A group of private label investors acting through the Dallas law firm of Talcott Franklin PC, said its members now represent ownership interests in about one-third of the $1.5 trillion PLS market.
The group's collective power is aimed at giving these investors -- including those that bought stakes in subprime and alt-A bonds -- more rights in how outstanding workout deals are handled.
Investors have sought this because "historically, when investors have approached the trustees about taking some kind of action...some of them have said [things like] 'there's a 25% requirement -- come back when you have 25%,'" attorney Tal Franklin told National Mortgage News.
Now that the "clearinghouse" group has met the requirements of many of these triggers, it is sending letters to trustees calling for better communication and resolving issues it feels will improve the "dismal" performance of RMBS.
There has been talk since spring that some headway was being made in legal barriers preventing effective workouts of securitized residential mortgages in which investors groups were mentioned, but Franklin said whether this occurs still remains to be seen.
"This is really the first step," he said. "We're going to see who is willing to cooperate with us and we're hoping that everyone is."
