UBS v. New Century – as the suits begin

It almost sound like Ginnie Mae’s conflict with American Home Mortgage. UBS Real Estate Securities Inc. v. New Century Mortgage Corporation, 07-50875, involves claims of breach of contract, conversion and breach of fiduciary duty against New Century, a mortgage lender. UBS is seeking an imposition of a constructive trust, an accounting and a permanent injunction.

In its complaint, UBS explained that it had entered into an agreement with New Century under which the mortgage lender “agreed to collect and deposit into a third-party custodial account borrower mortgage payments for the benefit of UBS, pending the repurchase of the underlying loans” by New Century.

But UBS claims that New Century failed to deposit millions of dollars of mortgage payments that it received from borrowers on loans purchased and owned by UBS, and did not account for missing escrow payments made by borrowers on loans purchased by UBS.

“As such [New Century has] misappropriated UBS’s money and escrow money being held for borrowers,” UBS said in its complaint. Representatives of New Century were not available for comment.

We simply ask, for the second time, about impact for the homeowner relative to taxes and insurance payments.