Jan
25

PRESS RELEASE | Public Citizen to Financial Regulators: Bank of America Poses a Grave Threat to U.S. Financial Stability, Should Be Broken Up

PRESS RELEASE Jan. 25, 2012 Public Citizen to Financial Regulators: Bank of America Poses a Grave Threat to U.S. Financial Stability, Should Be Broken Up Petition Calls on the Federal Reserve and Financial Stability Oversight Council to Reform Banking Behemoth, Create Smaller, Simpler and Safer Institutions to Guard Against Financial Crisis WASHINGTON, D.C. – Bank … Read more No related posts.
Jan
25

David Dayen | The Schneiderman Gambit: Financial Fraud Unit Appears Designed to Fail, and Grease Skids for Foreclosure Fraud Settlement

The Schneiderman Gambit: Financial Fraud Unit Appears Designed to Fail, and Grease Skids for Foreclosure Fraud Settlement By: David Dayen I’ll pepper in my thoughts on the State of the Union Address throughout the day, but I would be remiss if I didn’t start with the announcement of a Unit on Mortgage Origination and Securitization … Read more Related posts:
  1. David Dayen | Bank of America Uses Attack Dog, Kathryn Wylde, to Smear NY AG Schneiderman
  2. David Dayen | IG Report Whitewashes Firing of Foreclosure Fraud Investigators in Florida
  3. David Dayen FDL | Florida AG’s Politically Motivated Firings Protect the Foreclosure Fraud Industry
Jan
25

David Dayen | The Schneiderman Gambit: Financial Fraud Unit Appears Designed to Fail, and Grease Skids for Foreclosure Fraud Settlement

The Schneiderman Gambit: Financial Fraud Unit Appears Designed to Fail, and Grease Skids for Foreclosure Fraud Settlement By: David Dayen I’ll pepper in my thoughts on the State of the Union Address throughout the day, but I would be remiss if I didn’t start with the announcement of a Unit on Mortgage Origination and Securitization … Read more Related posts:
  1. David Dayen | Bank of America Uses Attack Dog, Kathryn Wylde, to Smear NY AG Schneiderman
  2. David Dayen | IG Report Whitewashes Firing of Foreclosure Fraud Investigators in Florida
  3. David Dayen FDL | Florida AG’s Politically Motivated Firings Protect the Foreclosure Fraud Industry
Jan
25

President Obama’s 2012 State Of The Union Address: Enhanced Version (VIDEO)

President Obama delivers the 2012 State of the Union Address to Congress and the nation. ~ 4closureFraud.org Tweet Related posts: Massive Union | The New York Transit Workers Union (TWU) To Side With #OccupyWallStreet Protesters Today at 4pm EDT $750,000 in Annual Activity | Fort Lauderdale Police Union Withdrawing from Bank of America Naked Capitalism … Read more Related posts:
  1. Massive Union | The New York Transit Workers Union (TWU) To Side With #OccupyWallStreet Protesters Today at 4pm EDT
  2. $750,000 in Annual Activity | Fort Lauderdale Police Union Withdrawing from Bank of America
  3. Naked Capitalism | H.U.M.P. – Obama to Try Better Smoke and Mirrors to Address Housing Market Woes
Jan
24

Look, this just isn’t that hard… The Solutions to Pressing Problems.

 

 

Someone recently wrote to me saying that instead of continually telling everyone what’s wrong, I should tell them how to solve the problems we’re facing and I thought to myself… okay, fair enough.  This just isn’t that hard.  We’re not solving things because we don’t want to, not because no one can think of how to solve anything.

So, you ready… I’m going to show you solutions in ONE MINUTE and one solution at a time.. so please try to keep up okay?

1. Problem: Forging documents and filing fraudulent documents in public records… or “Robo-signing,” if you’d prefer.

1. Either pass a law that says these documents don’t need to be signed at all… or stop the filing of forged and fraudulent documents in public records… and Nevada has shown us how to do that… it’s easy and doesn’t cost a nickel.  And foreclosure filings in Nevada dropped by more than 80% as a result of what they did in that state, which was simply to make the penalties criminal and the fines higher for filing a fraudulent document in the public record.  Because, I don’t care if they need to be signed or they don’t need to be signed… but they don’t need to be forged under any circumstances.

 

2. In simpler terms: If Mickey Mouse is going to sign it, and Donald Duck is going to notarize it… THEN DON’T SIGN IT… because we don’t need it signed.  BUT… if we DO need it signed, then don’t forge it and file a fraudulent document into the public record.  If you do that, it’ll cost you thousands and you could end up in jail.

 

3. We already have millions of forged and fraudulent docs in our public records thank you very much, and 30 years from now some lawyer will have occasion to pull title docs for whatever reason, he’ll find a forged or otherwise fraudulent document(s) and we’ll be litigating the whole damn thing all over again.  We certainly don’t need that situation exacerbated.  The documents may need to be signed… but they don’t NEED to be forged.

 

4. We also don’t need to wait until the situation shakes out or the scope of the problem is known… or whatever.  There’s no reason to wait for any of that because it doesn’t matter how we answer any of the unanswered questions… the solution to however you want to define the problem is NOT under any circumstances going to be: “Oh, just forge the signature and file a fraudulent document in the public record.”  NO… that’s not allowed to be the answer no matter how you want to define the problem.

 

5. I’ve never lost the pink slip to my car… but I’m sure there’s a process to follow if that ever happens.  I call the DMV and fill out some forms and then I… blah, blah, blah… it’s never happened to me so I don’t know what the process is.  But I know what it isn’t.  It isn’t: “Fake one on your Mac, sign Donald Duck’s name, and use it for whatever…”  That is definitely not how it’s done.

 

6. There shouldn’t be ANY push back to what I’m suggesting here… NONE.  To those who say that the banks will oppose what I’m saying because I’m trying to stop foreclosures I reply: No, I’m not.  I haven’t said a word about stopping foreclosures, I’m talking about stopping the forging of documents and the filing of fraudulent documents into the public record.  I have all the confidence in the world that BofA, Chase and our state/federal  governments are more than capable of coming up with some other process… either that or pass a law that says all you need to do is place a red X on the dotted line… or leave the damn things blank… I don’t care.  But, forgery and fraud are not going to be our chosen methodology for anything ever.

 

7. The reason for my efforts, as I’ve explained to several state AGs and state legislators, is that what is going on now, with forged and fraudulent docs being used every day all over the country to foreclose on homes, is already changing the nature of the foreclosure crisis.  What was a terribly unfair, incompetent, cronyism, banker friendly, messed up situation is being transformed into organized crime.  Homeowners look at their title documents, and very easily see that the assignments and other affidavits have been robo-signed.  They have tangible proof of a crime having been committed.  They show the judge, he doesn’t care… and they lose their house.

 

8. That is the definition of organized crime… 5 huge crime families we call banks… committing crimes in the public view… and state law enforcement and the court system refusing to enforce the law because of connections with the banks.  That’s organized crime, period.  And human nature dictates that when people see that their government is failing to uphold the rule of law or enforce the laws against certain individuals or groups… well, they take the law into their own hands.  That’s always been true… it is in fact a fundamental human instinct.

 

9. If your son or daughter is harmed or your store or home is robbed… and the law refuses to do anything about it because of who you are relative to who the perpetrators are… want to know what happens?  Ask the KKK.  Someone takes the law into their own hands and someone gets shot in the head, or ends up hanging from a tall oak.  Every single time… and any of us are capable of doing just that… taking the law into our own hands.

 

10. Allowing forgery and fraud to go on unchecked is a BAD idea, and everyone should understand and agree with that.  And aren’t we lucky that we know exactly how to stop it… the State of Nevada has shown us the way.  So, change the law, increase the penalties and problem solved.  Now isn’t that a relief?

 

And… DING!  

 

The foreclosure crisis has already been allowed to grow out of control and destroy the American middle class.  Standing by idly while we watch it get even worse, when it’s easy and free to prevent that from happening, is beyond unconscionable.  And if we do it, then we deserve whatever we get as a result.

 

See, that wasn’t that hard, was it?   ONE MINUTE SOLUTIONS by Mandelman Matters.  Why didn’t I think of that?  Next solution tomorrow, so stay tuned.

Mandelman out.

Jan
24

Look, this just isn’t that hard… The Solutions to Pressing Problems.

 

 

Someone recently wrote to me saying that instead of continually telling everyone what’s wrong, I should tell them how to solve the problems we’re facing and I thought to myself… okay, fair enough.  This just isn’t that hard.  We’re not solving things because we don’t want to, not because no one can think of how to solve anything.

So, you ready… I’m going to show you solutions in ONE MINUTE and one solution at a time.. so please try to keep up okay?

1. Problem: Forging documents and filing fraudulent documents in public records… or “Robo-signing,” if you’d prefer.

1. Either pass a law that says these documents don’t need to be signed at all… or stop the filing of forged and fraudulent documents in public records… and Nevada has shown us how to do that… it’s easy and doesn’t cost a nickel.  And foreclosure filings in Nevada dropped by more than 80% as a result of what they did in that state, which was simply to make the penalties criminal and the fines higher for filing a fraudulent document in the public record.  Because, I don’t care if they need to be signed or they don’t need to be signed… but they don’t need to be forged under any circumstances.

 

2. In simpler terms: If Mickey Mouse is going to sign it, and Donald Duck is going to notarize it… THEN DON’T SIGN IT… because we don’t need it signed.  BUT… if we DO need it signed, then don’t forge it and file a fraudulent document into the public record.  If you do that, it’ll cost you thousands and you could end up in jail.

 

3. We already have millions of forged and fraudulent docs in our public records thank you very much, and 30 years from now some lawyer will have occasion to pull title docs for whatever reason, he’ll find a forged or otherwise fraudulent document(s) and we’ll be litigating the whole damn thing all over again.  We certainly don’t need that situation exacerbated.  The documents may need to be signed… but they don’t NEED to be forged.

 

4. We also don’t need to wait until the situation shakes out or the scope of the problem is known… or whatever.  There’s no reason to wait for any of that because it doesn’t matter how we answer any of the unanswered questions… the solution to however you want to define the problem is NOT under any circumstances going to be: “Oh, just forge the signature and file a fraudulent document in the public record.”  NO… that’s not allowed to be the answer no matter how you want to define the problem.

 

5. I’ve never lost the pink slip to my car… but I’m sure there’s a process to follow if that ever happens.  I call the DMV and fill out some forms and then I… blah, blah, blah… it’s never happened to me so I don’t know what the process is.  But I know what it isn’t.  It isn’t: “Fake one on your Mac, sign Donald Duck’s name, and use it for whatever…”  That is definitely not how it’s done.

 

6. There shouldn’t be ANY push back to what I’m suggesting here… NONE.  To those who say that the banks will oppose what I’m saying because I’m trying to stop foreclosures I reply: No, I’m not.  I haven’t said a word about stopping foreclosures, I’m talking about stopping the forging of documents and the filing of fraudulent documents into the public record.  I have all the confidence in the world that BofA, Chase and our state/federal  governments are more than capable of coming up with some other process… either that or pass a law that says all you need to do is place a red X on the dotted line… or leave the damn things blank… I don’t care.  But, forgery and fraud are not going to be our chosen methodology for anything ever.

