RMBS Trustee Sues

Bear Stearns RMBS Trustee Sues EMC Mortgage to Enforce Repurchase Obligations

On September 13, 2011, Wells Fargo, acting as Trustee for the Bear Stearns Mortgage Funding Trust 2007-AR2, sued EMC Mortgage in Delaware Chancery Court. In its breach of contract claim, Wells Fargo alleges that EMC Mortgage breached the parties’ Pooling and Servicing Agreement and Mortgage Loan Purchase Agreement by refusing to repurchase hundreds of loans it sold to the Trust that did not meet stated minimum quality standards. According to Wells Fargo, EMC Mortgage has twice refused to fulfill its repurchase obligations to the Trust after receiving written notice regarding nonconforming loan. Complaint.