let's call our congressman tomorrow !!!!
Sunday, October 31, 2010
Sunday winner Video !!!!
Pay a close attention to what Bernanke
and the Federal Reserve Inspector General say.
write your congressman to get The Federal Reserve Bank audit ASAP.
and the Federal Reserve Inspector General say.
write your congressman to get The Federal Reserve Bank audit ASAP.
banks are concern about homeowners on foreclosure
We got exclusive access to the Bank's plan
on developing energy efficient homes to give free to homeowners in foreclosure.
Epecial sneak peek of the prototype
on developing energy efficient homes to give free to homeowners in foreclosure.
Epecial sneak peek of the prototype
Rick Santelli on Fed Audit - Darkness (secrecy) is NEVER better!
This video is from November 20/2009.
The two person in the right of the screen oppose to the Fed audit.
Listen to what the lady on the right of the screen said about our congressman.
She later state: "that the Federal Reserve is working on creating stronger economy"
Today, in October 31/2010, do you think the Federal Reserve succeed on creating a stronger economy ????
Audit the Fed Now !!!!!
The two person in the right of the screen oppose to the Fed audit.
Listen to what the lady on the right of the screen said about our congressman.
She later state: "that the Federal Reserve is working on creating stronger economy"
Today, in October 31/2010, do you think the Federal Reserve succeed on creating a stronger economy ????
Audit the Fed Now !!!!!
honey do list for next week
Fellow americans you have two things to do this coming week :
1) write to your congressman and ask for The Federal Reserve to be audit.
2) call The red Roof Inn hotel near you and ask for a free weekend room for the whole family
1) write to your congressman and ask for The Federal Reserve to be audit.
2) call The red Roof Inn hotel near you and ask for a free weekend room for the whole family
Another Black Eye
By Mark Fogarty
Mega-servicers like Bank of America and Ally Financial are kidding themselves if they think they can declare the foreclosure mess behind them after short self-investigations and blithely resume operations as before.
The issue isn’t whether or not these borrowers deserve to be foreclosed on or not. Let’s assume all of them, or nearly all, have defaulted on their mortgages. The issue is whether servicers have done these foreclosures with the proper due diligence or have not, out of carelessness or arrogance.
Servicers would be wise to consider the pent-up anger of the American public at mortgage firms. They were poorly served on the originations side by originators (especially subprime ones), ratings agencies and securitizers. Now they are being poorly served on the servicing side. Make no mistake about it. This is another black eye for an industry that can scarcely afford it.
What’s the worst that could happen? Judges could unwind foreclosures and give borrowers their homes back, though that seems highly unlikely. But both the House and Senate have scheduled hearings on the issue for this month, and everyone knows how powerful a committee chair with an ax to grind can be.
Plus, all 50 state attorneys general have banded together to investigate servicing practices. Our recollection of investigations by state AGs, and there only needs be one or two, not all 50, is that they tend to end up with multi-hundred-million-dollar settlements.
Stepping back a little farther yet, it is possible to survey industry practices over the last decade and ask, whatever happened to the mortgage industry? After the savings and loan debacle it seemed to soberly resume its normal functions only to lose its way in a major way in the last decade. Is the ethics and probity of the mortgage business as cyclical as real estate is? Let’s hope not.
Angelo Mozilo, who has just settled charges with the Securities and Exchange Commission, is the living emblem of the business. There’s no doubt his Countrywide Financial went off the tracks in a major way during the go-go subprime years. But for decades before that, Mozilo was the ideal mortgage banker, a man who measured his moves carefully and targeted minority borrowers not to abuse them but to serve them.
But greed and arrogance seemed to take over the business for a stretch there. Greed, for lack of a better word, is not good, to paraphrase a famous movie line. And perhaps it is on the wane in the industry. Now arrogance needs to be rooted out as well.
Mega-servicers like Bank of America and Ally Financial are kidding themselves if they think they can declare the foreclosure mess behind them after short self-investigations and blithely resume operations as before.
The issue isn’t whether or not these borrowers deserve to be foreclosed on or not. Let’s assume all of them, or nearly all, have defaulted on their mortgages. The issue is whether servicers have done these foreclosures with the proper due diligence or have not, out of carelessness or arrogance.
Servicers would be wise to consider the pent-up anger of the American public at mortgage firms. They were poorly served on the originations side by originators (especially subprime ones), ratings agencies and securitizers. Now they are being poorly served on the servicing side. Make no mistake about it. This is another black eye for an industry that can scarcely afford it.
What’s the worst that could happen? Judges could unwind foreclosures and give borrowers their homes back, though that seems highly unlikely. But both the House and Senate have scheduled hearings on the issue for this month, and everyone knows how powerful a committee chair with an ax to grind can be.
Plus, all 50 state attorneys general have banded together to investigate servicing practices. Our recollection of investigations by state AGs, and there only needs be one or two, not all 50, is that they tend to end up with multi-hundred-million-dollar settlements.
Stepping back a little farther yet, it is possible to survey industry practices over the last decade and ask, whatever happened to the mortgage industry? After the savings and loan debacle it seemed to soberly resume its normal functions only to lose its way in a major way in the last decade. Is the ethics and probity of the mortgage business as cyclical as real estate is? Let’s hope not.
Angelo Mozilo, who has just settled charges with the Securities and Exchange Commission, is the living emblem of the business. There’s no doubt his Countrywide Financial went off the tracks in a major way during the go-go subprime years. But for decades before that, Mozilo was the ideal mortgage banker, a man who measured his moves carefully and targeted minority borrowers not to abuse them but to serve them.
But greed and arrogance seemed to take over the business for a stretch there. Greed, for lack of a better word, is not good, to paraphrase a famous movie line. And perhaps it is on the wane in the industry. Now arrogance needs to be rooted out as well.
“Protest works. Just look at the proof”
by Yves Smith
It’s astonishing to see how Americans have been conditioned to think that political action and engagement is futile. I’m old enough to have witnessed the reverse, how activism in the 1960s produced significant advances in civil rights blacks and women, and eventually led the US to exit the Vietnam War.
I’m reminded of this sense of despair almost daily in the comments section. Whenever possible action steps come up, virtually without fail, quite a few will argue that there is no point in making an effort, that we as individuals are powerless.
I don’t buy that as a stance, particularly because trained passivity is a great, low cost way to hobble people who have been wronged. I mistakenly relegated an article by Johann Hari in the Independent on this topic to Links, and Richard Kline’s commentary on it made me realize it deserved its own post, so I am remedying that error now.
As Kline observed:
The nut of the matter is this: you lose, you lose, you lose, you lose, they give up. As someone who has protested, and studied the process, it’s plain that one spends most of one’s time begin defeated. That’s painful, humiliating, and intimidating. One can’t expect typically, as in a battle, to get a clean shot at a clear win. What you do with protest is just what Hari discusses, you change the context, and that change moves the goalposts on your opponent, grounds out the current in their machine. The nonviolent resistance in Hungary in the 1860s (yes, that’s in the 19th century) is an excellent example. Communist rule in Russia and its dependencies didn’t fail because protestors ‘won’ but because most simply withdrew their cooperation to the point it suffocated.
Americans have cultural norms that work against trying to move the political/social needle. Class and economic aspirations are one of them; protestors are by definition malcontents, and thus presumed losers. Busy successful people obviously have not reason to waste their time this way, right? Another impediment is the weird American fixation with optimism. Talk candidly about how stuffed up things are, and you can be dismissed as being “negative”. Despite how much it is revered in pop psychology and the “how to succeed in business” literature, optimism is not necessarily a good trait for long, hard fought struggles. Those who anticipate that success will come sooner than it does will find their hopes dashed repeatedly. Some may be resilient enough to themselves up and try again, but that isn’t universal (being pessimistic and tenacious is probably a better stance, but our culture does not breed for that).
From Johann Hari:
There is a ripple of rage spreading across Britain. It is clearer every day that the people of this country have been colossally scammed. The bankers who crashed the economy are richer and fatter than ever, on our cash. The Prime Minister who promised us before the election “we’re not talking about swingeing cuts” just imposed the worst cuts since the 1920s, condemning another million people to the dole queue. Yet the rage is matched by a flailing sense of impotence. We are furious, but we feel there is nothing we can do. There’s a mood that we have been stitched up by forces more powerful and devious than us, and all we can do is sit back and be shafted.
This mood is wrong. It doesn’t have to be this way – if enough of us act to stop it. To explain how, I want to start with a small scandal, a small response – and a big lesson from history.
In my column last week, I mentioned in passing something remarkable and almost unnoticed. For years now, Vodafone has been refusing to pay billions of pounds of taxes to the British people that are outstanding….
Many people emailed me saying they were outraged that while they pay their fair share for running the country, Vodafone doesn’t pay theirs. One of them named Thom Costello decided he wanted to organize a protest, so he appealed on Twitter – and this Wednesday seventy enraged citizens shut down the flagship Vodafone store on Oxford Street in protest. “Vodafone won’t pay as they go,” said one banner. “Make Vodafone pay, not the poor,” said another.
The reaction from members of the public – who were handed leaflets explaining the situation – was startling. Again and again, people said “I’m so glad somebody is doing this” and “there needs to be much more of this.” Lots of them stopped to talk about how frightened they were about the cuts and for their own homes and jobs. The protest became the third most discussed topic in the country on Twitter, meaning millions of people now know about what Vodafone and the government have done.
You might ask – so what? What has been changed? To understand how and why protest like this can work, you need some concrete and proven examples from the past. Let’s start with the most hopeless and wildly idealistic cause – and see how it won. The first ever attempt to hold a Gay Pride rally in Trafalgar Square was in 1965. Two dozen people turned up – and they were mostly beaten by the police and arrested. Gay people were imprisoned for having sex, and even the most compassionate defense of gay people offered in public life was that they should be pitied for being mentally ill.
Imagine if you had stood in Trafalgar Square that day and told those two dozen brave men and women: “Forty-five years from now, they will stop the traffic in Central London for a Gay Pride parade on this very spot, and it will be attended by hundreds of thousands of people. There will be married gay couples, and representatives of every political party, and openly gay soldiers and government ministers and huge numbers of straight supporters – and it will be the homophobes who are regarded as freaks.” It would have seemed like a preposterous statement of science fiction. But it happened. It happened in one lifetime. Why? Not because the people in power spontaneously realized that millennia of persecuting gay people had been wrong, but because determined ordinary citizens banded together and demanded justice.
If that cause can be achieved, through persistent democratic pressure, anything can. But let’s look at a group of protesters who thought they had failed. The protests within the United States against the Vietnam War couldn’t prevent it killing three million Vietnamese and 80,000 Americans. But even in the years it was “failing”, it was achieving more than the protestors could possibly have known. In 1966, the specialists at the Pentagon went to US President Lyndon Johnson – a thug prone to threatening to “crush” entire elected governments – with a plan to end the Vietnam War: nuke the country. They “proved”, using their computer modeling, that a nuclear attack would “save lives.”
It was a plan that might well have appealed to him. But Johnson pointed out the window, towards the hoardes of protesters, and said: “I have one more problem for your computer. Will you feed into it how long it will take 500,000 angry Americans to climb the White House wall out there and lynch their President?” He knew that there would be a cost – in protest and democratic revolt – that made that cruelty too great. In 1970, the same plan was presented to Richard Nixon – and we now know from the declassified documents that the biggest protests ever against the war made him decide he couldn’t do it. Those protesters went home from those protests believing they had failed – but they had succeeded in preventing a nuclear war. They thought they were impotent, just as so many of us do – but they really had power beyond their dreams to stop a nightmare.
Protest raises the political price for governments making bad decisions. It stopped LBJ and Nixon making the most catastrophic decision of all. The same principle can apply to the Conservative desire to kneecap the welfare state while handing out massive baubles to their rich friends. The next time George Osborne has to decide whether to cancel the tax bill of a super-rich corporation and make us all pick up the tab, he will know there is a price. People will find out, and they will be angry. The more protests there are, the higher the price. If enough of us demand it, we can make the rich pay their share for the running of our country, rather than the poor and the middle – to name just one urgent cause that deserves protest.
And protest can have an invisible ripple-effect that lasts for generations. A small group of women from Iowa lost their sons early in the Vietnam war, and they decided to set up an organization of mothers opposing the assault on the country. They called a protest of all mothers of serving soldiers outside the White House – and six turned up in the snow. Even though later in the war they became nationally important voices, they always remembered that protest as an embarrassment and a humiliation.
Until, that is, one day in the 1990s, one of them read the autobiography of Benjamin Spock, the much-loved and trusted celebrity doctor, who was the Oprah of his day. When he came out against the war in 1968, it was a major turning point in American public opinion. And he explained why he did it. One day, he had been called to a meeting at the White House to be told how well the war in Vietnam was going, and he saw six women standing in the snow with placards, alone, chanting. It troubled his conscience and his dreams for years. If these women were brave enough to protest, he asked himself, why aren’t I? It was because of them that he could eventually find the courage to take his stand – and that in turn changed the minds of millions, and ended the war sooner. An event that they thought was a humiliation actually turned the course of history.
You don’t know what the amazing ripple-effect of your protest will be – but wouldn’t Britain be a better place if it replaced the ripple of impotent anger so many of us are feeling? Yes, you can sit back and let yourself be ripped off by the bankers and the corporations and their political lackeys if you want. But it’s an indulgent fiction to believe that is all you can do. You can act in your own self-defence. As Margaret Mead, the great democratic campaigner, said: “Never doubt that a small group of thoughtful people could change the world. Indeed, it’s the only thing that ever has.”
It’s astonishing to see how Americans have been conditioned to think that political action and engagement is futile. I’m old enough to have witnessed the reverse, how activism in the 1960s produced significant advances in civil rights blacks and women, and eventually led the US to exit the Vietnam War.
I’m reminded of this sense of despair almost daily in the comments section. Whenever possible action steps come up, virtually without fail, quite a few will argue that there is no point in making an effort, that we as individuals are powerless.
I don’t buy that as a stance, particularly because trained passivity is a great, low cost way to hobble people who have been wronged. I mistakenly relegated an article by Johann Hari in the Independent on this topic to Links, and Richard Kline’s commentary on it made me realize it deserved its own post, so I am remedying that error now.
As Kline observed:
The nut of the matter is this: you lose, you lose, you lose, you lose, they give up. As someone who has protested, and studied the process, it’s plain that one spends most of one’s time begin defeated. That’s painful, humiliating, and intimidating. One can’t expect typically, as in a battle, to get a clean shot at a clear win. What you do with protest is just what Hari discusses, you change the context, and that change moves the goalposts on your opponent, grounds out the current in their machine. The nonviolent resistance in Hungary in the 1860s (yes, that’s in the 19th century) is an excellent example. Communist rule in Russia and its dependencies didn’t fail because protestors ‘won’ but because most simply withdrew their cooperation to the point it suffocated.
Americans have cultural norms that work against trying to move the political/social needle. Class and economic aspirations are one of them; protestors are by definition malcontents, and thus presumed losers. Busy successful people obviously have not reason to waste their time this way, right? Another impediment is the weird American fixation with optimism. Talk candidly about how stuffed up things are, and you can be dismissed as being “negative”. Despite how much it is revered in pop psychology and the “how to succeed in business” literature, optimism is not necessarily a good trait for long, hard fought struggles. Those who anticipate that success will come sooner than it does will find their hopes dashed repeatedly. Some may be resilient enough to themselves up and try again, but that isn’t universal (being pessimistic and tenacious is probably a better stance, but our culture does not breed for that).
From Johann Hari:
There is a ripple of rage spreading across Britain. It is clearer every day that the people of this country have been colossally scammed. The bankers who crashed the economy are richer and fatter than ever, on our cash. The Prime Minister who promised us before the election “we’re not talking about swingeing cuts” just imposed the worst cuts since the 1920s, condemning another million people to the dole queue. Yet the rage is matched by a flailing sense of impotence. We are furious, but we feel there is nothing we can do. There’s a mood that we have been stitched up by forces more powerful and devious than us, and all we can do is sit back and be shafted.
This mood is wrong. It doesn’t have to be this way – if enough of us act to stop it. To explain how, I want to start with a small scandal, a small response – and a big lesson from history.
In my column last week, I mentioned in passing something remarkable and almost unnoticed. For years now, Vodafone has been refusing to pay billions of pounds of taxes to the British people that are outstanding….
Many people emailed me saying they were outraged that while they pay their fair share for running the country, Vodafone doesn’t pay theirs. One of them named Thom Costello decided he wanted to organize a protest, so he appealed on Twitter – and this Wednesday seventy enraged citizens shut down the flagship Vodafone store on Oxford Street in protest. “Vodafone won’t pay as they go,” said one banner. “Make Vodafone pay, not the poor,” said another.
The reaction from members of the public – who were handed leaflets explaining the situation – was startling. Again and again, people said “I’m so glad somebody is doing this” and “there needs to be much more of this.” Lots of them stopped to talk about how frightened they were about the cuts and for their own homes and jobs. The protest became the third most discussed topic in the country on Twitter, meaning millions of people now know about what Vodafone and the government have done.