 

7. The reason for my efforts, as I’ve explained to several state AGs and state legislators, is that what is going on now, with forged and fraudulent docs being used every day all over the country to foreclose on homes, is already changing the nature of the foreclosure crisis.  What was a terribly unfair, incompetent, cronyism, banker friendly, messed up situation is being transformed into organized crime.  Homeowners look at their title documents, and very easily see that the assignments and other affidavits have been robo-signed.  They have tangible proof of a crime having been committed.  They show the judge, he doesn’t care… and they lose their house.

 

8. That is the definition of organized crime… 5 huge crime families we call banks… committing crimes in the public view… and state law enforcement and the court system refusing to enforce the law because of connections with the banks.  That’s organized crime, period.  And human nature dictates that when people see that their government is failing to uphold the rule of law or enforce the laws against certain individuals or groups… well, they take the law into their own hands.  That’s always been true… it is in fact a fundamental human instinct.

 

9. If your son or daughter is harmed or your store or home is robbed… and the law refuses to do anything about it because of who you are relative to who the perpetrators are… want to know what happens?  Ask the KKK.  Someone takes the law into their own hands and someone gets shot in the head, or ends up hanging from a tall oak.  Every single time… and any of us are capable of doing just that… taking the law into our own hands.

 

10. Allowing forgery and fraud to go on unchecked is a BAD idea, and everyone should understand and agree with that.  And aren’t we lucky that we know exactly how to stop it… the State of Nevada has shown us the way.  So, change the law, increase the penalties and problem solved.  Now isn’t that a relief?

 

And… DING!  

 

The foreclosure crisis has already been allowed to grow out of control and destroy the American middle class.  Standing by idly while we watch it get even worse, when it’s easy and free to prevent that from happening, is beyond unconscionable.  And if we do it, then we deserve whatever we get as a result.

 

See, that wasn’t that hard, was it?   ONE MINUTE SOLUTIONS by Mandelman Matters.  Why didn’t I think of that?  Next solution tomorrow, so stay tuned.

Mandelman out.

Jan
24

Mandelman | DOER ALERT: Dear Bank of America…

Dear Bank of America, and by Bank of America I mean CEO Brian Moynihan… Brian, I’m running out the door at the moment. I have to make a flight to Arizona so I can attend a meeting in the morning at the state capitol. A state senator called me last week asking for my help … Read more Related posts:
  1. DOER ALERT | Wells Fargo Bank Eviction… How could you do this to a mother of four?
  2. Mandelman | Register of Deeds, Jeff Thigpen, Is Not Playing Around – A Mandelman Matters Podcast
  3. Mandelman Matters | A Foot Soldier in the Foreclosure Wars – Matt Weidner, A Mandelman Matters Podcast
Jan
23

DOER ALERT: Dear Bank of America…

 

 

Dear Bank of America, and by Bank of America I mean CEO Brian Moynihan…

Brian, I’m running out the door at the moment.  I have to make a flight to Arizona so I can attend a meeting in the morning at the state capitol.  A state senator called me last week asking for my help promoting a bill related to the foreclosure situation there.  Were it not for my schedule, I’d be ripping you and your bank to pieces in this column, and then asking all of my DOERS to inundate you with emails and letters in support of yet another homeowner who’s life you have irrevocably, unconscionably and inconceivably harmed.

I’ll be back at my desk tomorrow, and I was just going to wait until then to deal with you, but you see… this story brought tears to my eyes asa I sat here checking in for my flight… I guess I’m just emotional (although I think “human” is the more appropriate word) about such things, while you perhaps are not.  Anyway, I decided that even though I didn’t have time to write the story in detail… I’d let you know what’s coming soon to a theater near you.

My thinking is, if you want to avoid me having to spend the eight or so hours it takes me to write all of the details into a piece that will be read and remembered by tens of thousands of people all over the country, you’ll address this situation before I get home tomorrow afternoon.  I hope you don’t view this as some sort of threat… I don’t mean it that way… I hate people that threaten, you know what I mean?  Either do it or shut up, has always been my motto.

I’m just giving you a heads up, if you will, of what tomorrow afternoon is absolutely certain to bring if you don’t do something about… hey, do you remember the Perry Mason television show from days gone by…

The Case of the Grieving Grandpa and the Lying Lender

Starring…

Mr. Dale Wright of Cloverdale, California

Loan Number 149664284

Brian, this one’s going to make a great story too, so if you can’t make time to handle it before I’m home tomorrow afternoon, you’re going to wish you had.  Here are a few highlights… think of it as the show’s preview or a movie trailer…

Mr. Dale Wright of Cloverdale, California turned to Bank of America for help in 2009 after being told by the President of the United States that Bank of America would help him, if at all possible.  Mr. Wright is an 82 year-old veteran who’s been a pillar of his community since before you were born, Brian.

He was approved for his trial modification under the Making Home Affordable program on March 23, 2010.  I’m told by several people involved in his case that he made all of his payments on time and as agreed and I have reason to believe they are correct.  He was denied for a permanent loan modification because of Bank of America claimed not to have received a new 4506T… even though you had received said 4506T, 30 days earlier and I’m told those things are good for 90 or 120 days.

No matter… he was told he was being reconsidered as of December 6, 2011.  In fact, he was told he was under consideration as of December 23rd.  You SOLD his house on January 3rd, Brian. He’s 82 years old, Brian.  December 25th is Christmas, Brian.  January 3rd is two days after New Years, Brian.  God damnit… Bank of America doesn’t need to do sh#t that week, Brian. (I’m sorry, for my language, but I can’t take much more of this without swearing, Brian.)

Of course, your bank didn’t tell him it was sold on January 3rd.  He found out when the investor knocked on his door on January 3rd and told him that it would be understood if he needed more than three days to move out!  The investor told Dale he was buying the property to “flip it.”

(SIDEBAR: You might want to mention to whoever that was that said that to him, that he’s damn lucky that it wasn’t me that answered the door that day because I don’t have any prior criminal record and I’d be willing to pick up a first offense charge for beating the crap out of someone for doing that to my grandfather. But, I don’t suppose he would have said it to me, now would he?  No, he only says things like that to 82 year olds, I’m fairly sure.)

So, Mr. Wright called and Bank of America was like…

“Wo, wo, wo… we don’t know how this happened… we were trying to postpone the sale, but Wells Fargo wouldn’t do it and they’re the investor that owns the loan. It wasn’t our fault… blah, blah, blah.”

Your bank sold the home of an 82 year-old veteran right after New Years so some investor could flip it, and couldn’t even be bothered to make a call to let him know?  No… instead you blamed it on Wells Fargo, saying they were the investor and they wouldn’t agree to delay the sale or modify the loan.  Hmmm… think that’s true, Brian?  I wonder…

But luckily, I didn’t have to wonder for very long… here’s the email from Wells Fargo from just a few days ago:

From: catherine.h.martin@wellsfargo.com

To: kristiesheets@hotmail.com

Date: Tue, 17 Jan 2012 14:01:19 -0600

Subject: Dale Wright

 Dear Ms. Sheets,

Wells Fargo Bank, N.A. received and reviewed your recent correspondence regarding your concerns as it relates to your Grandfather’s mortgage.

After researching this matter, we have verified that Wells Fargo Bank is not the Investor/Owner and does not have a direct role in servicing the loan.  That being said, I am forwarding your letter to the servicer, Bank of America, instructing that they subsequently respond in a timely manner to your concerns giving Mr. Wright every consideration allowed. 

I urge that you continue addressing Bank of America with concerns pertaining to this matter.  You may contact Ms. Nora Jones at 817-864-2293 at Bank of America to request that she escalate this matter within Bank of America. 

Wells Fargo Bank makes every effort to facilitate and inform servicers of such issues so they may properly respond. 

Respectfully,

Cathy Martin 

Client Service Consultant 

Wells Fargo Bank 

9062 Old Annapolis Road 

Columbia, MD  21045 

410-884-2161 FAX 866-493-7814 

 

Ooopsie!  I guess your system was wrong… or your bank’s wires got crossed.  Or maybe they were just feeding Mr. Wright “Lie Number 32,863,” from the Bank of America Handbook?

 

The man’s wife passed away in 2006.  They were married for 53 years.  Your bank explained that a request for postponement went in on the 23rd of December 2011 on a loan which Bank of America agreed to review for HAMP on December 1, 2011 and then you sold  the home on January 3, 2012… Brian, are you trying to punish this man?

Fix this, Brian.  Fix it so that it doesn’t happen to even one more elderly person.  Because if you’ve heard of karma, your later years are likely going to be a real bear if you don’t.

COME ON DOERS… DO SOMETHING ABOUT THIS…

I CAN’T SAY ANYTHING ELSE WITHOUT BREAKING MY KEYBOARD AND MISSING MY FLIGHT, AND BESIDES I CAN’T SEE AGAIN, THIS IS JUST TOO UPSETTING… I FEEL LIKE IT’S GROUNDHOG DAY…

BRIAN… Kristie Sheets is his granddaughter… HER NUMBER IS: 707-632-6101.  You can call her and ask how to make this right, if you have a mind to do so.  I’ll be home tomorrow afternoon, and I’ll check with her before I do anything else.  This, as I mentioned, was just a preview of coming attractions.  (Insert Perry Mason Music here.)

Mandelman out.

 

DOERS YOU KNOW WHAT TO DO!

Brian Moynihan, President, CEO & Chairman

Bank of America

Email: brian.t.moynihan@bankofamerica.com

Matthew Task, Executive Relations, 
Office of the CEO (At BofA)

Phone: 813-805-4873


Jan
23

DOER ALERT: Dear Bank of America…

 

 

Dear Bank of America, and by Bank of America I mean CEO Brian Moynihan…

Brian, I am running out the door at the moment.  I have to make a flight to Arizona so I can attend a meeting this evening and another in the morning at the state capitol.  A state senator called me last week asking for my help on a bill related to the foreclosure situation there.  Were it not for my schedule, I’d be ripping you and your bank to pieces in this column, and then asking all of my DOERS to inundate you with emails and letters in support of yet another homeowner who’s life you have irrevocably, unconscionably and inconceivably harmed.

I’ll be back at my desk tomorrow, so I was just going to wait until then to deal with you, but you see… this story brought tears to my eyes asa I sat here checking in for my flight… I guess I’m just emotional (although I think “human” is the more appropriate word) about such things, while you apparent;y are not.  Anyway, after I wiped them away I decided even though I didn’t have time to write the story in detail… I’d let you know what’s coming soon to a theater near you.

My thinking is, if you want to avoid me having to spend the eight or so hours it takes me to write all of the details into a piece that will be read and remembered by tens of thousands of people all over the country, you’ll address this situation before I get home tomorrow afternoon.  I hope you don’t view this as some sort of threat… I don’t mean it that way… I hate people that threaten, you know what I mean?  Either do it or shut up, has always been my motto.

