As has often been stated on many other forums on securitisation Capstone Mortgage Services administer the mortgage or loan, not on behalf of the originators such as SPPL, SPML or Preferred but on behalf of the SPE or SPV (Special Purposes Entity or Special Purposes Vehicle.)
The SPV purchased the loan and mortgage book from the originator with the aim of marketing the underlying collateral and security (that’s your house and mine) as an investment. the SPPL/SPML etc brands are dead in the water and were the minute they stopped lending and then selling on or securitising your mortgage. That was all they ever existed for. Hell they didn’t even collect. That was left to our good friends at Capstone.
The SPV then took whole tranches of mortgages, bundled them together (called pools) and issued them as notes.
These investments were marketed in the prospectuses as being particularly attractive to investors.
1. They were rated by the rating agencies as more or less AAA, or AAB and the ratings agencies were incentivised to do so given that their client was the SPV. No conflict of interest there then.
2. The high rate of return (that is screwing you and me into the ground with exorbitant interest rates) created a steady flow of lots of cash for everyone involved in the securitisation process. Ever thought that interest rates of 5% were just pure greed on behalf of your original lender when the BoE base rate and the LIBOR are at historically low levels? Think again. Everyone in the chain needs their cash. It has little or nothing to do with your credit worthiness. That is just a guilt trip, and one of many they will lay at your door to get you thinking that it’s all your fault. Note how they are always talking about your obligations, never theirs.
3. Enforced early redemption of the security, that is stripping out the equity in your home through falsely premised repossession claims. Typically the prospectus boasts that they investors will have the notes redeemed within about 5 years not the 20 or 25 years you AND THEY contracted to.
As the Lehman’s Ghosts are exorcised by Price Waterhouse Coopers, the role of Capstone becomes even more pivotal. You see they don’t really act on behalf of SPML at all.
That is just a cover story to keep the cash flowing, to apply the charges and make and their own handsome profits from unlawfully gotten gains, and ultimately to issue proceedings against you in court for possession of your home and your equity.
The SPV wants no illumination of its regulation avoidance and especially its tax dodging.
After all who would pay tax if they could find a legal way around it? Especially if that way happens to be sanctioned by the Treasury when a certain G.Brown was Chancellor of the Exchequer. So in fact what we have is the very department charged with revenue and excise advising and regulating in such a way as to allow UK registered companies to avoid paying UK tax. All very neat.
In the Treasury Select Committee section of this blog read Carmel Butler’s submission which details the tax avoidance structures which were essentially green lighted by the Treasury in 2002. Don’t just take my word for it. Have a read of this.
http://www.mortgagestrategy.co.uk/clarification-on-securitisation-issues-welcomed/87673.article
I particulalry like the bit about consumers not needing to be confused with all this. I don’t feel confused at all. In fact clarity illuminates and I now perfectly understand why Capstone Mortgage Services cannot treat customers fairly.
THEY ARE ENTIRELY BEHOLDEN TO THE RAPACIOUS DEMANDS OF THE SPV.
Oh what a tangled web they weave!
How I wish I was a full time investigative reporter. I am fortunate in the sense that my job makes this kind of digging possible, but not always, and unfortunate in that my work is very demanding. So it’s a double edged sword.
Digests and contributions are gratefully received though. Especially from you BOZ and your magical way with wordz. I will happily cut and paste and create a category. Perhaps I should name the category. The Philanthropy of the Jackal!
Capstone, have you done any research on the fact the spv’s are wholly owned by charitable trusts (as stated in spml annual report) ?
The charity commission says a charity/charitable trust must have a charitable purpose and be for the public benefit.
that would seem to make spml to be acting criminally, don’t you think ?
If that is the case then maybe a few people can be arrested on criminal charges ?
so it looks like the jackals are turning on themselves. not surprising amoral maggotfarmas.
http://www.lse.co.uk/regulatory-news-article.asp?shareprice=&ArticleCode=73k923eu&ArticleHeadline=Important_Notice_to_Noteholders
the most important point is that the Issuer(SPV) is asking the court to adjudicate if the SPV is insolvent, which the Trustee on behalf of the noteholders(investors)is claiming. no shit. as stated:
Insolvency Act 1986
Section 123(2) (as amended by Condition 9(a)(iii)) of the Act states:
“A company is also deemed unable to pay its debts if the value of the company’s assets is less than the amount of its liabilities, taking into account its contingent and prospective liabilities.”
Further accounts available
Any Noteholder wishing to receive a copy of the Issuer’s (unaudited) management accounts as at 30 November 2009 may request the same from the Trustee using the contact details set out at the bottom of this notice.
there are many reported cases now with investors(noteholders) taking the SPV to court, effectively the Trustee taking action on their behalf; so they can get hold of the mortgage assets-YOUR house as per the Trust Deed(m395). the ‘Vulture Fund’ scenario, whereby they retain CROOKLYN as 3rd party administrator.(OP).
TMH
Hatter this was always the end game scenario and should have happened when Lehmans went under.The government would have been forced to step in as they did with RBS etc
instead Lehman victims as here were shoved into a corner,forced to fend for themslves and forgotten whilst the rapacious remaining Lehman entities sucked every penny they could out of them legally or illegaly ,lining their own pockets until they folded themselves.