You might ask – so what? What has been changed? To understand how and why protest like this can work, you need some concrete and proven examples from the past. Let’s start with the most hopeless and wildly idealistic cause – and see how it won. The first ever attempt to hold a Gay Pride rally in Trafalgar Square was in 1965. Two dozen people turned up – and they were mostly beaten by the police and arrested. Gay people were imprisoned for having sex, and even the most compassionate defense of gay people offered in public life was that they should be pitied for being mentally ill.
Imagine if you had stood in Trafalgar Square that day and told those two dozen brave men and women: “Forty-five years from now, they will stop the traffic in Central London for a Gay Pride parade on this very spot, and it will be attended by hundreds of thousands of people. There will be married gay couples, and representatives of every political party, and openly gay soldiers and government ministers and huge numbers of straight supporters – and it will be the homophobes who are regarded as freaks.” It would have seemed like a preposterous statement of science fiction. But it happened. It happened in one lifetime. Why? Not because the people in power spontaneously realized that millennia of persecuting gay people had been wrong, but because determined ordinary citizens banded together and demanded justice.
If that cause can be achieved, through persistent democratic pressure, anything can. But let’s look at a group of protesters who thought they had failed. The protests within the United States against the Vietnam War couldn’t prevent it killing three million Vietnamese and 80,000 Americans. But even in the years it was “failing”, it was achieving more than the protestors could possibly have known. In 1966, the specialists at the Pentagon went to US President Lyndon Johnson – a thug prone to threatening to “crush” entire elected governments – with a plan to end the Vietnam War: nuke the country. They “proved”, using their computer modeling, that a nuclear attack would “save lives.”
It was a plan that might well have appealed to him. But Johnson pointed out the window, towards the hoardes of protesters, and said: “I have one more problem for your computer. Will you feed into it how long it will take 500,000 angry Americans to climb the White House wall out there and lynch their President?” He knew that there would be a cost – in protest and democratic revolt – that made that cruelty too great. In 1970, the same plan was presented to Richard Nixon – and we now know from the declassified documents that the biggest protests ever against the war made him decide he couldn’t do it. Those protesters went home from those protests believing they had failed – but they had succeeded in preventing a nuclear war. They thought they were impotent, just as so many of us do – but they really had power beyond their dreams to stop a nightmare.
Protest raises the political price for governments making bad decisions. It stopped LBJ and Nixon making the most catastrophic decision of all. The same principle can apply to the Conservative desire to kneecap the welfare state while handing out massive baubles to their rich friends. The next time George Osborne has to decide whether to cancel the tax bill of a super-rich corporation and make us all pick up the tab, he will know there is a price. People will find out, and they will be angry. The more protests there are, the higher the price. If enough of us demand it, we can make the rich pay their share for the running of our country, rather than the poor and the middle – to name just one urgent cause that deserves protest.
And protest can have an invisible ripple-effect that lasts for generations. A small group of women from Iowa lost their sons early in the Vietnam war, and they decided to set up an organization of mothers opposing the assault on the country. They called a protest of all mothers of serving soldiers outside the White House – and six turned up in the snow. Even though later in the war they became nationally important voices, they always remembered that protest as an embarrassment and a humiliation.
Until, that is, one day in the 1990s, one of them read the autobiography of Benjamin Spock, the much-loved and trusted celebrity doctor, who was the Oprah of his day. When he came out against the war in 1968, it was a major turning point in American public opinion. And he explained why he did it. One day, he had been called to a meeting at the White House to be told how well the war in Vietnam was going, and he saw six women standing in the snow with placards, alone, chanting. It troubled his conscience and his dreams for years. If these women were brave enough to protest, he asked himself, why aren’t I? It was because of them that he could eventually find the courage to take his stand – and that in turn changed the minds of millions, and ended the war sooner. An event that they thought was a humiliation actually turned the course of history.
You don’t know what the amazing ripple-effect of your protest will be – but wouldn’t Britain be a better place if it replaced the ripple of impotent anger so many of us are feeling? Yes, you can sit back and let yourself be ripped off by the bankers and the corporations and their political lackeys if you want. But it’s an indulgent fiction to believe that is all you can do. You can act in your own self-defence. As Margaret Mead, the great democratic campaigner, said: “Never doubt that a small group of thoughtful people could change the world. Indeed, it’s the only thing that ever has.”
Big Banks Told Not To 'Fix' A Fraud .
By ROBBIE WHELAN
Ohio's attorney general threw a wrench into the banking industry's push to quickly restart foreclosures by fixing faulty paperwork, and pressed them to modify mortgage loans.
In two letters released Friday, Attorney General Richard Cordray criticized a number of banks and loan-servicing companies, including Wells Fargo & Co.; Ally Financial Inc.'s GMAC Mortgage; Bank of America Corp.; and J.P. Morgan Chase & Co. Mr. Cordray said the banks are trying to paper over fraud committed in foreclosures with temporary fixes that don't address underlying problems in the banks' practices.
"It is not acceptable for a party who believes they submitted false court documents to merely replace those documents. Wells Fargo and any other banks are not simply allowed a 'do-over,' " he wrote in the letter to Wells. The other letter was sent to Ohio judges, who were asked to notify Mr. Cordray when banks file substitute affidavits.
He demanded that the banks vacate any court order or motion that was based on improper paperwork. In an interview Friday, Mr. Cordray said the banks would "be well-served to work out a settlement with the borrowers to modify the loans and work out payments."
Mr. Cordray's letters come as several banks say they have reviewed their foreclosure procedures and are resuming evictions. But his insistence that they go beyond replacing affidavits by employees who have been labeled "robo-signers"—who didn't adequately review underlying foreclosure documentation—threatens to upend banks' efforts to resolve their foreclosure problems.
Mr. Cordray's strategy gives clues to the goals of a 50-state probe, which was announced two weeks ago. Led by Iowa Attorney General Tom Miller, the effort was joined by top law-enforcement officers from all 50 states in response to reports of widespread errors in foreclosure filings and allegations of robo-signing.
"The banks are committing fraud on the court, essentially perjury, and then saying 'Whoops! You caught me! Here's some different evidence and use that instead,' " Mr. Cordray said in an interview Friday. "I know a lot of judges are not going to take kindly to that."
Bank of America declined to comment. A Wells Fargo spokeswoman said Friday the company intends to cooperate with Mr. Cordray's inquiries and doesn't "believe that any of these instances led to foreclosures which should not have otherwise occurred." She added that Wells Fargo has "chosen to submit supplemental affidavits out of an abundance of caution."
Tom Kelly, a J.P. Morgan spokesman, said the company is still reviewing foreclosure documents for mistakes and hasn't refiled any new or replacement affidavits. Gina Proia, a spokeswoman for GMAC, said her company is "not proceeding with foreclosure sales in Ohio or any state using a defective affidavit."
The aims of the 50-state probe were initially unclear. Some attorneys general, however, made reference to a 2008 settlement in which Bank of America agreed to an $8.4 billion loan-modification program after its Countrywide Financial unit was probed for predatory lending practices.
Mr. Cordray declined to discuss the 50-state investigation or the conversations he has had with other attorneys general about the matter. Mr. Cordray, a Democrat, faces a Republican challenger for his office in Tuesday's general election.
Wells Fargo Chief Financial Officer Howard Atkins said in an Oct. 20 television interview that he was "confident with our policies and controls" related to foreclosures and that "the person at Wells who signs a foreclosure file is the same person as the person who reviews the file, and it is not always done that way in the industry."
But on Oct. 28, Wells announced it was resubmitting affidavits for 55,000 pending foreclosures, suggesting that some of the paperwork might be flawed. In March, a Wells Fargo employee named Xee Moua said in a sworn deposition in a Florida foreclosure case that she signed between 300 and 500 foreclosure documents a day, without reviewing the numbers on the loan files for accuracy.
Asked if she verified the appropriate information, she said, "That's not part of my job description."
Ohio's attorney general threw a wrench into the banking industry's push to quickly restart foreclosures by fixing faulty paperwork, and pressed them to modify mortgage loans.
In two letters released Friday, Attorney General Richard Cordray criticized a number of banks and loan-servicing companies, including Wells Fargo & Co.; Ally Financial Inc.'s GMAC Mortgage; Bank of America Corp.; and J.P. Morgan Chase & Co. Mr. Cordray said the banks are trying to paper over fraud committed in foreclosures with temporary fixes that don't address underlying problems in the banks' practices.
"It is not acceptable for a party who believes they submitted false court documents to merely replace those documents. Wells Fargo and any other banks are not simply allowed a 'do-over,' " he wrote in the letter to Wells. The other letter was sent to Ohio judges, who were asked to notify Mr. Cordray when banks file substitute affidavits.
He demanded that the banks vacate any court order or motion that was based on improper paperwork. In an interview Friday, Mr. Cordray said the banks would "be well-served to work out a settlement with the borrowers to modify the loans and work out payments."
Mr. Cordray's letters come as several banks say they have reviewed their foreclosure procedures and are resuming evictions. But his insistence that they go beyond replacing affidavits by employees who have been labeled "robo-signers"—who didn't adequately review underlying foreclosure documentation—threatens to upend banks' efforts to resolve their foreclosure problems.
Mr. Cordray's strategy gives clues to the goals of a 50-state probe, which was announced two weeks ago. Led by Iowa Attorney General Tom Miller, the effort was joined by top law-enforcement officers from all 50 states in response to reports of widespread errors in foreclosure filings and allegations of robo-signing.
"The banks are committing fraud on the court, essentially perjury, and then saying 'Whoops! You caught me! Here's some different evidence and use that instead,' " Mr. Cordray said in an interview Friday. "I know a lot of judges are not going to take kindly to that."
Bank of America declined to comment. A Wells Fargo spokeswoman said Friday the company intends to cooperate with Mr. Cordray's inquiries and doesn't "believe that any of these instances led to foreclosures which should not have otherwise occurred." She added that Wells Fargo has "chosen to submit supplemental affidavits out of an abundance of caution."
Tom Kelly, a J.P. Morgan spokesman, said the company is still reviewing foreclosure documents for mistakes and hasn't refiled any new or replacement affidavits. Gina Proia, a spokeswoman for GMAC, said her company is "not proceeding with foreclosure sales in Ohio or any state using a defective affidavit."
The aims of the 50-state probe were initially unclear. Some attorneys general, however, made reference to a 2008 settlement in which Bank of America agreed to an $8.4 billion loan-modification program after its Countrywide Financial unit was probed for predatory lending practices.
Mr. Cordray declined to discuss the 50-state investigation or the conversations he has had with other attorneys general about the matter. Mr. Cordray, a Democrat, faces a Republican challenger for his office in Tuesday's general election.
Wells Fargo Chief Financial Officer Howard Atkins said in an Oct. 20 television interview that he was "confident with our policies and controls" related to foreclosures and that "the person at Wells who signs a foreclosure file is the same person as the person who reviews the file, and it is not always done that way in the industry."
But on Oct. 28, Wells announced it was resubmitting affidavits for 55,000 pending foreclosures, suggesting that some of the paperwork might be flawed. In March, a Wells Fargo employee named Xee Moua said in a sworn deposition in a Florida foreclosure case that she signed between 300 and 500 foreclosure documents a day, without reviewing the numbers on the loan files for accuracy.
Asked if she verified the appropriate information, she said, "That's not part of my job description."
Interesting today statement on MineSet blog
By: Jim Sinclair
If financial entities get away with clear and unquestioned CRIME, this society has ended.
Bankruptcy law is state law. Only a massive takeover of state rights would allow Washington to declare what is criminal (backdated false documents, false testimony in writing, etc.) as legal.
Right now this matter is fully the bastion of state Attorney Generals.
If financial entities get away with clear and unquestioned CRIME, this society has ended.
Bankruptcy law is state law. Only a massive takeover of state rights would allow Washington to declare what is criminal (backdated false documents, false testimony in writing, etc.) as legal.
Right now this matter is fully the bastion of state Attorney Generals.
Why big-time CEOs make terrible politicians
By Michael Hiltzik
Government and business are antithetical. That's not a flaw in the system government exists to take on precisely those tasks the private sector can't or won't
California is poised once again to compete for the crown as the nation's leading graveyard for business superstars trying to make the jump into politics.
With election day yet 48 hours away, it's still possible that Meg Whitman and Carly Fiorina will prevail in their campaigns for governor and U.S. senator. But the betting and the opinion polls are pointing the other way. So as we face the likely, if not certain, wreckage of these two lavishly financed campaigns, it's proper to ponder anew the following question: Why do big-time CEOs make such terrible politicians?
Of course, terrible politicians can come from anywhere, and not a few are currently serving in office. But you don't need much more than the fingers of one hand to count the successful business leaders who have morphed into successful politicians — and the political "success" of some is arguable.
The entrepreneur Michael Bloomberg is now serving his third term as an effective mayor of New York. Former Goldman Sachs Chairman Jon Corzine was elected twice to the U.S. Senate from New Jersey and once as governor, then lost a reelection bid.
In California, former Northwest Airlines Chairman Al Checchi squandered millions in a failed bid for the Democratic nomination for governor in 1998; four years later, financier Bill Simon lost the general election to Gray Davis. Peter Ueberroth, a successful businessman whose management of the 1984 Los Angeles Olympics won widespread praise, dropped out of the running for governor in the 2003 recall free-for-all. Michael Huffington, an executive in his family's oil firm, spent hugely to win a congressional seat in 1992 and got edged out by Dianne Feinstein in the millionaires' campaign for the Senate in 1994. One exception to this record: Richard Riordan, an investment executive, served two terms as a popular mayor of Los Angeles.
On the national level, the last business leader to reach the White House without having served previously in elective office was Herbert Hoover.
Searching for the secret of why business leaders find it so hard to make the transition to politics, I placed the issue before Simon Ramo, a founder of TRW, one of this state's leading industrialists for more than a half-century and a man who never felt the temptation to run for public office.
"To be a CEO and to be a political leader each demands about 10 important qualities," he told me. "Maybe five of those are the same — you have to know how to read a budget, and delegate authority, and manage people, for example — but the others have absolutely nothing in common with each other."
His point was that many qualities that make a good CEO are necessary, but not sufficient, to make a good politician, in the same sense that a concert violinist and a neurosurgeon need supple fingers — "but that doesn't mean you'd want a violinist to perform your surgery."
Eighty years ago, after Hoover's first year in office, the pundit Walter Lippmann observed that Hoover was a living disproof of the assumption that managerial skills in business were easily transferred to "the hurly-burly of conflicting wills which are the living tissue of popular government." Hoover showed himself incapable of jousting on that level. Instead, Lippmann wrote, he was "paralyzed by his own inexperience in the very special business of democracy."
It's hard to imagine a group of candidates more inexperienced in the "very special business of democracy" than our current crop of would-be CEO/politicos.
Engagement in democracy starts with participation in the ballot box. That's the real significance of Whitman's and Fiorina's well-documented failures to vote over the years. This isn't a "mistake," as Whitman likes to call it. A mistake is getting the address of the polling place wrong, once. Not bothering to vote year after year? That's contempt for the very concept of democracy.
In terms of public service, Whitman and Fiorina don't come near the stature of Hoover, who served as an administrator of humanitarian relief during and after World War I and in the cabinets of two presidents. Neither has served a similar public apprenticeship.
The usual rationale offered by business leaders to justify their candidacies is that "government needs to be run more like a business." For the most part, Whitman and Fiorina have avoided wholeheartedly embracing this threadbare trope, though the recent TV commercial in which Whitman says she knows "government isn't a business, and it shouldn't be," is at odds with the 2009 article in Fortune in which she's quoted as stating, "it's time to run California like a business."
It would be obvious to any business person who had spent a day in public administration that government and business are antithetical. That's not a flaw in the system. Government exists to take on precisely those tasks the private sector can't or won't do.
These include caring for the penniless; maintaining common amenities such as parks, schools, and universities; and creating infrastructure with broad value but unspecific beneficiaries, such as freeways and the Internet (which in coming days undoubtedly will be used by many readers to inform me by e-mail that they don't see how government serves any purpose).
Most of these functions can't be made to "pay" in the sense that a business strategy does. But they can be neglected or privatized only at great cost to society.
That's not to say there aren't efficiencies to be extracted from existing public services, but that these almost always prove to be marginal. Moreover, the candidates who bleat loudest about uncovering "waste, fraud and abuse" are often the rankest novices at governing. That includes Arnold Schwarzenegger, with his stillborn "blow up the boxes" campaign to reorganize state government, and Whitman, who has pledged to fire 40,000 state employees. Since California currently has the fourth-lowest ratio of state employees to population in the country, that sounds like a formula for less efficiency rather than more.
The principal quality that makes today's CEOs think they can compete in the political hurly-burly is wealth. Campaigns are more expensive than ever before (especially in California), and CEOs are better paid than they used to be. But recent history suggests that money isn't always enough. The Center for Responsive Politics found that in 2008, of the top 20 contributors to their own congressional campaigns, 13 failed to win their seat. Of the top 10 such candidates this year, only five are still in the race (including Fiorina).
If political skill could be acquired through the exercise of pure intelligence, which both Whitman and Fiorina possess in good measure, they would be doing better in the polls — and might have a real chance of success in their new jobs should they win. But if their public performances have suggested anything, it's that even in this electronic age, a good politician needs more than a PR staff and a TV budget.