I’m just giving you a heads up, if you will of what tomorrow afternoon is absolutely certain to bring if you don’t do something about… do you remember the Perry Mason television show from days gone by…

The Case of the Grieving Grandpa and the Lying Lender

Starring…

Mr. Dale Wright of Cloverdale, California

Loan Number 149664284

Brian, this one’s going to make a great story too, so if you can’t make time to handle it before I’[m home tomorrow afternoon, you’re going to wish you had.  Here are a few highlights… think of it as the show’s preview, if you will.

Mr. Dale Wright of Cloverdale, California turned to Bank of America for help in 2009 after being told by the President of the United States that Bank of America would help him if at all possible.  Mr. Wright is an 82 year old veteran who’s been a pillar of his community since before you were born, Brian.

He was approved for his trial modification under the Making Home Affordable program on March 23, 2010.  I’m told by several people involved in his case that he made all of his payments on time and as agreed and I have reason to believe they are correct.  He was denied for a permanent loan modification because of Bank of America claimed not to have received a new 4506T… even though they had received said 4506T 30 days earlier and I’m told those things are good for 90 or 120 days.

No matter… he was told he was being reconsidered as of December 6, 2011.  In fact, he was told he was under consideration as of December 23rd.  You SOLD his house on January 3rd, Brian. He’s 82 years old, Brian.  December 25th is Christmas, Brian.  January 3rd is two days after New Years, Brian.  God damnit… Bank of America doesn’t need to do shit that week, Brian. (I’m sorry, for my language, but I can’t take much more of this without swearing, Brian.)

Of course, your bank didn’t tell him it was sold on January 3rd.  He found out when the investor knocked on his door on January 3rd and told him that it would be understood if he needed more than three days to move out!  The investor told Dale he was buying the property to “flip it.”

(SIDEBAR: You might want to mention to whoever that was that said that to him, that he’s damn lucky that it wasn’t me that answered the door that day because I don’t have any prior criminal record and I’d be willing to pick up a first offense charge for beating the crap out of him for doing that to my grandfather. But, I don’t suppose he would have said it to me, now would he.  No, he only says things like that to 82 year olds, I am sure.)

Mr. Wright called and Bank of America was like… “Wo, wo, wo… we don’t know how this happened… we were trying to postpone the sale, but Wells Fargo wouldn’t do it and they’re the investor that owns the loan. It wasn’t our fault… blah, blah, blah.”

Your bank sold the home of an 82 year old vet right after New Years so some investor could flip it, and couldn’t even be bothered to make a call to let him know?  No… instead you blamed it on Wells Fargo, saying they were the investor and they wouldn’t agree to delay the sale or modify the loan.  Hmmm… think that’s true, Brian?  I wonder…

But I didn’t have to wonder for very long… here’s the email from Wells Fargo from just a few days ago:

From: catherine.h.martin@wellsfargo.com

To: kristiesheets@hotmail.com

Date: Tue, 17 Jan 2012 14:01:19 -0600

Subject: Dale Wright

 Dear Ms. Sheets,

Wells Fargo Bank, N.A. received and reviewed your recent correspondence regarding your concerns as it relates to your Grandfather’s mortgage.

After researching this matter, we have verified that Wells Fargo Bank is not the Investor/Owner and does not have a direct role in servicing the loan.  That being said, I am forwarding your letter to the servicer, Bank of America, instructing that they subsequently respond in a timely manner to your concerns giving Mr. Wright every consideration allowed. 

I urge that you continue addressing Bank of America with concerns pertaining to this matter.  You may contact Ms. Nora Jones at 817-864-2293 at Bank of America to request that she escalate this matter within Bank of America. 

Wells Fargo Bank makes every effort to facilitate and inform servicers of such issues so they may properly respond. 

Respectfully,

Cathy Martin 

Client Service Consultant 

Wells Fargo Bank 

9062 Old Annapolis Road 

Columbia, MD  21045 

410-884-2161 FAX 866-493-7814 

 

Ooopsie!  I guess your system was wrong… or your bank’s wires got crossed.  Or maybe they were just feeding Mr. Wright “Lie Number 32,863,” from the Bank of America Handbook?

 

The man’s wife passed away in 2006.  They were married for 53 years.  Your bank explained that a request for postponement went in on the 23rd of December 2011 on a loan which Bank of America agreed to review for HAMP on December 1, 2011 and then you sold  the home on January 3, 2012… Brian, are you trying to punish this man?

Fix this, Brian.  Fix it so that it doesn’t happen to even one more elderly person.  Because if you’ve heard of karma, your later years are going to be a bear if you don’t.

COME ON DOERS… DO SOMETHING ABOUT THIS… I CAN’T SAY ANYTHING ELSE WITHOUT BREAKING MY KEYBOARD AND MISSING MY FLIGHT, AND BESIDES I CAN’T SEE AGAIN…

BRIAN… Kristie Sheets is his granddaughter… HER NUMBER IS: 707-632-6101.  You can call her and ask how to make this right, if you have the mind to do so.  I’ll be home tomorrow afternoon, and I’ll check with her before I do anything else.  This, as I mentioned, was just a preview of coming attractions.  (Insert Perry Mason Music here.)

Mandelman out.

 

DOERS YOU KNOW WHAT TO DO!

Brian Moynihan, President, CEO & Chairman

Bank of America

Email: brian.t.moynihan@bankofamerica.com

Matthew Task, Executive Relations, 
Office of the CEO (At BofA)

Phone: 813-805-4873


Jan
23

Russian Mob Steals Refinance Money During Wire Transfer, Bank of America Forecloses

Bank of America held the Cannings first mortgage. It was supposed to be paid off during the transfer. Since the money never made it to them, the Cannings basically have two mortgages on their home. Bank of America wants its money back so it’s foreclosing on their home. ~ Stolen Wire Transfer Leaves Family In … Read more Related posts:
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  3. Trashed Out – This is Getting Ridiculous – Iraq Homecoming Spoiled After Bank of America Forecloses On Wrong Home AGAIN!
Jan
22

Credit Suisse Tells Bloomberg: “Mortgage Principal Cuts Don’t Help Homeowners?”

 

 

Believe it or not, I’m not an easy person to shock or offend.  No one that knows me would ever say that I possess delicate sensibilities, or anything close.  For example, the only thing I found at all shocking upon learning that Newt Gingrich had asked his now ex-wife if they could have an “open marriage,” was that there were more than two women (or even one gay man), that would even consider having sex with Newt.

 

But, when I read Bloomberg’s headline yesterday, “Mortgage Principal Cuts Don’t Help Homeowners, Says Credit Suisse,” I have to admit that I found myself recoiling in total shock that, in view of what’s happening today in the housing market, anyone would put forth such an utterly preposterous argument.

 

Here’s the beginning of the Bloomberg piece, you can read the rest later.

 

Reducing mortgage balances is a risky idea that hasn’t been shown to keep borrowers who owe more than their property’s worth in their homes, according to Credit Suisse Group AG. (CSGN).

 

Of the 11 million of “underwater” homeowners, about 6.5 million have never missed a payment and 2 million more are making on-time payments after a delinquency, said Dale Westhoff, the bank’s global head of structured products research. Widespread principal reductions may drive defaults “much, much higher” as borrowers seek the aid, he said.

 

“We’ve never done this before; we don’t know what the risk is,” Westhoff, a top-ranked mortgage-bond analyst in polls by Institutional Investor magazine for 15 years in a row while at Bear Stearns Cos., said today at a briefing for reporters in New York. Along with creating so-called moral hazard, the step may also tighten lending by forcing banks to offer “price protection” to borrowers, he said.

 

Credit Suisse’s view puts it at odds with Federal Reserve Bank of New York President William C. Dudley; Amherst Securities Group LP analyst Laurie Goodman, a member of the Fixed Income Analysts Society’s Hall of Fame; and hedge-fund manager Greg Lippmann, who last year advocated principal reductions, citing data from his former employer, Deutsche Bank AG.

 

Pretty offensive stuff, don’t you think… as you sit there reading this in your home that’s underwater by six figures and going down further every day?  Feel a little like wringing the guy’s neck that said it?  Yeah, well… me too.

 

 

Instead, I’ve written a corresponding article that I’d like to see Bloomberg run in the interest of being… what should I say… fair and balanced?  If you want the full impact, however, go back and read the Bloomberg version above one more time, then continue…

 

Not Recognizing Losses and Unlimited 0% Interest Loans Don’t Help Banks, Says Credit Slush

 

Suspending accounting rules is a risky idea that hasn’t been shown to keep banks that borrowed more than their assets are worth from becoming insolvent, according to Credit Slush Fund PIG.

 

Of the 11 most bailed out banks, about 6 have never been able to make their payments, and 2 more are making on time payments after being allowed to become bank holding companies in name only so they could borrow unlimited amounts from the Fed’s discount window at zero percent interest, said Bail Worstoff, the consumer’s global head-case for unstructured thinking. 

 

Widespread zero interest borrowing and the ongoing suspension of accounting rules that allow banks to push off the recognition of losses far into the future may drive insolvency rates “much, much higher” as banks become entirely dependent on the unrealistic and inappropriate aid.

 

“We’ve never done this before; we don’t know what the risk is,” Worsthoff, a top-ranked banking behavior analyst in polls by Concerned Citizens with Common Sense for 15 years in a row, said today at a briefing for reporters in New York.  Along with creating so-called “moral hazard,” these steps are also likely to perpetuate the irresponsible risk taking and amounts of leverage taken on by banks, which is what caused the global financial crisis in the first place, and would force congress to once again be unable to offer “any protection” to taxpayers who will be on the hook when the bankers invariably become insolvent once again, he said.

 

Credit Slush Fund’s view puts it at odds with Federal Unreserved Chair Ben Bailsnakee, Treasury Secretary Skim Getmore, Scary Summers, a member of the Fixed Outcome & Opacity Legion (“FOOL”); and sludge-fund manager Greed Hittmann, who last year advocated unlimited and unreported zero interest borrowing, undisclosed backdoor bailouts, and the elimination of all bank accounting and reporting requirements, citing data from his former employer, Deushbag Bank PIG.

 

First of all, the idea that reducing the dollar amount someone owes on his or her mortgage isn’t helpful to the homeowner… well, it’s simply a goofy thing to say.  I mean, it has to be a question of degree, right?  Like, reducing someone’s $100,000 balance by $1 wouldn’t be terribly helpful, I understand.  It’s the Sorites Paradox, I suppose… which back in my debate-the-useless days as an undergrad we used to refer to as the “Paradox of the Heap.”

 

 

(Assuming you have no idea what I’m talking about, but would like to… the Paradox of the Heap deals with a heap of sand from which one grain of sand at a time is removed.  The first premise is that one million grains of sand is a heap of sand.  And the second premise is that a heap of sand minus one grain of sand is STILL a heap of sand.  With me so far?  Good. 

So, the question is… when a single grain of sand is all that’s remains, is it STILL a “heap of sand?”  If you answer yes, then you sound ridiculous because a heap is defined as a group of things placed or thrown on top of each other.” And if you answer no to that question, then the follow-up question is when did it stop being a heap… when it was two grains of sand… three… four… 100? 

I can’t remember exactly, it’s been too many years… but I think after that you either run screaming from the room, beat the crap out of your roommate for dragging you into this inane conversation, or take a hit off the bong.)

