreloreae, he promiory noe.

to oreloe, a r, bank or moraenane ian h a Fannie Mae or Freie

Ma m poe he oriinal blink ine promiory noe. the rpar o he noe are a he boom - enoremen, omewha like hoe on bak o a hek. the areemen eablihir reqire a proper hain o enoremenhowin leal raner o a noe rom oriinal lener, hroh any inermeiaowner, an nally o he r iel.

Aorney eenin homeowner oneha improper enoremen are rie. Reeobaine rom pbli or reor aeene aorney more han 100 eampl

o noe ha or ario reaon appear o improper.

MyStEry oF Mary artHUr

ONE ExAMPLE: the aemp by crei sini dLJ Morae capial o oreloe Mary Arhr o dobb Ferry, New York. MArhr, 63 an leally blin, work paime a an aian in a oor oOriinally rom trinia, Mr. Arhr beamelinqen on her $427,500 loan aer hparen an ier ie an he ran p ebraellin home or he neral, aorinher aorney, Lina tirelli.

the loan erier, sele Porolio seriio sal Lake ciy, hreaene o oreloon dLJ behal. Mr. Arhr arrane wisele Porolio a rial morae moiaio ee i he ol keep p wih he repaymen. she mae he paymen btirelli ai, sele Porolio le o orelo

dLJ le in wo eparae or awha i ai were aheni opie o MArhr promiory noe. Beae hwere ppoe o be opie o he am

clik o hek o he ieo on

Reer Inier:://k../k62

rEUtErSiNSiDEr
http://link.reuters.com/myk62shttp://link.reuters.com/myk62shttp://link.reuters.com/myk62shttp://link.reuters.com/myk62shttp://link.reuters.com/heq72qhttp://link.reuters.com/myk62shttp://link.reuters.com/myk62shttp://link.reuters.com/myk62s


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omen, he enoremen le wih bohor hol be ienial.

B a look a he omen how hahe erion le in ae or an he onele in bankrpy or ha ompleelyieren enoremen on hem -- naminieren owner bank an ine by ierenpeople. tirelli ai he ha broh hi o

he aenion o he bankrpy je an iawaiin a rlin.

crei sie, whih own boh dLJMorae capial an sele Porolioseriin, eline o ommen, a i caeyHowar, he lawyer repreenin dLJ in hebankrpy ae.

Bank o Ameria, meanwhile, i ominner re rom a New York eeral bankrpy

je.La teay, Je Rober drain orere

an ineiaion inolin a orelore aebroh by he bank. two earlier opie o

a promiory noe le in or ha lakeany enoremen, b hen one appeare onhe noe when bank lawyer proe heoriinal.

the je ai he en appearaneo an enoremen, an hi own loe looka i, raie qeion abo wheher i habeen ae illeally o make he noe lookleiimae.

I "raie a ienly erio ie a owhen an more imporanly by whom hinoe wa enore," he je ai.

A Bank o Ameria pokeman aihe bank will proe eiene ha will

emonrae o he or aiaion hahe enoremen i proper.

(In re: Priilla c. taylor, debor, uniesae Bankrpy cor, sohern diri oNew York, cae # 10-22652.)

MiSSiNG SiGNatUrES

tHEsE BANKs ARENt alone in linobl omen. Reer on ae inwhih Well Faro in obain moraeainmen - an hene he rih ooreloe - nil well aer i ha leorelore ae.

Well Faro, a a ree, ha moeo oreloe on homeowner who haemorae rom now-en Opion OneMorae corp. In Jne, a bankrpyappellae panel o he eeral Ninh ciricor o Appeal oerrne a eiion oallow Well Faro o oreloe on an OpionOne morae. I ai ha here wa noeiene ha he noe an morae haeer been rne oer o Well Faro aree.

In or le o Floria orelore aeby Well Faro on Opion One morae,none o he promiory noe le aehibi in 10 ae on by Reer ha anyenoremen on hem.

A Well Faro pokewoman ai i ipoible ha proper enoremen eib were omie rom he opie o hepromiory noe le in or.

