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Delaware AG Joins Cries For Foreclosure Freeze, As Mortgage Meltdown Moves Away From Just Judicial States
The populist chorus for a foreclosure freeze is now approaching 100 dB. The latest to join the fray is Delaware AG Beau Biden's, whose office, according to the AP, sent letters Tuesday asking three mortgage lenders
to suspend all pending foreclosures until the banks can review their
policies. While not all that surprising, this latest move is slightly peculiar as Delaware is not part of the 23 "judicial" states in which GMAC, JPM and BofA have instituted a voluntary foreclosure halt (for an analysis by Barclays of why the judicial states are mostly impacted, for now, click here). Per the AP, "the letter also asks Bank of America Corp., JP Morgan Chase & Co. and
Ally Financial Inc. officials to describe their foreclosure review and
verification process, and provide copies of Delaware homeowner
complaints about the foreclosure process, including concerns about court
documents that contained inaccurate information, improper notarization
or signatures to Biden's fraud and consumer protection division." Which means that as other AGs follow suit, the foreclosure halt will immediately expand from merely the 23 judicial states to all, especially since as Bloomberg just reported, "JPMorgan, Bank of America face "hydra" of foreclosure probes." We couldn't have coined a better visual if we tried.
More from the AP:
A Biden spokesman told The Associated Press on Monday that his office would request mortgage banks temporarily suspend foreclosure proceedings, but he clarified Tuesday that only three lenders would be asked.
The targeted lenders have halted tens of thousands of foreclosure cases elsewhere due to document verification issues.
In the letter, Biden's staff asks the companies to explain how they ensure that the information presented to the Delaware Courts is "complete and accurate" and provide a detailed description of why the bank has suspended foreclosures in other states. The Attorney General's office directs the lenders to return the requested information by Oct. 18.
Tom Kelly, a spokesman for JP Morgan, declined to comment.
Gina Proia, a spokeswoman for Ally Financial, declined to comment specifically on Delaware's request. Proia referred to a previous company statement that says bank officials are confident they have not inappropriately foreclosed on any borrowers and they are acting with urgency to resolve problematic issues in some places. The statement says a procedural error was found on some affidavits required in certain states.
Bank of America spokespeople did not immediately respond to a request for comment.
And here is a brief summary of all the moving parts in this rapidly deteriorating scandal which will blow holes in most mortgage servicers income statements and balance sheets:
Other states are taking similar action. In neighboring Maryland, Gov.
Martin O'Malley, Attorney General Doug Gansler and Rep. Elijah Cummings
sent a joint letter Monday to seven mortgage lenders, including three of
the firms targeted by Biden's office in Delaware, asking them to
similarly suspend foreclosure proceedings and review their procedures to
make sure foreclosures in Maryland were done properly. In Texas,
Attorney General Greg Abbott asked 27 loan servicing companies on Monday
to suspend all foreclosure activities over concerns about the accuracy
of foreclosure documents.
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The fireworks are getting spectacular aren't they?
I can't wait until it goes viral.
What? Oh, it already has? Damn, was I asleep? I didn't see anything on the TeeVee.
Wassa matta, you don' watch Kudlow?
Not since he and I were doing lines in the bathroom.
I wonder about his claims to be in "recovery". His manic behaviour is odd.
One word.
Hydrocodone.
http://en.wikipedia.org/wiki/Hydrocodone
Thank goodness. I was afraid he was huffing.
That's one word too. I think Larry multitasks. In the bathroom, on the set, in Trish's private dressing room.
http://www.cnbc.com/id/17579209
"Due to its opiate-related side effects such as euphoria, sedation and somnolence, hydrocodone is now one of the most common recreational prescription drugs in America, along with oxycodone"
come to think of it, this does explain Kudlow's bullishness...
Massachusetts AG did the same yesterday
http://www.boston.com/business/articles/2010/10/06/coakley_asks_for_fore...
NC AG the same thing today.
Oh goodie. It is going viral.
It's going viral faster than stuxnet. Hackers just can't compete against a bunch of lawyers who smell a lot of money to be made.
The new LegalBot 2000, able to bring up to 10,000 sps (suits per second) to a Courtroom near you (your performance may vary). :>D
Verfied!
North Carolina Attorney General Roy Cooper joins the list of those calling for a foreclosure suspension because of robo-signers:
http://www.housingwire.com/2010/10/06/north-carolina-ag-opens-investigat...
You absolutely could not make this stuff up!
Actually the one person I think who could make it up is WB7. A very sick individual.
Ya know him?
Please note, Mr. WB7 said YOU couldn't make this up. And, by extension, me too.
I'd tend to agree with him. And with you. This is exactly the sort of thing Mr. WB7 would make up.
It takes the mind of the super criminal, but with morals and compassion. Which makes for one very interesting sociopath. :>)
I'm going to have to rachet things up a notch. The story demands it.
Shouldn,t even be in court,if the banks had their way it would be no paperwork,no court .... another home stolen.
duplicate.
some ee cummings type punctuation in there... :)
In other news, its ON like Donkey Kong, big time:
http://www.marketwatch.com/story/geithner-steps-up-pressure-on-china-2010-10-06
What ever happened to preponderance of the evidence?