 

Am I getting my point across here?  Or am I being too subtle?

 

Because I often worry that my use of humor or sarcasm either goes over too many heads or is solely as thought of as being entertainment… instead of as the less-than-veiled threat to societal tranquility that was my actual intention.  (That was supposed to be funny, people… stay with me, okay?)

 

After reading the Bloomberg article, it occurred to me that this was not the first time I was being shocked at the hubris of Credit Suisse’s conclusions allegedly derived from some review of distressed homeowner data.  The last time it happened was more than two years ago, November 2009, when I wrote about it in an article titled: “Why Banks Are Better at Making Loans Than Modifying Them.”

 

Back then Credit Suisse in conjunction with UBS, published a statistic saying that loan modifications were re-defaulting in 60 percent of cases after just 10 months… the clear implication being that loan modifications didn’t work, so better for all involved to simply foreclose.  It took some digging as I recall, but in the end it came out that in 2008… 60 percent of the loans modified ended up with higher monthly payments than before they were modified… which would explain the 60 percent re-default rate quite handedly.

 

It’s been a while, but I remember having an exasperating conversation with a banker during which I was trying to make the point that when the payment amount increases, it should not be called or classified as a “loan modification.”  The banker I was talking to… bless his heart… was trying to patiently explain to me why in point of fact, it was a “modification” of the loan and therefore had to be classified and reported as a “loan modification.”  (Amazing I’m still alive, don’t you think?  Or that the banker is… I’m not sure which.)

 

I replied that it didn’t matter.  What mattered is that if I were to line up 10 million homeowners in this country, and ask them whether a loan modification makes your monthly mortgage payments go up or down, for the most part they’d all say down.  Therefore, the term “loan modification” should only be used when the modification results in a reduced payment amount.

 

“So, what should we call it if the loan gets modified but the payments go up,” he inquired.  His tone made it sound as if he was sure that he’d have me in one or two more moves on an imaginary chessboard.

 

“Well, I’m not sure,” I replied.  “I’m not a banker or anything, and I wouldn’t want to presume to know your job better than you do by any means, but you could give some thought to calling it… oh, I don’t know… A PAYMENT INCREASE?”

 

Unfortunately, our conversation had to wrap up quickly after that… apparently something unexpected had come up and he had to run.

 

Do Principal Reductions Help, or Are they the Poster Child for Moral Hazard?

 

Credit Suisse should be exposed and discredited for being banking industry propagandists more than willing to risk further destruction of America’s middle class economy and our reduced standard of living before they lift a finger to make things better economically speaking.  That much is certain… and all too obvious.

 

But, the question is: Would principal reductions help homeowners avoid foreclosure?  And I want to address the substance of Mr. Dale Westhoff’s/Credit Suisse’s arguments against, lest anyone think that I’m being purely snarky about this whole thing, and therefore am in any sense being non-responsive to the issue at hand.

 

It’s not a simple subject, by the way.  So, don’t expect me to offer an oversimplified and hence meaningless response.

 

Mr. Westhoff, the bank’s “global head of structured product research,” the term “research” being used extremely lightly… hinges his argument against principal reductions for homeowners as a means for preventing foreclosure on the same old argument: it will create a moral hazard.

 

Now, let’s take a look at what this “moral hazard” thing is all about.

 

Traditionally, moral hazard exists when a party can make decisions about how much risk to take on, while another party bears the costs of that risk going badly.  And if that’s how we were defining it here, the only moral hazard that we’ve got to be concerned about is the moral hazard resulting from banks taking on too much risk knowing that they are “too big to fail.”

 

That’s the type of moral hazard that’s gotten us into this mess in the first place, and since the bailouts of banks in 2008, it’s the most significant risk we bear as a nation because if banks think they’ll be bailed out no matter what because they are too big to fail… we can all count on them needing to be bailed out again… and again… and again.  So, that’s that.

 

Westhoff, however, is using the term moral hazard in a different sense.  He’s asserting that if homeowners know that there are principal reductions available to those in default, more and more homeowners will intentionally go into default in order to get their principals reduced.

 

Moral Hazard and Principal Reductions

 

It’s shocking how little the financial services industry understands about the people it serves.  One particularly telling example of this was seen in May of 2011, when one of the three major credit bureaus, TransUnion, published the results of a study that shocked the banking industry by concluding that many who have lost homes to foreclosure did so because of the downturn in the economy and not as a result of an inability to handle debt, as was previously thought.

 

“Lenders always try to distinguish a one-off, life-crisis event like divorce or a medical catastrophe versus people who are just ineffective at managing credit,” said Ezra Becker, TransUnion vice president of research and consulting, and one of the study’s authors.

 “Our argument is that this economy disproportionately affected certain people in a way akin to a one-time crisis. Those consumers have not in fact forever changed their personal philosophy on repaying debt. It was a one-time event because of the specific and personal circumstances of the recession, and they otherwise would be good credit risks.”

 

What’s most amazing about the TransUnion study is that they needed to conduct a study to establish that people losing homes to foreclosure in the last few years were not irresponsible deadbeats, as the financial services industry had been assuming, but rather… well, it was the economy, stupid.  That anyone in financial services needed a study to tell them that foreclosures were being caused by the credit crisis that their industry brethren created is either some distorted form of irony or disingenuous nonsense.

 

The banking industry’s abysmal knowledge of consumers is also readily apparent when looking at the issue of moral hazard as related to principal reductions, or the incidence of strategic default, which is when someone chooses to walk away from a mortgage even though they can afford to make their payments.  These are the two subjects from which one might write a book of scary bedtime stories for bankers.

 

 

To understand this topic, first you have to understand how regular people view their homes. 

 

The years 2003-2007 notwithstanding, homes are not seen by regular people as investments in the traditional sense, they are more like forced irrational savings accounts we inhabit.  We don’t care what interest rate we’re getting on our “home/account,” but we do know the balance will be significant if we pay it off, and so they are a key component of America’s retirement plan.

 

Most people save money for a down payment on a house during the early part of their lives when their costs of living are relatively low.  After that, if property values are rising, they become relatively more mobile because they use the equity in one home to purchase the next.  It’s true that our incomes rise as we get older, but life gets more expensive over the years too.

 

Because the costs and expenses of buying a home and moving, if property values are falling or flat, we do everything we can to hold on to the homes we have, which is why so many underwater homeowners have applied for loan modifications even though from a strictly financial perspective, it doesn’t appear to make any sense.

 

It actually does make sense, however, once you understand that most people know that their only hope of buying another home will come from equity they build up in their current one.  And even if they don’t build that equity as a result of market price appreciation, that’s okay because the forced savings account functionality will eventually kick in, and they’ll have the equity to move up, or an asset of significant value for unplanned emergencies or retirement years, or the foundation of an estate to leave to our children.

 

It should be obvious that this line of thinking is foreign to financial investment types who think in terms of comparing returns on different investments.  It would be easy to show someone why it would be advantageous to accumulate wealth through a diversified set of investment vehicles while renting a home, but regular people know that they can’t trust themselves to be disciplined about saving and investing, but they can make a mortgage payment each month for 30 years because not paying that payment means disrupting their family’s tranquility… and having nowhere to live.

 

As a result, to stop making one’s mortgage payments on a primary residence is in general a big deal… a huge risk… you may end up losing your home… you can’t tell a living soul about what you’ve done… and your credit score goes to pot within a couple of months.  It’s immensely stressful, and no one does it unless financially speaking it’s absolutely necessary, meaning that some significant life event has occurred… job or income loss, injury or illness, divorce… those are the big ones anyway.

 

The bottom-line is, if people can afford to make their mortgage payments… they make their mortgage payments, and this is most easily verified by looking at how low foreclosure rates have been historically, again these past few years notwithstanding, even though between 1950 and 2000, home prices nationally were flat if adjusted for inflation.

 

So, will homeowners in any meaningful number take the risk inherent to going into default on their mortgage in order to get their principal balance reduced?  The answer should be obvious… it depends on how far underwater the homeowner is, how does the homeowner view the potential and timeframe for home price appreciation to occur, how certain is it that by defaulting they will be granted the principal reduction, and what are their options if their principal isn’t reduced and they lose their home to foreclosure.

 

Obviously, someone $200,000 underwater who thinks it will be 20 years before the market price appreciates by that amount, is much more likely than someone less severely underwater who views prices as coming back in five years, to walk away… or to go into default in order to try to get their bank to reduce the principal balance of their mortgage.

 

 

The other question about the efficacy of principal reductions in foreclosure prevention, applies to homeowners who are already seriously delinquent and seriously underwater, who are applying for a loan modification.  Lowering this homeowner’s interest rate and extending his or her term can make the monthly payment affordable and therefore prevent a foreclosure in the short term, but the question is, by leaving the homeowner so far underwater, are we just creating a strategic default in the future?

 

A couple of years ago, there were a slew of articles in places like the Wall Street Journal among others, that claimed that there a rash of strategic defaulters, which are defined as people that can afford to pay their mortgage no problem, but choose not to because they owe more than the home is worth.  And a couple of years ago, I wrote that strategic defaults are nonsense because no one that can afford their mortgage payments gets up on Sunday and says to their spouse:

 

“Honey, I realize that we can afford our mortgage payments no problem, but I was just thinking how far underwater we are and thought now might be a good time to clean out our garage, ruin our credit scores, endure the hassles of moving, and go rent a place for a five years.”

 

That is not what’s been happening to-date.  Not that it never has or will happen, but it’s exceedingly rare.  Everyone that hasn’t made a mortgage payment in months or even years is in their current situation because of money.  They didn’t stop making their mortgage payment because they became upset about being underwater, nor was it because of an ability to handle debt.  They stopped, in the vast majority of cases, because the economy or a life event knocked them down financially, and after using whatever savings they had, there came a day when they simply couldn’t make the payment… it wasn’t because they didn’t want to.

 

Optimism is a hard thing of which to let go…

 

I think I can remember the exact day that the dot-com bubble popped… it was April 10, 2000… and I was watching it happen on a television screen showing CNN as I waited in line to board a flight home from San Jose where I had spent the day in meetings.  I remember saying to my assistant at that time, that’s it… it’s all over now, or something to that effect.

 

I also remember seeing the cover of Newsweek two months later; I think it was the June issue.  It suggested that the tech sector would be coming back by December of that year, the obvious message being, “Don’t sell.”  I laughed when I read it… but not as much as I did two years later when I was at my favorite local watering hole after work with a friend of mine.  Mid-sip of my martini, he told me he was still holding onto his shares in Cisco Systems, purchased at $84, causing me to spit out my drink, choking as I laughed.

 

At the time, I think Cisco was trading at around $9, but my innumerate and hopelessly optimistic friend was explaining that he was only hoping the stock would return to half of its $84 price so he could then get out, losing only half of his dough.  I tried to explain the math involved showing him why he should sell and take the loss on his tax returns, and he listened… but it was another year before he took the advice and I learned that optimism is a hard thing of which to let go and this crisis has been no exception.

 

In the early stages of the crisis, essentially everyone listened to the administration, other government sources, and financial industry PR, and as a result believed that we were experiencing a temporary downturn as had happened before… that the housing market would start to come back around in a few years.  The idea of a “lost decade” was something that only happened in Japan… and everyone was saying that we were not Japan, which made sense to most folks because we cooked our fish before eating it in most if not all cases.