Government and business are antithetical. That's not a flaw in the system government exists to take on precisely those tasks the private sector can't or won't
California is poised once again to compete for the crown as the nation's leading graveyard for business superstars trying to make the jump into politics.
With election day yet 48 hours away, it's still possible that Meg Whitman and Carly Fiorina will prevail in their campaigns for governor and U.S. senator. But the betting and the opinion polls are pointing the other way. So as we face the likely, if not certain, wreckage of these two lavishly financed campaigns, it's proper to ponder anew the following question: Why do big-time CEOs make such terrible politicians?
Of course, terrible politicians can come from anywhere, and not a few are currently serving in office. But you don't need much more than the fingers of one hand to count the successful business leaders who have morphed into successful politicians — and the political "success" of some is arguable.
The entrepreneur Michael Bloomberg is now serving his third term as an effective mayor of New York. Former Goldman Sachs Chairman Jon Corzine was elected twice to the U.S. Senate from New Jersey and once as governor, then lost a reelection bid.
In California, former Northwest Airlines Chairman Al Checchi squandered millions in a failed bid for the Democratic nomination for governor in 1998; four years later, financier Bill Simon lost the general election to Gray Davis. Peter Ueberroth, a successful businessman whose management of the 1984 Los Angeles Olympics won widespread praise, dropped out of the running for governor in the 2003 recall free-for-all. Michael Huffington, an executive in his family's oil firm, spent hugely to win a congressional seat in 1992 and got edged out by Dianne Feinstein in the millionaires' campaign for the Senate in 1994. One exception to this record: Richard Riordan, an investment executive, served two terms as a popular mayor of Los Angeles.
On the national level, the last business leader to reach the White House without having served previously in elective office was Herbert Hoover.
Searching for the secret of why business leaders find it so hard to make the transition to politics, I placed the issue before Simon Ramo, a founder of TRW, one of this state's leading industrialists for more than a half-century and a man who never felt the temptation to run for public office.
"To be a CEO and to be a political leader each demands about 10 important qualities," he told me. "Maybe five of those are the same — you have to know how to read a budget, and delegate authority, and manage people, for example — but the others have absolutely nothing in common with each other."
His point was that many qualities that make a good CEO are necessary, but not sufficient, to make a good politician, in the same sense that a concert violinist and a neurosurgeon need supple fingers — "but that doesn't mean you'd want a violinist to perform your surgery."
Eighty years ago, after Hoover's first year in office, the pundit Walter Lippmann observed that Hoover was a living disproof of the assumption that managerial skills in business were easily transferred to "the hurly-burly of conflicting wills which are the living tissue of popular government." Hoover showed himself incapable of jousting on that level. Instead, Lippmann wrote, he was "paralyzed by his own inexperience in the very special business of democracy."
It's hard to imagine a group of candidates more inexperienced in the "very special business of democracy" than our current crop of would-be CEO/politicos.
Engagement in democracy starts with participation in the ballot box. That's the real significance of Whitman's and Fiorina's well-documented failures to vote over the years. This isn't a "mistake," as Whitman likes to call it. A mistake is getting the address of the polling place wrong, once. Not bothering to vote year after year? That's contempt for the very concept of democracy.
In terms of public service, Whitman and Fiorina don't come near the stature of Hoover, who served as an administrator of humanitarian relief during and after World War I and in the cabinets of two presidents. Neither has served a similar public apprenticeship.
The usual rationale offered by business leaders to justify their candidacies is that "government needs to be run more like a business." For the most part, Whitman and Fiorina have avoided wholeheartedly embracing this threadbare trope, though the recent TV commercial in which Whitman says she knows "government isn't a business, and it shouldn't be," is at odds with the 2009 article in Fortune in which she's quoted as stating, "it's time to run California like a business."
It would be obvious to any business person who had spent a day in public administration that government and business are antithetical. That's not a flaw in the system. Government exists to take on precisely those tasks the private sector can't or won't do.
These include caring for the penniless; maintaining common amenities such as parks, schools, and universities; and creating infrastructure with broad value but unspecific beneficiaries, such as freeways and the Internet (which in coming days undoubtedly will be used by many readers to inform me by e-mail that they don't see how government serves any purpose).
Most of these functions can't be made to "pay" in the sense that a business strategy does. But they can be neglected or privatized only at great cost to society.
That's not to say there aren't efficiencies to be extracted from existing public services, but that these almost always prove to be marginal. Moreover, the candidates who bleat loudest about uncovering "waste, fraud and abuse" are often the rankest novices at governing. That includes Arnold Schwarzenegger, with his stillborn "blow up the boxes" campaign to reorganize state government, and Whitman, who has pledged to fire 40,000 state employees. Since California currently has the fourth-lowest ratio of state employees to population in the country, that sounds like a formula for less efficiency rather than more.
The principal quality that makes today's CEOs think they can compete in the political hurly-burly is wealth. Campaigns are more expensive than ever before (especially in California), and CEOs are better paid than they used to be. But recent history suggests that money isn't always enough. The Center for Responsive Politics found that in 2008, of the top 20 contributors to their own congressional campaigns, 13 failed to win their seat. Of the top 10 such candidates this year, only five are still in the race (including Fiorina).
If political skill could be acquired through the exercise of pure intelligence, which both Whitman and Fiorina possess in good measure, they would be doing better in the polls — and might have a real chance of success in their new jobs should they win. But if their public performances have suggested anything, it's that even in this electronic age, a good politician needs more than a PR staff and a TV budget.
Drowning in Campaign Cash
Editorial The New York Times.
Shrill political attacks have saturated the airwaves for months, but behind them is the real problem of this demoralizing election: the dark flow of dollars, often secretly provided by donors with very special interests.
The amount is staggering: Nearly $4 billion is likely to be spent once the final figures are in, according to the Center for Responsive Politics, far more than in the 2006 midterms, which cost $2.85 billion. It could even eclipse the $4.14 billion spent in the 2004 presidential campaign.
Much of this is a direct creation of the Supreme Court under Chief Justice John G. Roberts Jr., which has cut away nearly all campaign finance restrictions.
The court’s 2007 decision in Wisconsin Right-to-Life gave corporations and unions the right to run advocacy ads in the last 60 days of a campaign — as long as they did not expressly advocate the election or defeat of a specific candidate. This year’s Citizens United decision effectively ended even that last restriction, and pulled away all limits on corporate spending in campaigns.
Building on those decisions, political operatives — mainly Republicans — decided they could collect unlimited amounts of money through independent, tax- exempt organizations known as 501(c) groups, without revealing the source of the donations.
By offering anonymity and no limits, these groups (with gauzily apolitical names, like American Future Fund and American Action Network) have been able to raise and spend extraordinary sums. In the 2006 midterms, outside groups not affiliated with political parties spent $51.6 million; so far this year, such groups have spent $280 million. About 60 percent of that spending is from undisclosed donors, most of which has benefited Republicans. Democratic candidates raised huge amounts, but the sources for most of it were disclosed.
Combining both traditional and outside money, Republicans have slightly outraised Democrats, $1.64 billion to $1.59 billion, but there is more to be tallied.
While large secret donations have been legalized, it is not clear that the 501(c) groups spending the money on barrages of attack ads are playing by the last, threadbare rules. The tax code requires that these groups not be “primarily engaged” in political advocacy, but neither the Internal Revenue Service nor the Federal Election Commission has made any apparent effort to investigate what other purpose they might have. Some groups have suggested they would begin nonpolitical activities — after the election.
What is clear is that the new world of unlimited spending, both open and secret, confers huge benefits on wealthy individuals, corporations and unions. In a striking example, reported by ABC News last week, Terry Forcht, a prominent Kentucky banker and nursing home executive, helped pay for a series of attack ads against Attorney General Jack Conway, the Democratic Senate candidate. Mr. Conway is prosecuting one of Mr. Forcht’s nursing homes for allegedly covering up sexual abuse.
Mr. Forcht has directly raised at least $21,000 for Mr. Conway’s Republican opponent, Rand Paul. He serves as the banker for American Crossroads, the shadowy group of nonprofits organized by Karl Rove that has spent nearly $30 million to defeat Democrats and more than $1 million to defeat Mr. Conway.
This year, of course, is just batting practice for 2012. Congress still has time to act. The first step is to pass the Disclose Act, which would require the identification of large campaign donors. The second is to create a public financing system for Congressional candidates that provides extra money to those who rely on small donations.
Voters say — again and again — that they want to break the hold of special interests and end pay-to-play politics. And politicians promise — again and again — that they will. Four billion dollars and one particularly ugly campaign later, there can be no more excuses.
Shrill political attacks have saturated the airwaves for months, but behind them is the real problem of this demoralizing election: the dark flow of dollars, often secretly provided by donors with very special interests.
The amount is staggering: Nearly $4 billion is likely to be spent once the final figures are in, according to the Center for Responsive Politics, far more than in the 2006 midterms, which cost $2.85 billion. It could even eclipse the $4.14 billion spent in the 2004 presidential campaign.
Much of this is a direct creation of the Supreme Court under Chief Justice John G. Roberts Jr., which has cut away nearly all campaign finance restrictions.
The court’s 2007 decision in Wisconsin Right-to-Life gave corporations and unions the right to run advocacy ads in the last 60 days of a campaign — as long as they did not expressly advocate the election or defeat of a specific candidate. This year’s Citizens United decision effectively ended even that last restriction, and pulled away all limits on corporate spending in campaigns.
Building on those decisions, political operatives — mainly Republicans — decided they could collect unlimited amounts of money through independent, tax- exempt organizations known as 501(c) groups, without revealing the source of the donations.
By offering anonymity and no limits, these groups (with gauzily apolitical names, like American Future Fund and American Action Network) have been able to raise and spend extraordinary sums. In the 2006 midterms, outside groups not affiliated with political parties spent $51.6 million; so far this year, such groups have spent $280 million. About 60 percent of that spending is from undisclosed donors, most of which has benefited Republicans. Democratic candidates raised huge amounts, but the sources for most of it were disclosed.
Combining both traditional and outside money, Republicans have slightly outraised Democrats, $1.64 billion to $1.59 billion, but there is more to be tallied.
While large secret donations have been legalized, it is not clear that the 501(c) groups spending the money on barrages of attack ads are playing by the last, threadbare rules. The tax code requires that these groups not be “primarily engaged” in political advocacy, but neither the Internal Revenue Service nor the Federal Election Commission has made any apparent effort to investigate what other purpose they might have. Some groups have suggested they would begin nonpolitical activities — after the election.
What is clear is that the new world of unlimited spending, both open and secret, confers huge benefits on wealthy individuals, corporations and unions. In a striking example, reported by ABC News last week, Terry Forcht, a prominent Kentucky banker and nursing home executive, helped pay for a series of attack ads against Attorney General Jack Conway, the Democratic Senate candidate. Mr. Conway is prosecuting one of Mr. Forcht’s nursing homes for allegedly covering up sexual abuse.
Mr. Forcht has directly raised at least $21,000 for Mr. Conway’s Republican opponent, Rand Paul. He serves as the banker for American Crossroads, the shadowy group of nonprofits organized by Karl Rove that has spent nearly $30 million to defeat Democrats and more than $1 million to defeat Mr. Conway.
This year, of course, is just batting practice for 2012. Congress still has time to act. The first step is to pass the Disclose Act, which would require the identification of large campaign donors. The second is to create a public financing system for Congressional candidates that provides extra money to those who rely on small donations.
Voters say — again and again — that they want to break the hold of special interests and end pay-to-play politics. And politicians promise — again and again — that they will. Four billion dollars and one particularly ugly campaign later, there can be no more excuses.
How the Banks Put the Economy Underwater
By Ives Smith
IN Congressional hearings last week, Obama administration officials acknowledged that uncertainty over foreclosures could delay the recovery of the housing market. The implications for the economy are serious. For instance, the International Monetary Fund found that the persistently high unemployment in the United States is largely the result of foreclosures and underwater mortgages, rather than widely cited causes like mismatches between job requirements and worker skills.
This chapter of the financial crisis is a self-inflicted wound. The major banks and their agents have for years taken shortcuts with their mortgage securitization documents — and not due to a momentary lack of attention, but as part of a systematic approach to save money and increase profits. The result can be seen in the stream of reports of colossal foreclosure mistakes: multiple banks foreclosing on the same borrower; banks trying to seize the homes of people who never had a mortgage or who had already entered into a refinancing program.
Banks are claiming that these are just accidents. But suppose that while absent-mindedly paying a bill, you wrote a check from a bank account that you had already closed. No one would have much sympathy with excuses that you were in a hurry and didn’t mean to do it, and it really was just a technicality.
The most visible symptoms of cutting corners have come up in the foreclosure process, but the roots lie much deeper. As has been widely documented in recent weeks, to speed up foreclosures, some banks hired low-level workers, including hair stylists and teenagers, to sign or simply stamp documents like affidavits — a job known as being a “robo-signer.”
Such documents were improper, since the person signing an affidavit is attesting that he has personal knowledge of the matters at issue, which was clearly impossible for people simply stamping hundreds of documents a day. As a result, several major financial firms froze foreclosures in many states, and attorneys general in all 50 states started an investigation.
However, the problems in the mortgage securitization market run much wider and deeper than robo-signing, and started much earlier than the foreclosure process.
When mortgage securitization took off in the 1980s, the contracts to govern these transactions were written carefully to satisfy not just well-settled, state-based real estate law, but other state and federal considerations. These included each state’s Uniform Commercial Code, which governed “secured” transactions that involve property with loans against them, and state trust law, since the packaged loans are put into a trust to protect investors. On the federal side, these deals needed to satisfy securities agencies and the Internal Revenue Service.
This process worked well enough until roughly 2004, when the volume of transactions exploded. Fee-hungry bankers broke the origination end of the machine. One problem is well known: many lenders ceased to be concerned about the quality of the loans they were creating, since if they turned bad, someone else (the investors in the securities) would suffer.
A second, potentially more significant, failure lay in how the rush to speed up the securitization process trampled traditional property rights protections for mortgages.
The procedures stipulated for these securitizations are labor-intensive. Each loan has to be signed over several times, first by the originator, then by typically at least two other parties, before it gets to the trust, “endorsed” the same way you might endorse a check to another party. In general, this process has to be completed within 90 days after a trust is closed.
Evidence is mounting that these requirements were widely ignored. Judges are noticing: more are finding that banks cannot prove that they have the standing to foreclose on the properties that were bundled into securities. If this were a mere procedural problem, the banks could foreclose once they marshaled their evidence. But banks who are challenged in many cases do not resume these foreclosures, indicating that their lapses go well beyond minor paperwork.
Increasingly, homeowners being foreclosed on are correctly demanding that servicers prove that the trust that is trying to foreclose actually has the right to do so. Problems with the mishandling of the loans have been compounded by the Mortgage Electronic Registration System, an electronic lien-registry service that was set up by the banks. While a standardized, centralized database was a good idea in theory, MERS has been widely accused of sloppy practices and is increasingly facing legal challenges.
As a result, investors are becoming concerned that the value of their securities will suffer if it becomes difficult and costly to foreclose; this uncertainty in turn puts a cloud over the value of mortgage-backed securities, which are the biggest asset class in the world.
Other serious abuses are coming to light. Consider a company called Lender Processing Services, which acts as a middleman for mortgage servicers and says it oversees more than half the foreclosures in the United States. To assist foreclosure law firms in its network, a subsidiary of the company offered a menu of services it provided for a fee.
The list showed prices for “creating” — that is, conjuring from thin air — various documents that the trust owning the loan should already have on hand. The firm even offered to create a “collateral file,” which contained all the documents needed to establish ownership of a particular real estate loan. Equipped with a collateral file, you could likely persuade a court that you were entitled to foreclose on a house even if you had never owned the loan.
That there was even a market for such fabricated documents among the law firms involved in foreclosures shows just how hard it is going to be to fix the problems caused by the lapses of the mortgage boom. No one would resort to such dubious behavior if there were an easier remedy.
The banks and other players in the securitization industry now seem to be looking to Congress to snap its fingers to make the whole problem go away, preferably with a law that relieves them of liability for their bad behavior. But any such legislative fiat would bulldoze regions of state laws on real estate and trusts, not to mention the Uniform Commercial Code. A challenge on constitutional grounds would be inevitable.
Asking for Congress’s help would also require the banks to tacitly admit that they routinely broke their own contracts and made misrepresentations to investors in their Securities and Exchange Commission filings. Would Congress dare shield them from well-deserved litigation when the banks themselves use every minor customer deviation from incomprehensible contracts as an excuse to charge a fee?
There are alternatives. One measure that both homeowners and investors in mortgage-backed securities would probably support is a process for major principal modifications for viable borrowers; that is, to forgive a portion of their debt and lower their monthly payments. This could come about through either coordinated state action or a state-federal effort.
The large banks, no doubt, would resist; they would be forced to write down the mortgage exposures they carry on their books, which some banking experts contend would force them back into the Troubled Asset Relief Program. However, allowing significant principal modifications would stem the flood of foreclosures and reduce uncertainty about the housing market and mortgage securities, giving the authorities time to devise approaches to the messy problems of clouded titles and faulty loan conveyance.
