• Report: #430556

Complaint Review: Saxon Mortgage Services, Quality Loan Service Corp., Novastar MOrtgage Inc.

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  • Submitted: Tue, March 03, 2009
  • Updated: Sat, March 21, 2009

  • Reported By:Harbor City California
Saxon Mortgage Services, Quality Loan Service Corp., Novastar MOrtgage Inc.
2141 5th Avenue San Diego, Los Angles, Santa Ana, California U.S.A.

Saxon Mortgage Services, Quality Loan Service Corp., Novastar MOrtgage Inc. SAXON Mortgage and NOVastar violated RESPA, FDCPA, and Restraining Order San Diego, Los Angles, Santa Ana California

*Consumer Comment: Author needs to be better informed before filing complaints

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Thus guys are above and beyond the law, or so they think. Novastar was so busy covering it's own a_s in bankruptcy, they laid everybody off, who was minding the "store". My payment had an impound for prop taxes, they didn't pay them until one day before tax sale. I wrote demanding a full accounting, never got it. I wrote threatening a lawsuit and telling them that I would not make payments until they accounted for the tax monies they collected, so they transfer the loan, to an "innocent thrid party." I continued to write them, no answers. on Sept 4 2008 the "new servicer" initiates foreclosure proceedings, on Sept 16, 2008, my atorney submits a written dispute demanding a full accounting, copies of original loan documents proof of their authorization to collect, and the deed of trust. They prepared an December 11, 2008, which arrived December 18, 2008. Trustee sale scheduled 12/29/08. (my Merry XMAS). On Dec 26, I filed lawsuit, my attorney was on his Xmas vacation from December 23-January 6, 2008. On December 29, 2008 the court issued a restraining order with an OSC hearing scheduled for January 19, 2009. It was served the same day. Now I feel reasonably secured, right. WRONG and WRONG some more. They sold the house. On January 9, 2009, they issued the Trustees Deed. They violated RESPA and Ca Civ Code 2943, by not providing the notice of transfer, the accounting, the copies of the note and deed of trust. They violated FDCPA, by not timely responding to the letter and ceasing collection activities as required by the FDCPA. They violated Ca Civ Code 2924, by continuing the sale proceedings in violation of the restraining order. They will more than likely claim innocence and blame just NOVASTAR, they're history remember the BK. When Deutsche bought the loan they paid 13 cents on the dollar, roughly 35,000. They sold my house for 353,000, I owed 254,000, plus 6 months payments. Even in todays market it was worth 700K. Did they make money they, you bet. When they sold the loan for 35,000 who do you think took the "hit" for the loss on sale of the note, the certificate holders, not Novastar. Who made the money DEUTSCHE BANK. And guess who was advisor to NOVASTAR in preparation of its BK filing>>>>>DEUTSCHE BANK. If you had your loan with Novastar, and it was transferred to SAXON, get out as soon as you can. QUALITY LOAN SERVICE is a foreclosure trustee. They promote themselves to the banks, as "keeping strict timelines" from NOD to trustee sale, even if it violates the law, or its intent. If you think they might have done this to you, please let me know, with details.

Mario
Harbor City, California
U.S.A.

This report was posted on Ripoff Report on 03/03/2009 10:42 PM and is a permanent record located here: http://www.ripoffreport.com/r/Saxon-Mortgage-Services-Quality-Loan-Service-Corp-Novastar-MOrtgage-Inc/San-Diego-Los-Angles-Santa-Ana-California-92101/Saxon-Mortgage-Services-Quality-Loan-Service-Corp-Novastar-MOrtgage-Inc-SAXON-Mortgage-430556. The posting time indicated is Arizona local time. Arizona does not observe daylight savings so the post time may be Mountain or Pacific depending on the time of year.

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#1 Consumer Comment

Author needs to be better informed before filing complaints

AUTHOR: Steve - (U.S.A.)

While scanning for news about NovaStar I came across this complaint. Reading through it I observed several factual errors presented and wanted to comment to correct them.

First of all, from reading the complaint the individual gave clues that his loan was held by one of the securitization trusts which Deutsche Bank National Trust Company is the trustee and would be either NovaStar Mortgage Funding Trust, Series 2006-4, NovaStar Mortgage Funding Trust, Series 2006-5, NovaStar Mortgage Funding Trust, Series, 2006-6, NovaStar Mortgage Funding Trust, Series, 2007-1 or NovaStar Mortgage Funding Trust, Series 2007-2.

Those trusts were set up and loans were sold from Novastar Mortgage, Inc to a Depositor which transferred all rights to the Trustee without recourse and the Trustee issued certificates to the depositor for those loans and the depositor sold those certificates to the underwriters and the underwriters sold those certificates to investors. The fact that there were investors that were willing to invest in mortgage pools was more than likely the only reason the individual qualified for a loan in the first place as underwriting standards were relaxed greatly during that period. The effects we are seeing now is related to the fact that the markets have lost trust in lending due to so many borrowers who have defaulted on their loans.

The underwriters for the deals were Greenwich Capital Markets, Inc, Wachovia Capital Markets, LLC and Deutche Bank Securities, Inc. They are the ones that purchased the certificates and sold them to investors to finance the loans. With this process the housing market was opened up to many individuals who under current credit considerations would not be eligible for a loan due to their credit profile and lack of ability to afford at least 20% down payment.