 

Recovery, the so-called experts said, would come by the end of 2010… then it was 2011… and then 2012.  As the years passed and home prices continued falling, consumer spending followed, and people came to realize that any recovery in the housing market would take longer than it had after past downturns… maybe it would be five years… maybe seven, so maybe by 2014 or 2015?

 

As long as most people believed that what was happening had happened before they could remain grounded, go on with their lives, and await our return to national prosperity.  This was the way people felt through 2009, 2010 and some part of 2011.

 

Last year, the news started to change and for a large segment of the population hope for recovery within a decade started to seem overly optimistic.  A lost decade was now understood to be almost a certainty, and the idea of a 20-year downturn, unthinkable only a couple of years earlier, now seemed a possibility.

 

Of course, there will come a time when some significant number of people sans money problems walking away from their mortgages en masse, and if we continue on our current path, that time will be here soon enough.

 

For millions of homeowners today, their situation has deteriorated to the point that it has become close to paralyzing.  Government programs have in all cases, not only been spectacular failures, they’ve also been spectacular lies.  As a result people have lost both trust and confidence in those they elected as they have plainly misled and ultimately abandoned them.

 

Additionally, having been televised it’s now widely recognized that too many courts have been ambivalent to the flagrant forgeries and fraudulent documents banks have used in the foreclosure process.  And losing faith in the courts and rule of law, is leading millions of homeowners to increasingly view their future as potentially dire.

 

And you know what they say: Desperate people take desperate measures.  (Or is that… “Disparate people choose different pleasures.  I can never remember how these sayings go… LOL.)

 

So, the bottom-line is that today, the issue of moral hazard as it relates to principal reductions is an entirely different matter than it was even a year or two ago. Today, and looking forward, I’m sure there is increasing reason to be concerned about homeowners being inspired to intentionally default in order to have their principal balances reduced, but the banking industry should realize that those that do so… well, if they’re willing to take that sort of risk then they’re on their way to a strategic default anyway… so, it’s really just a matter of choosing your poison.

 

ENTER: Mr. Dale Westhoff of Credit Suisse…

 

Dale Westhoff, our insipid bond analyst from Bear Stearns, says that beyond the creation of moral hazard, offering to reduce principal may also tighten lending by forcing banks to offer “price protection” to borrowers.

 

Now, I have no idea what “price protection” is, but I would like to say something to Dale about the idea that offering to reduce principal balances may result in tighter lending standards… so if you’ll just excuse me for a moment… be right back.

 

Dale?  Hi there.  Mandelman here.  Listen, I want to be diplomatic about this… you know that pseudo-threat you made about tighter lending standards as a result of principal reductions?  Did someone tell you that if you run out of rationales for not reducing principal balances, hit them with the old “banks will tighten lending” line? 

 

Well, Dale… that would sure make for an interesting threat that I might actually care about… if banks were actually lending… or, I don’t know… maybe if anyone was interested in borrowing.  However, since neither is the case, nor is it likely to be the case anytime soon, I’d say the only thing that comes to mind in response to your empty and barely veiled threat about tighter lending in the future as a result of principal reductions is… Shut the front door, Dale.

 

Let me share a little something with you and your banking pals… it has to do with principal reductions.  Do them… don’t do them… stick them up your tailpipe… homeowners barely give a rat’s behind anymore what you do or don’t do… think or don’t think.

 

You see… I guess you could say that it’s wearing kind of thin, Dale my boy… and homeowners wouldn’t believe you if you said the sky was blue.  Loan modifications don’t work because of their re-default rate… and now it’s principal reductions aren’t worth a darn because they create moral hazard. 

 

Well, what would “work” for you and yours, Dale?  I think I have an idea of what you and Credit Suisse are all about actually… tell me if I’m getting warm…

 

Just a scant couple of days ago Credit Suisse won the bidding process and as a result bought $7.014 billion in face value RMBS (“Residential Mortgage-backed Securities”) from the Federal Reserve Bank of New York.  The New York Fed bought them from AIG and had them in their Maiden Lane II, which is the New York Fed’s… what do you call that sort of entity… shell company?

 

So, when Maiden Lane II bought the assets their face value was $39 billion… and they paid $20.5 billion.  Now their face value is just over $7 billion and Credit Suisse paid… oh dear, wouldn’t you know it… darn the luck… the NY Fed says the actual price you guys paid won’t be disclosed until April 16, 2012.

 

Why is that, Dale?  How about a little research on that issue?  Why can’t the Fed disclose how much the Credit Suisse bid was until April 16, 2012, when the sale was made on January 19, 2012?  I’m sure there’s a perfectly good reason don’t get me wrong… I’m sure it’s just something to protect the interests of us U.S. taxpayers.  Always looking out for us, aren’t you Dale?

 

So, I hate to even mention it, but does the fact that you guys at Credit Suisse are running around like vulture investors trying to scoop up distressed residential mortgage-back backed securities at bargain basement prices bother you at all… I mean, considering that at the same time you’re publishing supposed “research” under headlines like, “Mortgage Principal Cuts Don’t Help Homeowners, Says Credit Suisse?”

 

The only reason I’m asking is that Laurie Goodman of Amherst Securities was quoted in that same Bloomberg article and she said…

 

“Amherst’s Goodman says that principal reductions are needed to avoid 8 million to 10 million more distressed-property sales.”

 

See, she said that because she felt it would be a bad thing to have 8-10 million more distressed property sales, but it looks like Credit Suisse wouldn’t actually mind at all if there were lots more distressed property sales, since Credit Suisse is scampering about in the night buying them for pennies on the… no, that’s not right… for some undisclosed amount to be disclosed on April 16, 2012.

 

The suspense is killing me, Dale.  I wonder if Credit Suisse overpaid for the distressed assets they bought?  Any guesses on how it will turn out?

 

On January 6, 2012, Federal Reserve Bank of New York President William C. Dudley, had the following to say on this very subject…

 

“Analysis by my staff that looks at likely borrower behavior over an extended time horizon suggests that without a significant turnaround in home prices and employment, a substantial proportion of those loans that are deeply underwater will ultimately default — absent an earned principal reduction program.”

 

Yeppers… so absent principal reductions, looks like I was about right once again… a whole bunch of loans are going to default… which will create a whole bunch of distressed RMBS assets for sale at pennies on the… well, at undisclosed prices for three months.

 

And Credit Suisse would just HATE that, right Dale? Since it’s evidently the bank’s business model at the moment.  I wonder why the bank isn’t making it’s money LENDING, like banks used to do.  You know, lending before all that tightening that we’re supposed to be so afraid of, according to you, if we allow principal reductions.

 

I’m actually thinking that you’re the moral hazard here, Dale… because you certainly don’t seem to have a moral compass.  And besides, you’re statements are starting to make me dizzy.

 

I scanned that Bloomberg article over and over, and it must have slipped your mind because you forgot to mention the bit about Credit Suisse having bought the distressed RMBS assets from Maiden Lane II… two days before you gave the story… or rather the press release…. to Bloomberg… nicely done, Dale… very nicely done… in fact, I’d have to say crackerjack work, my slimy friend.

 

Don’t feel too badly about this whole thing coming out this way though… I have skills.

 

Oh, and one more key point… Laurie Goodman made it… it’s about the one place where principal reductions appear to be very effective in preventing defaults…

 

“We have shown that, even controlling for all other factors, principal reductions are more effective.  Realize also that banks are doing it on their own portfolios and have been for years. Why would they continue if it was not more effective?”

 

Got to hand it to her there… it’s a darn fine question, isn’t it Dale?  Why do you suppose banks offer principal reductions when it’s their own portfolio loans, but not when it’s the taxpayers who are on the hook, such as when the loan is owned by Fannie, Freddie, or insured by FHA?

 

Or, maybe the whole moral hazard thing doesn’t apply when it’s a portfolio loans on a bank’s balance sheet, is that what it is… or isn’t?  Or, whatever Dale… no need to reply…no one is listening to you anymore.

 

Mandelman out.

 

 

 

 

Jan
21

Motion to Dismiss Denied | Bank of America May Owe “Foreclosure King” David J. Stern $11 Million

Bank of America May Owe Lawyers $11 Million (CN) – A Plantation, Fla., law firm can seek $11 million in unpaid legal fees for its work on Bank of America foreclosure cases, a federal judge ruled. The Law Offices of David J. Stern says it was the legal counsel for Bank of America’s Florida residential … Read more Related posts:
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  2. Deadbeat | David J. Stern, Dethroned “Foreclosure King” Does NOT Pay His Bills
  3. Full Deposition of Foreclosure King David J. Stern
Jan
20

Fraudclosure | Woman Nearly Loses Her Home Over Error Made by Citimortgage

“They should have said, ‘We were totally wrong, we have to do what we need to do to stop this foreclosure and do what we need to do to correct this’” ~ East Pennsboro Township woman nearly loses her home over error made by Citimortgage Citimortgage received a $20 billion government bailout on grounds it’s … Read more Related posts:
  1. NY Times – Queens Woman Nearly Loses Home Over Bank of America Error
  2. Fraudclosure | Largo Man Nearly Loses His Home Over 80 Cents, Still Not In the Clear
  3. A Fraudclosure Story | CitiMortgage Foreclosure, Loan Mods and Lies
Jan
20

WMC Mortgage | GE Lending Unit Said to be Target of U.S. Probe for Selling Fraudulent Loans

GE Lending Unit Said to be Target of U.S. Probe At issue is whether WMC Mortgage knowingly wrote fraudulent loans it later sold to investors. Federal authorities are investigating possible fraud at General Electric Co.’s former subprime mortgage arm amid increased public pressure to hold Wall Street accountable for its role in the financial crisis. … Read more Related posts:
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  2. NY Times | Bank of America to Create Troubled Loans Unit
  3. HUSH MONEY – Wells Fargo pays $24M to End Mortgage Probe
Jan
20

Calling All Lawyers to 5,000,000 Crime Scenes


It’s time for me to have an adult conversation with the experienced practicing attorneys in this country.  Other grown-ups are welcome to sit in as well, but it’s time for children to be in bed or occupied elsewhere, okay?

If there’s no money to be made solving something… no profit incentive… then for the most part, we don’t quite have a handle on to solving it.  For example, we’re not very good at cleaning up our oceans in general, and if there weren’t money to be made cleaning up oceans after oil spills, my guess would be that we wouldn’t be very good at doing that either.
To-date, however, BP has reportedly spent $21 billion cleaning up the Gulf of Mexico since its last mega-disaster, and guess what?  The Gulf of Mexico is pretty clean again… just two years later!  I remember hearing environmentalists predict that it could take 100 years to clean up the Gulf after the Deepwater Horizon catastrophe.  I guess they were underestimating just how much solution $21 billion can often buy.

Well, today we have a mammoth size foreclosure problem in this country, and it’s being talked about like it’s damn near an unsolvable problem… as if solving it would require determining the chemical origins of life, or figuring out whether black holes really do exist in space.