In oher ae reiewe by Reer, WellFaro an gMAc Morae, a ni o AllyFinanial, hi year aine morae romen lener New cenry Morae corp.,whih wen ner in 2007. seriizaionlawyer ay i i ehnially impoible ora en ompany o irely ain a

morae oer o anoher owner.domen an aemen mae o o

ha are on o be ale an amon rime ner ae an eeral law. danRihman, a colmbia unieriy law proe

an ormer eeral proeor, ai h aan be perjry, an preparin raleomen an be proee ner eemail an wire ra ae. the sarbaneOley A make i a rime pnihable by o 20 year in jail o le ale omen inbankrpy ae, inlin orelore.

robo-SiGNErS rEtUrN

REutERs ALsO FOuNd ha loan erieare ill in he orner-in ai h

HolDiNG oN: Aboe an below, Mary an see ah h h d F, nw yk, j 14, 2011

rEUtErS/MikE SEGar


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mo apre he pbli imainaion layear: robo-inin.

the ineiaion ienie i knownrobo-iner who hae onine o hrno lare nmber o morae ainmenine he beinnin o 2011 monh aerhe inry owe o op he praie.

Amon hem i Bryan Bly, an employee o

Naionwie tile clearin o Palm Harbor,Floria.

Bly eie in a Jly 2010 oreloreae in Floria ha he ine p o 5,000morae ainmen per ay a heloan-eriin ompany. Alhoh he ian employee o Naionwie, he ine heomen a a ie preien o OpionOne Morae, dehe Bank, ciiBank anoher iniion. (cae # 2009-cA-1920,ciri cor o he Forh Jiial diri,clay cony, FL)

In hi epoiion, Bly ai Naionwie

mliplie hi op by eleroniallyampin hi inare on aiionalmorae ainmen ha Bly ai he neeraw. He eie, oo, ha all he omenhen were alely noarize. Naionwienoarie were ien ak o he alreay-ine omen, he ai, an aeealely ha Bly ha ine he leal paperin ron o hem. Bly ai he in eriy heinormaion in he paper he ine, anha he in neran key wor anepreion in hem.

depie hee ilore, a Reer earho ony lerk reor in Floria, New Yorkan Maahe how ha Bly onineo in hoan o morae ainmenhi year.

A Naionwie pokewoman ai here inohin illeal abo inin lare nmber

o morae ainmen. Aer Reerinqire abo Bly, howeer, he laer aiha beae o reen qeion raieabo him by Naionwie omer, Bly habeen moe o a job a he rm ha oeninole inin omen.

R. chriopher Roem, a lawyer or Bly,ai here i nohin improper abo inin

lare nmber o morae ainmen.Roem ai Bly ha reeie eah hreaaer a ieoape epoiion Bly aein Noember 2010 wa poe briefy onYotbe, in whih he eie abo ininmaie nmber o morae ainmen.

a lawyErS NaME

ROBO-sIgNINg IsNt limie o low-leelemployee a loan erier.

Lawrene Bkley i a lawyer who manaehe dalla, tea law rm Brie, vanerLinen an Wernik. In Marh, he eie

ha he ha allowe hi eleroni inareo be ae o worn or omen hahe ha neer een. the omen, knowna proo o laim, inle one le wihhe eeral bankrpy or in New York. Ioh permiion or dehe Bank o eizehe Bron, New York, hoe o 59-year-olvirinia Obai. (unie sae Bankrpycor, sohern diri o New York, cae #

10-10494 Mg)Bkley ai he ha neer een

omen, an ha anoher lawyer a hrm ha le i in Bkley eleroninare. the inare appear on omen a // Lawrene J. Bkley.

Bkley ai ha oher lawyer a hi rwere permie o e hi inare o

omen eleronially wih bankrpor. He eie ha i wa anapraie a he rm no o reiew any o oriinal omen he laim wa ppoo be bae on, h a he oriinpromiory noe an morae.