When the loans were sold in 2006 and 2007 to the trusts, NovaStar Mortgage, Inc. retained the servicing rights and was the servicer and as such their job as servicer was to collect loan payments, apply portions of payments to escrow for taxes and insurance, pay taxes and insurance from escrow, pay trustee fees, pay custodian fees, pay private mortgage insurance which helps protect the lender from defaults by the borrower, advance interest and principal for late payments received and distribute principal and interest to the certificate holders. When they receive payments from individuals that include principal, interest, insurance and taxes, that portion for each goes to their respective accounts. If payments are late or missed then the escrow account may not have ample funds to pay taxes or insurance when due.

Servicers rely on lines of credit and other sources of funding to borrow funds to pay the funding accounts for the benefit of the certificate holders when borrowers are late with their payments. When the credit market locked up in the fall of 2007 no one was and still isn't willing to lend money to anyone and NovaStar, as a plan to survive decided it was best to sell their servicing rights to Saxon to pay down all their short term borrowing. On November 1, 2007, all servicing records and files were transferred from NovaStar Mortgage to Saxson Mortgage Services, Inc. So the "new servicer" the complainer talks about on Sept 4, 2008 was already his servicer for the past year.

In several instances he tries to claim that NovaStar had filed bankruptcy of which it never did. There was an involuntary petition filed by investors of Trust Preferred Securities of NovaStar Mortgage, Inc., a subsidiary of NovaStar Financial, Inc. because the company defaulted on interest payments and was later settled in more favorable terms to NovaStar and dismissed but had no relation to any lending or servicing activities and Deutsche Bank had no relationship in the involuntary petition as was claimed by the complainer.

The complainer also states "When Deutsche bought the loan they paid 13 cents on the dollar" for his loan which is not true either as the loan was one of several thousand included in a pool of loans that were purchased at 100% by the depositor who exchanged those loans with the trust for certificates which were sold to the underwriters for 100% less an underwriting discount of about 0.25%. He then goes on to say that he owed 254,000 plus 6 months payments and that the house was sold for $353,000 and then proceeds to say the home in today's market is valued at 700k? I frequently look at remittance reports and never have I ever seen one foreclosure sale go for more than what is owed. The normal loss severity to the lender is about 60-70% and in some cases with 2nd mortgages can be more than 100% because as those payments are not being paid by the borrower the investors in the pool of loans still have to be paid interest on the money invested to buy the certificates that enabled the defaulting borrower to get a loan in the first place.

So if the servicer held out and allowed the individual to live free in the home without making a mortgage payment for 6 months then that borrower should be foreclosed on. After 90 days if the borrower has stopped making payments then the servicer should conclude that the borrower has no intention to honor the promissory note they signed to borrow funds to purchase the home and should proceed to foreclose.

As far as avoiding foreclosure, the loans in the NovaStar Mortgage Funding Trust Series are more flexible to borrowers than most of all securitized deals being serviced out there and borrowers should feel lucky if they haven't been foreclosed on after 90 days. From reviewing servicer reports and loan level detail, you can see that borrowers that are more than 90 days out and haven't been foreclosed on are generally trying to make some payment and work with the lender to avoid foreclosure. It is folks like Mario that decided to not make any payments for 6 months that will ensure that people such as him in the future will not be eligible to get a loan.

It appears from what I see the only one that may have violated the law here was the borrower who may have provided false information to obtain the loan in the first place. As a borrower myself, my loan sold or transferred to different servicers several times and I made it a point to ensure that I would be responsible for ensuring that the new servicer received my payments and that my account was up to date and accurate. Anyone with a mortgage can do the same at any time. All, they have to do is pick up the phone or get on the internet. Obviously Mario chose to just not make payments for 6 months instead and now complains because he was foreclosed on.

Marios posting looks very similar to some short sellers of NovaStar and other similar companies posting on stock message boards. Mostly rants and ramblings with false information and no proof to back up anything they say. Their whole purpose is to instill fear in investors by spreading disinformation so the short seller can make money and they will go to any lengths to try to discredit the company, supporters of the company or any company that may have a working relationship with the intended target. The complaint I am replying to fits the profile exactly as at the bottom he encourages anyone with a mortgage from NovaStar and serviced by Saxon to run. The only way to run away from Saxon is to refinance with another lender, sell the property or do as Mario did and stop making payments thereby hurting his target by reducing possible cash flows from residual securities that the targeted company owns and hurting other investors. It also hurts the borrow that stops making payments as they will lose their home and any hopes of being a homeowner in the future will be dim as no lender will want to loan such a person money in the future because of the risk associated.

For more information on the disinformation campaign on Wall Street and it's far reaching impact see http://www.deepcapture.com and become better informed instead of a victim.

Servicer reports for the NovaStar Mortgage Funding Trusts at Deutsch Bank can be viewed https://tss.sfs.db.com/investpublic/

Prospectuses, Loan Purchase Agreements, Underwriting Agreements, Pooling & Servicing Agreements, and Novation Agrements can be found at http://www.sec.gov/cgi-bin/browse-edgar?company=Novastar+mortgage+funding+trust&match=&CIK=&filenum=&State=&SIC=&owner=include&action=getcompany

All public filings of NovaStar Financial can be viewed at http://www.sec.gov/cgi-bin/browse-edgar?action=getcompany&CIK=0001025953&owner=include&count=40

All court documents involving any parties you choose can be found at http://dockets.justia.com/

It's not that hard to educate yourself. Obviously it is easier to remain ignorant and blame your mistakes on someone else.
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