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Some Very Bad News For The "Sweep Fraudclosure Under The Rug" Brigade

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Fri, 01/07/2011 - 11:38 | 856145 HelluvaEngineer
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BAC @ 14.45

Fri, 01/07/2011 - 12:08 | 856295 HelluvaEngineer
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14.07 (BTFD)

Fri, 01/07/2011 - 12:16 | 856333 JLee2027
JLee2027's picture

Jim Cramer was just pumping BAC last night.

Fri, 01/07/2011 - 12:28 | 856382 HelluvaEngineer
HelluvaEngineer's picture

Yeah, I actually saw that.  Unfortuntately.  Something about BAC owning more homes than anyone, and since housing was about to make a complete recovery...

What bothers me about his show is that lately his callers all sound like they are 65-75 years old and chasing return to save their retirement.

Fri, 01/07/2011 - 12:29 | 856394 Cognitive Dissonance
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Or to stay retired.

Fri, 01/07/2011 - 12:38 | 856428 Salinger
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WTF watching Cramer and reading ZH   talk about oxymoron

Fri, 01/07/2011 - 13:56 | 856730 Almost Solvent
Almost Solvent's picture

Assuming that's not sarcasm, one should keep their friends close and their enemies closer.

How can you defeat your enemy if you do not study its ways?

Fri, 01/07/2011 - 16:26 | 857357 TheProphet
TheProphet's picture

Yeah. Reading ZH is the Oxy... watching Cramer is the moron.

Fri, 01/07/2011 - 16:25 | 857360 TheProphet
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Yeah. Reading ZH is the Oxy... watching Cramer is the moron.

Fri, 01/07/2011 - 16:54 | 857437 JLee2027
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For the record, I didn't watch, I just flipped channels while making din-din. But I have in the past, it's a macabre fascination like watching a train wreck in slow motion.

Fri, 01/07/2011 - 12:29 | 856391 Cognitive Dissonance
Cognitive Dissonance's picture

Too much of Jim Cramer causes blindness. Oh, wait a minute. Mom told me too much of something causes blindness, but I can't remember what.

Anyone? Bueller? Bueller?


Fri, 01/07/2011 - 13:19 | 856565 carbonmutant
carbonmutant's picture

Cramer causes contradictory spikes in your neural net leading to memory loss which leads to a decline in various neurotransmitters such as Serotonin ( source of confidence). The other thing as well as drinking and excessive eating are attempts to boost serotonin back to normal levels.

Sat, 01/08/2011 - 01:16 | 858268 Cheesy Bastard
Cheesy Bastard's picture

Just do it until you need glasses.

Fri, 01/07/2011 - 12:17 | 856341 jus_lite_reading
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The real news is that the Primary dealers submitted $25 BILLION into todays POMO!!


Fri, 01/07/2011 - 12:43 | 856449 Tom Servo
Tom Servo's picture

So I guess the false flag terror hit is going to happen soon, so to get this off the news (if it even makes the news....)


Fri, 01/07/2011 - 12:53 | 856484 HelluvaEngineer
HelluvaEngineer's picture

Why?  Looks like the /ES is bouncing now and this will all be forgotten by Monday.

Fri, 01/07/2011 - 12:55 | 856492 pan-the-ist
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When will the begin to investigate fraudulent mortgage origination?

Fri, 01/07/2011 - 13:33 | 856626 tsx500
tsx500's picture

uhhhh.....when will Megan Fox show up at my front door and unzip my fly  ?

Fri, 01/07/2011 - 11:39 | 856148 docj
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Good call by the SJC.  Let's see if (hope) it's the start of a state tsunami.

Fri, 01/07/2011 - 12:28 | 856388 JLee2027
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Yeah baby.

Stop your MERS Mortgage payment now. They can't foreclose....because they broke state property laws and no longer own your home. It's yours!

Fri, 01/07/2011 - 12:40 | 856436 Arthor Bearing
Arthor Bearing's picture

Well remember that there are still quantum meruit (unjust enrichment) contract claims by banks against mortgagors as well as equitable remedies. Courts have broad power to remedy unfair results. But this definitely gives momentum to the homeowners and it's very helpful that there's SJC endorsement of weighing the bankers' profits into the unjust enrichment balance. 

