The shell game: Has portion of your mortgage payment been applied to your loan or to the securitization trust?

See above chart of the MERS system and how this particular portion of the homeowner's mortgage payment went to the returns to the investors who bought into the security.

Which begs the question: Have many of the portions of homeowners' mortgage payments actually going to the payoff the 15 or 30 term loan or going to the pay the investors in the securitization trust? Well, there is the force placed insurance probe where the banks charge more money for homeowners for insurance,

and now we learn of the Feds probing possible double dipping billing by banks. Why the Feds are probing the banks of double-dipping billing of escrow fees? From the questioning from the U.S. bankruptcy trustee from the DOJ. Check out this article that I posted in May of the U.S. bankruptcy trustee findings:

NY Times:
 

The other problematic area showing up in the trustees’ inquiries relates to what Mr. White calls improper default servicing fees. These include charges for legal work, property inspections, insurance and appraisals.

Often, the fees charged to troubled borrowers are not even specified. Trustee program officials found a defaulted borrower who was charged $10,260.50 in “prior service fees” with zero documentation. In another case, a borrower fell behind after the lender doubled his escrow payments with no explanation or justification. Then the bank filed a motion to lift the bankruptcy stay so that it could foreclose.


“In fewer than 20 judicial districts,” Mr. White said, “we have identified hundreds of facial deficiencies, including cases in which we seek to investigate inflated or improper escrow charges and cases in which the mortgage servicer sought relief from stay so it could foreclose on a debtor’s home.”


Mistakes happen, of course. And loan servicers like to contend that if errors occur, they are rare and honestly made. But after sifting through the data produced by this investigation, Mr. White disagreed that problems are rare. “In Senate testimony, an executive from Countrywide said its error rate was 1 percent,” Mr. White recalled. “The mortgage servicer industry error rate might be 10 times higher, based on the number of cases we are looking at.”