The people who so carefully designed the mortgage securitization process unwittingly devised a costly trap for people who ran roughshod over their handiwork. The trap has closed — and unless the mortgage finance industry agrees to a sensible way out of it, the entire economy will be the victim.
editor note: after reading this impecable article,
Don't you feel that the whole financial system( the people making decisions ) know they did wrong on purpose ?
I wonder if this people ever learned values, ethics, principles....
They don't care about the people life's, or struggling families
So far.....they are above the law.
IN Congressional hearings last week, Obama administration officials acknowledged that uncertainty over foreclosures could delay the recovery of the housing market. The implications for the economy are serious. For instance, the International Monetary Fund found that the persistently high unemployment in the United States is largely the result of foreclosures and underwater mortgages, rather than widely cited causes like mismatches between job requirements and worker skills.
This chapter of the financial crisis is a self-inflicted wound. The major banks and their agents have for years taken shortcuts with their mortgage securitization documents — and not due to a momentary lack of attention, but as part of a systematic approach to save money and increase profits. The result can be seen in the stream of reports of colossal foreclosure mistakes: multiple banks foreclosing on the same borrower; banks trying to seize the homes of people who never had a mortgage or who had already entered into a refinancing program.
Banks are claiming that these are just accidents. But suppose that while absent-mindedly paying a bill, you wrote a check from a bank account that you had already closed. No one would have much sympathy with excuses that you were in a hurry and didn’t mean to do it, and it really was just a technicality.
The most visible symptoms of cutting corners have come up in the foreclosure process, but the roots lie much deeper. As has been widely documented in recent weeks, to speed up foreclosures, some banks hired low-level workers, including hair stylists and teenagers, to sign or simply stamp documents like affidavits — a job known as being a “robo-signer.”
Such documents were improper, since the person signing an affidavit is attesting that he has personal knowledge of the matters at issue, which was clearly impossible for people simply stamping hundreds of documents a day. As a result, several major financial firms froze foreclosures in many states, and attorneys general in all 50 states started an investigation.
However, the problems in the mortgage securitization market run much wider and deeper than robo-signing, and started much earlier than the foreclosure process.
When mortgage securitization took off in the 1980s, the contracts to govern these transactions were written carefully to satisfy not just well-settled, state-based real estate law, but other state and federal considerations. These included each state’s Uniform Commercial Code, which governed “secured” transactions that involve property with loans against them, and state trust law, since the packaged loans are put into a trust to protect investors. On the federal side, these deals needed to satisfy securities agencies and the Internal Revenue Service.
This process worked well enough until roughly 2004, when the volume of transactions exploded. Fee-hungry bankers broke the origination end of the machine. One problem is well known: many lenders ceased to be concerned about the quality of the loans they were creating, since if they turned bad, someone else (the investors in the securities) would suffer.
A second, potentially more significant, failure lay in how the rush to speed up the securitization process trampled traditional property rights protections for mortgages.
The procedures stipulated for these securitizations are labor-intensive. Each loan has to be signed over several times, first by the originator, then by typically at least two other parties, before it gets to the trust, “endorsed” the same way you might endorse a check to another party. In general, this process has to be completed within 90 days after a trust is closed.
Evidence is mounting that these requirements were widely ignored. Judges are noticing: more are finding that banks cannot prove that they have the standing to foreclose on the properties that were bundled into securities. If this were a mere procedural problem, the banks could foreclose once they marshaled their evidence. But banks who are challenged in many cases do not resume these foreclosures, indicating that their lapses go well beyond minor paperwork.
Increasingly, homeowners being foreclosed on are correctly demanding that servicers prove that the trust that is trying to foreclose actually has the right to do so. Problems with the mishandling of the loans have been compounded by the Mortgage Electronic Registration System, an electronic lien-registry service that was set up by the banks. While a standardized, centralized database was a good idea in theory, MERS has been widely accused of sloppy practices and is increasingly facing legal challenges.
As a result, investors are becoming concerned that the value of their securities will suffer if it becomes difficult and costly to foreclose; this uncertainty in turn puts a cloud over the value of mortgage-backed securities, which are the biggest asset class in the world.
Other serious abuses are coming to light. Consider a company called Lender Processing Services, which acts as a middleman for mortgage servicers and says it oversees more than half the foreclosures in the United States. To assist foreclosure law firms in its network, a subsidiary of the company offered a menu of services it provided for a fee.
The list showed prices for “creating” — that is, conjuring from thin air — various documents that the trust owning the loan should already have on hand. The firm even offered to create a “collateral file,” which contained all the documents needed to establish ownership of a particular real estate loan. Equipped with a collateral file, you could likely persuade a court that you were entitled to foreclose on a house even if you had never owned the loan.
That there was even a market for such fabricated documents among the law firms involved in foreclosures shows just how hard it is going to be to fix the problems caused by the lapses of the mortgage boom. No one would resort to such dubious behavior if there were an easier remedy.
The banks and other players in the securitization industry now seem to be looking to Congress to snap its fingers to make the whole problem go away, preferably with a law that relieves them of liability for their bad behavior. But any such legislative fiat would bulldoze regions of state laws on real estate and trusts, not to mention the Uniform Commercial Code. A challenge on constitutional grounds would be inevitable.
Asking for Congress’s help would also require the banks to tacitly admit that they routinely broke their own contracts and made misrepresentations to investors in their Securities and Exchange Commission filings. Would Congress dare shield them from well-deserved litigation when the banks themselves use every minor customer deviation from incomprehensible contracts as an excuse to charge a fee?
There are alternatives. One measure that both homeowners and investors in mortgage-backed securities would probably support is a process for major principal modifications for viable borrowers; that is, to forgive a portion of their debt and lower their monthly payments. This could come about through either coordinated state action or a state-federal effort.
The large banks, no doubt, would resist; they would be forced to write down the mortgage exposures they carry on their books, which some banking experts contend would force them back into the Troubled Asset Relief Program. However, allowing significant principal modifications would stem the flood of foreclosures and reduce uncertainty about the housing market and mortgage securities, giving the authorities time to devise approaches to the messy problems of clouded titles and faulty loan conveyance.
The people who so carefully designed the mortgage securitization process unwittingly devised a costly trap for people who ran roughshod over their handiwork. The trap has closed — and unless the mortgage finance industry agrees to a sensible way out of it, the entire economy will be the victim.
editor note: after reading this impecable article,
Don't you feel that the whole financial system( the people making decisions ) know they did wrong on purpose ?
I wonder if this people ever learned values, ethics, principles....
They don't care about the people life's, or struggling families
So far.....they are above the law.
Saturday, October 30, 2010
Extra Extra !!! Banks CEO's secret meeting
Our Papparazzi got a shot of the secret meeting in New York.
Top Banks Executives gathering to discuss the foreclosure technicalities.
Some Law enforcement officers where there asking for ID's
Some Law enforcement officers where there asking for ID's
Will State AGs in Shining Armor Slay the Bank Dragons?
By Yves Smith
Joe Nocera has a very hopeful piece at the New York Times on the potential scope and impact of the investigation by all 50 state attorneys general into the robo signing scandal. Nocera stresses that the leader of this effort, Tom Miller of Iowa, and a core group of assistant AGs with long standing working relationships, are using the probe into what banks would have you believe are mere paperwork problems to delve into more serious abuses, with an eye to forcing the servicers to make serious loan modifications:
And best of all, they have a very clear idea of what they are trying to accomplish. They don’t want to merely reform the foreclosure system (though that would be nice, wouldn’t it?). Nor do they particularly want a big financial settlement, which would be meaningless for a giant like Bank of America.
Rather, they hope to use their investigation as a cudgel to force the big banks and servicers to do something they’ve long resisted: institute widespread, systematic loan modifications. “Instead of paying a huge fine,” Mr. Miller posited to me the other day, on his way to an election rally, “maybe have the servicers adequately fund a serious modification process.” Getting the banks and servicers to take loan modification seriously is another in a series of areas where the Obama Treasury Department has failed miserably.
Nocera recounts how some of the AGs were early onto abuses by subprime bank lenders, and mounted successful efforts against First Alliance (in 2002!), Household Financial, and Ameriquest.
But the story also describes how the state prosecutors were blocked from going after bigger banks:
During the bubble, it was the state attorneys general who first saw the problems in subprime lending. But whenever they tried to do something to halt the predatory lending and outright fraud, they were stopped cold by the federal bank regulators, who consistently sided with the banks in court. It is not too much to say that if the states had succeeded, the subprime crisis might never have occurred…..
On the contrary, the O.C.C. and the Office of Thrift Supervision, the two primary federal regulators of the banking industry, viewed their role, incredibly, as protecting banks from consumers rather than the other way around.
They consistently went to court to block efforts by states to put a stop to predatory lending. Their primary weapon was the doctrine of pre-emption, which said, in effect, that because the national banks were governed by federal rules, they were immune from state consumer protection laws. The success of both agencies in asserting pre-emption — which they also used as a marketing tool to make their charters more attractive to potential bank “clients” — actually forced some states to roll back their antipredatory lending laws.
Nocera also believes the passage of Dodd-Frank and the difference in national sentiment mean the AGs will have a clear field in which to operate:
One advantage they have this time is that foreclosure is a state matter, not a federal one. The O.C.C. couldn’t intervene even if it wanted to.
Of course they have another advantage this time around: times have changed. No federal regulator would have the nerve, post-financial crisis, to try to block the states from investigating the mortgage foreclosure scandal.
The law has changed too. As a result of the Dodd-Frank law, it will be much harder for a federal regulator to use pre-emption to shut down a state investigation into a financial institution. Under the new law, states can enforce their own state consumer laws against nationally chartered banks — even when those laws are stronger than any parallel federal law. And state attorneys general have been given the explicit right under the new law to enforce the rules and regulations that will soon emerge from the new Consumer Financial Protection Bureau.
Yves here. As much as I would like to believe this optimistic scenario, do not underestimate the banking industry’s ability to regain the upper hand, and from the public’s perspective, snatch defeat from the jaws of victory. While a bold move by the Ohio attorney general to stymie bank efforts to continue with business as usual in the wake of the robo signing scandal is a good early salvo, this battle has only recently been joined. Because the banks don’t yet appear to realize how much jeopardy they are in, they have not yet geared up for a serious fight.
One factor very much in the AGs favor is the degree of denial operative in the financial services industry and Washington. We’ve (and by this I mean me plus the mortgage and legal experts I confer with) have been gobsmacked by the lame defenses offered by securitization industry professionals, and more important, major law firms. They appear not to understand the nature of their clients’ transgressions; there remarks, when you parse them, amount to “The procedures were proper, what are you folks, idiots?”
But the issue, as we have described in gruesome detail, is the procedures set forth in the securitization documents were not followed, and it appears the lapses were significant and widespread. Now we’ve been told by some experts in close contact with investors that these white shoe law firms are so removed from what is happening in local courts, and have not been consulted by clients who really haven’t turned over the rocks in their own organization, that they are badly behind facts on the ground. While that may be true, there is a more cynical explanation: that investors relied on big firm opinions, which were crafted very narrowly (the form was “if everyone does what they committed to do, everything is swell). These attorneys are bound to come under the spotlight, and their emphasis on the soundness of the procedures, as opposed to what actually took place, is very consistent their likely “see no evil” defense.
The longer that bankers, their lawyers, and their lapdog regulators keep saying “nothing to see here”, the harder it will be for them to reverse gear and demand that Congress or Federal regulators intervene on their behalf. But don’t kid yourself that discussion of that possibility is not underway. I happened to chat with a staffer to a not-terribly-bank-friendly Senator about the foreclosure mess. He matter of factly said he though concerns were overblown (this was about a month ago, before additional shoes had dropped) but then volunteered that if anything serious were amiss, Congress would intercede, relying on pre-emption. Now does Congress have the nerve to trample on state law and run the risk of a Constitutional challenge? I suppose it depends on how high the stakes are perceived to be.
Similarly, we’ve had this worrying trail balloon:
The chairperson of the Federal Deposit Insurance Corporation recently suggested a solution to the on-going mortgage and foreclosures scandal. FDIC Chair Sheila Bair proposed that the banks involved would be granted “legal protection from lawsuits” in exchange for granting struggling homeowners a minimum of 25 percent reduction in monthly mortgage payments.
First, the idea of a broad based exemption from liability is heinous and undermines the operation of a capitalist society. What good are contracts if you can mess up on a grand enough scale so as to receive a Federal waiver? Second, mere payment reductions are inadequate, and serve to protect servicers, whose fees are based on unpaid principal balances. Most investors favor principal mods to viable borrowers because their losses are lower than what they experience through the costs of foreclosure and the process of selling the home (there would need to be disciplined processes for verifying income and putting together household budget information; NACA has a process that could be adapted to this purpose). And remember, many borrowers losing their homes now were not profligate borrowers, but normal credit losses, as in individuals suffering from job losses or cutbacks in hours worked, as well as those on the wrong end of servicing errors.
So I’d be delighted to be wrong and see Nocera’s scenario pan out, but state attorneys general have been hemmed in before. If the foreclosure mess turns out to be as serious as we believe, the banks will push Congress and its friendly regulators hard to call off those nasty state AGs. This saga has a long way to run before anyone can start forecasting outcomes.
editor note:
Tell your Attorney General “Don’t Sit Down with the Banks! Stand up Against Fraud!”
Call your AG and report your case, don't wait !!!! Get involve !!!
Joe Nocera has a very hopeful piece at the New York Times on the potential scope and impact of the investigation by all 50 state attorneys general into the robo signing scandal. Nocera stresses that the leader of this effort, Tom Miller of Iowa, and a core group of assistant AGs with long standing working relationships, are using the probe into what banks would have you believe are mere paperwork problems to delve into more serious abuses, with an eye to forcing the servicers to make serious loan modifications:
And best of all, they have a very clear idea of what they are trying to accomplish. They don’t want to merely reform the foreclosure system (though that would be nice, wouldn’t it?). Nor do they particularly want a big financial settlement, which would be meaningless for a giant like Bank of America.
Rather, they hope to use their investigation as a cudgel to force the big banks and servicers to do something they’ve long resisted: institute widespread, systematic loan modifications. “Instead of paying a huge fine,” Mr. Miller posited to me the other day, on his way to an election rally, “maybe have the servicers adequately fund a serious modification process.” Getting the banks and servicers to take loan modification seriously is another in a series of areas where the Obama Treasury Department has failed miserably.
Nocera recounts how some of the AGs were early onto abuses by subprime bank lenders, and mounted successful efforts against First Alliance (in 2002!), Household Financial, and Ameriquest.
But the story also describes how the state prosecutors were blocked from going after bigger banks:
During the bubble, it was the state attorneys general who first saw the problems in subprime lending. But whenever they tried to do something to halt the predatory lending and outright fraud, they were stopped cold by the federal bank regulators, who consistently sided with the banks in court. It is not too much to say that if the states had succeeded, the subprime crisis might never have occurred…..
On the contrary, the O.C.C. and the Office of Thrift Supervision, the two primary federal regulators of the banking industry, viewed their role, incredibly, as protecting banks from consumers rather than the other way around.
They consistently went to court to block efforts by states to put a stop to predatory lending. Their primary weapon was the doctrine of pre-emption, which said, in effect, that because the national banks were governed by federal rules, they were immune from state consumer protection laws. The success of both agencies in asserting pre-emption — which they also used as a marketing tool to make their charters more attractive to potential bank “clients” — actually forced some states to roll back their antipredatory lending laws.
Nocera also believes the passage of Dodd-Frank and the difference in national sentiment mean the AGs will have a clear field in which to operate:
One advantage they have this time is that foreclosure is a state matter, not a federal one. The O.C.C. couldn’t intervene even if it wanted to.
Of course they have another advantage this time around: times have changed. No federal regulator would have the nerve, post-financial crisis, to try to block the states from investigating the mortgage foreclosure scandal.
The law has changed too. As a result of the Dodd-Frank law, it will be much harder for a federal regulator to use pre-emption to shut down a state investigation into a financial institution. Under the new law, states can enforce their own state consumer laws against nationally chartered banks — even when those laws are stronger than any parallel federal law. And state attorneys general have been given the explicit right under the new law to enforce the rules and regulations that will soon emerge from the new Consumer Financial Protection Bureau.
Yves here. As much as I would like to believe this optimistic scenario, do not underestimate the banking industry’s ability to regain the upper hand, and from the public’s perspective, snatch defeat from the jaws of victory. While a bold move by the Ohio attorney general to stymie bank efforts to continue with business as usual in the wake of the robo signing scandal is a good early salvo, this battle has only recently been joined. Because the banks don’t yet appear to realize how much jeopardy they are in, they have not yet geared up for a serious fight.
One factor very much in the AGs favor is the degree of denial operative in the financial services industry and Washington. We’ve (and by this I mean me plus the mortgage and legal experts I confer with) have been gobsmacked by the lame defenses offered by securitization industry professionals, and more important, major law firms. They appear not to understand the nature of their clients’ transgressions; there remarks, when you parse them, amount to “The procedures were proper, what are you folks, idiots?”
