Rel liquidating trust
Section A202: Representations and Warranties...1120 4. Sections A208 and A209: Events of Default and Non-Exclusive, Cumulative Remedies...1120 5. Recovery in Indemnity for RFC's Losses and Liabilities (the Allowed Claims), Not Just Actual Losses Incurred...1158 b. Purchasers of the securities often require that they be insured by monoline insurers as a hedge against investment risk. The trust pays for the loans by issuing securities for which the loans serve as collateral. "The right to receive trust income is parceled into certificates and sold to investors, called certificateholders." Id. [ ]RFC has the right to control any litigation or governmental proceeding related to a Loan, including but not limited to choosing defense counsel and making settlement decisions. 1 (Evolution of Client Guide § A212).) As this Court previously noted, Plaintiffs and the originating-lender Defendants were active participants in the RMBS market frenzy. ¶ 19).) The Trusts consequently sustained significant financial losses. ) Multiple entities, including the RMBS Trustees, demanded repurchase and/or filed lawsuits against RFC, alleging that their losses were caused by the poor quality of the loans in RFC's securitizations. ¶ 20.)Each RMBS securitization that RFC sponsored or serviced was administered by a Trustee. ) The Trustee was authorized to seek remedies against RFC to recover losses experienced by the securitization due to contractual breaches by RFC. ) Any recoveries that the Trustees obtained would be paid to the Trusts, and ultimately benefit the investors. ) The following Trustees sought relief against Plaintiffs and participated in a settlement with them ("the RMBS Trustee Settlement"): Deutsche Bank National Trust Company and Deutsche Bank Trust Company Americas ("Deutsche Bank"), Bank of New York Mellon ("BNYM"), U. Client shall instruct its officers, directors and agents (including legal counsel) to cooperate with [ ]RFC in connection with the defense of any litigation or governmental proceeding involving a Loan. * * * [ ]RFC is not required to demand repurchase within any particular period of time, and may elect not to require immediate repurchase. ¶¶ 17–20).) Absent settlement, Plaintiffs' then-expert Frank Sillman estimated that lifetime losses for these trusts could have ranged between .6 billion to .8 billion. If [ ]RFC decides to require repurchase, the Client shall repurchase the Loan and the servicing (if the Loan was sold servicing released) within 30 days after [ ]RFC'S decision is communicated to Client in writing.
A mortgage lender raises funds for new mortgages through this process.
In the mid-2000s, the "explosion in the market for [RMBS]" resulted in a securitization market frenzy.
During this time period, "[l]enders provided mortgage loans to many high-risk borrowers with questionable ability to repay, fueled in large part by the opportunity to package and sell those mortgages into the growing market for [residential] mortgage-backed securities ("[R]MBSs")." In re Barclays Bank, 2017 WL 4082305, at *4.
In addition, Client shall indemnify [ ]RFC against any and all losses, damages, penalties, fines, forfeitures, judgments, and any other costs, fees and expenses (including court costs and reasonable attorneys' fees) incurred by [ ]RFC in connection with any litigation or governmental proceeding that alleges any violation of local, State or federal law by Client, or any of its agents, or any originator or broker in connection with the origination or servicing of a Loan.
First, RFC purchased residential mortgage loans from numerous originating financial lenders, including Defendants Home Loan Center, Inc., CTX Mortgage Co., LLC, Standard Pacific Mortgage, Inc., Impac Funding Corp., i Serve Residential Lending, LLC, and Freedom Mortgage Corporation (collectively, "Defendants"), and bundled them into securitization pools of thousands of loans. This includes, without limitation, liabilities arising from (i) any act or failure to act, (ii) any breach of warranty, obligation or representation contained in the Client Contract, (iii) any claim, demand, defense or assertion against or involving [ ]RFC based on or resulting from such breach, (iv) any breach of any representation, warranty or obligation made by [ ]RFC in reliance upon any warranty, obligation or representation made by the Client contained in the Client Contract and (v) any untrue statement of a material fact, omission to state a material fact, or false or misleading information provided by the Client in information required under Regulation AB or any successor regulation.