Mr Cooper Group Inc (COOP)

[redisnieurt]

Good research. I'm not sure that I can buy into the underlying premise, but it does look like you identified a number of Trusts that were related to WaMu securitizations.

One flaw in your analysis, in my opinion....

You mention that 692B was securitized across these 29 Trusts. But some of these go all the way back to 2001, and many of them go back to 2004, and none of them are any newer than 2006.

So when the WaMu seizure occured in 2008, there had already been up to 7 years of P&I payments already remitted back to WMI. Right? People make payments every month, and the UPB of these trusts would just whittle away over time. And pre-payments and extra principal would also have been remitted and therefore the UPB would be reduced also.

In fact, if you think about it, there could be someone who got a loan from WaMu in 2001, and was part of a security. Then they refinanced in 2003, (and paid off their 2001 loan) and that new loan ended up in a new ---and different--- security. But not BOTH securities. And it could have happened again in 2005....and 2006. There were "serial Refinancers" in the marketplace at the time.

Also, dont overlook the fact that most of these trusts are related to Long Beach Mortgage. Long Beach was a subprime lender. The rates on the loans were very high so it was an excellent return.....as long as the borrowers made their payments. So any analysis would need to include the massize credit losses that did infact occur. Loans were made on appraised amounts far in excess of what a property would sell for in foreclosure after the prices crashed. The trust takes that loss....

WaMu used to track on key metric on subprime loans. It was called "first payment default." Literally meaning that the borrower failed to even make their first payment. WaMu'g goal was to make sure any originated loan could be securitized or sold in less than 30 days so they wouldnt be exposed to the first payment default loans (those had to be kept, and they didnt want them)....

Even if the analysis you provided was accurate from a "mechanical" point of view, my guess is that there is considerably less than 692 to divy up....