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Crux of the "Foreclosure Mess" (Explained By Chris Whalen)

By Implode-Explode Heavy Industries

``... you are probably wondering why the good people at Lehman Brothers never bothered to send a paralegal to the New York State Courthouse in White Plains to record a change in the collateral lien -- at least regarding the sale to Lehman Brothers. The cost of perfecting the lien on the hundreds or even thousands of loans in a typical ABS costs money, but in aggregate would have added less than half a point to the cost of the deal. But the investment bankers at Lehman Brothers took that half point as profit instead of doing their jobs. No doubt claims for fraud, RICO and other misdemeanors are possible against Lehman and other RMBS underwriters, as with the civil RICO lawsuit against Citigroup''

Full post as published by Mortgage Lender Implode-o-Meter on October 09, 2010 (boomark / email).