Regardless of whether the jr and sr bondholders have a dispute with eachother and/or the underwriter of the MBS and/or the originating bank and/or the servicer...THE DEADBEAT TENANTS HAVE STOPPED PAYING THEIR MORTGAGES!
Regardless of who does own the house, clearly the deadbeat does not.
Unless the goal is to destroy bank capital and the real estate market?
There is no preponderance of the evidence, as title is unclear as the law provides clear evidence of how title is to held and recorded or else you've screwed yourself.
So it's just like a criminal prosecution? One party to the contract must make every document, every procedure, and every filing perfectly. Or else the other party gets the house for free!
Cool.
They keep telling me that our once-great Republic has become a Democracy somewhere along the line. I guess this is part of that.
So people should open their front door walk away and live in tents while the banks own all the empty houses no one can afford.
Got it.
You know bearass, there is no good solution here. The crooks have made sure of that. Now stop your whining.
If all these people who bid up house prices so I couldn't afford one would get out of the houses they really couldn't afford either, then prices will come down to where I can buy one. They should damn well live in tents.
You think these people are any different than the crooks on wall street? They are not. They stole what they could get their hands on and the big time crooks just had access to more money. I've been harmed by all of them. They all suck and I'll take enjoyment in any of them getting a smack down.
Yes, a bank/mortgage holder should properly transfer ORIGINAL documents (the one's that you actually signed) and retain them in their files. Yes, they should ACTUALLY serve you notice that you are in foreclosure. Yes, an affidavit should be signed with PERSONAL knowledge.
While some deadbeats might not make ideal victims in this, not prosecuting the banks would be one LARGE step closer to fascism - where proof of ownership is not required, due process is not followed - as long as a bank can demonstrate it's not getting paid.
Two wrongs do not make a right.
But they do seem to make a political mandate.
So you'd be ok with me foreclosing on your house? Even though I have no valid paperwork?
Either way, someone is getting something for nothing. In my eyes, the people who agreed to take on the risk should be the ones that take the loss. Possession being 9/10ths of the law and all.
What, Bearster, you honestly think the little guy (deadbeat or not) won't get fucked if HE doesn't do everything right?
Cant' think of a better incentive for people to not fuck up important paperwork.
So, I guess you think that allowing the banks to "securitize" mortgages was a good idea. How about if they "securitize" banging your wife/husband? My point is that some things in the world of finances should be unmolested -- not the situation we have here!
@Bearster
Bank capital? -- LOL -- maybe 50 cents on the dollar.
Real estate market? About 3-4 years inventory.
Looks like the destruction already happened.
Whatever happened to possession is 9/10 of the law?
Why would you want criminals to get ahold of a home... so millions can end up homeless or millions of other folk not be able to even try to sell if they need to do so?
Some people were had, maybe some knew they were buying into something to good to be true, but the banksters knew better at all of the worlds expense. If you are so worried about the banksters... let's be clear they should have a roof over their head in club-fed.
Quit letting those CNBC bastards scream this evil-drivel into your head all day long.
The bank has NO skin in the game at all. The loan is conjured from thin air. They certainly should not wind up with an asset in the end.
Actually the point is to not compromise hundreds of years of property law because a bunch of too fucking smart bankers decided paperwork wasn't that important when they were securitizing any loan that could be written to anyone.
Everyone with a mortage should call their bank & demand proof they actually hold the title, if nothing else to gum up the works.
It's not about evidence, it's about the chain of title. This area of law has been settled so long that it has whiskers. That is what is in question. Holding out for a "free house" is another matter altogether.
"The chain of title" Good one RR.
They made sure of that. That is why the 'treaties' paid the vanguished (in gold) as well as kicking them off. The chain of title goes a long ways back. I'm reasonably paranoid, that in the shadows, the real claimants know all this.
Read the treaties (the Indian treaties). They all have a common thread. Payment.
All the way back to the 30 pieces of Silver. And beyond.
Always make sure there's an exchange of value, even if it's under duress. If there's an argument or complaint, it will be settled in your court system. You win.
http://en.wikipedia.org/wiki/Judas_Iscariot
And a sack of potatoes or a used bicycle will trump passing an evicence of debt (in settlement) instead of actually paying.
And 30 pieces of silver placed at 2% since that time would be quite the pile. So it didn't happen. The compound interest slavery in service of (one's own) signature is no longer working as intended.
Rotwang, the "chain of title" and "good and valuable consideration" are terms of art.
Glad you have the background to appreciate the terms.
"$1.00 and other good and valuable consideration" is a phrase that probably exceeds the use of the words "close cover before striking".
Except I don't agree with "$1.00".
My line of thinking would tend towards:
"For twenty-five dollars (USC.31.5112(a)(8)) in hand paid and other good and valuable consideration"
Better to bring the amount of controversy up to a level where it might have actual standing. A half-Eagle tendered into circulation does this.
That is, if those ancient invocations will be allowed to stand.
Unless the goal is to destroy bank capital and the real estate market?
Its a patriotic duty to default on 40x leveraged money because the credit never existed in the first place so why should it be forced to maintain its magical existence?