The foreclosure crisis, thank goodness, is not a black hole-type problem as many would have us believe.  It is a problem that, political constraints notwithstanding, exists at the juncture of economics and the rule of law.  In other words… it’s an oil spill… perhaps the worst oil spill of which the world has ever conceived… the Exxon Valdez meets Deepwater Horizon x 100, if you will… but it’s still just an oil spill.

It’s also important to note that as an economics problem alone, the foreclosure crisis is not a particularly challenging one to solve.  Some would rush to remind me that any proposed solution would be rife with “moral hazard,” and while that may be true, it doesn’t make the problem insoluble, by any means.

The elephant in the room is that what we’re facing in this country today is not just a foreclosure crisis, what we’re dealing with with is much better described as a FRAUDclosure crisis.

A couple of years ago, many would have said that my use of the word “fraud” before “closure,” is just hyperbole.  Today, however, anyone voicing that sort of opinion is selling something.  Even a cursory review of last year’s scathing “consent orders,” that federal regulators issued after months spent investigating mortgage servicers… or a quick perusal of the complaints filed against the servicers by attorneys general in Massachusetts, Nevada, Maryland, or Arizona… or by reading any number of published court decisions favoring homeowners… and one can only conclude that use of the word “fraud” is, if anything, understatement.

Additionally, this past year has been a turning point for the general public as far as FRAUDclosures are concerned.  Television’s most venerable news magazine, “60 Minutes,” along with newspaper-of-record, “The New York Times,” joined a long list of others documenting the many ways that banks and mortgage servicers are routinely breaking numerous laws in order to take advantage of homeowners in foreclosure.  It’s now widely understood to be something that’s occurring all over the country, and even though the banking industry continues to try to dismiss publicized instances as insignificant dalliances or “isolated incidents,” their sheer number has made such attempts laughable.  And the levels of wholesale anger and dissatisfaction with government felt among the populace are both palpable and rising fast.

Today, even forecasts from the likes of Goldman Sachs and Amherst Securities peg the number of foreclosures between 10.4 and 14 million by year-end 2014, and those numbers could easily go higher should home prices continue to fall… which they invariably will.  Add those numbers to the millions of foreclosures already water under the bridge, and were talking about a crisis that results in ONE IN FOUR Americans with mortgages losing their homes to foreclosure in the next handful of years.

What I’m describing will unquestionably devastate any hope for recovery in our broader economy for any number of reasons.  For one thing, as banks are forced to recognize their losses incurred on the mortgage-backed securities and CDOs that capitalize their balance sheets, they will become insolvent… and this time many will be forced to fail.  For another, home prices will continue falling pushing more and more homeowners underwater and consumer spending will continue to decline and that will lead to rising unemployment, which will in turn fuel further foreclosures.  And those hopelessly underwater will begin walking away en masse, which will further exacerbate the decline in prices and become impossible to combat.

All of these factors and more will combine to reduce future demand for residential real estate dramatically… perhaps by half, but in addition, with no secondary mortgage market… no ability to securitize debt… even those wanting to buy homes going forward will find credit to be tight and tighter, destroying any potential for recovery in the housing market.

And I’m no longer in a small group of people writing about this deteriorating situation as was the case three plus years ago.  Every day others are waking up to the fact that what we’ve been told about foreclosures to-date by our government and the financial services and related industries, has proven itself to be at best mistaken… at worst misdirection… or, not to put too fine a point on it, outright folderol.

As conservative columnist, Peggy Noonan, has pointed out recently, it’s simply impossible to imagine this sort of future without also seeing social unrest on a scale not seen in this country since at least the 1930s.  Writing recently about the Occupy Wall Street (“OWS”) movement, Noonan echoes my sentiments on the situation to a tee…

“OWS is an expression of American discontent, and others will follow.  Protests and social unrest are particularly likely if people feel they are unfairly losing their homes to support irresponsible, law-breaking institutions that have successfully disregarded the fundamental rules of capitalism and good citizenship.”

The harsh truth is that whatever is done in the future at state or federal levels to mitigate the damage caused by foreclosures, it’s simply too late to prevent our FRAUDclosure crisis from pretty much wiping out our nation’s middle class economy for more than a generation.  As a practical matter, the only real question we face today is how many are wounded and how many are killed… none of us is getting out unscathed.

There should be no question in anyone’s mind… there are only two paths ahead from which to choose.  Both involve fighting a war… but on one path the battle is fought by lawyers in our courts… on the other, by citizens in our streets.

Make no mistake about it… if we are to mitigate any of the  damage being caused, uphold the rule of law, and protect the rights of millions of homeowners… it should be obvious to anyone that WE NEED TENS OF THOUSANDS OF LAWYERS trained in foreclosure defense, loss mitigation and bankruptcy.  And yet, more than four years into the FRAUDclosure crisis, we don’t have anywhere near the number of trained, ethical attorneys required to meet the demand.

We’re all adults here, so let’s not kid ourselves about why that’s the case.  

We all know why we don’t have the lawyers we need to marshall a more effective defense of homeowners engulfed by the FRAUDclosure crisis… it’s because THERE’S NO MONEY IN IT.  Or, at least that’s what lawyers have been told they are supposed to believe.  Not only that, but the message has been that there  shouldn’t be any money in representing homeowners at risk of FRAUDclosure. It’s as if attorneys profiting from representing homeowners at risk of FRAUDclosure is somehow a bad thing.

AND THAT’S JUST 100% BANKER-INSPIRED B.S.

Don’t you see what’s happened here?  We’ve allowed the banks, and the government that’s been bailing them out, to essentially criminalize the profit potential in representing homeowners at risk of foreclosure… and wonder of wonders, miracles of miracles… here we sit with what appears to be an unsolvable problem.

Consider this… bankers say that they’ve been overwhelmed by the millions of homeowners unexpectedly seeking loan modifications and that’s why applying for a loan modification has been such a nightmare.  But, what about the number of foreclosures occurring in the same time frame?  Haven’t there been an unprecedented and unexpected number of foreclosures too?  So,why is it that the banks have no problems accommodating the millions of unexpected foreclosures, but the millions of unexpected loan modifications represent an unsolvable problem?

It’s simple… because on the foreclosure side of the equation, banks allow lawyers to be profitably compensated for handling foreclosures, and sure enough those law firms have figured out how to handle any number of foreclosures that come down the pike… in fact, the more the merrier, as they say.  On the loan modification side of the house, however, profits are a dirty word… and wouldn’t you know it, the problem is unsolvable.  Why am I not surprised?

Over the TWO YEARS following the Deepwater Horizon disaster, BP spent $21 billion to clean up the Gulf of Mexico.  In the FOUR YEARS since the tsunami of foreclosures began, we’ve spent roughly ten percent of what BP spent cleaning up the Gulf… $2.4 billion… and the vast majority of that amount paid to mortgage servicers… and we’re wondering why the problem can’t be solved?

 A MESSAGE TO OUR NATION’S LAWYERS…

It’s the biggest financial opportunity for the legal profession

SINCE THE REAR END COLLISION. 

The fact is… there is a HUGE OPPORTUNITY today to build a very profitable legal practice based on the ethical and effective representation of homeowners caught in the FRAUDclosure crisis.

From the very beginning of the mortgage meltdown, banks have tried to make sure that homeowners were not represented by attorneys when trying to save their homes from FRAUDclosure.   The reason is now apparent: Banks knew it was a FRAUDclosure crisis before the rest of us did because they’re the ones who put the FRAUD into FRAUDclosure.  From the earliest days of the crisis, the banks and the Obama Administration have been reinforcing TWO LIES:

  1. Homeowners at risk of foreclosure don’t need lawyers… they can just call their bank directly.  That’s like the police telling someone under arrest that he or she doesn’t need a lawyer because any questions can be answered by the District Attorney.  It’s a damn lie… homeowners DO NEED LAWYERS to help them save their homes because it’s not just a foreclosure crisis, it’s a FRAUDclosure crisis.
  2. A lawyer who charges a homeowner at risk of foreclosure up front… is a “SCAMMER.”  That is not only a LIE, but it’s a lie to achieve two key bank objectives.  One – It stopped many homeowners from seeking legal representation, thus allowing the banks to do whatever they wanted as related to foreclosing on their homes.  Two – It stopped countless attorneys from building a profitable practice based on representing homeowners at risk of foreclosure.

The California Example…

In California, the efforts to stop lawyers from representing homeowners have been more extreme than in any other state.  Here the campaign to malign the legal profession has been driven by legislative committees and supported by the California State Bar Association.  In October 2009, California’s SB 94 created a law that has effectively prevented lawyers from offering to represent homeowners who are seeking to avoid foreclosure through modification of their loans.  Under the guise of “charging up front makes you a scammer,” SB 94 has made it illegal for a lawyer to charge a homeowner an upfront retainer for legal fees.

Quite predictably, the law has made it difficult or even impossible for California homeowners to find quality legal representation related to seeking loan modifications, forcing those at risk of foreclosure who want to be represented by an attorney into either litigation or bankruptcy.  Writing for The New York Times in December 2010, David Streitfeld’s article titled, “Homes at Risk, and No Help from Lawyers,” described the situation in California related to SB 94.

In California, where foreclosures are more abundant than in any other state, homeowners trying to win a loan modification have always had a tough time. 

Now they face yet another obstacle: hiring a lawyer.

Sharon Bell, a retiree who lives in Laguna Niguel, southeast of Los Angeles, needs a modification to keep her home. She says she is scared of her bank and its plentiful resources, so much so that she cannot even open its certified letters inquiring where her mortgage payments may be. Yet the half-dozen lawyers she has called have refused to represent her.

“They said they couldn’t help,” said Ms. Bell, 63. “But I’ve got to find help, because I’m dying every day.”

Lawyers throughout California say they have no choice but to reject clients like Ms. Bell because of a new state law that sharply restricts how they can be paid. Under the measure, passed overwhelmingly by the State Legislature and backed by the state bar association, lawyers who work on loan modifications cannot receive any money until the work is complete. The bar association says that under the law, clients cannot put retainers in trust accounts.

To make matters worse, SB 94 has recently become controversial.  In late September 2011, Suzan Anderson, who is the supervising trial council of the state bar’s special team on loan modifications, made an unscheduled appearance at the bar’s annual conference, presenting what she purported to be the bar’s new interpretation of SB 94.  Literally hundreds of attorneys and legal scholars disagree, however, and litigation has recently been filed against the bar seeking declaratory relief, so we’ll soon see the courts decide the issue.

The core issue is about when a lawyer who represents a homeowner trying to get their loan modified can be compensated.  The bar claims the law requires an attorney to wait until the very end of the case, however, the actual language contained in SB 94 doesn’t say that… it says lawyers cannot be paid until completing “any and all services (the lawyer) has contracted to perform…” Up until Ms. Anderson’s presentation at the annual meeting, lawyers were dividing services into separate contractual arrangements and accepting payments from homeowners as discreet sets of services were completed.

Regardless of which side of the debate you’re on, the issue highlights how far the banking lobby will push a state legislature and state bar association in an attempt to prevent homeowners from being represented by legal council when trying to to avoid foreclosure, and it should come as absolutely no surprise that SB 94 was born in the state’s Senate Banking Committee, sponsored by Sen. Ron Calderon, who chairs that committee.

