Deposition: Countrywide Admits to Not Conveying Notes to Mortgage Securitization Trusts

Written by Biloxi

I will recap the chain of title when a homeowner takes out a mortgage loan:



A (originator) = B (sponsor) = C (depositor) = D (trust).


A testimony in a New Jersey bankruptcy court case certainly gives more proof that banks may not know whether they hold the notes of the homeowners and that the mortgages may not be properly transferred in the mortgage securitization process. It has been long said mortgage backed securities have been packaged, re-packaged, and sold to investors.




In a testimony in New Jersey bankruptcy court case bankruptcy court filing, posted by StopForeclosureFraud website, provides the first of many problems down the road.



EXCERPT:


The new allonge was signed by Sharon Mason,


Vice President of Countrywide Home Loans, Inc., in the Bankruptcy Risk


Litigation Management Department. Linda DeMartini, a supervisor and


operational team leader for the Litigation Management Department for BAC


Home Loans Servicing L.P. (“BAC Servicing”) testified that the new allonge


was prepared in anticipation of this litigation, and that it was signed several


weeks before the trial by Sharon Mason.


As to the location of the note, Ms. DeMartini testified that to her


knowledge, the original note never left the possession of Countrywide, and that


the original note appears to have been transferred to Countrywide’s foreclosure


unit, as evidenced by internal FedEx tracking numbers. She also confirmed


that the new allonge had not been attached or otherwise affIxed to the note.


She testified further that it was customary for Countrywide to maintain possession of


the original note and related loan documents.


In a supplemental submission dated September 9,2009, the defendant


asserted that “the Defendant/Secured Creditor located the original Note. The


original Note with allonge and Pooling and Servicing Agreement are available


for inspection.,,7 When the matter returned to the court on September 24,


2009, counsel for the defendant represented to the court that he had the


original note, with the new allonge now attached, in his possession. No


additional information was presented regarding the chain of possession of the


note from its origination until counsel acquired possession.





And what is allonge? An allonge is a separate sheet of paper which is attached to a note to allow for more signatures. It looks like Countrywide, now Bank of America, have quit conveying the mortgage notes to the securitization trust, yet Countrywide never changed the pooling and servicing agreement on the loan to reflect the change. The question is how many banks will get caught with the same problems as Countrywide? Stay tuned.