When housing is at 1985 levels we will return to 2-3% inflation.
There is nothing destructive about erasing credit that never existed. You call it "bank capital" but it was never, ever bank capital - it was fractional reserve lending - created out of thin air.
You call it "destroying" the real estate market but it is actually "creating" one for those buyers that can afford the adjusted prices.
The best thing that can happen to this country is a total collapse in the real estate market.
Then, maybe people can buy, afford and payoff home loans in less than 30 years instead of digging themselves deeper into debt.
What you default on is your "voluntary servitude", and that can not be tolerated on a large scale.
Gonna need a bigger rug.....
North Carolina has joined the party:
http://voices.washingtonpost.com/political-economy/2010/10/north_carolina_joins_states_ca.html
Wells Fargo still refusing.
A chilly wind blows from the north on this house of criminally rigged cards.
Yeah, that's right. The people who "bought" a house for no money down, paid the bill for a few months at insanely low interest rates, and who have BEEN LIVING IN IT FOR FREE FOR OVER A YEAR are such ...
...victims.
What is wrong with you? You love the crooks in the banks who did this?
Who are these straw people you would incite us to join you in condemning?
Please provide evidence that this inflamatory appeal to cheap stereotypes has genuine relevance . . . since you seem incapable of comprehending the issues of law.
Bearster, how about you show your work?
Of the current homes in foreclosure and those foreclosed on in the last 18 months, how many of them as a percentage of the total defined above actually ""bought" a house for no money down, paid the bill for a few months at insanely low interest rates, and who have BEEN LIVING IN IT FOR FREE FOR OVER A YEAR" ????????????
When you have an answer you will be allowed to shoot your mouth off. Until then, I think you know what to do.
Predatory lending bears bitter fruit..........
Bearster,
What about people making their payments who could lose their homes because they innocently bought something they thought had the proper title work done? Only someone else has a lien on it? Or worse? What about them? What of the stories we have heard of folks who OWNED THE FULLY PAID FOR HOUSE, thrown out of the house because the sheriff thought the documents were in order when they were not. All their stuff thrown out on the street. I'd die if I lost my son's pictures, certain special objects, can't get that back no matter who you sue.
I feel about this like I do about capital punishment, better to let some criminals go than to kill the innocent. To spell it out here, better to let some deadbeats have a house they don't deserve, rather than screwing folks who thought they had DOD.
Yep. What if you bought a car from a guy who had "clear title". Then you find out that the actual owner of record wants his money -- or "your" car. What then? If some recovery service picks up your car in the middle of the night you'll perk up to the legal machinations that have long been established. Maintaining a chain of title is the issue at hand.
The last throes of an ownership society?
Maybe not. The last throes of a society are often capable of ushering in a period of very clear, if violent, ownership. Just might not be the same owners.
Yup. Shooting the guy in the tow-truck is the same as shooting the guy who is changing the locks on the house. The wrong guy is the target!
You gotta go to the source:
Man Crashes Plane Into Texas I.R.S. OfficeWow. I wrote this incident into a post and deleted it because I didn't want to sound too extreme.
Edit: What I meant to say is that I was on the same wavelength, thinking about that man's choice. Things are much worse.
agreed, well said
"First the banks stole our money now they're trying to steal our house..." - protest sign
Squatter's paradise...They just got at least another year to live for free. And when all is said and done, expect cram downs and re-fi's at 3%. All those option arm's and alt A's that were going to reset at 6.8% +++Not happening. Somehow I get the feeling that this will turn into a mortgage bailout which will be put on the taxpayer's credit card. The more I read about mortgage gate, the more I get this bad feeling that when all is said and done the Banks will be better off and the 60% of American's that were underwater suddenly got some equity back.Not to mention home values will end up higher as supply and demand will come to terms. Just look at every other twist that has taken place this year? I'm sure as Rham cleaned out his desk last week he reminded his former boss that he should never let a good crisis go to waste. Almost to the point where the line was thrown to Alan Grayson and he took it hook,line and sinker...
@tahoe
Yes, I too fear that this latest "emergency" will morph into a broad bailout for state governments, banks, and general amnesty for the thousands of guilty parties. The lame-duck Congress will have one last laugh at our expense.
We'll see how it all plays out. I don't agree that there will be an easy solution to this, nor will the banks be better off. They are not popular any more (if they ever were) and their paperwork issues can not be scapegoated to anyone else.
The securitization issues are likely to have a much greater impact (if less media coverage). Millions upon millions of notes/titles might be clouded without a proper chain of title IRRESPECTIVE of whether the homeowner is paying or not. What happens <if> no title insurance can be written on any house that was securitized from 2003-2009? What happens to the housing market? Fail.
I appreciate all the junkers as this would probably send most of you over the top, however lets not forget who is running this country right now and what they will do to keep the dream alive!