Fri, 01/07/2011 - 16:57 | 857445 JLee2027
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The bank sold the mortgage and was paid by the buyer. There is no unjust enrichment, except by the bank...who sold junk that cannot be foreclosed on. I didn't do anything wrong. 

Fri, 01/07/2011 - 12:50 | 856471 Sig Sauer
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sorry, but your obligation doesn't just disappear.  best case is it is now an unsecured obligation.

Fri, 01/07/2011 - 13:44 | 856673 Skeebo
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Which means if you are willing to take a significant credit hit... you own your house free and clear.

What's the value of a couple hundred grand extra over several years in your pocket vs your credit score?

Course, you'd never be able to move again, but still... their could be an interesting cost benefit analysis run there, especially if you were say... in you were 65+ and liked your current home...

Fri, 01/07/2011 - 16:57 | 857450 JLee2027
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Me thinks the banks would be around much longer, and if you have enough of a PM stash you can pay...cash in the future. 

Fri, 01/07/2011 - 17:00 | 857461 TeMpTeK
TeMpTeK's picture

Your Honor.. Im not saying I dont owe a payment.. Im saying I dont owe a payment to the Plaintiff...

Bye Bye MERS

Fri, 01/07/2011 - 13:12 | 856540 docj
docj's picture

Methinks you'd best to a very thorough title search before trying that little stunt.

Fri, 01/07/2011 - 18:42 | 857738 Strider52
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So, who actually owns the home, since the title wasn't properly transferred? The last legal title-holder?

Fri, 01/07/2011 - 11:39 | 856151 ReallySparky
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Virginia, there is a Santa Claus.

Fri, 01/07/2011 - 11:40 | 856155 FaithEqualsZero
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Is there an honest court still out there? Whats the catch?

Fri, 01/07/2011 - 11:46 | 856208 Cognitive Dissonance
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Supreme Court, Ponzi banks, Congress giving it all away, martial law, SEC Porn, DOJ is DOA etc. Take your pick which "catch" you wish to examine today.

Fri, 01/07/2011 - 12:01 | 856268 tamboo
tamboo's picture

An attorney was sitting in his office late one night, when Satan appeared before him. The Devil told the lawyer, "I have a proposition for you. You can win every case you try, for the rest of your life. Your clients will adore you, your colleagues will stand in awe of you, and you will make embarrassing sums of money. All I want in exchange is your soul, your wife's soul, your children's souls, the souls of your parents, grandparents, and parents in law, and the souls of all your friends and law partners." The lawyer thought about this for a moment, then asked, "So, what's the catch?"

Fri, 01/07/2011 - 14:17 | 856807 I Am The Unknow...
I Am The Unknown Comic's picture

Tamboo, that's the first time you made me laugh.  Believe it or not, I haven't heard that joke before.  I will be using it all weekend, and will mention you as the source.  Thanks. Cheers.

Sat, 01/08/2011 - 01:59 | 858315 zero-g
zero-g's picture

Nice, first good laugh of the day!

Fri, 01/07/2011 - 12:13 | 856317 NotApplicable
NotApplicable's picture

The kangaroo was out sick.

Fri, 01/07/2011 - 12:18 | 856339 LMAO
LMAO's picture

Whats the catch?


Well if this shit is going to stick (which I seriously doubt as the fine gov. of the USSA will be working on a backdoor deal in which the perpetrators will receive a thumbs up and carry on deal) and the mortgage/banking industry has to take a serious hit, the taxpayer of course will be forced to the rescue.

Business as usual.

Carry on, nothing to see here.



Fri, 01/07/2011 - 12:33 | 856399 JLee2027
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Federal Government can't do anything....property laws are state law; not a Federal issue.

We should all thank the Founding Fathers today. This was one of the protections built into the system.

Fri, 01/07/2011 - 12:51 | 856457 Widowmaker
Widowmaker's picture

Don't be an ass-clown.  Anything involving money is a Federal issue.   If your state is in the red it belongs to the Fed. 

They can, and will taketh away (pick any entitlement from highways to health care).

