One of the largest investment banks at the center of the robo-signing scandal is claiming that distressed borrowers are using the allegations as a stall tactic to prevent losing their homes. Further, the secondary industry is rejecting claims that the current transfer of mortgage titles into the bond market is faulty.
According to one analyst at JPMorgan Chase, the storm surrounding robo-signing activity may delay the process but will not help troubled homeowners retain their property.
In a strategy call Friday morning, JPM mortgage-backed securities analyst Ed Reardon said that borrowers who are in default on their homes will naturally search for a number of ways to prevent foreclosure. These borrowers will look for any legal technicality to make the lawsuit or procedure “inappropriate,” he said.
“Robo-signing is just the latest legal strategy by borrowers to try to prevent foreclosures,” Reardon said. “Our view is robo-signing can be fixed relatively quickly,” and the foreclosures will go forward eventually.