Advocates of SB 94 claim that it was needed to stop “scammers” who were preying on homeowners in distress from accepting up-front fees.  As quoted from Streitfeld’s article in The New York Times…

A spokesman for the Mortgage Bankers Association said it simply wanted to protect homeowners from fraud. “Be very careful about anyone who wants you to pay them to help you get a loan modification,” said the spokesman, John Mechem.

The evidence of any sort of army of lawyers-turned-scammers ripping off homeowners has always been thin, and by “thin” I mean nonexistant.  In the two years since the bill became law, the bar has taken some type of disciplinary action related to the representation of homeowners in foreclosure against two dozen lawyers, give or take a few.  In a state with more than 200,000 lawyers and 2 million homeowners in foreclosure, two dozen lawyers disciplined would hardly seem justification for a law that effectively prevents lawyers from helping homeowners get their loans modified.

Last December, Suzan Anderson, who heads up the bar’s task force on loan modifications, told The New York Times…

“I wish the law had worked,” Ms. Anderson said.

It’s also telling that no other state in the country has a law anything like SB 94, in fact, the rest of the states follow the FTC’s Mortgage Assistance Relief Services rule, MARS, which was adopted on January 30, 2011, and it does allow attorneys representing homeowners seeking loan modifications to accept funds in advance into their trust accounts.

The New York Times article also offered the perspective of several California homeowners seeking legal assistance in a post SB 94 world…

Mark Stone, a 56-year-old general contractor in Sierra Madre, feels differently. A few years ago, he got sick with hepatitis C. Unable to work full time, he began to miss mortgage payments. The drugs he was taking left him “a little confused,” he said.

Mr. Stone knew that his condition put him at a disadvantage in negotiations with his bank. So he hired Gregory Royston, a real estate lawyer in Redondo Beach. It took Mr. Royston nearly a year, but he restructured the loan.

 Without the lawyer, Mr. Stone said, “I’d be living under a bridge.
The legal bill, paid in advance, was $3,500. “Worth every penny,” said Mr. Stone, who is now back at work.
“This law,” Mr. Royston said, “took the wrong people out of the game.”

A Bleak Picture in California…

California’s approach to discouraging lawyers from representing homeowners at risk of foreclosure has not served the state or its residents well at all.  California is the “hardest hit” of all 50 states, accounting for one of every five foreclosures in the U.S.  Almost half of California’s homeowners are either underwater or effectively underwater today.  Since 2008, there have been 1.2 million foreclosures statewide, and that number is expected to exceed 2 million by the end of 2012.  And, according to the report published by the California Reinvestment Coalition…

The 2 million foreclosures expected by the end of this year are forecasted to cost the state and its residents $650 billion statewide.

Today, in California alone there are roughly TWO MILLION homeowners in foreclosure.  I don’t know exactly how many we have nationwide, estimates vary, but are in the 5 million range.  I do know that if two million people needed just 10 hours of legal assistance, it would take 20 million man hours.  Assuming a six hour work day and a 260 day work year… that’s just under 13,000 years assuming only one lawyer were involved.  To help two million people, assuming 10 hours each, at best would require more than 10,000 lawyers trained and working efficiently.

How many attorneys do we have  trained and ready to help loans get modified, represent homeowners in foreclosure defense matters and/or in bankruptcy.  Nowhere near 13,000 that’s for sure… in fact, we might not find 1300 either… and many would say the number could be closer to 130, and with the proliferating fraudulent documents… the abuses by servicers… the number of people who are foreclosed on illegally… its become easy to see the disease, and trained ethical lawyers would seem the only cure.

