Practice Areas & Industries: Loeb & Loeb LLP

Practice/Industry Group Overview

Loeb & Loeb's Mortgage Industry Service Team is an interdisciplinary group of lawyers established to advise our clients with respect to the myriad legal, economic and practical issues which have arisen as a result of the dislocations and upheavals in the subprime mortgage market. We are currently engaged in significant and broad ranging actions involving the issues that are at the heart of the current market disruption.

Our attorneys have more than a decade of experience representing participants in the subprime mortgage industry. This experience includes virtually all aspects of mortgage lending, the financing of mortgage lenders and the securitization of mortgage backed assets, as well as fair lending and mortgage fraud litigation, including individual suits, class actions, regulatory matters, criminal matters and massive civil fraud suits.

By working as a coordinated team, we are able to assist our clients in analyzing the challenges and opportunities they face, prepare for the possible eventualities, and respond promptly and effectively as issues arise.

Services Available

Bankruptcy and Restructuring
Since the latter part of 2006, our bankruptcy group has been very active representing institutional clients in connection with their mortgage industry transactions. Among the major stakeholders we currently represent are:

• a major Wall Street financial services company
• national and international money-center banking institutions
• a West Coast-based mortgage issuer
• institutional debt investors, including insurance companies
• a Southern California-based subprime wholesale mortgage lender
• a private mortgage banker
• a large subprime mortgage lender and real estate investment trust (REIT)
• a Texas-based wholesale mortgage loan provider and
• a privately-held national mortgage lender.

This work has included pre-bankruptcy advice, debt restructurings, out of court recapitalizations, refinancing securitizations, addressing rating agency concerns, DIP financing, asset purchases and sales (both in and out of bankruptcy), representation in pending bankruptcy proceedings, compliance and disclosure issues and corporate governance advice.

We have assisted our clients in liquidating repo agreements, forward contracts, swaps and other derivatives, many of which have special protections under recent amendments to the Bankruptcy Code. We have already experienced challenges by the debtors in several of the subprime bankruptcies focusing on, among other things, the characterization of these arrangements and the methodologies employed by repo counterparties to value and liquidate their collateral.

We are currently representing significant stakeholders in connection with some of the largest pending mortgage and subprime bankruptcy cases in the United States, including:

• Aegis Mortgage Corporation
• Alliance Mortgage Investments, Inc.
• American Home Mortgage Holdings, Inc.
• Choice Capital Funding, Inc.
• First Magnus Financial Corporation
• MILA, Inc.
• New Century Financial Corporation
• Ownit Mortgage Solutions, Inc.
• People's Choice Home Loan, Inc.
• Premier Mortgage Funding, Inc.
• ResMAE Mortgage Corporation, Inc.
• Sentinel Management Group, Inc.
• Southstar Funding, LLC

Litigation
Our litigators have significant experience in a broad range of matters relating to residential mortgage lending in general and subprime lending in particular. We have represented:

• one of the nation's largest purchasers of mortgages in the secondary mortgage market in a suit against a mortgage lender for massive fraud;
• a publicly-traded mortgage lender in a $110 million suit regarding cash flow projections for residual interests in securitizations;
• numerous different subprime lenders in fair lending claims;
• lenders in investigations and actions by Federal and State law enforcement and Federal and State regulators regarding various predatory lending and equal credit claims;
• lenders, purchasers, and underwriters in claims by borrowers; and
• claims for violations of TILA, RESPA, HOEPA, ECOA and state UDAP laws.

In working on these matters, our litigators have worked extensively with experts and market participants to develop a substantial knowledge and experience base in, among other things, the value of mortgage-backed assets issued by subprime lenders, which we believe is likely to become a more frequently litigated issue in the wake of the current crisis.

Our litigation team includes experienced trial attorneys, many of whom served as Assistant US Attorneys, state prosecutors and, in one case, as the Director of Law Enforcement for the United States Treasury Department, as well as seasoned bankruptcy practitioners who regularly handle both transactional and adversarial work.

Transactional Work
We also have comprehensive experience in transactional matters related to the recapitalizations of companies, workouts and restructurings of credit facilities and the purchase and sale of assets and businesses both within and outside of bankruptcy proceedings, and on behalf of debtors, creditors and government agencies. This includes experience with cashflow projections and modeling, determination of economic assumptions, sale of mortgage assets, and servicing platforms, warehouse lending, accounting for mortgage backed assets and intercreditor negotiations among various categories of debt and capital providers.

Service Approach
At Loeb & Loeb we endeavor to marshal the resources necessary to provide efficient comprehensive strategic analysis and legal advisory services to our clients. To accomplish this, we draw on our colleagues in such practice areas as:

• Bankruptcy, Restructuring and Creditors' Rights
• Commercial Finance
• Corporate Governance
• Corporate Investigations and Compliance
• Financial Services
• Mergers and Acquisitions
• Securities
• Securitization and Structured Finance
• Tax
• White Collar Criminal Defense

Practice Contact

Walter H. Curchack
Partner
212.407.4861
wcurchack@loeb.com