First of all I don't hate all banks and bankers...there are some responsible ones like Comerica and Bank of the West. The TBTF fuckers are the ones I have a problem with. Pushing subprime shit ended up with our economy tanking. They didn't care. The taxpayers bailed them out for their crimes. While there were some greedy borrowers with the brains to know better, their were a lot of naive suckers out there as well...they received no help or bailout. Now we find out that all along the way the Banksters complicit in this mess completely disregarded the law of the land in the creation of this mess and the attempted unwinding of this mess. Here's my advice to the government: Let these fuckers fail, break up the big banks and take all the time neccessary to sort the shit out. If it takes 5 years before you can legally foreclose, then do it the right way. The money that is lost should be recaptured from all the banks and senior execs who had a hand in the mess...I believe this could be achieved under the RICO statutes. Clean up the system and make it honest again. If you bail out the banks you will have a civil war on your hands. If you bail out the property owners in foreclosure you will create division so deep that our country may not be able to withstand it. I implore you for the first time to do the right thing, not the expedient thing and not the politically correct thing. ETB
I don't hate leeches and ants, either. I just kill the pests.
"The money that is lost should be recaptured from all the banks and senior execs who had a hand in the mess...I believe this could be achieved under the RICO statutes."
No way this will work. First, the banks are already bankrupt so what money are you going to recapture? Second, the filthy rich execs will move to a country without an extradition treaty with the U.S. and wave every American the middle finger from a safe distance. There is no fix, only another opportunity for greedy assholes to take more of your shit to "fix" the problem.
While any criminal who is allowed bail may indeed "run", that doesn't equal a tenable argument against investigation or prosecution for any other kind of crimes. Even if 100% of them got away--absurdly unlikely--I would expect it to serve a substantial deterrent effect.
Of course, if the risk is that substantial, perhaps bail should be eliminated in the case of financial crimes.
Not to mention that their financial assets could be tracked and seized, like those of (other) terrorists.
The downside for them would be tremendous--and we wouldn't have ourselves to blame for not even making the effort.
We probably should try prosecuting but the money has been lost. Recovery will be similar to recovery by investors in Madoff. The damage is done and now we have to live with it.
I know the elite spend like drunken sailors, but there's only so much money anybody can spend. Plenty to recover . . . the important thing is that they keep zero ill-gotten gains.
Why so sanguine about letting them live both free and rich?
You got personal skin in this game?
I am a serf. I don't have anything. I'm not sanguine about 'letting' them live free, but they own the courts, the government, and the money press and I have nothing. They win.
Perhaps you should rouse yourself from that "serf" mentality . . . when we start virtually making the arguments for the bad guys, that is self-defeating.
I, defeated.
When everyone is "homeless and living in the street" (Thomas Jefferson) I am sure there will be reward money offered for certains heads to be delivered on a platter. With the number of people needing money, I sure there will be many takers.
This problem is getting bigger than "money". It is turning into a matter of survival for millions of people, who for the most part, have never known real need. It is going to get very ugly and chaotic.
so what do you propose for a fix?
I don't think this problem will be "fixed", and you'll have to propose a definition for "fixed" before I can give you an answer.
Reset
The guillotine fixes everything. The bankers can run but they can't hide. They will be found. I was just going to take their money by re-issuing US dollars but I remembered that the bankers have stashes of gold and silver.
Redemption, anyone. How about merc hit teams? Good enough to whack arabs, good enough to whack bankster terrorists.
I was thinking like bounty hunters, give them a commission for the fraudsters they capture and bring back for trial. Seize their assets and the mercs get a cut.
Maybe a smaller incentive program for AGs, don't want it so out of control they grab just anyone, but some kind of incentive.
WE LOVE YOU MERCS!
. . . just what we need, more lawless, armed men head-hunting for profit taking, as if we don't have enough predators loose as it is.
your request for advice on "night vision" devices last evening so that your "husband can shoot" is hopefully a co-incidence.
Wow, that takes dry humor to the next level!
Blah. Virtually all western mercenaries provide technical support or glorified (if highly skilled and expensive) guard duty.
MsCreant - Night vision - head/helmet mount PVS-14 or go home. Combine it with an IR laser, don't screw around with trying to use it through your optic on a night vision brightness setting or any such nonsense. If the laser is offset, and it will be, zero it offset or you'll be off vertically and horizontally at every other range. Combine it with a white light on the weapon for when you're not actively using the NV.
But most of all remember that no matter what equipment you're using, one person is a sitting duck. First rule of a gunfight is to bring a gun. Second rule is to bring all your friends who have guns.
Cathartes,
My post above was "Gallows humor" maybe with a little too much emphasis on the gallows part. I'm mad. How about you? Everyday we let this bullshit go on, we are partners in the crime, we are passive, complacent, hypocritical and letting it happen to us.
Peaceful solutions to this are looking more and more like academic bullshit to me. I used to be pacifist, hard core. What is happening makes me sick, it is harder and harder, to walk a pacifist's walk. Some of what I do is research trauma. Knowing about trauma and the effects on the body and the soul holds me to a higher standard. Trauma begets trauma.
But what does an organism do when it is threatened? Fight, flight, or freeze. Many of us have been only peripherally aware of the threat for much of our lives. But once you know you are being stalked, what do you do? Many of us freeze at first, hope the threat goes away. This one ain't going anywhere. Some may try to run, but there is no where on the globe to run to. At the end of the day, we will have to fight. How will that fight manifest? We shall see. Us spacemonkeys are funny creatures. All kinds of poo to throw.
