Mortgage Repurchase and Indemnification Support

Overview

Mortgage loan repurchase demands have been a problem for loan originators for many years. The subprime mortgage loan crisis exacerbated this further. The fall-out as a result of the crisis coupled with the housing bubble burst led to a massive increase in repurchase demands. Therefore, all aspect of governing representation and warranty agreements is carefully scrutinized to justify repurchase demands and/or rescind any application insurance coverage issued.

Lenders must repurchase loans and make whole demands or indemnities. Even as the crisis subsided, mortgage loan repurchase demands continue to persist. Tighter credit and underwriting standards in recent years have led to investor’s increasing purchased loans scrutiny and demanding buy-back or indemnification at the slightest hint of red flags.