Lke Maole, a lawyer or Bkleai he aw nohin wron wih Bkllein lawyer he irely manae e heleroni inare. Laer, in an e-mailaemen, Maole ae ha wha orri nohin like robo-inin" an o ha loae erm wol be nair in

ereme.

a jUDGE iNVEStiGatES

ROBO-sIgNER cHRIstINA carer rerain a rlin earlier hi monh, when Arhshak, a New York sae or je Brooklyn, hrew o an aemp by HsBc oreloe on a Brooklyn hoe.

shak ai he ha inre HsBc h

Not HoME:a p h

c h m g, F sp 15,

2009. rEUtErS/carloS barria


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lawyer in he ae, Frank caara, o onrm

key a irely wih HsBc oial. the je ai caara beqenly armener he penalie o perjry ha he haone o. B he je ai i rne o hacaara ha neer heke wih anyone aHsBc, an ha he employee caara haai he poke wih a HsBc aally workeor a loan erier.

the je alo ai inare onomen in he ae were le by knownrobo-iner, hree o whom he ienieby name, inlin carer o Owen Loanseriin. He peronally ha eaminemliple eample o heir inare, he

je ai, an on wie ariaion, raiinhe poibiliy ha oher people ha beeninin heir name.

Je shak hen ook an nal ep:He ormally hreaene HsBc cEO, Irenedorner, a well a lawyer or he rm, wihanion or relyin on known robo-iner,lin ale omen an makin alerepreenaion o he or. the poibleanion ol rane rom an oral reprimano nanial an oher penalie.

I HsBc ha a y o make money ori okholer, shak wroe, why i

i prhain nonperormin loan, anwain he cor ime wih eeiepaperwork an he e o robo-iner?

HsBc pokeman Neil Brazil ai ha heerier, Owen, wa reponible or whaorre in he ae, an ha HsBc ha hano role in i.

Pal Kohe, Owen eneral onel,ai in an e-mail: to or knowlee, herewa nohin bmie by or leal onelo he or ha wa in any way mileaina o who i he owner o hi morae annoe, nor wa here any on o any kin

ha wol jiy anion.carer ay he i nohin improper, anle Owen olnarily in May or anoher job.

DowN iN FloriDa

tHE BANK NOW tRYINg o oreloeon Marjorie gner ha proe aroble paper rail. OneWe bmiea omen ine hi Febrary o proeha he oriinal lener or her morae,a ompany alle MoraeIt, ha ineoer ownerhip o OneWe. B MoraeIt,

owne by dehe Bank, wan in binein Febrary. I ha eae operaion hreeyear earlier, in 2008.

A dehe Bank pokeman eline oommen.

Een i he Febrary omen were

aheni, i wan reore nil nearly10 monh aer OneWe ha lanhe iorelore aion, whih bean in May 2010.Real eae law hroho he unie saereqire ha beore moin o oreloe, ar or bank m alreay own he moraean relae promiory noe. Oherwie,or hae rle, a oreloer ha no rih oeize a hoe.

OneWe alo le wo eparae opie owha i ai wa he 87-year-ol homeowneroriinal promiory noe. the r ha anenoremen only rom MoraeIt o

now-en InyMa Bank. Week laer,OneWe le a eon opy o he noe,wih he aiion o a blank enoremen- an enoremen by InyMa, b wih hename o he payee le empy. OneWe hale no eiene in he ae ha he noewa beqenly ranerre o Fannie Mae.

OneWe eline o eplain he mlipleapparen irepanie in he gnerorelore omen. A pokeman ai inan e-mail: OneWe i eiae o enrinha i mee he nee o i omer,

a in aorane wih appliable law

an omplie wih i onraal moraeriin ie o he hihe anar.A Fannie Mae pokewoman ai Fann

oe own he gner noe, b elino eplain how he morae nanian obaine i, e o i bein in ailiiaion.

the je in he gner ae han rlye on OneWe omen. (20h Jiciri cor in collier cony, FL, canmber 10-2982-cA).

Mr. gner lie in Immokalee, a rbown 34 mile inlan rom For Myer oFloria gl oa. Abo 40 per en he ownpeople lie below he poery linen aa how. she hare her home wiher hree o; her one riin on liea nrin home.

In an ineriew a her hoe, on a roa o he main hihway, Mr. gner ahe oen neran why he bank oreloin.