But the issue, as we have described in gruesome detail, is the procedures set forth in the securitization documents were not followed, and it appears the lapses were significant and widespread. Now we’ve been told by some experts in close contact with investors that these white shoe law firms are so removed from what is happening in local courts, and have not been consulted by clients who really haven’t turned over the rocks in their own organization, that they are badly behind facts on the ground. While that may be true, there is a more cynical explanation: that investors relied on big firm opinions, which were crafted very narrowly (the form was “if everyone does what they committed to do, everything is swell). These attorneys are bound to come under the spotlight, and their emphasis on the soundness of the procedures, as opposed to what actually took place, is very consistent their likely “see no evil” defense.
The longer that bankers, their lawyers, and their lapdog regulators keep saying “nothing to see here”, the harder it will be for them to reverse gear and demand that Congress or Federal regulators intervene on their behalf. But don’t kid yourself that discussion of that possibility is not underway. I happened to chat with a staffer to a not-terribly-bank-friendly Senator about the foreclosure mess. He matter of factly said he though concerns were overblown (this was about a month ago, before additional shoes had dropped) but then volunteered that if anything serious were amiss, Congress would intercede, relying on pre-emption. Now does Congress have the nerve to trample on state law and run the risk of a Constitutional challenge? I suppose it depends on how high the stakes are perceived to be.
Similarly, we’ve had this worrying trail balloon:
The chairperson of the Federal Deposit Insurance Corporation recently suggested a solution to the on-going mortgage and foreclosures scandal. FDIC Chair Sheila Bair proposed that the banks involved would be granted “legal protection from lawsuits” in exchange for granting struggling homeowners a minimum of 25 percent reduction in monthly mortgage payments.
First, the idea of a broad based exemption from liability is heinous and undermines the operation of a capitalist society. What good are contracts if you can mess up on a grand enough scale so as to receive a Federal waiver? Second, mere payment reductions are inadequate, and serve to protect servicers, whose fees are based on unpaid principal balances. Most investors favor principal mods to viable borrowers because their losses are lower than what they experience through the costs of foreclosure and the process of selling the home (there would need to be disciplined processes for verifying income and putting together household budget information; NACA has a process that could be adapted to this purpose). And remember, many borrowers losing their homes now were not profligate borrowers, but normal credit losses, as in individuals suffering from job losses or cutbacks in hours worked, as well as those on the wrong end of servicing errors.
So I’d be delighted to be wrong and see Nocera’s scenario pan out, but state attorneys general have been hemmed in before. If the foreclosure mess turns out to be as serious as we believe, the banks will push Congress and its friendly regulators hard to call off those nasty state AGs. This saga has a long way to run before anyone can start forecasting outcomes.
editor note:
Tell your Attorney General “Don’t Sit Down with the Banks! Stand up Against Fraud!”
Call your AG and report your case, don't wait !!!! Get involve !!!
JP Morgan Chase Plays Fast and Dirty in Florida Loan Mod Waiver
By Yves Smith
I’ve harbored the sneaking suspicion that JP Morgan Chase is the worst behaved of the big US retail banks, based on a couple of experiences with them a bit more than two years ago. Not to bore readers with details, but basically, bank staff lied to me persistently regarding the terms of various products. Of course, the real terms, spelled out in difficult to decipher language in itty bitty print in a very long document, were far more unfavorable to me. It was only a credit card and a supposedly fee free checking account, both of which I promptly closed, so all I suffered was a teeny bit of inconvenience and the annoyance of being had. But if a fairly finance savvy person like me can be fooled by Chase, image the field day it has with normal marks.
JP Morgan Chase Foreclosure Waiver and Release Redacted
JP Morgan Chase Foreclosure Waiver and Release Redacted
The critical bit starts in the third paragraph. There JP Morgan Chase points out that it is becoming more common in Florida for judges to require the bank to take action, meaning file a motion, which then leads to a hearing and and order of cancellation, to stop a foreclosure. It also points out that this is a change. In the past, If the bank merely failed to appear at a judicial sale, most courts would cancel it.
Now here’s the sneaky bit. JP Morgan Chase never bothers to say that it regards filing that motion and going to the trouble of attending a hearing is just too much cost and bother to stop foreclosure action when it has started loan mod negotiations. And to add insult to injury, its sneaky wording makes it sound as if it lacks the power to halt the foreclosure process, as opposed to incur more costs (boldface ours):
Because Chase, as a plaintiff or servicer of your loan, is no longer able to unilaterally cancel a judicial sale in many Courts in the State of Florida….
In other words, JP Morgan Chase offers an irrelevant excuse as a pretext for the borrower to make an astonishing concession:
I/we the undersigned Borrower(s), understand and agree that any and all loss mitigation agreements entered into with Chase……..that requires the cancellation of a judicial sale, shall be made expressly conditional upon the Court rendering a valid and final Order cancelling the judicial sale….any and all loss mitigation agreements shall be deemed null, void, and of no further force and effect…..Chase, as plaintiff or as the servicer of your loan, may proceed with the lawsuit to foreclosure your mortgage, including, without limitation, the upholding of any judicial sale and the issuance of certificate of title, as if no loss mitigation agreement was entered into…
So effectively, what the borrower has agreed to is for JP Morgan Chase to proceed with the foreclosure and to waive all rights to using the existence of a loss mitigation negotiation, or even a signed loss mitigation agreement, as a reason for stopping the foreclosure action. The letter has a faux borrower friendly sixth paragraph, that it “may” attempt to cancel a foreclosure sale, but there is no obligation.
Its true stance is blindingly obvious in the first two paragraphs on the second page. In the first paragraph, it
says that all signed loss mitigation agreements will have a paragraph added that the judicial sale has to be canceled for the loss mitigation agreement to be valid, and in the off chance all this isn’t clear, this little two page letter, which gets JP Morgan Chase off the hook as far as doing anything to stop the foreclosure sale, and further asking the chump borrower to waive any rights he might have to protest, controls.
To put it even more bluntly, this has all the appearances that Chase wants to foreclose, and is pressing borrowers to agree to terms that guarantee that loss mitigation negotiations have no force if a foreclosure action is underway.
This document is consistent with complaints we reported on earlier from Florida’s rocket docket, that foreclosures were finalized even when borrowers protested to the court that they were in loan modification programs. This is yet another example of how the banks are gaming the latest loan modification program, HAMP. Servicers collect fees for foreclosures and have the opportunity to apply the proceeds to the principal and interest advances they have made to investors. Those incentive far outweigh the puny fees the Treasury pays them to mod, but hey, if they can have both and placate Treasury by going through the motions of doing loan mods, why not?
Now some readers may argue that this is a cover your ass letter, but I don’t buy that. The language is sweeping and absolute. One rule in negotiations is never make a free concession (as in give something up without getting something back) and the concession that Chase demands is huge. A more reasonable document would have concessions to the borrower, like a requirement that Chase would make good faith efforts to halt any foreclosure, with a caveat that it could not guarantee outcomes. A carve out that Chase demonstrate, if pressed, that it had taken reasonable steps consistent with following through with the loan modification effort would make this a relatively fair agreement. But JP Morgan Chase is clearly not in the business of being fair.
Editor note: JPMorgan has been since 1913 involve in several Banks scandals.
But JPMorgan Chase still today in the Board of Directors in the Federal Reserve Bank
DISTRICT 2 - NEW YORK Class A
James Dimon Chairman and Chief Executive Officer JPMorgan Chase & Co.New York, New York.
(I guess bad performance is rewarded by the Federal Reserve. )
I’ve harbored the sneaking suspicion that JP Morgan Chase is the worst behaved of the big US retail banks, based on a couple of experiences with them a bit more than two years ago. Not to bore readers with details, but basically, bank staff lied to me persistently regarding the terms of various products. Of course, the real terms, spelled out in difficult to decipher language in itty bitty print in a very long document, were far more unfavorable to me. It was only a credit card and a supposedly fee free checking account, both of which I promptly closed, so all I suffered was a teeny bit of inconvenience and the annoyance of being had. But if a fairly finance savvy person like me can be fooled by Chase, image the field day it has with normal marks.
JP Morgan Chase Foreclosure Waiver and Release Redacted
JP Morgan Chase Foreclosure Waiver and Release Redacted
The critical bit starts in the third paragraph. There JP Morgan Chase points out that it is becoming more common in Florida for judges to require the bank to take action, meaning file a motion, which then leads to a hearing and and order of cancellation, to stop a foreclosure. It also points out that this is a change. In the past, If the bank merely failed to appear at a judicial sale, most courts would cancel it.
Now here’s the sneaky bit. JP Morgan Chase never bothers to say that it regards filing that motion and going to the trouble of attending a hearing is just too much cost and bother to stop foreclosure action when it has started loan mod negotiations. And to add insult to injury, its sneaky wording makes it sound as if it lacks the power to halt the foreclosure process, as opposed to incur more costs (boldface ours):
Because Chase, as a plaintiff or servicer of your loan, is no longer able to unilaterally cancel a judicial sale in many Courts in the State of Florida….
In other words, JP Morgan Chase offers an irrelevant excuse as a pretext for the borrower to make an astonishing concession:
I/we the undersigned Borrower(s), understand and agree that any and all loss mitigation agreements entered into with Chase……..that requires the cancellation of a judicial sale, shall be made expressly conditional upon the Court rendering a valid and final Order cancelling the judicial sale….any and all loss mitigation agreements shall be deemed null, void, and of no further force and effect…..Chase, as plaintiff or as the servicer of your loan, may proceed with the lawsuit to foreclosure your mortgage, including, without limitation, the upholding of any judicial sale and the issuance of certificate of title, as if no loss mitigation agreement was entered into…
So effectively, what the borrower has agreed to is for JP Morgan Chase to proceed with the foreclosure and to waive all rights to using the existence of a loss mitigation negotiation, or even a signed loss mitigation agreement, as a reason for stopping the foreclosure action. The letter has a faux borrower friendly sixth paragraph, that it “may” attempt to cancel a foreclosure sale, but there is no obligation.
Its true stance is blindingly obvious in the first two paragraphs on the second page. In the first paragraph, it
says that all signed loss mitigation agreements will have a paragraph added that the judicial sale has to be canceled for the loss mitigation agreement to be valid, and in the off chance all this isn’t clear, this little two page letter, which gets JP Morgan Chase off the hook as far as doing anything to stop the foreclosure sale, and further asking the chump borrower to waive any rights he might have to protest, controls.
To put it even more bluntly, this has all the appearances that Chase wants to foreclose, and is pressing borrowers to agree to terms that guarantee that loss mitigation negotiations have no force if a foreclosure action is underway.
This document is consistent with complaints we reported on earlier from Florida’s rocket docket, that foreclosures were finalized even when borrowers protested to the court that they were in loan modification programs. This is yet another example of how the banks are gaming the latest loan modification program, HAMP. Servicers collect fees for foreclosures and have the opportunity to apply the proceeds to the principal and interest advances they have made to investors. Those incentive far outweigh the puny fees the Treasury pays them to mod, but hey, if they can have both and placate Treasury by going through the motions of doing loan mods, why not?
Now some readers may argue that this is a cover your ass letter, but I don’t buy that. The language is sweeping and absolute. One rule in negotiations is never make a free concession (as in give something up without getting something back) and the concession that Chase demands is huge. A more reasonable document would have concessions to the borrower, like a requirement that Chase would make good faith efforts to halt any foreclosure, with a caveat that it could not guarantee outcomes. A carve out that Chase demonstrate, if pressed, that it had taken reasonable steps consistent with following through with the loan modification effort would make this a relatively fair agreement. But JP Morgan Chase is clearly not in the business of being fair.
Editor note: JPMorgan has been since 1913 involve in several Banks scandals.
But JPMorgan Chase still today in the Board of Directors in the Federal Reserve Bank
DISTRICT 2 - NEW YORK Class A
James Dimon Chairman and Chief Executive Officer JPMorgan Chase & Co.New York, New York.
(I guess bad performance is rewarded by the Federal Reserve. )
GSEs Instruct Servicers to Help Unemployed Through State Programs
By: Carrie Bay
Fannie Mae and Freddie Mac have both issued notices to servicers that they must work closely with state housing finance agencies to provide mortgage assistance to homeowners who’ve lost their jobs.
The Treasury Department has awarded $7.6 billion for housing agencies in certain states to develop programs that provide temporary relief to unemployed homeowners.
(editor note: Only 7.6 billon ???? why not 700 billon, ...the same amount use from taxpayers to save the banks ??????????)
Effective immediately, GSE servicers are instructed to accept all monthly mortgage payments from housing finance agencies (HFAs) on behalf of borrowers enrolled in state-specific programs for unemployment mortgage assistance or mortgage reinstatement plans.
The directive applies to mortgage loans held in the GSEs’ own portfolio, in a mortgage-backed securities (MBS) pool with the special servicing option, or a shared-risk MBS pool for which the GSEs market the acquired property.
Specific program details vary by HFA, but the assistance provided generally falls under one of two types. An unemployment mortgage assistance program pays portion of or the full monthly mortgage payment amount for qualifying borrowers so that they may seek employment or obtain job training without fear of losing their homes. A mortgage reinstatement program provides a one-time lump sum payment to assist in restoring a delinquent mortgage to current status
A borrower participating in an HFA program may not simultaneously receive assistance through another loss mitigation program, including the federal government’s Home Affordable Modification Program (HAMP).
Servicers have been instructed that they may not determine borrower eligibility or communicate qualification for a state HFA program to a borrower. Servicers can, however, refer potentially eligible borrowers to the HFA in accordance with relevant state requirements.
The GSEs’ stressed, though, that servicers must not deny or delay consideration of a borrower for a relief or workout option pending approval for HFA mortgage assistance and must not require a borrower to first request financial assistance from an HFA as a condition of consideration for a relief or workout option.
Regarding protocol for foreclosures related to loans that qualify for an HFA program, Servicers are not required to accept mortgage assistance payments if a notice of trustee/sheriff sale has been recorded and is scheduled less than seven days from the date the servicer is notified of borrower approval by the HFA.
If the notice of borrower approval from the HFA is received seven or more days in advance of a scheduled foreclosure sale, Fannie says a servicer still should not suspend the foreclosure proceedings unless it has actually received funds from the HFA to cover the borrower’s mortgage payment.
Freddie stressed that if servicers suspend foreclosure proceedings, they must ensure that appropriate action is taken to re-commence foreclosure proceedings should the borrower’s mortgage payment not be received from the HFA in the month in which it is due.
Fannie Mae noted that it has elected not to participate in any principal reduction options that may be offered by some HFAs. Freddie Mac did not specify in its notice whether principal reduction was an approved means of assistance.
Fannie Mae and Freddie Mac have both issued notices to servicers that they must work closely with state housing finance agencies to provide mortgage assistance to homeowners who’ve lost their jobs.
The Treasury Department has awarded $7.6 billion for housing agencies in certain states to develop programs that provide temporary relief to unemployed homeowners.
(editor note: Only 7.6 billon ???? why not 700 billon, ...the same amount use from taxpayers to save the banks ??????????)
Effective immediately, GSE servicers are instructed to accept all monthly mortgage payments from housing finance agencies (HFAs) on behalf of borrowers enrolled in state-specific programs for unemployment mortgage assistance or mortgage reinstatement plans.
The directive applies to mortgage loans held in the GSEs’ own portfolio, in a mortgage-backed securities (MBS) pool with the special servicing option, or a shared-risk MBS pool for which the GSEs market the acquired property.
Specific program details vary by HFA, but the assistance provided generally falls under one of two types. An unemployment mortgage assistance program pays portion of or the full monthly mortgage payment amount for qualifying borrowers so that they may seek employment or obtain job training without fear of losing their homes. A mortgage reinstatement program provides a one-time lump sum payment to assist in restoring a delinquent mortgage to current status
A borrower participating in an HFA program may not simultaneously receive assistance through another loss mitigation program, including the federal government’s Home Affordable Modification Program (HAMP).
Servicers have been instructed that they may not determine borrower eligibility or communicate qualification for a state HFA program to a borrower. Servicers can, however, refer potentially eligible borrowers to the HFA in accordance with relevant state requirements.
The GSEs’ stressed, though, that servicers must not deny or delay consideration of a borrower for a relief or workout option pending approval for HFA mortgage assistance and must not require a borrower to first request financial assistance from an HFA as a condition of consideration for a relief or workout option.
Regarding protocol for foreclosures related to loans that qualify for an HFA program, Servicers are not required to accept mortgage assistance payments if a notice of trustee/sheriff sale has been recorded and is scheduled less than seven days from the date the servicer is notified of borrower approval by the HFA.
If the notice of borrower approval from the HFA is received seven or more days in advance of a scheduled foreclosure sale, Fannie says a servicer still should not suspend the foreclosure proceedings unless it has actually received funds from the HFA to cover the borrower’s mortgage payment.
Freddie stressed that if servicers suspend foreclosure proceedings, they must ensure that appropriate action is taken to re-commence foreclosure proceedings should the borrower’s mortgage payment not be received from the HFA in the month in which it is due.
Fannie Mae noted that it has elected not to participate in any principal reduction options that may be offered by some HFAs. Freddie Mac did not specify in its notice whether principal reduction was an approved means of assistance.
