OMFG Fire Up the Shredders
Forbes breaks this story:
American Home Mortgage Investment Corp.'s plan to destroy 490,000 hardcopy mortgage loan files has drawn fire from federal bankruptcy monitors, who say it could hurt homeowners' ability to sue the failed lender.
The company, once one of the country's largest mortgage lenders, says it can no longer afford the $45,000-per-month rental on warehouse space to preserve hard loan files.
"The only loan files that we are destroying or seeking to destroy have been fully imaged," Kalas said. "Anything related to consumer concerns or loan fraud or anything like that, the information would be available on American Home servers."
Investors who own the loans also have protested the plan to destroy the files, complaining in court papers that they have had trouble getting full documentation from American Home, and don't want to see the paper files destroyed.
"Tanta the Great" at Calculated Risk has both denouned and settled this. Several judges who have been exposed to the shady lawyer practices seeking to obviate this fundamental protection have wisely followed her lead.
Documents and provenance are de rigeur. When all that French stuff starts showing up you know it is serious.