OneWe ay ha Mr. gner noi elinqen by more han $160,00Her lawyer, Joeph Klein o he Leal Aserie o collier cony, are here aeenain irmane.

copie o her morae appliaion ormhow ha in deember 2006, an aen dehe Bank MoraeIt ni inp Mr. gner or a $149,900 morathe orm, liin her inome, how ha aen knew ha he monhly paymen $1,151, inlin inrane - were more hher monhly inome o $800 rom soseriy pl abo $200 in oo amp.

In an aai le in or, Mr. gnai he ha ake he aleman or reere morae, whih allow eniizen o remain in heir home wiho

makin morae paymen, wih he alo he hoe oin o he bank when hey B he omen he aleman ae her in were or an orinary 30-year mora

Loin her plae wol be a eaaiblow, Mr. gner ai. I hey ake hoe, he ai, heyll ake me, oo.

(so Palrow repore rom New York aWahinon, tom Brown rom Immokale

eiin by Mihael William aclaia Paron

oneWest is dedicated to ensuring that it meets the needs ofits customers, acts in accordance With applicable laWs,

and complies With its contractual mortgage servicing dutiesto the highest standards."

'takE ME too': m g, wh 87 m,

q h $160,000 h .

rEUtErS/joE SkiPPEr


8/8


th r 2011. a h v. 47001073 0310rpc th r c, c , ph wh h p w c th r. th r h th

r k k th r f cp.

FOR MORE INFORMAtION cONtAct:

michael williams,

global enterprise editor

+1 646 223 5462

[email protected]

claudia parsons,

deputy enterprise editor

+1 646 223 6282

[email protected]

scot paltrow

+1 646 223 6334

[email protected]

by Scot Paltrow

NEW YORK, JuLY 19

WHY HAvE sKEtcHY MORtgAgEproere been o il o roo

o? some lawyer blame miieeor o o. Mo orelore arenonee, hey noe. An o erierae money by aoiin oly earheor miin oriinal omen or hirinaiional a o eal wih he re in

orelore.there are in, howeer, ha erier

reor o obl omen beaehey hae no hoie i hey are eermineo oreloe: to a rea een, oriinalimply on ei.

I one o he oerlooke leaie o hehoin boom.

In he rh o make new home loan anell hem o a a a poible o ineoron Wall sree, he oriinal lener --bibank a well a now en makero bprime loan -- eroye oriinal

omen, or neer rne hem oera reqire o he ownerhip pool haoope hem p. From 2004 hroh

he en o he hoin boom in 2006,more han hal o all new moraewere eriize an ol o h pool,known a morae-eriizaion r,aorin o he seriie Inry anFinanial Marke Aoiaion.

so, bank an inermeiarie in manyae neer rne oer he wo eenialomen nerpinnin a home loan --promiory noe an morae -- hawol oney ownerhip o he ineor

r. tha mean many penion n,inrane ompanie an hee n hainee in he r neer o ormal ileo morae hey ha pai or.

sheila Bair, who reenly eppe own aFeeral depoi Inrane corp. hairman,in conreional eimony ha alle ora wie-ranin ai o he problem. Boher relaor o ar haen bake heiea, poibly earin ha i he een ohe problem beame known he hoinmarke mih woren.

One eample: Pbli reor in

orelore ae iniae ha Newcenry Morae, he naion eon-lare bprime lener nil i ollape

in 2007, almo neer enore promiorynoe or aine morae o r haboh i morae.

A Reer amplin o 50 oreloreae le in dal cony, Floria,inolin New cenry morae onha none o he promiory noe lein he ae ha any enoremen aall on hem. Reor how ha imilarlare-ale lape orre wih oher bilener.

the rel i ha r may be o manybillion o ollar, ay Mahew Weiner,a lawyer who peialize in moraeliiaion. I proper proere are ollowenow, orelore ol low o a rikle.An a lo wol han oer ile omillion o home, poenially rhereprein he hoin marke.

sheila Bair, who reenly eppe own aFeeral depoi Inrane corp. hairman,in conreional eimony ha alle ora wie-ranin ai o he problem. Boher relaor o ar haen bake he

iea, poibly earin he oneqene ihe een o he problem beame known.(Eiin by Mihael William)

behind the corner-cutting, vast

troves of missing documents

EVictED:a c c

p h

p h F,

V, Wh

m 5, 2011.rEUtErS/larry

DowNiNG

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