I am not setting out to harm anyone, but I will protect my family, loved ones, myself, hell anyone around me in trouble. There are a lot of sheep dogs posting on this blog, they feel me. I shoot, my husband shoots. We have permits. We have good equipment. I live in an area that gets all kinds of number one ratings for various kinds of crime. It really isn't so bad either, mostly just need common sense and one will generally be okay. But law enforcement will not and cannot protect me. No offense intended to them, but they know they are the clean up crew. I am responsible to take care of myself and learning self defense is how I do it.
It seems these impulses of mine (my anger with the economic situation and the fact that I practice self defense) could be conflated in your interpretation of my posting habits. It is not crazy to conflate them, but one and the other are not necessarily related. I am fighting with other tools right now. I have a bully pulpit in my classroom and that is going pretty well.
You asked me and I don't know if you ever saw the post where I answered you, my husband is NOT currently in the service any more, he is a therapist. He is also a Buddhist monk. And he shoots.
My world is shades of grey, grey everywhere.
I've been mad for years MsCreant, about many obscenities, and with no "bully pulpit" save the internet. . .
you recently posted a reply to someone else about their use of "NWO" - that it is a concept that "runs up against your wall" - well, cheering mercenaries hit a wall for me as well, even in the context of hunting down "banksters" - psychopathy is rife, worldwide, and yes I too feel the threat. Being armed to defend family is one thing, it's increasingly necessary, but paying ex-military thugs to hunt down other humans is beyond the pale, and it's already here, amrka pays billions for their "service":
http://www.counterpunch.org/maass06022006.html
and they've just created yet another new moniker to be included in a 10 billion dollar state department contract, despite the controversy they create.
http://www.wired.com/dangerroom/2010/10/exclusive-blackwater-wins-piece-...
these numerous "mercenary" groups are responsible for some egregious shit wherever amrka roams, and to know they're given "authority" here is one hell of a mindfuck, so yes, I take it seriously.
"trauma begets trauma" - indeed it does, and since you research trauma you'll be aware of "triggers" and the results of those re-actions. . . right now there are traumatised individuals scattered around the nation, in families, on the streets, in bars sedating themselves, up in the woods "buggin' out", whooping 'n' driving down the highways late into the night - I hear them, and I know what's going down in my community, and I know these ticking time bombs in soft human bodies are going to EXPLODE like land mines, hurting everyone around them, and there's nothing. I. can. do. - we're militarised now, and angry, and it's ugly.
I realise that I'm in the minority here when it comes to sexualising anger, or talking mad weaponry, when references are made to "ass raping" by the "banksters" etc. etc. - and I honestly don't care. Most times I just scroll past, occasionally post a retort, depends on how I'm feeling at the time. As you say, it's the "locker room" here, so the lowest common denominator makes the "rules". . . there are also some thoughtful people who post, and there's some good information available that makes scrolling through the immaturity worthwhile. For now.
I didn't see your reply about your husband being ex-military. . . it matters not to me, but it IS rather ironic that he's a therapist - didn't you post that he'd said all therapists were "rapists" - as in "the rapist" - yeah, lulz. . .
my world is shaded grey as well, and I keep my mind open and flexible, but not so open that I lose a sense of my own morality or mortality. We're all trying to survive here, all of us.
In the Age of Kali, you DO what Kali demands of you.
indeed.
surrender the illusion of control. . .
and within that, we act.
This put anther nail in the coffin. Here lies "Trust", rest in peace, funeral for the dollar coming soon near you.
Can I reckon and this here upcoming Fore[skin]closure Hol(l)y Day (old time magicians wands made out of holly, don't cha know), gonna be synonymous with a bank[ster]ing Holy Day?
Since such a hiatus would grossly revalue real estate and PMs are going to go into Earth Gravity Escape as a result, because what backs the Fed/Treasury IS just the lil' ole MBS.
Well, Shiiiiiiiiit!
We dun got us some intended consequences!
Shucks, TD, coulda tole ya that!
Go long His Majesty's Explosive (HMX), Royal Daughter's Explosive (RDX) and Nitrated High Energy Compounds as the China Solution to RE Overcapacity is coming soon to a see through office park and suburban community hear you.
If you are having a foreclosure holiday and a bank holiday, why not throw in an election holiday?
This is very similar to what triggered LTCM's explosion in the 90s - with all their mathematical hedging models they never expected the instability in Russia, or the Asian financial crisis. PHDs got schooled.
Although the bulls will be cheering that somehow this should help artificially stablize the drop this will not be the case if the mortgage market grinds to a halt. The real concern should be what happens now that the Fed sucked all the demand forward with low interest rates, tax credits and fooled some of the last few prudent savers with jobs who were in possesion of fair credit scores?
I will tell you what will happen is that an economic shock and an increase in job loss will mean that all these young married couples who have been savings for years that finally though they were attaining a bargain ended up purchasing homes that were artificially (Much like equities) propped up and can find themselves 25% underwater in a matter of months. A gapdown in home prices across the nation and the inability for people to sell even if they would like because of the convolution caused by the inability to located owners..fraud can and will be catastrophic.
