“Double Dipping Docket” is Just a Dumb Idea

By Mandelman

I saw the article’s headline pop up here and there online just last week… a few homeowners even emailed me a link to it, as if to say “See…” The headline read: “The Embarrassing Double Dipping Docket: Bank Foreclosure Complaints Conceal That the PSA Trusts Pay Defaulted Mortgages.”

My first thought was that perhaps for the author, English was a second language. I mean… a “PSA Trust?” I know what a PSA is and what kind of trust the author is referring to, but “PSA” and “trust,” just aren’t words that should be placed right next to each other.

The article was written by a lawyer, Susan Chana Lask, and her bio says she is “New York’s High Profile Attorney,” and that she has appeared before the U.S. Supreme Court… and that she was responsible for suing and shutting down a notorious foreclosure mill.”

I have no reason to doubt anything Susan is saying about her background. And it would seem that based on that background, she has to be an experienced lawyer… but she what she says in this article is NOT CORRECT. And actually, it’s pretty basic stuff, so I don’t know why she doesn’t know.

Beyond the awkward grammar, the headline bothered me for all sorts of other reasons. “Double dipping,” and foreclosure complaints “concealing” that PSA trusts are paying something? It’s all like nails on a chalkboard to me. Complaints conceal something? How so? And PSA trusts paying something? That’s just not possible since there’s no such thing as a PSA trust.

The PSA stands for Pooling & Servicing Agreement and it’s the 500+ page contract between the trust, which holds the loans, and the servicer who collects payments and deposits them into the trust, pursuant to the PSA. When a borrower defaults, the servicer notifies the trustee and the trust initiates the foreclosure.

No reason to dwell on a headline though, so I started to read the article…

“Foreclosure complaints routinely allege that because homeowners fail to pay their mortgage then the bank must take the home to recover its losses. However, the banks are never at a loss according to the Pooling and Servicing Agreement (“PSA”) trusts terms. Notably, banks never inform the courts of the PSA terms in their foreclosure complaints.”

“The PSA is the insurance existing specifically to protect the banks from homeowner’s …read more