KENTUCKY, KENTON COUNTY ORDER REQUIRES COMPLETE CHAIN OF TITLE AND OWNERSHIP TO FORECLOSE
KENTUCKY, KENTON COUNTY ORDER REQUIRES COMPLETE CHAIN OF TITLE AND OWNERSHIP TO FORECLOSE
Posted on30 October 2010. Tags: assignment of deed of trust, assignment of mortgage, county, cr 17.01, cr 8.01(1), documentation, Judge Gregory M. Bartlett, Judge Martin J. Sheehan, Judge Patricia M. Summe, kenton, kentucky, Order, original note, promissory note, trustee
COMMONWEALTH OF KENTUCKY
KENTON CIRCUIT COURT
GENERAL ORDER
Pursuant to CR 8.01(1) and CR 17.01, plaintiff in foreclosure complaints filed in Kenton County, Kentucky, must show that it is the holder of the note and mortgage at the time the complaint is filed. Effective with the foreclosure complaints filed November 15, 2010, and thereafter, the complaint at the time of the filing must be accompanied by all of the following:
(1) a copy of the promissory note with all endorsements;
(2) a copy of the recorded mortgage;
(3) an affidavit by the plaintiff, it’s representative, it’s attorney or it’s servicer (a) documenting that the named plaintiff is the owner of the note and mortgage at the time the complaint is filed, and (b) identifying plaintiff as either the original note and mortgage holder, or as an assignee, trustee or successor-in-interest of the original note and mortgage holder;
(4) a copy of all the assignments of the note and mortgage, if plaintiff is not the original mortgage holder, evidencing the complete chain of assignments. The assignment of the note and mortgage to the named plaintiff must be executed prior to the filing of the foreclosure complaint;
(5) documentation establishing plaintiff as a successor-in-interest if plaintiff is a successor-in-interest.
This General Order from KENTON CIRCUIT COURT in Kentuky, should be a rule for every Court in US
Posted on30 October 2010. Tags: assignment of deed of trust, assignment of mortgage, county, cr 17.01, cr 8.01(1), documentation, Judge Gregory M. Bartlett, Judge Martin J. Sheehan, Judge Patricia M. Summe, kenton, kentucky, Order, original note, promissory note, trustee
COMMONWEALTH OF KENTUCKY
KENTON CIRCUIT COURT
GENERAL ORDER
Pursuant to CR 8.01(1) and CR 17.01, plaintiff in foreclosure complaints filed in Kenton County, Kentucky, must show that it is the holder of the note and mortgage at the time the complaint is filed. Effective with the foreclosure complaints filed November 15, 2010, and thereafter, the complaint at the time of the filing must be accompanied by all of the following:
(1) a copy of the promissory note with all endorsements;
(2) a copy of the recorded mortgage;
(3) an affidavit by the plaintiff, it’s representative, it’s attorney or it’s servicer (a) documenting that the named plaintiff is the owner of the note and mortgage at the time the complaint is filed, and (b) identifying plaintiff as either the original note and mortgage holder, or as an assignee, trustee or successor-in-interest of the original note and mortgage holder;
(4) a copy of all the assignments of the note and mortgage, if plaintiff is not the original mortgage holder, evidencing the complete chain of assignments. The assignment of the note and mortgage to the named plaintiff must be executed prior to the filing of the foreclosure complaint;
(5) documentation establishing plaintiff as a successor-in-interest if plaintiff is a successor-in-interest.
This General Order from KENTON CIRCUIT COURT in Kentuky, should be a rule for every Court in US
Ohio Attorney General Asks for Affidavits by Wells Fargo `Robo-Signer'
By Michael Riley
Ohio Attorney General Richard Cordray asked judges in his state for copies of foreclosure affidavits filed in their courts that are signed by a woman he identified as a “robo-signer” for Wells Fargo Bank NA.
Cordray sent a letter to 133 judges asking for information on any cases that involved Xee Moua, a Wells Fargo vice president of loan documentation. Cordray sent a separate letter to Wells Fargo & Co. asking the bank to vacate any foreclosure judgment in Ohio involving incorrect affidavits.
Moua gave a deposition in a Florida case in March in which she testified that “statements made by her in sworn affidavits were false,” Cordray said in the letter. Moua said she wasn’t familiar with the books and records related to the transactions an affidavit covered, according to Cordray.
“These are crucial misstatements that are an affront to our legal system,” he wrote. “If you become aware of affidavits Ms. Moua signed in any foreclosure cases filed in your court, I would appreciate receiving copies of such affidavits.”
Tom Goyda, a spokesman for Wells Fargo, said the company’s policy is “to comply with all applicable state and federal laws and to follow required court procedures” and that executives “intend to cooperate” with Cordray’s inquiries.
Wells Fargo, the biggest U.S. home lender, said Oct. 27 that it will file supplemental foreclosure affidavits to courts in about 55,000 proceedings after finding some statements “did not strictly adhere to the required procedures.” The bank has said it chose to resubmit the documents out of “an abundance of caution” and that none of “these instances led to foreclosures which should not have otherwise occurred.”
‘Vacate Any Judgment’
Cordray provided a copy of a letter to Wells Fargo deputy general counsel David Moskowitz in which he asked the San Francisco-based bank to “vacate any judgment and withdraw any motion that resulted in a judgment in which Wells believes an improper affidavit was submitted.”
The attorney general also asked for a list of Ohio foreclosures in 2009 and 2010 in which a Wells Fargo entity served as plaintiff or servicer and a list of all people who signed Ohio foreclosure affidavits for Wells Fargo in those years.
Ohio Attorney General Richard Cordray asked judges in his state for copies of foreclosure affidavits filed in their courts that are signed by a woman he identified as a “robo-signer” for Wells Fargo Bank NA.
Cordray sent a letter to 133 judges asking for information on any cases that involved Xee Moua, a Wells Fargo vice president of loan documentation. Cordray sent a separate letter to Wells Fargo & Co. asking the bank to vacate any foreclosure judgment in Ohio involving incorrect affidavits.
Moua gave a deposition in a Florida case in March in which she testified that “statements made by her in sworn affidavits were false,” Cordray said in the letter. Moua said she wasn’t familiar with the books and records related to the transactions an affidavit covered, according to Cordray.
“These are crucial misstatements that are an affront to our legal system,” he wrote. “If you become aware of affidavits Ms. Moua signed in any foreclosure cases filed in your court, I would appreciate receiving copies of such affidavits.”
Tom Goyda, a spokesman for Wells Fargo, said the company’s policy is “to comply with all applicable state and federal laws and to follow required court procedures” and that executives “intend to cooperate” with Cordray’s inquiries.
Wells Fargo, the biggest U.S. home lender, said Oct. 27 that it will file supplemental foreclosure affidavits to courts in about 55,000 proceedings after finding some statements “did not strictly adhere to the required procedures.” The bank has said it chose to resubmit the documents out of “an abundance of caution” and that none of “these instances led to foreclosures which should not have otherwise occurred.”
‘Vacate Any Judgment’
Cordray provided a copy of a letter to Wells Fargo deputy general counsel David Moskowitz in which he asked the San Francisco-based bank to “vacate any judgment and withdraw any motion that resulted in a judgment in which Wells believes an improper affidavit was submitted.”
The attorney general also asked for a list of Ohio foreclosures in 2009 and 2010 in which a Wells Fargo entity served as plaintiff or servicer and a list of all people who signed Ohio foreclosure affidavits for Wells Fargo in those years.
Do the Rich Need Coddling?
By Kevin Drum
for Mother Jones
A couple of weeks ago I sort of vaguely intended to write a bit about the extreme sensitivity of the American business community. I had just read someone (I forget who) saying that he had been out in the world chatting with business folks and had fully expected their anger with Barack Obama to rate about an 8 out of 10. But no! It was 10 out of 10. They were in an absolute frenzy of combined rage (over what he was doing to them) and fear (over what he might say about them if they dared to criticize him publicly).
Needless to say, this seemed crazy to me. On a substantive front, after he took office Obama continued George Bush's rescue of the banking system, boosted the economy by passing a stimulus bill, and saved untold thousands of businesses by rescuing GM and Chrysler. His healthcare reform bill was so business friendly it's a wonder the industry didn't keel over in hypoglycemic shock after it was passed. On the rhetorical front, he's taken a few modest shots at the financial industry, but not much more. So what were they all so apoplectic about?
But then I stopped and decided there was no point. If I asked, business folks would say they were afraid to invest because of Obama's blizzard of new regulations. They'd say they were afraid he was going to raise their taxes. They'd say he had somehow screwed up the banking sector so that they could no longer get loans the way they used to. They'd say they were afraid of cap-and-trade and card check, which Obama supported even though they both went nowhere. Looking at the big picture, they'd claim the administration is squeezing them on all sides because its actions have resulted in slow hiring, higher taxes, impaired lending, and further limits to individuals' ability to deploy capital in business ventures (whether their own or other people's).
Or, as John Gapper put it earlier this week, quoting the U.S. Chamber of Commerce, Obama has "vilified industries while embarking on an ill-advised course of government expansion, major tax increases, massive deficits and job-destroying regulations." Gapper himself says there's some truth to this: "Mr Obama has failed to understand or communicate the role big business plays in remoulding the economy and creating highly skilled and highly-paid jobs. Unlike Bill Clinton, the previous Democratic president, he sounds as if he thinks multinationals do little but suck work out of the US."
And Gapper's evidence? As Ezra Klein and Matt Yglesias point out, precisely one thing: Obama's criticism of large companies for using tax breaks to ship jobs overseas. That's it. Something that's virtually a staple of American politics. Obama is following in the footsteps of thousands when he complains about this, including plenty of Republicans when they're in a tight election campaign.
What's remarkable about all this is that Obama is, patently, not anti-business. All of the corporate complaints above, when you dig an inch below the surface, amount to lashing out at phantasms. However, although Obama isn't anti-business, it is fair to say that he's not especially business friendly. And after decades of almost literally getting their every heart's desire from Republican presidents and congresses, this has come as something as a shock to the corporate community. When Obama puts a tax break in the stimulus bill, it's aimed mainly at the middle class, not the rich. When he hires a labor secretary, it's someone who actually thinks labor laws should be enforced. When he says he wants to pass a healthcare reform bill, he actually does it. (Its impact on big business is close to zero, but no matter.) There's no evidence at all that Obama wants to punish big business, but at the same time it's quite plain that he cares much more about the middle class than he does about the rich.
And that's pretty hard for them to take. So they're apoplectic. On a scale of 1 to 10, he's a ten. Merely refusing to coddle the business community endlessly is all it takes these days.
for Mother Jones
A couple of weeks ago I sort of vaguely intended to write a bit about the extreme sensitivity of the American business community. I had just read someone (I forget who) saying that he had been out in the world chatting with business folks and had fully expected their anger with Barack Obama to rate about an 8 out of 10. But no! It was 10 out of 10. They were in an absolute frenzy of combined rage (over what he was doing to them) and fear (over what he might say about them if they dared to criticize him publicly).
Needless to say, this seemed crazy to me. On a substantive front, after he took office Obama continued George Bush's rescue of the banking system, boosted the economy by passing a stimulus bill, and saved untold thousands of businesses by rescuing GM and Chrysler. His healthcare reform bill was so business friendly it's a wonder the industry didn't keel over in hypoglycemic shock after it was passed. On the rhetorical front, he's taken a few modest shots at the financial industry, but not much more. So what were they all so apoplectic about?
But then I stopped and decided there was no point. If I asked, business folks would say they were afraid to invest because of Obama's blizzard of new regulations. They'd say they were afraid he was going to raise their taxes. They'd say he had somehow screwed up the banking sector so that they could no longer get loans the way they used to. They'd say they were afraid of cap-and-trade and card check, which Obama supported even though they both went nowhere. Looking at the big picture, they'd claim the administration is squeezing them on all sides because its actions have resulted in slow hiring, higher taxes, impaired lending, and further limits to individuals' ability to deploy capital in business ventures (whether their own or other people's).
Or, as John Gapper put it earlier this week, quoting the U.S. Chamber of Commerce, Obama has "vilified industries while embarking on an ill-advised course of government expansion, major tax increases, massive deficits and job-destroying regulations." Gapper himself says there's some truth to this: "Mr Obama has failed to understand or communicate the role big business plays in remoulding the economy and creating highly skilled and highly-paid jobs. Unlike Bill Clinton, the previous Democratic president, he sounds as if he thinks multinationals do little but suck work out of the US."
And Gapper's evidence? As Ezra Klein and Matt Yglesias point out, precisely one thing: Obama's criticism of large companies for using tax breaks to ship jobs overseas. That's it. Something that's virtually a staple of American politics. Obama is following in the footsteps of thousands when he complains about this, including plenty of Republicans when they're in a tight election campaign.
What's remarkable about all this is that Obama is, patently, not anti-business. All of the corporate complaints above, when you dig an inch below the surface, amount to lashing out at phantasms. However, although Obama isn't anti-business, it is fair to say that he's not especially business friendly. And after decades of almost literally getting their every heart's desire from Republican presidents and congresses, this has come as something as a shock to the corporate community. When Obama puts a tax break in the stimulus bill, it's aimed mainly at the middle class, not the rich. When he hires a labor secretary, it's someone who actually thinks labor laws should be enforced. When he says he wants to pass a healthcare reform bill, he actually does it. (Its impact on big business is close to zero, but no matter.) There's no evidence at all that Obama wants to punish big business, but at the same time it's quite plain that he cares much more about the middle class than he does about the rich.
And that's pretty hard for them to take. So they're apoplectic. On a scale of 1 to 10, he's a ten. Merely refusing to coddle the business community endlessly is all it takes these days.
Saturday Horror Movie !!!!!
This is unbelievable, is this the people that handle the taxpayer money spending ????????
The Federal reserve lend 2 trillon dollars to god know who !!!!
and the Goverment through Fannie Mae and HUD, don't have money to help homeowners with their loan Modification ???????
The Federal reserve lend 2 trillon dollars to god know who !!!!
and the Goverment through Fannie Mae and HUD, don't have money to help homeowners with their loan Modification ???????
Foreclosure Frauds, Wells Fargo-the Fox in Charge, and Victimization
By Barbara Ann Jackson
In the past 24 hours, Wells Fargo has ceased denying that - like other mortgage lenders, it also has been filing flawed foreclosure proceedings in courtrooms across the country. To correct its defective foreclosures, Wells Fargo has now announced that it will re-file 55,000 Wells Fargo foreclosures.
But I believe that Wells Fargo is only now forthcoming because covering up its wrongful foreclosures is no longer effective. Also, I suspect that instead of those 55k improper foreclosures Wells Fargo has admitted to, there are much more. There might even be 55k fraudulent foreclosures in the state where I reside.
The res ipsa loquitur foreclosure frauds that occur here in Louisiana involving Wells Fargo, Freddie Mac, certain foreclosure mills, and certain corrupt judges make it apparent that Wells Fargo cannot be trusted to fix its foreclosure wrongdoings, no more than an addict can be trusted to self-reform.
I have posted a small amount of information about Wells Fargo, Freddie Mac, Lehman Brothers (yes, Lehman is defunct, but if that name is needed for flimflam), foreclosure debt collector attorneys (foreclosure mills), and judicial corruption. Understandably, foreclosure fraud / real estate racketeering thrives in my state where - as attested to before Congress for the impeachment of Federal Judge Thomas Porteous - it is the "Louisiana Way" to give gifts (bribes) and 'do favors' for judges.
Thus, it is further understandable how thousands of Louisianians' homes have been illegally taken as judges signed orders allowing foreclosure mills to auction (sometimes simulated) peoples' homes - even when the mortgage lender (the PLAINTIFF) does not exist. Or, the mortgage "plaintiff" named in the foreclosure petition has no ownership whatsoever of the secured interest in the mortgage note - even when the homeowners dispute that's not their lender. To be specific, the foreclosure petition consists of a mortgage plaintiff that has NO STANDING. Such is an element of Louisiana's way. Such is what Wells Fargo and the above-listed miscreants have done in Louisiana for a long time - and such, as the facts show, goes unreported, unaddressed. Here it is 'business as usual'.
On my website there is mention of how Wells Fargo (WF) filed a false IRS form 1099-A to receive tax benefits despite the fact that Wells Fargo did not foreclose on my home, and of which I knew nothing about until I received a tax bill.
Incidently, I had written an FYI notice to Attorneys General in 25 states to notify them about Wells Fargo's filing false "acquisition" 1099s under pretext of having acquired properties via foreclosures. Because an A.G. from a different state forwarded my letter to Louisiana's A.G., I took pains to explain that mixup. (For years, I have been providing A LOT of information to the A.G. in my state. The only thing it accomplished for me were bitter reprisals, including employment blacklisting - kinds of hostilities subjected upon unprotected whistleblowers.)
Also, on my website, see: Lehman Brothers, Wells Fargo Foreclosure and Insurance Claims. There on my site is the "Bailey" foreclosure that was filed under Lehman Brothers, but the Hurricane Katrina insurance money was demanded from Allstate by Wells Fargo.
However it might be explained away, it is not lawful for foreclosure mill lawyer, Adcock, to utilize the defunct Lehman Brothers' name to carry on the Bailey foreclosure proceedings well after the fact of Lehman Brothers' collapse. It is further not lawful for Adcock to write Allstate Insurance and prosecute a federal court lawsuit for Katrina insurance money for the Bailey property on behalf of Wells Fargo while at the same time Adcock maintained a state court lawsuit on behalf of the defunct Lehman Brothers.