Once the public who are running out of their unemployment benefits find out that Americans truly are living rent free because the foreclosure process has been halted we should be right on cue for my 60%-75% decline target in housing prices. There are no jobs to support these prices, no credit and soon even fewer credit qualified.
And this is not even taking into account what would happen to the jobs market if the market lost 25% from this level in the coming months. The Fed should finally be realizing that they cannot stem the decline in housing prices let alone reflate it with these gimmicks. They already played this card over and over and over again in the past decade eventually the piper needs to be paid.
Yes. The real crash still cometh.
I agree, let the market forces do what they will...just don't let criminals off the hook in the process. One more note...no plausable denial for senior execs of the TBTF banks...the culture starts at the top...shit flow downhill
and part of the "hook" these senior execs should be facing is clawbacks on their bonuses that were unwarranted on so many levels
Time to not only pierce the corporate veil, but rip it to shreds!!
Yup.
"the mortgage market grinds to a halt"...
granted about 20% of recent RE sales have been REOs & SS...however, a 20% drop in the market for existing or home sales will not "Crash the market"....
and I ASSURE you that the USA Govt will be there to provide "mortgage assistance" should that unlikely situation come about.
Nobody cares. Dow goes up and nobody cares. It'll only matter when this up market breaks.
Foreclosures are becoming soo late-allowing people to continue to live in their homes till after they die.
They are considering changing the name from foreclosure to aftclosure. Badaboom!
Tyler,
I thought you blew up all the banks in Delaware.
IMO, the freeze is another coverup. Now all documents must be delivered and analyzed by 30 or 40 AGs with will end up in years of court battles while the banks can't comment on anything because its in lititgation. The dead beats living free must love this. Kick the can down the road. Extend and pretend. Everyone watch as new highs are reach on all indexes.
The banks don't own the houses they are trying to foreclose on. What part of that don't you understand?
All I can say is that at some point, there will need to be mechnism that dictates alleged squatters produce a deed or proof of current payments or get the f*** out yesterday... the free ride is over. The problem will be figuring out who that authority is and making sure it operates fairly and with due process. Lacking this, I can easily see a ripple effect through entire mortgage industry as the remain folks who are still making payments (myself included) say f*** this, I am done. Nobody should get a free house - but the banking system that caused this needs to be dismantled now. Bankers can join the ranks of the unemployed.
It's not just about people not paying. It's ALL titles/notes that were securitized. Many of these notes were not transferred into the MBS trusts properly. WHO OWNS THE NOTE? Notes cannot be transferred into the MBS retroactively. WHO OWNS THE NOTE? Put backs to the bank will make them insolvent (please, please).
And then, imagine your note was put into an MBS. The top 2 tranches have been paid off, and therefore no longer have standing. Who signs off on the transfer of the note to the buyer when you go to sell the house? The servicer? MERS? Or the remaining tranches? What is legally sufficient? [The last paragraph is fairly speculative, but MBS securitization is a very new development, and in many ways contrary to long-standing real estate law - where quaint "wet ink" original notes and proper chains of ownership transfers are required on physical pieces of paper.]
Totally agree. The multi-trillion dollar question is who owns what (and at what price under what precedent)? There may not be a mortgage out there in any form or standing that hasn't been through the organ grinder and fubar'ed beyond recognition or lost/destroyed. Only a national system through which the whole damn thing could be vetted and cleared would really work - and that would take forever plus a day or two. Leads to the conclusion that there will have to be a major cover-up attempt. Or some sort of national refinancing initiative on top of a massive cover-up attempt. Either way, I feel a hail-Mary pass coming soon.
additionally... we aren't even talking yet about the secondary mortgage market (i.e. HELOCs). Yikes.
Yes, likely a hail-Mary soon.
How about the CDS market on those RMBS? YIKES!
No doubt COMMERCIAL REAL ESTATE is just fine and all the documents are in order there. No problems...
Actually I have less concern about Commercial RE because the paper is often kept in house and thus the bank must live and die with any sloppy work. Plus because it's usually 5 years or less paper those problems can come up fast.
I've no doubt there are problems there. But not on the scale of the personal housing paper mills of 05-08. The 06-07 vintages are particularly rancid.
I will take your word for it, the in house part makes sense.
CRE, so far, has mimicked the whole subprime/Alt-A lending template, only worse, so I incorrectly extrapolated that it would be true here as well, but also worse. I know part of the worse had to do with the inability to roll loans that were coming up sooner (no one can get the money for the roll and the properties were not making money). Just seemed like with distress sales, and folks like the Simon group snapping up properties, in lumps, well, you get where I was going. Why not have Mills processing that stuff too in order to turn it around fast? And why not break the law there too, to make money on the bottom line. I could actually keep going on...but I am guessing and have no experience. ZIP.
It's an encouragement to join the foreclosed. Join them by not paying. Paying debt is for suckers.
Yup. The current situation is real double-edged sword. And that sword is a-swinging right now.
I would clarify that nobody got a free house, just a reduced in price house...depending on how many years you made payments.
