Loan brokers and correspondents that live in fear of mortgage buy back requests from secondary market investors may have a new nemesis to worry about: the Federal Deposit Insurance Corp (FDIC).
The agency has even hired an outside law firm, The Mortgage Recovery Law Group (TMRLG), Glendale, Calif., to press its claims.
An FDIC spokesman confirmed that the law firm is indeed an outside contractor for FDIC, hired to recovery money. “We’re asking for repurchase claims,” he said.
He could offer no figures on how many repurchase claims the FDIC has pursued to date. “Some failed banks were big players in mortgages,” he said. “Don’t be surprised to see more of these.”
One New Jersey loan broker who recently received a “notice of claims” from TMRLG concerning a mortgage she facilitated was stunned by the allegations mailed to her, and initially thought it might be a hoax. “It didn’t arrive registered mail or anything. This was on a loan I did back in 2007,” she told National Mortgage News. “I brokered it and they told me the bank lost $419,000 on it and now they want money from me.”
Broker Anna Lazar who runs a small brokerage shop called Allied Financial said the law firm contacted her about a settlement and isn’t sure what to do next. (The mortgage was table funded by Bank United, a now defunct Florida bank that specialized in payment option ARMs and other exotic products.)
TMRLG could not be reached for comment.
“I brokered the loan,” she said. “It was a stated income loan that was done to Bank United’s guidelines. I didn’t underwrite it. I’m a broker – we don’t underwrite. The borrower told me their income and that’s what I was told [by Bank United] to accept.” (For the full story see the weekly edition of National Mortgage News.)