Approached by compensation firm about Mortgage Securitisation?

Approached by compensation firm about Mortgage Securitisation?

10:58 AM, 7th June 2017, About 4 years ago 64

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Is anyone aware of the Mortgage Securitisation issue that has arisen with “promises” of “up to 8 out of 10 UK Borrowers could qualify for a reduction in their mortgage by up to 70% if mortgage was sold by lender without borrower being told”? 

 I have been cold call approached by a mob seeking to represent me, but immediately thought if there is anything in it that it might be a job for Mark Smith representing our group?

Basically Robinson Murphy Solicitors of Newcastle have written to me due to having my details from a previous contact I had with them years ago – can’t recall about what? –  saying they have been instructed by Legal Quest as one of their administrators in respect of challenging BTL or residential mortgages.

The crux of the matter centres on having a mortgage that was sold, transferred or assigned under a process called Mortgage Securitisation which the lender has not told the borrower about. To qualify one must have a loan secured by a mortgage on your property, the loan must have more than two years before maturity and repayments must be up to date with no arrears.

I’ll be interested to know what Mark Smith makes of it.

Many thanks



by Mark Alexander

15:14 PM, 4th August 2017, About 4 years ago

Reply to the comment left by Philip Hudson at 04/08/2017 - 13:49It's £100 down the drain in my opinion. Also, have you checked you're not exposing yourself to counter claims for legal fees if you lose your case?

by Philip Hudson

17:55 PM, 4th August 2017, About 4 years ago

Reply to the comment left by Mark Alexander at 04/08/2017 - 15:14Thanks for the reply Mark its much appreciated, sometimes a different opinion can be great insight...
I understand that its a Validation process, I could do it but have no idea how to. They act on my behalf and do it for me. I'll get a legal opinion at the end and then decide if I take the matter further through a legal claim, which is offered on a no-win no-fee basis, so no further costs (i hope and believe)...

I accept the comment on the £100 and might start my legal claim myself as they've offered their service for a massive 30% fees.... for me this could mean a £80k legal bill, which I think i could get done through my own solicitor for £15k to £20k... The big question is the money claim, i'm not sure about this and would value input... Nothing ventured nothing gained.....

by Mark Alexander

18:28 PM, 4th August 2017, About 4 years ago

Reply to the comment left by Philip Hudson at 04/08/2017 - 17:55Hi Philip

Having investigated this and taken Counsels advice I am quite certain this is either an advance fee scam or a very naive legal firm behind this. Sorry if that's not what you wanted to hear.

My advice to you is let some other mug take the risk and in the extremely unlikely event of them getting a result then jump on the back of that.

by Philip Hudson

19:04 PM, 4th August 2017, About 4 years ago

Reply to the comment left by Mark Alexander at 04/08/2017 - 18:28sounds like a plan. I'll try and find out the legal firm involved and let you know... But I understand its a big player..

Thanks for the direct approach, much appreciated. I've paid them now so lets see....

More info to follow

by Steve McNair

18:03 PM, 31st October 2017, About 4 years ago

Hi Philip

Out of interest it's been 3 months since your last post on this matter. Did you get anywhere or is it a damp squib ?



by Michael Mathews

22:55 PM, 18th November 2017, About 4 years ago

Reply to the comment left by Mark Smith (Barrister-At-Law) at 07/06/2017 - 11:10

If Peter pays Paul for me, then I now "rightly" owe Peter - even if I never agreed to Peter paying Paul (I owe it by substitution/subrogation)

If I benefit from my mortgage being paid off by an "investor" (by accident, malfeasance or fraud etc), even if I have no relationship (agreement) with the "investor" and that "investor" has no legal interest (legal or equitable) in my property, the "investor" can still claim I owe him money "by subrogation" and then seek a charging order in a court against any property / properties of mine.

Credit cards, personal loans etc are not "secured" when they are first given to someone, but if that person fails to pay the lender, the lender can seek a court order to secure them against any property they find you own and might have some equity in it.

Simply defeating the security of the debt, does not defeat the debt – and an unsecured debt can always be secured through an application to a court for a charging order.

Though in a case of “subrogation” (which is based in “Equitable Law” - in simple terms, law based on Fairness), a court might just directly substitute the bank for the investor as the person owed the money and owning the original charge – to ensure (“fairly”), that the investor is put in exactly the same position as the original bank lender eg: as 1st charge on a property with more than 1 charge.

