In-House Counsel’s Role in the Structuring of Mortgage-Backed Securities

30 Pages Posted: 10 Dec 2011  

Shaun Barnes

affiliation not provided to SSRN

Kathleen G. Cully

Kathleen G. Cully PLLC

Steven L. Schwarcz

Duke University School of Law

Date Written: December 8, 2011

Abstract

We briefly introduce the financial crisis and the role played by mortgage-backed securities. Then we describe the controversy at issue: whether, in order to own and enforce the mortgage loans backing those securities, a special-purpose vehicle “purchasing” mortgage loans must take physical delivery of the notes and security instruments in the precise manner specified by the sale agreement. Focusing on this controversy, we analyze (i) the extent, if any, that the controversy has merit; (ii) whether in-house counsel should have anticipated the controversy; and (iii) what, if anything, in-house counsel could have done to avert or, after it arose, to mitigate the controversy. Finally, we examine how the foregoing analysis can help to inform the broader issue of how in-house counsel should address complex legal transactions.

Keywords: financial crisis, mortgage-backed securities

Suggested Citation

Barnes, Shaun and Cully, Kathleen G. and Schwarcz, Steven L., In-House Counsel’s Role in the Structuring of Mortgage-Backed Securities (December 8, 2011). Wisconsin Law Review, Forthcoming. Available at SSRN: https://ssrn.com/abstract=1970249

Shaun Barnes

affiliation not provided to SSRN

Kathleen G. Cully

Kathleen G. Cully PLLC ( email )

42 W. 44th Street
New York, NY 10036
United States
(212) 447-9882 (Phone)

Steven L. Schwarcz (Contact Author)

Duke University School of Law ( email )

210 Science Drive
Box 90362
Durham, NC 27708
United States
919-613-7060 (Phone)
919-613-7231 (Fax)

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