Would a check paid to their brother-in-law be accceptable? Who says he doesn't own the house? He has as much claim as the bank without the title or deed.
here's how I see it, banks need the loans on books, so even tho they get no income, they still have the house value as an "asset", a halt in foreclosure lets them pretend house is still worth the value of the mortgage. Homeowner gets to stay in house for free. Good deal for both, but what about the loss of income from no existant loan payments...that come via the taxpayers...FED creates money for nothing, lends it to banks for 0 percent interest, and then banks buy Treasuries with it, we the taxpayers pay interest to borrow money, we (the FED) created. Everybody wins except all the US taxpayers, who pay for interest on national debt and also lose buying power of the dollar as we see some assets classes inflate due to easy money. Basically, banks steal our money via monetary tricks and thus they do not have to throw out squatters.
People were in their houses for 1 -2 years without paying more than a few thousand to lawyers before, can you imagine how long they could live rent free for now? Shoot this shoudl be bullish for Florida and Cali economy.
Until CDO tranche holders go "head hunting", that is!
Hmmm. A crisis! An election. Something must be done.
I'm still calling the mtg mess as the catalyst for the October surprise.
I agree the mess will be used politically. But what are you saying will be the surprise? Or am I missing the whole point?
edit: I just saw your post further above. Are you saying suspend elections?
Unemployed homeowners can now get a loan to pay down improperly securitized loans:
http://finance.yahoo.com/news/Unemployed-Get-a-federal-loan-cnnm-3747132612.html?x=0&.v=2
It's getting surreal.
This mother is going to colon blow soon.
If anything will freeze up the system this foreclosing cluster f will do it.
Won't be long after that the back up lets loose.
Take cover mates.
Fubar
+
This is a very interesting situation indeed.. The real problem that the playerBanks and the govt. were in collusion creating the bubble. Both new most people would never be able to pay the property taxes. So they bundled it in the mortgage. When Squatters stop paying mortgage they also stop paying property taxes..
QE2 will happen and in a big way.. They'll bail out both the banks and the Bankrupt cities.
It's a shit sandwich w/ chillishit fries and a coke..
What are you going to do?
Wondering if anyone has calculated the amount of $ that stops flowing if everyone gets a mortgage holiday? Stopping forclosures happening? Why the fuck should I make my monthly deathgage payment? Multiply that by a certain # of homeowners. What does that do to $ velocity? From econ 101:
< $ velocity = deflatulation (big time)
cheers
Fubar
Once again, you can thank the 'well managed'44 TBTF Uber banks...their arrogance cannot go unpunished.
Class-action RICO lawsuit:
Tennessee v. MERSCorp. et al
http://stopforeclosurefraud.com/2010/05/10/tennessee-vs-mers-mortgage-el...
I read the entire thing just for its sheer beauty . . . what great work!!!!
Nothing about RICO, however. It was a Qui Tam suit under TN law that seeks--and is a slam dunk case for--treble damages on evasion of registration fees to counties, $2,500-10,000 per count for each statutory violation . . . ON 1 MILLION INCIDENTS. All the big banks, etc., are defendants.
Unless the crooks in DC find some way to spring their Wall Street buddies free of the law, this should easily bring them completely down, it seems to me.
This is just TN--multiply by 50 for full effect.
I suspect new laws will be coming and this will end in state fighting pre-emption in Supreme Court. Really, the banks should just be made to settle for some precentage of this and state use the money to fund their state govt for a year or two, new roads and high speed internet for everyone....
For those advocating we should shed 100 years of old-fashioned, good property law and record-keeping because some businesses just decided it was too burdensome..please just look at real world examples of such a policy....take a look at third world countries where they don't have good property/title records and ownership of most pieces of land is disputed and squatters to tend rule , erracticly with political regimes, as law is in chaos...its not pretty.
We used to be a land of secure, transparent, low-fraud markets because we HAD "burdensome" due process and good title record keeping. The "burden" of the record keeping and due process is way way way less wasteful and inefficient than you get from constant disputes, mistakes, vague and unclear title.
Who decided to securitize? Who decided to set-up MERS? Who decided to bypass traditional record-keeping for excel spreadsheets ?(to the point that one guy stole 10s of million by simply changing a few numbers on mortgage spread sheets).
Who did this stuff? was it the person asking for a loan, the consumer, the home buyer?
Did people even get good deals on these loans because of the efficiency gains in processing the mortgage companies gained? No...studies show often they did not, in fact the got tricks and traps mortgages that blew up in their face. No consumer asked for this mess and they did not benefit from it (unless now they are squatting in an underwater house).
Instead, this mess was thought up and driven by businesses because it was a shortcut (a risky one) that saved them costs, and thus made them more money.
Banks, private businesses servicing the mortage industry and the formerly, supposed private enterprises, Fan and Fred chose to sidestep the rules, at their own risk.
So our markets, which were once upon a time secure, stable, reliable are now like third world: trashed, frozen, muddy, and scary.
And now we should just forget the rules that worked so well for us so many years?!?! the rules that made our economy and markets the envy of the world, that made our markets safe, stable and low in fraud?!?!....and now because banks chose some risky short cut, and now we should go all third-world!?!?....HELL NO.
