RT Journal Article
SR Electronic
T1 Securitized Loan Due Diligence: Expert Status for
Independent Third-Party Review Firms
JF The Journal of Structured Finance
FD Institutional Investor Journals
SP 51
OP 53
DO 10.3905/jsf.2011.17.3.051
VO 17
IS 3
A1 Sue Allon
YR 2011
UL https://pm-research.com/content/17/3/51.abstract
AB This article explains the need for an independent mortgage loan review process in connection with the securitization of mortgage loans, the U.S. SEC’s new stipulation that any diligence firm named to a transaction will be held to expert status, and five key areas the diligence industry must address to shoulder the extra burden of being held legally liable for statements: a certification process for expert firms, a certification process for analysts, standards for training, standards for loan reviews, and a governing body of peers. It is premature to hold a firm to expert status before the industry is ready to step up and provide the other mechanisms that will enable firms to perform at that level.TOPICS: MBS and residential mortgage loans, legal and regulatory issues for structured finance