Fri, 01/07/2011 - 16:59 | 857456 JLee2027
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What kind of sad country are you from? That's simply not true in the United States. Real Property Rights are the strongest in the world here.

Fri, 01/07/2011 - 17:09 | 857477 TeMpTeK
TeMpTeK's picture

Over 200 years of well settled contract and property case law cannot be undone...without a revolution by morning..

Broken title is Broken title.. You cant stiff the locality of its filing/recording fees which are required by law....then try to get its courts to back u up.. Every DA in the country will defend its own couffers..The banks are Beat!


Fri, 01/07/2011 - 12:30 | 856401 MachoMan
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How the hell is it going to get overturned?  On some procedural issue?  The providence of recording acts and the like are held by states... 

If the feds want to implement a national solution, then it will only apply to prospective foreclosures...  further, it will probably overstep federal authority and be patently unconstitutional...  and, in that case, you can expect the SCOTUS to strike it down (yes, that SCOTUS).

That is not to say that any other state has to follow this decision...  as all have different rules...  but, it is clearly an important step in the process and, in all likelihood, the facts present in the ibanez case will be incredibly similar to those throughout the country, including the applicable land statutes.

Fri, 01/07/2011 - 17:12 | 857484 TeMpTeK
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Agreed.. A national solution would never pass muster..

Fri, 01/07/2011 - 11:42 | 856174 Jason T
Jason T's picture

should I but TOL before it gets upgraded because its been up the last few weeks?

Fri, 01/07/2011 - 11:43 | 856175 americanspirit
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Honest judges. Military intelligence. Both oxymorons.

Fri, 01/07/2011 - 13:17 | 856564 LFMayor
LFMayor's picture

Go stick that military intelligence cliche right up your ass, next to your head. Included is my most heartfelt junk, dicksmack.

Fri, 01/07/2011 - 14:07 | 856777 chumbawamba
chumbawamba's picture

Jeez, dude.  It's not like he's the first person to ever use that phrase.

Hits home, does it?

I am Chumbawamba.

Fri, 01/07/2011 - 11:42 | 856177 youngman
youngman's picture

I still think the Feds will intervene and put this to bed somehow.....

Fri, 01/07/2011 - 12:07 | 856283 Eternal Student
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They will certainly try. The question is whether they will be successful. If the Feds don't try, they (I.e. we) will probably get stuck with the tab for the clean up, one way or another. So there's a huge financial incentive for them to try and change the law.

The problem here is that this is under centuries (at least) of Common Law. Common Law is what says that "the rain may enter your house, but the King may not". People in the Judicial arena really do take this stuff very, very seriously. And not just them. Many make a very strong argument that it is this type of law which separates success and failure when it comes to Capitalism.

So even if the Banks are able to get the law changed, it will absolutely be challenged, and any changes have a very good chance of being struck down.

Personally, I think the Banks are completely screwed. But beware a wounded animal, especially a crazy one.

Fri, 01/07/2011 - 12:35 | 856420 MachoMan
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All this means is that the notes are going to get put back on the originators or the first to securitize, whichever is latter...  which then entails them going out of business given the underwater nature of the collateral/debtor.  This leaves a few scenarios: (1) get a GSE to go ahead and be assigned the things to save the originators or (2) let them fail and have the TBTF (or wealthy private actor) come in and pick them up for pennies on the dollar, thus increasing their level of capitalization and systemic risk.  The size of the originator will determine which scenario occurs. 

Fri, 01/07/2011 - 15:29 | 857124 MaximumPig
MaximumPig's picture

My guess is that the fix will come in the form of an exception to the REMIC tax rules, which currently have severe adverse consequences for adding collateral to a REMIC trust more than 90 days after closing.  If the IRS (which is part of Tim Geithner's Treasury) creates an exception for these situations (i.e. where the assignments of mortgages to the trusts are flawed, leaving the trust without proper standing to foreclose), the banks can then go back and paper over the assignments properly, get the mortages into the trust, and then have a clear path to foreclosure.  It will still be time-consuming and probably a little more costly than now but it is not a wholesale wipeout of collateral as it currently is, at least in Massachusetts after this case.

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