Boarddork, this is a brilliant summation and should be read by all that have not seen or read it before, including me. This brings much into perspective and should comfort all that actually Have a beneficial interest in all flavors of WMI/ COOP. The future value of COOP is much more than is on the surface at this time. It's like a diamond in the rough that has now been sent to a diamond cutter to maximize it's value. GO COOP!
Qualification of real estate assets in Safe Harbor and Legal Isolation, held Off Balance Sheet and kept Bankruptcy Remote - used for securitization collateral ("$240B Held in Portfolio"), requires one thing. A "True Sale". (CBA09 has also explained this well).
Without a true sale, there is no security to sell, there is no collateral to protect the investors who purchased certs, there is no participation interest for the parent to receive income from, WMI would've never been able to claim Bankruptcy (from all the assets 'not in safe harbor'), all $240B in mortgage assets held in portfolio + 10 years of cert participation income, would've either been declared in the FDIC receivership or the WMI bankruptcy.............AND They Were NOT in either.
Why?
Because a proper "True Sale" occurred, like it does in Trillions of mortgage securitizations all over this nation by every other bank, to protect investor and their own SELF $interests from any future disaster events like receivership and bankruptcy. It's how WMI, (to coin one of my court objection phrases) hid the sausage...legally. WMI 'true sold' security cert participation interests, TO ITSELF, from its lenders and thru intermediary depositing subs, for its sole benefit. Crazy smart, and par for the course.
Since a true sale occurred in the past structuring of each securitization, with WMI/WMIIC as beneficiary, Safe Harbor and Legal Isolation, 1000% was triggered by FDIC receivership and WMI bankruptcy, as designed by law to protect the underwriting pool of 'held in portfolio' collateral, and investors interests (WMIIC).
One requirement for qualification of a "True Sale", is 3rd party management by a Trustee like Deutche Bank - who is responsible for put-back claims, managing servicers or sub-servicers, collecting and distributing participation income to cert holders, etc. The triggering of Safe Harbor and Legal Isolation FLASH-FREEZES time and money, off balance sheet legally. Its like an inheritance you didn't know about, collecting massive income every year, for over 10 years. Not able to be paid out to you until the estate is completely settled by the estate trustee - all bills paid, any parties of interest notified/claims made/litigated/paid or settled.......then and only then, can an entity like the FDIC acting as an ultimate trustee, as the ultimate backstop and responsible party; then and only then can you as the ultimate beneficiary receive what was designated and intended long ago.
WMI planned for its total devastation. WMI, left a 'cache' hidden in the weeds, for us as legacy WMI to pick up later after the dust settled.
What we've had for too long of a time, is a classic triangulated gunfight between the FDIC, legacy WMI/WMIIC in Bankruptcy and claims holding up termination, JPM and the PAA, and ALL Trustees like DB. Everyone is pointing a gun at every one else for over 10 friggin years, causing one heck of a delay. The FDIC wants to make sure it really "cost them nothing". Legacy WMI wants out of BK and what is theirs known to be hiding in plain sight, off balance sheet. DB wanted what it was owed for hanging onto FROZEN and ICED safe harbored mortgage security collateral, without reimbursement for over 10 years.
Everyone wanted something......and everyone had a rope to untie for themselves, yet all are tangled in one giant knot together...........and when everyone is pulling on the rope at the same time, the knot is impossible to untie. Every participant in this fight, needed 'encouragement' to release a little tension, so the knots can be unwound. Sometimes, like now, the FDIC is the only one pulling too tight, as we all have 'released' and relaxed our grip on the rope..... legacy WMI in BK releases, JPM and PAA claims settled in probate and DOJ settlement agreements, DB trustee and putback claims settled in probate, the WMB bondholders here and in Europe (as AZ as so graciously explained) .... The good news at this point in time, is nearly the whole circle of interests is not tugging on the rope causing tension on the knot like it was a couple months back!!
All that's left now is for the FDIC to reconcile the receivership of WMB (and the WMI safe harbor vacuumed up at the same time, which was a line for the FDIC to tap IF it was going to cost them something), dot i's and cross t's, total up accounts and claims = "cost them nothing"...........and then and only then IMO will the FDIC release their grip on the rope, so our knot can be untied quickly, and we cast off.
For legacy WMI who released, and any smaller leftovers for WMIH to exploit....we are ALL waiting on the FDIC to reconcile, and finally remove the safe harbor/legal isolation yoke. To remove the 'yoke' prematurely, is a litigation morass.