Moreover, it is nonsensical to expect a mortgage lender to comply with laws, statutes, and Civil Procedures. Precisely, mortgage lenders are not required to know laws - attorneys are! Most of the time, the attorneys have made severe errors - sometimes intentionally, since errors help keep the billable tab going, and commit the very frauds that provide basis, defenses, and reasons to attempt negotiating mortgage contracts. Notice how litigation, NOT foreclosure, was the preferred achievement for Wells Fargo lawyers! See this case: Super Future Equities Inc. v. Wells Fargo, et al.
Defaulted Homeowners and Unaddressed Repugnant Foreclosure Frauds (Extortion)
In the first place, people who scowl at 'deadbeats' do not know everyone's situation. Those who chide defaulted homeowners as "deadbeats," seem unwilling to regard that not everyone obtained ill-affordable mortgages.
Some people defaulted due to divorce, overwhelming medical bills, 'outsourced' jobs to overseas that caused unemployment, and so much more. Also, should 'deadbeat' people with student loans have known how long it would take to get jobs? Further, unless someone has been living on Mars, it's impossible to not have heard about elderly people being tricked into "home repair" refinancing that plunged them into debt.
Here in Louisiana as well as Mississippi, even something as recent as the Gulf Oil spill exemplifies how unexpected circumstances can affect people's ability to pay their bills.
People are justifiably worried about being forced into foreclosure and repossession. Similarly, because of rampant judicial corruption here, it is not likely they will receive justice regarding workers' compensation, Family, Criminal or Municipal courts; and it is a foregone conclusion that federal courts' fairness - for minorities (the 'have nots'), does not exist. Wherefore, the possibility of not being able to pay one's bills, directly linked to judicial collusion, places any person or any business in jeopardy of foreclosure.
Yet, thick-skulled people who scorn "deadbeats" seem to prefer communities ull of vacant properties, blighted neighborhoods, and people living on streets or in tents - even though the determination as to the lawful mortgage holders of security notes could take years!
Thick-skulled people say 'people ought to move out and let banks decide for themselves'. But what part do such people not understand; banks are unable to decide ownership. Still, scoffers brush aside the fact about fraudulent court pleadings being filed by lawyers who are required to know better! And scoffers ignore that 'the bank' may not even get that property AT ALL! Meanwhile, if homeowners 'move out', the scoffers will be forced to welcome void and blight - and rats and vagrants eventually will also be coming and going.
Moreover, incredibly, some folks have become so omniscient they say that everyone in mortgage default is unwilling to pay rent -but again, those folks don't know people's stories, nor the facts.
Such people who spew anger about others living 'rent free' have absurd responses about 'White Collar foreclosure fraud' - which includes confiscating distressed properties via falsified court bankruptcy and state court pleadings.
Scoffers seem delighted about legal license and credentials being utilized for dishonest, criminal, unfair, unjust, enrichment against people already in distressed circumstances; and against sometimes innocent people.
Lenders' Lawyers engaged in fraud and extortion must be held accountable; jailed for real estate racketeering
Injurious acts by foreclosure lawyers render them, as well as their clients liable for damages. The half has not been told of outrageous, unfair collections, and privacy invasions associated with foreclosure! For a description of deleterious conduct see: Some Home Foreclosures are Actually Disguised Real Estate Extortions
As a fundamental matter in some instances, the amount owed to lenders for people's mortgage have become drastically reduced and offset because of justiciable damages from wrongful actions of lenders' lawyers and debt collectors under TILA, FDCA, and other laws.
The lenders' lawyers know that certain conduct is "actionable," and they don't want their mortgage clients or Investors to discover that they have committed malpractice in handling the foreclosures assigned to those lawyers. They make distressed borrowers appear as the loathsome problem.
Compare: blighted neighborhoods and foreclosure deed conveyances to non-existent mortgage lenders; bankruptcy "Lift Stay" motions that "lack standing," and names on "proof of claims" different from 'lift stays' "movers"; and illegal property deeds. Need I say, some people have never lawfully lost ownership of their homes, but they 'moved out'. 'The bank' with ownership may have never obtained that property. It is possible a lawyer flipped it, and perhaps Wells Fargo filed a 1099-A!
Also, foreclosure lawyers have failed to "effect service," failed at various substantive Civil Procedure requirements which make it not lawful to proceed with that lawyer's case until those errors are corrected. As such, homeowners are not to be blamed for refusing to cooperate with erroneous and fraudulent confiscation of their homes!
Often, foreclosure delays are because of the lawyers, but the lawyers keep that fact from clients. It is usually always foreclosure lawyers' serious mistakes, errors, and frauds that supply reasons, defenses, and basis for anyone with a brain / anyone who prefers to not be homeless to attempt renegotiating his or her mortgage contract.
Also, property owners seeking debt reorganization through Chapter 13 Bankruptcy are not to be blamed for contesting a false "proof of claim" or false "Lift Stay" motion. As such, countless foreclosure lawyers owe a lot of money to their clients for fatally botching foreclosure cases.
Furthermore, binding mortgage contracts contain an "Acceleration Clause." In particular, the contract requires LAWFUL foreclosure. It seems plausible that when homeowners receives provable "damages" from unlawful foreclosures, the lenders whose agents (the lawyers) violate the acceleration portion of mortgage contracts are liable to homeowners. Therefore, of necessity, culpable lenders should make modifications.
It is not fair for mortgage lenders to hire despicable, underhanded foreclosure firms who commit horrific, sometime crippling wrongs against defaulted borrowers under the guise of collections, to whitewash the facts behind abusive collection practices.
Abusive collections is the side of the coin that rarely gets talked about. Through the years, among the few people or institutions of which I have known to discuss these UNFAIR DEBT COLLECTIONS, are Elizabeth Warren, Gretchen Morgenson, Professor Katherine Porter, and the Brennan Justice Center.
The foreclosure lawyers know what they have done. They seek to have neighbors spewing hate about things which they know little about; and for victims to go out into tents or underpasses. However, although mortgage default causes foreclosure, it does not cause nor justify fraud and victimization of defaulted borrowers.
For reasons such as the foregoing, Wells Fargo, nor any other mortgage lender should be allowed to fix (whitewash) its fraudulent foreclosures. Further, for the foregoing reasons, real estate racketeering must be dealt with, and perpetrators sent to jail.
In the past 24 hours, Wells Fargo has ceased denying that - like other mortgage lenders, it also has been filing flawed foreclosure proceedings in courtrooms across the country. To correct its defective foreclosures, Wells Fargo has now announced that it will re-file 55,000 Wells Fargo foreclosures.
But I believe that Wells Fargo is only now forthcoming because covering up its wrongful foreclosures is no longer effective. Also, I suspect that instead of those 55k improper foreclosures Wells Fargo has admitted to, there are much more. There might even be 55k fraudulent foreclosures in the state where I reside.
The res ipsa loquitur foreclosure frauds that occur here in Louisiana involving Wells Fargo, Freddie Mac, certain foreclosure mills, and certain corrupt judges make it apparent that Wells Fargo cannot be trusted to fix its foreclosure wrongdoings, no more than an addict can be trusted to self-reform.
I have posted a small amount of information about Wells Fargo, Freddie Mac, Lehman Brothers (yes, Lehman is defunct, but if that name is needed for flimflam), foreclosure debt collector attorneys (foreclosure mills), and judicial corruption. Understandably, foreclosure fraud / real estate racketeering thrives in my state where - as attested to before Congress for the impeachment of Federal Judge Thomas Porteous - it is the "Louisiana Way" to give gifts (bribes) and 'do favors' for judges.
Thus, it is further understandable how thousands of Louisianians' homes have been illegally taken as judges signed orders allowing foreclosure mills to auction (sometimes simulated) peoples' homes - even when the mortgage lender (the PLAINTIFF) does not exist. Or, the mortgage "plaintiff" named in the foreclosure petition has no ownership whatsoever of the secured interest in the mortgage note - even when the homeowners dispute that's not their lender. To be specific, the foreclosure petition consists of a mortgage plaintiff that has NO STANDING. Such is an element of Louisiana's way. Such is what Wells Fargo and the above-listed miscreants have done in Louisiana for a long time - and such, as the facts show, goes unreported, unaddressed. Here it is 'business as usual'.
On my website there is mention of how Wells Fargo (WF) filed a false IRS form 1099-A to receive tax benefits despite the fact that Wells Fargo did not foreclose on my home, and of which I knew nothing about until I received a tax bill.
Incidently, I had written an FYI notice to Attorneys General in 25 states to notify them about Wells Fargo's filing false "acquisition" 1099s under pretext of having acquired properties via foreclosures. Because an A.G. from a different state forwarded my letter to Louisiana's A.G., I took pains to explain that mixup. (For years, I have been providing A LOT of information to the A.G. in my state. The only thing it accomplished for me were bitter reprisals, including employment blacklisting - kinds of hostilities subjected upon unprotected whistleblowers.)
Also, on my website, see: Lehman Brothers, Wells Fargo Foreclosure and Insurance Claims. There on my site is the "Bailey" foreclosure that was filed under Lehman Brothers, but the Hurricane Katrina insurance money was demanded from Allstate by Wells Fargo.
However it might be explained away, it is not lawful for foreclosure mill lawyer, Adcock, to utilize the defunct Lehman Brothers' name to carry on the Bailey foreclosure proceedings well after the fact of Lehman Brothers' collapse. It is further not lawful for Adcock to write Allstate Insurance and prosecute a federal court lawsuit for Katrina insurance money for the Bailey property on behalf of Wells Fargo while at the same time Adcock maintained a state court lawsuit on behalf of the defunct Lehman Brothers.
Moreover, it is nonsensical to expect a mortgage lender to comply with laws, statutes, and Civil Procedures. Precisely, mortgage lenders are not required to know laws - attorneys are! Most of the time, the attorneys have made severe errors - sometimes intentionally, since errors help keep the billable tab going, and commit the very frauds that provide basis, defenses, and reasons to attempt negotiating mortgage contracts. Notice how litigation, NOT foreclosure, was the preferred achievement for Wells Fargo lawyers! See this case: Super Future Equities Inc. v. Wells Fargo, et al.
Defaulted Homeowners and Unaddressed Repugnant Foreclosure Frauds (Extortion)
In the first place, people who scowl at 'deadbeats' do not know everyone's situation. Those who chide defaulted homeowners as "deadbeats," seem unwilling to regard that not everyone obtained ill-affordable mortgages.
Some people defaulted due to divorce, overwhelming medical bills, 'outsourced' jobs to overseas that caused unemployment, and so much more. Also, should 'deadbeat' people with student loans have known how long it would take to get jobs? Further, unless someone has been living on Mars, it's impossible to not have heard about elderly people being tricked into "home repair" refinancing that plunged them into debt.
Here in Louisiana as well as Mississippi, even something as recent as the Gulf Oil spill exemplifies how unexpected circumstances can affect people's ability to pay their bills.
People are justifiably worried about being forced into foreclosure and repossession. Similarly, because of rampant judicial corruption here, it is not likely they will receive justice regarding workers' compensation, Family, Criminal or Municipal courts; and it is a foregone conclusion that federal courts' fairness - for minorities (the 'have nots'), does not exist. Wherefore, the possibility of not being able to pay one's bills, directly linked to judicial collusion, places any person or any business in jeopardy of foreclosure.
Yet, thick-skulled people who scorn "deadbeats" seem to prefer communities ull of vacant properties, blighted neighborhoods, and people living on streets or in tents - even though the determination as to the lawful mortgage holders of security notes could take years!
Thick-skulled people say 'people ought to move out and let banks decide for themselves'. But what part do such people not understand; banks are unable to decide ownership. Still, scoffers brush aside the fact about fraudulent court pleadings being filed by lawyers who are required to know better! And scoffers ignore that 'the bank' may not even get that property AT ALL! Meanwhile, if homeowners 'move out', the scoffers will be forced to welcome void and blight - and rats and vagrants eventually will also be coming and going.
Moreover, incredibly, some folks have become so omniscient they say that everyone in mortgage default is unwilling to pay rent -but again, those folks don't know people's stories, nor the facts.
Such people who spew anger about others living 'rent free' have absurd responses about 'White Collar foreclosure fraud' - which includes confiscating distressed properties via falsified court bankruptcy and state court pleadings.
Scoffers seem delighted about legal license and credentials being utilized for dishonest, criminal, unfair, unjust, enrichment against people already in distressed circumstances; and against sometimes innocent people.
Lenders' Lawyers engaged in fraud and extortion must be held accountable; jailed for real estate racketeering
Injurious acts by foreclosure lawyers render them, as well as their clients liable for damages. The half has not been told of outrageous, unfair collections, and privacy invasions associated with foreclosure! For a description of deleterious conduct see: Some Home Foreclosures are Actually Disguised Real Estate Extortions
As a fundamental matter in some instances, the amount owed to lenders for people's mortgage have become drastically reduced and offset because of justiciable damages from wrongful actions of lenders' lawyers and debt collectors under TILA, FDCA, and other laws.
The lenders' lawyers know that certain conduct is "actionable," and they don't want their mortgage clients or Investors to discover that they have committed malpractice in handling the foreclosures assigned to those lawyers. They make distressed borrowers appear as the loathsome problem.
Compare: blighted neighborhoods and foreclosure deed conveyances to non-existent mortgage lenders; bankruptcy "Lift Stay" motions that "lack standing," and names on "proof of claims" different from 'lift stays' "movers"; and illegal property deeds. Need I say, some people have never lawfully lost ownership of their homes, but they 'moved out'. 'The bank' with ownership may have never obtained that property. It is possible a lawyer flipped it, and perhaps Wells Fargo filed a 1099-A!
Also, foreclosure lawyers have failed to "effect service," failed at various substantive Civil Procedure requirements which make it not lawful to proceed with that lawyer's case until those errors are corrected. As such, homeowners are not to be blamed for refusing to cooperate with erroneous and fraudulent confiscation of their homes!
Often, foreclosure delays are because of the lawyers, but the lawyers keep that fact from clients. It is usually always foreclosure lawyers' serious mistakes, errors, and frauds that supply reasons, defenses, and basis for anyone with a brain / anyone who prefers to not be homeless to attempt renegotiating his or her mortgage contract.
Also, property owners seeking debt reorganization through Chapter 13 Bankruptcy are not to be blamed for contesting a false "proof of claim" or false "Lift Stay" motion. As such, countless foreclosure lawyers owe a lot of money to their clients for fatally botching foreclosure cases.
Furthermore, binding mortgage contracts contain an "Acceleration Clause." In particular, the contract requires LAWFUL foreclosure. It seems plausible that when homeowners receives provable "damages" from unlawful foreclosures, the lenders whose agents (the lawyers) violate the acceleration portion of mortgage contracts are liable to homeowners. Therefore, of necessity, culpable lenders should make modifications.
It is not fair for mortgage lenders to hire despicable, underhanded foreclosure firms who commit horrific, sometime crippling wrongs against defaulted borrowers under the guise of collections, to whitewash the facts behind abusive collection practices.
Abusive collections is the side of the coin that rarely gets talked about. Through the years, among the few people or institutions of which I have known to discuss these UNFAIR DEBT COLLECTIONS, are Elizabeth Warren, Gretchen Morgenson, Professor Katherine Porter, and the Brennan Justice Center.
The foreclosure lawyers know what they have done. They seek to have neighbors spewing hate about things which they know little about; and for victims to go out into tents or underpasses. However, although mortgage default causes foreclosure, it does not cause nor justify fraud and victimization of defaulted borrowers.
For reasons such as the foregoing, Wells Fargo, nor any other mortgage lender should be allowed to fix (whitewash) its fraudulent foreclosures. Further, for the foregoing reasons, real estate racketeering must be dealt with, and perpetrators sent to jail.
Americans Get Screwed- The Servicers and Con Artists And Wall Street Fat Cats Make Billions
By Matt Weidner
Everybody, and I mean Everybody now knows and acknowledges what I, and a handful of attorneys, activists, bloggers and internet crackpots and alarmists have been screaming for years now—THE BULK OF THE SUBPRIME MORTGAGE INDUSTRY IS AND HAS BEEN A MASSIVE BAJILLION DOLLAR SCHEME TO ROB AMERICA OF BAJILLIONS OF DOLLARS
Read Chain of Blame and The Big Short and watch House of Cards for detailed and sickening analysis that supports that dramatic and broad statement. I have additional gut feelings and opinions based solely on my 8th grade level economic analysis that goes something like this:
The US failed to create real jobs, industry and economic growth to pay for the absurd prosperity of the last decade. Quite simply Americans didn’t work harder or create more to entitle us to the dramatic increase in creature comforts and standard of living we instantly became entitled to with a fury beginning around 2000. The fact that we didn’t actually earn this new prosperity didn’t stop all of America from partaking in it….we just took out the collective American credit card and borrowed it all….to the tune of trillions of dollars. A massive bulk of the American economy is based not on what we produce or what we are actually entitled to use or consume, but what we’ve all borrowed….the American economy in 2000-2010 was like a coke addict with a wide open tab at a casino in Vegas–whooppiee!
