Freddie Repossesses Its Files

Fannie Mae and Freddie Mac had already suspended all their work with David Stern. But now they’ve officially severed all relations with him and Freddie has taken their files away.

Freddie Mac took the rare step of removing loan files after an internal review raised “concerns about some of the practices at the Stern firm,” a Freddie spokeswoman said.

“We have begun taking possessions of all files on Freddie Mac mortgages simply to protect our interest in those loans as well as those of the borrowers,” the Freddie spokeswoman said. A Fannie spokeswoman declined to elaborate.

Fannie and Freddie said they will move those files to other law firms in the state but that they hadn’t yet identified where they would be redistributed. The firms said they had notified Florida’s attorney general about the decision to remove the files and that the Stern firm had cooperated with the action.

Let’s see. It’s November 2. On October 4, 29 days ago, the former assistant of the woman who oversaw Stern’s robosigner division testified that 1) Stern’s firm would routinely reclassify Freddie Mac loans as some some other firm’s loans when Freddie came onsite for an audit to hide those files from the firm, and 2) sometime in August, Stern reportedly packed up an eighteen wheeler full of documents and took them to an unspecified office in Orlando.

I can’t imagine why Freddie would want to take possession of its files, can you?

Problem is, it may well be far too late to prevent Stern from tampering with Freddie’s documents. Though it’s nice of them to start worrying about protecting the interests of their homeowners.

    • BoxTurtle says:

      The number of horses involved is a trade secret, that’ll be discussed behind closed doors.

      And as for who will round them up, well, we expect they’ll wander back to the barn if we give them time.

      Boxturtle (Obama’s nominee for cowboy is held up in the senate)

      • bobschacht says:

        It took me a moment to get your reference– very clever!

        But will the four horsemen of the apocalypse be able to find their horses? Or are you suggesting that they were already there in the barn, and rode their steeds out of it?

        Bob in AZ

  1. bobschacht says:

    I used that Who Holds Your Note? website a few weeks ago to find out who owns the note for my wife’s condo in Hawaii. Yesterday we got a brush-off letter from Bank of America, saying that we didn’t have any right to that information (even though the request letter cited the relevant laws stating that we DO have the right to that info.) And then, lazy sorts that they are, they sent us a copy about the original note holder. Which we already knew, of course.

    Bob in AZ

    • emptywheel says:

      You’re not the only person who got that response.

      Please make sure you go back to the whereisthenote site and let them know that’s what BoA said–I think they’ll be able to collate examples like that and note who is refusing to reveal where the note is. Plus, I suspect they might adapt the tool for second attempts.

        • BoxTurtle says:

          Unh, did you forget the /snark? tag

          Boxturtle (If you didn’t intend that as a snark, would you like to buy a used car?)

      • thatvisionthing says:

        What’s WhereIsTheNote going to do with this info? I already know MERS and Countrywide are on my deed or whatever that is at the county recorder and that Countrywide sold my mortgage immediately. I know that there’s a ruling against MERS in California. Why does every case have to be litigated? Why isn’t that ruling like Rosa Parks’ ruling, why doesn’t it free us all? Just saying, I have no lawyer. And for all the fact that law firms scour recorder records, the letters I get from them are all about refi and bankruptcy, and not one about challenging MERS.

  2. parsnip says:

    I’ve read of a foreclosure by a bank of a loan owned by Fannie Mae. Is it possible that Stern was letting banks foreclose on Freddie loans? Is it possible that banks sold loans to the GSEs and then foreclosed on some of those loans, stealing them back? Catherine Austin Fitts describes software that could help the banks determine which defaulting addresses would be more profitable to repossess and have a better chance at resale, based on neighborhood.

    • thatvisionthing says:

      I just replied to you in another diary, it’d answer here as well. See comment that follows too. David J. Stern forecloses FOR Fannie and Freddie, he’s their tool — although maybe I’m misunderstanding your point, which is that Stern uses banks as tools too in concert with Fannie/Freddie foreclosures?

      I feel like Homer Simpson: Three walnut shells. No pea. Stare.

  3. BoxTurtle says:

    Though it’s nice of them to start worrying about protecting the interests of their homeowners

    What in the world makes you think THAT is their motivation? They’re looking to cover their own butts. I find it hard to believe that the two largest holders of mortgages weren’t aware at some level of what was going on, those docs may well show that.

    Boxturtle (They may well show other things as well, I still don’t think we’ve uncovered everything)

  4. dustbunny44 says:

    60 days late and maybe a few hundred billion $ short.

    Think about these kinds of things when they come knocking to manage your social security savings.

  5. parsnip says:

    thatvisionthing @ 13

    I replied at the Grayson diary, but not about the point I made here. It’s possible that the two known cases in which banks tried to foreclose on a borrower whose mortgage was owned by Fannie were not flukes.

    I read the deposition in which the hiding of the Freddie paperwork was described, and I didn’t understand the reasoning, so maybe Ms. Kapusta or Ms Scott (I forget which one it was) was given a bogus reason. It could have been to hide the fact that the Freddie foreclosure cases were ‘disappearing’ because some other bank was appropriating them and stealing the houses. The Pocopanni and D’Amelio cases, and this comment by Yves Smith support my theory. All they had to do was create phony assignments.