In an Assignment of Mortgage and Note, there are three parties involved in the transaction. These are: the Assignor (Seller); the Assignee (Buyer); and the underlying maker of the mortgage and loan as the Payor. The Payor may have no say as to the assignment occurrence and is therefore a silent partner, however, they do have some participation since they are the party that will continue making future payments as may be due. Typically, a transaction between the Assignor/Seller and Assignee/Buyer should imply an arm's-length transaction, meaning that the Buyer is responsible for the due diligence involved to determine the Present Value of the future cash flow of payments as may be still due until the mortgage and note are paid off. What the Assignee/Buyer pays to the Assignor/Seller should be a function of a negotiated price, since the future cash flow value is a function of the number of payments due in the future, their frequency, interest rate payable, interest rate environment at the time of the transaction, as well as the future anticipated interest rate environment, the strength of the collateral value and the financial/credit strength of the Payor, etc (among many other factors to consider). In other words, the Assignee/Buyer is paying an amount at the assignment date closing upon which they expect a Return On Investment and the risk of collecting on their cash investment.
Now what I find interesting is (from what I have seen), that in an assignment, the Assignor and Assignee typically trust each other, in that the Assignor says the Payor owes so much on such and such a date, and has so many future payments. They can transfer the original mortgage and note since those documents are needed in their original form in order to foreclose upon the collateral and to establish claim standing. However, there is no proof of due diligence, and/ or to the transfer of underlying Payment History records, bookkeeping, etc. After all, how does Payor know what the hell the Assignor/Seller sold? What if they were faulty in their record keeping? What if they had practiced predatory lending and overcharged on interest, fees, etc., and/or just made mistakes (honest or not) on prior transactions to the Assignment? If the Assignee/Buyer doesn’t do a complete due diligence analysis, how do they know what they are buying and if it is correct?
In fact, some Assignments have recourse, while others do not. In the end, the parties to the Assignment have a duty to the Payor because it is their collateral they are handling and transferring, plus a fiduciary duty to maintain an accurate, sufficiently detailed payment history such as, but not necessarily limited to, what date where payments received and how they were handled and applied, as may involve principal reduction, principal pre-payment, interest accrued, and interest payment reduction, as well as taxes, insurance, costs, expenses and fees, etc. A Payor has a right to now how their mortgage payments are being handled, applied and amortized, and it is the responsibility of the Lender to maintain and document this upon reasonable demand.
In the end, if the Lender cannot provide a meaningful, sufficiently detailed, trustworthy and accurate payment history, they then cannot make a case to say what amount is owned at any given point in time, whether it is for the Assignment or when they make claim for a payoff or a foreclosure lawsuit action.
Yes, the Lenders issue an affidavit from someone who works and has duty only to the Lender, who says they are the keeper/custodian of the records, and they say what is owed. Well crap on them, because they had better handled, or been employed continuously through the period of the payment history so they can accurately attest to it. Otherwise they cannot say with any certainty the payment history is accurate. This is even more applicable after an Assignment has taken place.