Subrogation is a rarefied area of law, but one most mortgage companies will deal in every day. Cases can be complex, but given what the mortgage companies might stand to lose if they did not stand up to claims of botched securitisation, they would throw their best lawyers at the case and tell them to spend whatever time it takes to defeat such claims.

Even if your mortgage company has sold your mortgage (not just the income stream from it) onto other people (by Securitising it) and even if they made a right mess of the paperwork, it still holds that you benefited from having your mortgage paid off by that 3rd person and so owe him “rightly” (fairly) by "Subrogation".

If Legal Quest PLC lost the case in court, that the securitisation paperwork was botched, then the court would likely award all the lengthy, expensive legal costs of the original lender against you personally. Legal Quest PLC state that “After The Event” (ATE) insurance would cover you for this – but you will have to decide how much you be able to rely on Legal Quest PLC and their After The Event Insurance in such circumstances.

Also, note that any claim for debts by “subrogation” would be an entirely separate legal action, initiated by the investor after any original lender lost his case (if he did lose his case) and so would not be covered by any “No Win, No Fee” agreement or “After The Event” (ATE) insurance provided from or through Legal Quest PLC.

"Subrogation" is part of "Equitable Law" - in simple terms, law (legal decisions) based on Fairness.

See also: law of “Unjust Enrichment”

If you signed up to Legal Quest PLC's "Contingency Fee Arrangement" (CFA - No Win, No FEE agreement) and they succeeded in getting a court to agree that the paperwork was botched and so the "charge" on your property was null and void, then you could find yourself owing 30% of the original mortgage amount to Legal Quest PLC as a success fee, 100% of the original mortgage amount by subrogation to the "investor" who bought the mortgage from your bank and huge legal costs for asserting the "investor's" rights by "subrogation". Ouch!

Remember, mortgage companies weren’t born yesterday. They face such baseless attacks every day. They will know how to screw you – after all they screwed the entire country royally in 2008!

by Michael Mathews

0:06 AM, 19th November 2017, About 4 years ago

Reply to the comment left by Nicky Andrew at 08/06/2017 - 14:05

states [botched documentation] "is the entire reasoning behind the Ease Your Mortgage introducing the Legal Quest Mortgage Challenge"

Given the pedigree of some of the solicitors behind this scheme, it seems surprising that they should hang their entire case on such a thin thread.

by Mark Smith (Barrister-At-Law)

10:20 AM, 19th November 2017, About 4 years ago

As a result of my previous comment I was approached by Legal Quest, and I eventually met two of the principals in London on 18th October. They are both senior people in their fields, and were very courteous to me.
I agreed not to disclose the mechanics of their strategy, but I will candidly say that I did not fully understand it. That is not to say it has no merit; I could or could not say that until I fully grasp the process. In particular, I would remain concerned about any ramifications in equity for unjust enrichment if a debt obligation was written off or not pursued by the actual legal owner.

by Mark Alexander

10:54 AM, 19th November 2017, About 4 years ago

Reply to the comment left by Mark Smith (Barrister-At-Law) at 19/11/2017 - 10:20
If you didn't fully understand it Mark, what hope is there for the mere mortals such as myself?

The comments left by Michael Matthew's appear to echo at least some of my own initial thoughts. His comments regarding subrogation, equitable law and the potential adverse Court Awards to borrowers therefrom were particularly interesting/worrying.

In many cases, securitised mortgage debt was packaged into bonds which were traded over and over again. In some cases, finding the owner with equitable interest would be like dismantling a spiders web a thread at a time. I cannot see how it could be done. Nevertheless, I do not feel confident enough to get involved in the Class Action myself, and for that reason I will not be recommending others to do so. I'm out!

by Michael Mathews

21:33 PM, 19th November 2017, About 4 years ago

I suspect that the original lender would pick up the sword for all the buyers who had bought their debt - a type of class action in reverse - were they not to succeed in defending their investors from such claims, their investors would never buy another securitised mortgage package ever from them again - what a fine mess for the lenders!
Also, it is my understanding that lenders pass the mortgages over to a Special Purpose Vehicle - a separate legal company like landlords use to purchase, run and finance properties tax efficiently nowadays - before this SVP then sells the bonds. This single SVP would therefore be the immediate owner of the equitable interest - not so hard to find or assert.
According to the MSE thread on this subject, Santander use SVPs called "Holmes Master" and "Fosse Master" for this purpose.
Though every bank might do things differently - as Mark said, some may just sell the income stream, but keep the equitable interest - finding out would be like Russian Roulette - every bank being different, possible cases within a single bank being different. My head is spinning already!

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