No economy or market can truly thrive and be efficient without some checks and balances and without orderliness, equal due process to all and transparency.
I wish we could just grow up, acknowledge it was a stupid, short-sighted thing to get away from our boring old stable ways of record keeping, bring everyone to the table and discuss solution to existing mess and have our democracy pass laws/policy that provides the fairest, and best for the overall common wealth, way to process these improperly recorded mortgages. That likely involves everyone taking hit.
And then, lets turn back to something crazy harsh like what we did from the 40's to 90's, we all know what bad economic times those were when we had banking regulation and little mortgage fraud.
Nice analysis! The ugliness is even deeper, however--see the TN case linked above . . .
Bravo Moneymutt!
Help a pea-brained man out here by giving me a specific answer so I might possibly understand the ramifications. I have a mortgage originated through Chase and owned by Fannie Mae. Chase says they have the deed of trust and that it was filed in the city courthouse where it was originated and where the property is located. Are you saying that there is no legal standing at Fannie Mae or Chase, in terms of claiming ownership, if my mortgage was packaged with others and sold in tranches as part of an MBS? Does that mean if I stop paying my mortgage to Chase and save that money, I can tell them that they have no legal standing to come after me until they can present the party that does have rightful claim to my mortgage balance in the form of the originally signed mortgage document? And further, ZH followers believe it to be impossible to ascertain who that owner is due to the sloppy job banks did in handling the packaging and securitization of my mortgage after it was wrapped by Fannie Mae. Anywhere close to being on the right path?
I don't think a specific answer is available without more information, and without watching this play out a bit more. There will have to be some attempt at a 'global' fix to this, as it does risk the entire real estate market if it breaks open.
You will have to look at your entire chain of title, whether your mortgage was indeed packaged into an RMBS. There might be some unsettled implications to this as well (as in who owns all of the tranches, and can they get together to 'collect' standing)?
I think it's fair to say that you will need to contact a lawyer to get specifics, but I would humbly recommend getting some popcorn and watching the mess for a bit. As mentioned, they will likely try to rectify this with some action. Whether that is successful or not is the next question.
From what I've read though, you seem to be on the right track, but would need to understand the specifics of your actual note. It's possible that it was transferred appropriately and therefore you're lack of payment would indeed get you a proper foreclosure. Of course, there's always the issue of whether the servicer has standing in foreclosure (it does not).
No proof of ownership = no ownership. No chain of title = cloud on title = no title insurance (which means great difficulty selling or transferring title). In the end the powers that be will find a solution and I would hazard a strong guess that no one will be able to walk away from their loan and retain ownership of their property. The banks will pay a price, things will get cleaned up and foreclosures will start again. The only questions? How much will the banks be on the hook for? How complete will the cleanup be? How long will it take? Can the economy withstand the Black Swan?
agree, good points, banks are too powerful to not get some legislative solution, but I anticipate many things could end up going to Supreme Court...but this current court always always sides with big business. The real unknown happens between now and final solution, because it will not be easily nor quickly swept under rug.
I have no idea what the answer is but I would not rely on anyone random advice from internet on this one, talk to a lawyer in your state specializing in foreclosure before you do anything.
I have plenty of equity in my house so don't plan on giving that up by not paying and have lived there since 1993, but re-fi'd in Dec, also with Chase servicing, Fannie owning...and I got a bunch of MERS notifications after I closed on re-fi and that makes even me nervous.
Of course, of course. Just curious to see if I had the thinking right.
Good interview with Kyle Bass today BTW. They let him speak!
http://www.cnbc.com/id/39538677
If I may add to the above 2 posters, who seem dead-on; it seems to me this whole issue is moot, from the home-owner's perspective, if all payments are made on time and in full. As long as the home-owner isn't one of those being falsely foreclosed upon. I myself will certainly keep all my payment records, every document I got at closing, etc.; and I should probably go buy a copy of whatever really got filed at my County Recorder's office.
In general, most people who make their payments should be fine. But talk to a lawyer; don't trust some moron with a made-up screen name.
It's <possible> that this impacts a significant portion of all titles/loans securitized. The notes may not have been transferred properly into the RMBS. No chain of title = no clear title ownership. This would be FUBAR.
Good. Let the politicians give the squatters get a head start this time around. Game on.
Yeah, really bad politics to foreclose on voters before the election. Or, Beau is in mortgage trouble himself. Or, Beau has purchased all of the foreclosures he can, for now. Or, Papa Joe is freaking out.
<Moved to a more recent post>
No worries gents, Senate just passed this shiny (without public debate) new law to help fix the mess. Just needs Mr. Prez's signature !
No worries gents, Senate just passed this shiny (without public debate) new law to help fix the mess. Just needs Mr. Prez's signature ! http://www.newsdaily.com/stories/tre6955yx-us-usa-foreclosures-bill/
This sucks but it still does not address the problem that they have not been doing appropriate title searches. That has been testified to in court. Does not change that certain fuckers are foreclosing on property that is not theirs. And throwing people who are paid up out of their houses.
I think the tax evasion angle with the counties is sexy and promising. Also the idea that you can't confidently track what is in the MBSs.