Anywhoo, all this fun and games and the entire American economy…trillions of dollars in real mortgage debt (evidenced by MERS based mortgages) was converted into mystical, magical mortgage bonds and floating paper and pools of billions of dollars of debt that was traded around the world through shadowy, amorphous, shifting trusts. The originators of all this debt (the original subprime lenders) are long, long gone. The initial aggregators of the pools of the mystical debt are also now long gone and what remains are a handful of major servicers, government sponsored, corrupt and unregulated criminal debt collectors that are trying to re-convert the mystical magical paper into real mortgages or real fixed assets again that might take them out of the mystical, magical realm and turn them into real money for the institutions.
The subprime pooling and packaging industry was an unfettered, unregulated orgy of greed, incompetence and corruption that led directly to the financial collapse of 2008. No one in the industry was punished in the least bit, not one tiny bit for an industry that was totally out of control. To the contrary, the executives, the traders, the attorneys, the Fat Cats that got us into the mess were all rewarded handsomely for all the crimes and deceit. And the rewards continue today as we rush headlong into the Real Collapse of the American Economy that’s coming in 2011.
Remember my first comment, “Everybody, and I mean Everybody now knows that the entire American subprime mortgage market is a scheme to rob the American people?” Well, in recent testimony before a Congressional panel, the details of the most current aspects of the criminal enterprise are revealed with staggering details:
The federal government is pumping billions of dollars into the criminal servicers who are simply pocketing the money, in many cases improperly, with no accountability to the American people.
I’m just a simple, small town lawyer but what I see on the ground level is exactly what is admitted among and between all the big shots, elected leaders and Wall Street Fat Cats. The Assignments, Affidavits, Endorsements and claims of ownership are lies, fabrications and at best guesses and estimates. (We don’t know who really owns your mortgage, but we’re going to take it anyway.) Our local judges should care about details like real claims to ownership and preventing widespread, systemic fraud and abuses and mega corporations receiving billions of dollars they are not entitled to. Our judges should be looking at the bigger pictures and reading exchanges like the following and understanding that they not only have the power to right the wrongs that are happening to their neighbors and the Amercian people as a whole, but that they have a sacred Constitutional obligation to stop these abuses. Our judges are on the front lines and they hear the stories from struggling consumers who are lied to and abused by servicers. Our judges hear the stories everyday of homeowners who have filled out the endless and conflicting forms only to be shot down, shut out and kicked aside. Our judges, more than anyone else through their interactions with the victims of the servicers have the unique ability to put these statements into their sickening context:
“How do we know that people who don’t have good liens aren’t getting public money essentially under the false pretense that they have a good lien?” Silvers asked Caldwell.
“Again, we don’t,” was her reply. “Our focus at this point has been on…”
Silvers quickly stopped her. “Hold it,” he said. “That’s the issue.” He added that he hoped Treasury “would be diligent” in trying to answer “what’s potentially at play — are servicers and banks getting public money under false pretenses? We ought to try to figure out whether that’s true or not,”
Everybody, and I mean Everybody now knows and acknowledges what I, and a handful of attorneys, activists, bloggers and internet crackpots and alarmists have been screaming for years now—THE BULK OF THE SUBPRIME MORTGAGE INDUSTRY IS AND HAS BEEN A MASSIVE BAJILLION DOLLAR SCHEME TO ROB AMERICA OF BAJILLIONS OF DOLLARS
Read Chain of Blame and The Big Short and watch House of Cards for detailed and sickening analysis that supports that dramatic and broad statement. I have additional gut feelings and opinions based solely on my 8th grade level economic analysis that goes something like this:
The US failed to create real jobs, industry and economic growth to pay for the absurd prosperity of the last decade. Quite simply Americans didn’t work harder or create more to entitle us to the dramatic increase in creature comforts and standard of living we instantly became entitled to with a fury beginning around 2000. The fact that we didn’t actually earn this new prosperity didn’t stop all of America from partaking in it….we just took out the collective American credit card and borrowed it all….to the tune of trillions of dollars. A massive bulk of the American economy is based not on what we produce or what we are actually entitled to use or consume, but what we’ve all borrowed….the American economy in 2000-2010 was like a coke addict with a wide open tab at a casino in Vegas–whooppiee!
Anywhoo, all this fun and games and the entire American economy…trillions of dollars in real mortgage debt (evidenced by MERS based mortgages) was converted into mystical, magical mortgage bonds and floating paper and pools of billions of dollars of debt that was traded around the world through shadowy, amorphous, shifting trusts. The originators of all this debt (the original subprime lenders) are long, long gone. The initial aggregators of the pools of the mystical debt are also now long gone and what remains are a handful of major servicers, government sponsored, corrupt and unregulated criminal debt collectors that are trying to re-convert the mystical magical paper into real mortgages or real fixed assets again that might take them out of the mystical, magical realm and turn them into real money for the institutions.
The subprime pooling and packaging industry was an unfettered, unregulated orgy of greed, incompetence and corruption that led directly to the financial collapse of 2008. No one in the industry was punished in the least bit, not one tiny bit for an industry that was totally out of control. To the contrary, the executives, the traders, the attorneys, the Fat Cats that got us into the mess were all rewarded handsomely for all the crimes and deceit. And the rewards continue today as we rush headlong into the Real Collapse of the American Economy that’s coming in 2011.
Remember my first comment, “Everybody, and I mean Everybody now knows that the entire American subprime mortgage market is a scheme to rob the American people?” Well, in recent testimony before a Congressional panel, the details of the most current aspects of the criminal enterprise are revealed with staggering details:
The federal government is pumping billions of dollars into the criminal servicers who are simply pocketing the money, in many cases improperly, with no accountability to the American people.
I’m just a simple, small town lawyer but what I see on the ground level is exactly what is admitted among and between all the big shots, elected leaders and Wall Street Fat Cats. The Assignments, Affidavits, Endorsements and claims of ownership are lies, fabrications and at best guesses and estimates. (We don’t know who really owns your mortgage, but we’re going to take it anyway.) Our local judges should care about details like real claims to ownership and preventing widespread, systemic fraud and abuses and mega corporations receiving billions of dollars they are not entitled to. Our judges should be looking at the bigger pictures and reading exchanges like the following and understanding that they not only have the power to right the wrongs that are happening to their neighbors and the Amercian people as a whole, but that they have a sacred Constitutional obligation to stop these abuses. Our judges are on the front lines and they hear the stories from struggling consumers who are lied to and abused by servicers. Our judges hear the stories everyday of homeowners who have filled out the endless and conflicting forms only to be shot down, shut out and kicked aside. Our judges, more than anyone else through their interactions with the victims of the servicers have the unique ability to put these statements into their sickening context:
“How do we know that people who don’t have good liens aren’t getting public money essentially under the false pretense that they have a good lien?” Silvers asked Caldwell.
“Again, we don’t,” was her reply. “Our focus at this point has been on…”
Silvers quickly stopped her. “Hold it,” he said. “That’s the issue.” He added that he hoped Treasury “would be diligent” in trying to answer “what’s potentially at play — are servicers and banks getting public money under false pretenses? We ought to try to figure out whether that’s true or not,”
Friday, October 29, 2010
Movie night: COP Hearing on TARP Foreclosure Mitigation Programs
Just pray that from this hearing we will get some help.
http://cop.senate.gov/hearings/library/hearing-102710-foreclosure.cfm
http://cop.senate.gov/hearings/library/hearing-102710-foreclosure.cfm
Fannie Mae retires HAMP option for mortgage payment reductions (Fannie Mae is working to help homeowners !!!)
by JON PRIOR
Fannie Mae will end its Payment Reduction Plan (PRP), a program designed to give borrowers ineligible for the Home Affordable Modification Program temporary payment relief while the servicer works toward another foreclosure alternative.
According to a servicing announcement issued Friday, PRP will end Dec. 31, and any relief given before then must end before July 1, 2011, or within six months. Servicers must still report data to Fannie Mae, and its incentives to those servicers will still be paid on eligible PRPs when foreclosure is prevented.
A spokesperson for Fannie said recent volumes in the program were relatively small, and borrowers experiencing hardships such unemployment and problematic drywall, can still be put into regular forbearance plans and extensions.
Fannie started PRP Oct. 26, 2009 as a interim for servicers to get borrowers through HAMP. Through it, mortgage principal and interest payments were reduced by up to 30% for qualifying borrowers. It replaced Fannie’s HomeSaver Forbearance program.
PRP reduced the payments by 30% rather than the previous 50% under HomeSaver Forbearance, because permanent solutions are closer to 30%, Fannie Mae said at the time.
Servicers totaled 171,176 modifications on Fannie and Freddie Mac loans in the second quarter, according to the Federal Housing Finance Agency. Although that was a 24% increase from the previous quarter, the more than 275,00 foreclosure starts still outnumbered those modifications.
Fannie Mae did not immediately respond to requests for comment.
Fannie Mae will end its Payment Reduction Plan (PRP), a program designed to give borrowers ineligible for the Home Affordable Modification Program temporary payment relief while the servicer works toward another foreclosure alternative.
According to a servicing announcement issued Friday, PRP will end Dec. 31, and any relief given before then must end before July 1, 2011, or within six months. Servicers must still report data to Fannie Mae, and its incentives to those servicers will still be paid on eligible PRPs when foreclosure is prevented.
A spokesperson for Fannie said recent volumes in the program were relatively small, and borrowers experiencing hardships such unemployment and problematic drywall, can still be put into regular forbearance plans and extensions.
Fannie started PRP Oct. 26, 2009 as a interim for servicers to get borrowers through HAMP. Through it, mortgage principal and interest payments were reduced by up to 30% for qualifying borrowers. It replaced Fannie’s HomeSaver Forbearance program.
PRP reduced the payments by 30% rather than the previous 50% under HomeSaver Forbearance, because permanent solutions are closer to 30%, Fannie Mae said at the time.
Servicers totaled 171,176 modifications on Fannie and Freddie Mac loans in the second quarter, according to the Federal Housing Finance Agency. Although that was a 24% increase from the previous quarter, the more than 275,00 foreclosure starts still outnumbered those modifications.
Fannie Mae did not immediately respond to requests for comment.
Dodd-Frank, Affidavit Errors Could Feed Demand for Specialty Servicing
By: Alison Rich
New regulations coming down from the Dodd-Frank Act and the recent news of so-called “robo-signers” and problems with foreclosure affidavits will help fuel continued growth of the specialty mortgage servicing
sector, so says Steven Horne, CEO and founder of Wingspan Portfolio Advisors, a Dallas area-based specialty and component loan servicing firm.
Specialty servicers step in for mainstream mortgage servicers on loans with specific needs, typically either when the loan is in default or on the verge of foreclosure. Those servicers generally are paid based on their success in rescuing loans from foreclosure and helping them revert to re-performing status.
The current foreclosure documentation crisis plaguing the mortgage realm will lead more servicers and investors to seek specialists to prevent loans from moving to foreclosure in the first place, Horne says.
“At this point, it appears every state is affected. Investors and servicers alike now have greater motivation than ever to ensure both that the loss mitigation process is fully documented and effective and that all legal processes, including foreclosure, are compliant,” he said. “We have been preparing for an onslaught because of the Dodd-Frank Act, but these latest developments in foreclosure documentation bring an entirely new dimension to the demand for our services.”
Horne explains that the Dodd-Frank Act itself is a game-changer, not just for mainstream lenders and servicers but also for his specialty niche.
“Though most of the financial reform law’s implications have not yet emerged, Dodd-Frank will bring several new aspects to the loan servicing landscape,” he said. “These include empowering bond investors and other stakeholders to have a greater say in the default servicing process, along with the methods used and who uses them.”
Dodd-Frank shines a spotlight on the treatment of defaulting loans and giving more control to entities with at-risk funds in both individual transactions and loan pools
The growth of special servicing is but one of the new realities materializing from the mortgage morass, Horne continues, especially as the fine points of Dodd-Frank become evident and the roles of special servicers like Wingspan are magnified.
“In addition to the full transfer of default servicing responsibility to special servicers, lenders are aggressively using ‘component servicing,’ where only certain tasks are performed by special servicers…at even earlier stages of delinquency,” Horne said. “This strategy, combined with the full outsourcing of loans considered hopeless, has resulted in tremendous growth for Wingspan and the sector as a whole.”
Case in point: Wingspan has expanded its operation several times over the last three years. The company now occupies roughly 40,000 square feet in the Dallas suburb of Carrollton.
Just as bond investors are finding that specialty servicers are a more effective option, the same holds true for lenders whose ability to foreclose and resell properties hangs in the balance because of documentation irregularities and “robo-signings” of faulty foreclosure affidavits.
“With the validity of completed foreclosures now in question and primary servicers struggling to comply with legal requirements in a cost-effective manner,” Horne said, “it is imperative to clear any clouds on title and to look for ways to keep motivated borrowers in their homes with foreclosure alternatives.”
He goes on to say that the specialty servicer’s modus operandi is very different from that of a typical loan servicer.
“Our niche is very high touch, allocating far more time with borrowers than the primary servicer could ever afford to spend,” said Horne, an attorney and former Fannie Mae director of servicing risk strategy. “Specialty servicers aren’t typically paid until they succeed, so it is not a numbers game for us. We monitor call times closely just like a primary servicer does, but instead of making as many brief calls as possible, we want to make sure they are spending plenty of time with each borrower.”
The specialty and component servicing sector already is helping the nation rise from its ongoing economic slump, Horne notes.
“Thousands of families are still in their homes because options other than foreclosure were found. Our experience has been that if the borrowers truly want to stay in their homes, we can most often find a way to make that happen and get the loan back to performing status,” he said.
Horne added, “The results are evident in restored loan value, fewer houses in the national inventory, and borrowers preserving better credit situations instead of being shut out of the housing market for five or more years because of a foreclosure.”
New regulations coming down from the Dodd-Frank Act and the recent news of so-called “robo-signers” and problems with foreclosure affidavits will help fuel continued growth of the specialty mortgage servicing
sector, so says Steven Horne, CEO and founder of Wingspan Portfolio Advisors, a Dallas area-based specialty and component loan servicing firm.
Specialty servicers step in for mainstream mortgage servicers on loans with specific needs, typically either when the loan is in default or on the verge of foreclosure. Those servicers generally are paid based on their success in rescuing loans from foreclosure and helping them revert to re-performing status.
The current foreclosure documentation crisis plaguing the mortgage realm will lead more servicers and investors to seek specialists to prevent loans from moving to foreclosure in the first place, Horne says.
“At this point, it appears every state is affected. Investors and servicers alike now have greater motivation than ever to ensure both that the loss mitigation process is fully documented and effective and that all legal processes, including foreclosure, are compliant,” he said. “We have been preparing for an onslaught because of the Dodd-Frank Act, but these latest developments in foreclosure documentation bring an entirely new dimension to the demand for our services.”
Horne explains that the Dodd-Frank Act itself is a game-changer, not just for mainstream lenders and servicers but also for his specialty niche.
“Though most of the financial reform law’s implications have not yet emerged, Dodd-Frank will bring several new aspects to the loan servicing landscape,” he said. “These include empowering bond investors and other stakeholders to have a greater say in the default servicing process, along with the methods used and who uses them.”
Dodd-Frank shines a spotlight on the treatment of defaulting loans and giving more control to entities with at-risk funds in both individual transactions and loan pools
The growth of special servicing is but one of the new realities materializing from the mortgage morass, Horne continues, especially as the fine points of Dodd-Frank become evident and the roles of special servicers like Wingspan are magnified.
“In addition to the full transfer of default servicing responsibility to special servicers, lenders are aggressively using ‘component servicing,’ where only certain tasks are performed by special servicers…at even earlier stages of delinquency,” Horne said. “This strategy, combined with the full outsourcing of loans considered hopeless, has resulted in tremendous growth for Wingspan and the sector as a whole.”
Case in point: Wingspan has expanded its operation several times over the last three years. The company now occupies roughly 40,000 square feet in the Dallas suburb of Carrollton.
Just as bond investors are finding that specialty servicers are a more effective option, the same holds true for lenders whose ability to foreclose and resell properties hangs in the balance because of documentation irregularities and “robo-signings” of faulty foreclosure affidavits.
“With the validity of completed foreclosures now in question and primary servicers struggling to comply with legal requirements in a cost-effective manner,” Horne said, “it is imperative to clear any clouds on title and to look for ways to keep motivated borrowers in their homes with foreclosure alternatives.”
He goes on to say that the specialty servicer’s modus operandi is very different from that of a typical loan servicer.
“Our niche is very high touch, allocating far more time with borrowers than the primary servicer could ever afford to spend,” said Horne, an attorney and former Fannie Mae director of servicing risk strategy. “Specialty servicers aren’t typically paid until they succeed, so it is not a numbers game for us. We monitor call times closely just like a primary servicer does, but instead of making as many brief calls as possible, we want to make sure they are spending plenty of time with each borrower.”
The specialty and component servicing sector already is helping the nation rise from its ongoing economic slump, Horne notes.
“Thousands of families are still in their homes because options other than foreclosure were found. Our experience has been that if the borrowers truly want to stay in their homes, we can most often find a way to make that happen and get the loan back to performing status,” he said.
Horne added, “The results are evident in restored loan value, fewer houses in the national inventory, and borrowers preserving better credit situations instead of being shut out of the housing market for five or more years because of a foreclosure.”
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