Mandelman out.

~~~

We need a literal army of experienced litigators, and Max Gardner’s Bankruptcy Boot Camp has trained close to 900 attorneys to protect the rights of homeowners in foreclosure.  I’ve attended Max’s Boot Camp… I could never recommend it strongly enough… and often do.  But, there’s more than legal training that’s required here… and if we’re going to attract the number of lawyers we need to fight this war…

The Answer is Money…

What Was Your Question?

Ohio’s former Attorney General Marc Dann is a highly experienced foreclosure defense attorney and a graduate of Max Gardner’s Boot Camp. He’s proven in his own successful practice that lawyers have the opportunity to DO GOOD… and DO WELL at the same time by learning the ins and outs of this, unfortunately, very fast growing and specialized field.  And he’s developed a comprehensive training and ongoing support program that allows experienced foreclosure defense attorneys to immediately access new clients and the right clients, improve operations within their firms, and yes… increase their profitability dramatically.

 

Marc understands our need for an experienced army of foreclosure defense lawyers, but he also understands the reality that lawyers have to make money in order to operate effectively.  In a phrase, a lawyer that can provide effective representation for homeowners at risk of foreclosure today, should not be worried about losing his or her own home to foreclosure because that benefits no one.

So, Marc has developed and employed best practices in building his own successful foreclosure defense practice, and now he’s teaching other attorneys how to make money in foreclosure defense so that ultimately he will have provided countless thousands of homeowners all over the country with access to highly capable, ethical and experienced attorneys.

Marc Dann’s LAW PROFITS program will take experienced and effective attorneys committed to foreclosure defense and protecting the rights of homeowners, and help transform them into vibrant, profitable firms or individual legal practices.  Some of the innovative solutions Marc will be delivering include:

  • How to cut through the noise created by scammers, reaching out to homeowners in a very honest and compelling way.
  • When and how to sue the bad modification company or bad lawyer.
  • Suing the foreclosure mills for fun and profits.
  • Using Fair Debt Collection Practices and State Consumer Protection.
  • Learn about the new practices available under Dodd Frank.
  • Harnessing TILA and RESPA inside and outside bankruptcy court.
  • Unconventional approaches stay one step ahead of servicer practices.
  • Billing structures, methodologies, and practice accounting.
  • Designing compensation programs that balance the needs of homeowners with the needs of your firm.  
  • Never lose clients – Ongoing communications program that’s turn-key and educates clients so they become fans.
  • Fee agreements – for contingency and hourly clients.
  • Become part of a highly visible network of top foreclosure defense attorneys, and strategic partners.
  • Communications strategies and tactics proven effective and unavailable anywhere else.

Making little or no money in foreclosure defense isn’t doing your clients any favors because you cannot be your best without it.  Marc Dann’s LAW PROFITS is not a pot of gold, or a winning lottery ticket, but it is a proven process and suite of best practices that makes a law practice profitable… essentially immediately.  It’s work, no question about it, but it’s important and gratifying work.

I wholeheartedly support Mar’c Dann’s LAW PROFITS initiative.  And I strongly urge all of the lawyers reading this to take action now by clicking the link below, so you can find out more about what his LAW PROFITS program for foreclosure defense and bankruptcy lawyers can do for you and your firm.  The FRAUDclosure crisis and its ancillary topics, I’m sorry to say, are going to be with us for a long time… a decade plus, if we’re lucky.  Longer if we’re not.  It’s time to settle in and start capitalizing on being one of the best at solving on of the worst case scenarios.

Click below to find out more about…

Marc Dann’s 

LAW PROFITS

Jan
20

Calling All Lawyers to 5,000,000 Crime Scenes


It’s time for me to have an adult conversation with the experienced practicing attorneys in this country.  Other grown-ups are welcome to sit in as well, but it’s time for children to be in bed or occupied elsewhere, okay?

If there’s no money to be made solving something… no profit incentive… then for the most part, we don’t quite have a handle on solving it.  For example, we’re not very good at cleaning up our oceans in general, and if there weren’t money to be made cleaning up oceans after oil spills, my guess would be that we wouldn’t be very good at doing that either.
To-date, however, BP has reportedly spent $21 billion cleaning up the Gulf of Mexico since its last mega-disaster, and guess what?  The Gulf of Mexico is pretty clean again… just two years later!  I remember hearing environmentalists predict that it could take 100 years to clean up the Gulf after the Deepwater Horizon catastrophe.  I guess they were underestimating just how much solution $21 billion can often buy.

Well, today we have a mammoth size foreclosure problem in this country, and it’s being talked about like it’s damn near an unsolvable problem… as if solving it would require determining the chemical origins of life, or figuring out whether black holes really do exist in space.

The foreclosure crisis, thank goodness, is not a black hole-type problem as many would have us believe.  It is a problem that, political constraints notwithstanding, exists at the juncture of economics and the rule of law.  In other words… it’s an oil spill… perhaps the worst oil spill of which the world has ever conceived… the Exxon Valdez meets Deepwater Horizon x 100, if you will… but it’s still just an oil spill.

It’s also important to note that as an economics problem alone, the foreclosure crisis is not a particularly challenging one to solve.  Some would rush to remind me that any proposed solution would be rife with “moral hazard,” and while that may be true, it doesn’t make the problem insoluble, by any means.

The elephant in the room is that what we’re facing in this country today is not just a foreclosure crisis, what we’re dealing with with is much better described as a FRAUDclosure crisis.

A couple of years ago, many would have said that my use of the word “fraud” before “closure,” is just hyperbole.  Today, however, anyone voicing that sort of opinion is selling something.  Even a cursory review of last year’s scathing “consent orders,” that federal regulators issued after months spent investigating mortgage servicers… or a quick perusal of the complaints filed against the servicers by attorneys general in Massachusetts, Nevada, Maryland, or Arizona… or by reading any number of published court decisions favoring homeowners… and one can only conclude that use of the word “fraud” is, if anything, understatement.

Additionally, this past year has been a turning point for the general public as far as FRAUDclosures are concerned.  Television’s most venerable news magazine, “60 Minutes,” along with newspaper-of-record, “The New York Times,” joined a long list of others documenting the many ways that banks and mortgage servicers are routinely breaking numerous laws in order to take advantage of homeowners in foreclosure.  It’s now widely understood to be something that’s occurring all over the country, and even though the banking industry continues to try to dismiss publicized instances as insignificant dalliances or “isolated incidents,” their sheer number has made such attempts laughable.  And the levels of wholesale anger and dissatisfaction with government felt among the populace are both palpable and rising fast.

Today, even forecasts from the likes of Goldman Sachs and Amherst Securities peg the number of foreclosures between 10.4 and 14 million by year-end 2014, and those numbers could easily go higher should home prices continue to fall… which they invariably will.  Add those numbers to the millions of foreclosures already water under the bridge, and were talking about a crisis that results in ONE IN FOUR Americans with mortgages losing their homes to foreclosure in the next handful of years.

What I’m describing will unquestionably devastate any hope for recovery in our broader economy for any number of reasons.  For one thing, as banks are forced to recognize their losses incurred on the mortgage-backed securities and CDOs that capitalize their balance sheets, they will become insolvent… and this time many will be forced to fail.  For another, home prices will continue falling pushing more and more homeowners underwater and consumer spending will continue to decline and that will lead to rising unemployment, which will in turn fuel further foreclosures.  And those hopelessly underwater will begin walking away en masse, which will further exacerbate the decline in prices and become impossible to combat.

All of these factors and more will combine to reduce future demand for residential real estate dramatically… perhaps by half, but in addition, with no secondary mortgage market… no ability to securitize debt… even those wanting to buy homes going forward will find credit to be tight and tighter, destroying any potential for recovery in the housing market.

And I’m no longer in a small group of people writing about this deteriorating situation as was the case three plus years ago.  Every day others are waking up to the fact that what we’ve been told about foreclosures to-date by our government and the financial services and related industries, has proven itself to be at best mistaken… at worst misdirection… or, not to put too fine a point on it, outright folderol.

As conservative columnist, Peggy Noonan, has pointed out recently, it’s simply impossible to imagine this sort of future without also seeing social unrest on a scale not seen in this country since at least the 1930s.  Writing recently about the Occupy Wall Street (“OWS”) movement, Noonan echoes my sentiments on the situation to a tee…

“OWS is an expression of American discontent, and others will follow.  Protests and social unrest are particularly likely if people feel they are unfairly losing their homes to support irresponsible, law-breaking institutions that have successfully disregarded the fundamental rules of capitalism and good citizenship.”

The harsh truth is that whatever is done in the future at state or federal levels to mitigate the damage caused by foreclosures, it’s simply too late to prevent our FRAUDclosure crisis from pretty much wiping out our nation’s middle class economy for more than a generation.  As a practical matter, the only real question we face today is how many are wounded and how many are killed… none of us is getting out unscathed.

There should be no question in anyone’s mind… there are only two paths ahead from which to choose.  Both involve fighting a war… but on one path the battle is fought by lawyers in our courts… on the other, by citizens in our streets.

Make no mistake about it… if we are to mitigate any of the  damage being caused, uphold the rule of law, and protect the rights of millions of homeowners… it should be obvious to anyone that WE NEED TENS OF THOUSANDS OF LAWYERS trained in foreclosure defense, loss mitigation and bankruptcy.  And yet, more than four years into the FRAUDclosure crisis, we don’t have anywhere near the number of trained, ethical attorneys required to meet the demand.

We’re all adults here, so let’s not kid ourselves about why that’s the case.  

We all know why we don’t have the lawyers we need to marshall a more effective defense of homeowners engulfed by the FRAUDclosure crisis… it’s because THERE’S NO MONEY IN IT.  Or, at least that’s what lawyers have been told they are supposed to believe.  Not only that, but the message has been that there  shouldn’t be any money in representing homeowners at risk of FRAUDclosure. It’s as if attorneys profiting from representing homeowners at risk of FRAUDclosure is somehow a bad thing.

AND THAT’S JUST 100% BANKER-INSPIRED B.S.

Don’t you see what’s happened here?  We’ve allowed the banks, and the government that’s been bailing them out, to essentially criminalize the profit potential in representing homeowners at risk of foreclosure… and wonder of wonders, miracles of miracles… here we sit with what appears to be an unsolvable problem.

Consider this… bankers say that they’ve been overwhelmed by the millions of homeowners unexpectedly seeking loan modifications and that’s why applying for a loan modification has been such a nightmare.  But, what about the number of foreclosures occurring in the same time frame?  Haven’t there been an unprecedented and unexpected number of foreclosures too?  So,why is it that the banks have no problems accommodating the millions of unexpected foreclosures, but the millions of unexpected loan modifications represent an unsolvable problem?

It’s simple… because on the foreclosure side of the equation, banks allow lawyers to be profitably compensated for handling foreclosures, and sure enough those law firms have figured out how to handle any number of foreclosures that come down the pike… in fact, the more the merrier, as they say.  On the loan modification side of the house, however, profits are a dirty word… and wouldn’t you know it, the problem is unsolvable.  Why am I not surprised?

Over the TWO YEARS following the Deepwater Horizon disaster, BP spent $21 billion to clean up the Gulf of Mexico.  In the FOUR YEARS since the tsunami of foreclosures began, we’ve spent roughly ten percent of what BP spent cleaning up the Gulf… $2.4 billion… and the vast majority of that amount paid to mortgage servicers… and we’re wondering why the problem can’t be solved?

 A MESSAGE TO OUR NATION’S LAWYERS…

It’s the biggest financial opportunity for the legal profession

SINCE THE REAR END COLLISION. 

The fact is… there is a HUGE OPPORTUNITY today to build a very profitable legal practice based on the ethical and effective representation of homeowners caught in the FRAUDclosure crisis.

From the very beginning of the mortgage meltdown, banks have tried to make sure that homeowners were not represented by attorneys when trying to save their homes from FRAUDclosure.   The reason is now apparent: Banks knew it was a FRAUDclosure crisis before the rest of us did because they’re the ones who put the FRAUD into FRAUDclosure.  From the earliest days of the crisis, the banks and the Obama Administration have been reinforcing TWO LIES:

  1. Homeowners at risk of foreclosure don’t need lawyers… they can just call their bank directly.  That’s like the police telling someone under arrest that he or she doesn’t need a lawyer because any questions can be answered by the District Attorney.  It’s a damn lie… homeowners DO NEED LAWYERS to help them save their homes because it’s not just a foreclosure crisis, it’s a FRAUDclosure crisis.
  2. A lawyer who charges a homeowner at risk of foreclosure up front… is a “SCAMMER.”  That is not only a LIE, but it’s a lie to achieve two key bank objectives.  One – It stopped many homeowners from seeking legal representation, thus allowing the banks to do whatever they wanted as related to foreclosing on their homes.  Two – It stopped countless attorneys from building a profitable practice based on representing homeowners at risk of foreclosure.

The California Example…

In California, the efforts to stop lawyers from representing homeowners have been more extreme than in any other state.  Here the campaign to malign the legal profession has been driven by legislative committees and supported by the California State Bar Association.  In October 2009, California’s SB 94 created a law that has effectively prevented lawyers from offering to represent homeowners who are seeking to avoid foreclosure through modification of their loans.  Under the guise of “charging up front makes you a scammer,” SB 94 has made it illegal for a lawyer to charge a homeowner an upfront retainer for legal fees.

Quite predictably, the law has made it difficult or even impossible for California homeowners to find quality legal representation related to seeking loan modifications, forcing those at risk of foreclosure who want to be represented by an attorney into either litigation or bankruptcy.  Writing for The New York Times in December 2010, David Streitfeld’s article titled, “Homes at Risk, and No Help from Lawyers,” described the situation in California related to SB 94.

In California, where foreclosures are more abundant than in any other state, homeowners trying to win a loan modification have always had a tough time. 

Now they face yet another obstacle: hiring a lawyer.

Sharon Bell, a retiree who lives in Laguna Niguel, southeast of Los Angeles, needs a modification to keep her home. She says she is scared of her bank and its plentiful resources, so much so that she cannot even open its certified letters inquiring where her mortgage payments may be. Yet the half-dozen lawyers she has called have refused to represent her.

“They said they couldn’t help,” said Ms. Bell, 63. “But I’ve got to find help, because I’m dying every day.”

Lawyers throughout California say they have no choice but to reject clients like Ms. Bell because of a new state law that sharply restricts how they can be paid. Under the measure, passed overwhelmingly by the State Legislature and backed by the state bar association, lawyers who work on loan modifications cannot receive any money until the work is complete. The bar association says that under the law, clients cannot put retainers in trust accounts.

To make matters worse, SB 94 has recently become controversial.  In late September 2011, Suzan Anderson, who is the supervising trial council of the state bar’s special team on loan modifications, made an unscheduled appearance at the bar’s annual conference, presenting what she purported to be the bar’s new interpretation of SB 94.  Literally hundreds of attorneys and legal scholars disagree, however, and litigation has recently been filed against the bar seeking declaratory relief, so we’ll soon see the courts decide the issue.

The core issue is about when a lawyer who represents a homeowner trying to get their loan modified can be compensated.  The bar claims the law requires an attorney to wait until the very end of the case, however, the actual language contained in SB 94 doesn’t say that… it says lawyers cannot be paid until completing “any and all services (the lawyer) has contracted to perform…” Up until Ms. Anderson’s presentation at the annual meeting, lawyers were dividing services into separate contractual arrangements and accepting payments from homeowners as discreet sets of services were completed.

Regardless of which side of the debate you’re on, the issue highlights how far the banking lobby will push a state legislature and state bar association in an attempt to prevent homeowners from being represented by legal council when trying to to avoid foreclosure, and it should come as absolutely no surprise that SB 94 was born in the state’s Senate Banking Committee, sponsored by Sen. Ron Calderon, who chairs that committee.

Advocates of SB 94 claim that it was needed to stop “scammers” who were preying on homeowners in distress from accepting up-front fees.  As quoted from Streitfeld’s article in The New York Times…

A spokesman for the Mortgage Bankers Association said it simply wanted to protect homeowners from fraud. “Be very careful about anyone who wants you to pay them to help you get a loan modification,” said the spokesman, John Mechem.

The evidence of any sort of army of lawyers-turned-scammers ripping off homeowners has always been thin, and by “thin” I mean nonexistant.  In the two years since the bill became law, the bar has taken some type of disciplinary action related to the representation of homeowners in foreclosure against two dozen lawyers, give or take a few.  In a state with more than 200,000 lawyers and 2 million homeowners in foreclosure, two dozen lawyers disciplined would hardly seem justification for a law that effectively prevents lawyers from helping homeowners get their loans modified.

Last December, Suzan Anderson, who heads up the bar’s task force on loan modifications, told The New York Times…

“I wish the law had worked,” Ms. Anderson said.

It’s also telling that no other state in the country has a law anything like SB 94, in fact, the rest of the states follow the FTC’s Mortgage Assistance Relief Services rule, MARS, which was adopted on January 30, 2011, and it does allow attorneys representing homeowners seeking loan modifications to accept funds in advance into their trust accounts.

The New York Times article also offered the perspective of several California homeowners seeking legal assistance in a post SB 94 world…

Mark Stone, a 56-year-old general contractor in Sierra Madre, feels differently. A few years ago, he got sick with hepatitis C. Unable to work full time, he began to miss mortgage payments. The drugs he was taking left him “a little confused,” he said.

Mr. Stone knew that his condition put him at a disadvantage in negotiations with his bank. So he hired Gregory Royston, a real estate lawyer in Redondo Beach. It took Mr. Royston nearly a year, but he restructured the loan.

 Without the lawyer, Mr. Stone said, “I’d be living under a bridge.
The legal bill, paid in advance, was $3,500. “Worth every penny,” said Mr. Stone, who is now back at work.
“This law,” Mr. Royston said, “took the wrong people out of the game.”

A Bleak Picture in California…

California’s approach to discouraging lawyers from representing homeowners at risk of foreclosure has not served the state or its residents well at all.  California is the “hardest hit” of all 50 states, accounting for one of every five foreclosures in the U.S.  Almost half of California’s homeowners are either underwater or effectively underwater today.  Since 2008, there have been 1.2 million foreclosures statewide, and that number is expected to exceed 2 million by the end of 2012.  And, according to the report published by the California Reinvestment Coalition…

The 2 million foreclosures expected by the end of this year are forecasted to cost the state and its residents $650 billion statewide.

Today, in California alone there are roughly TWO MILLION homeowners in foreclosure.  I don’t know exactly how many we have nationwide, estimates vary, but are in the 5 million range.  I do know that if two million people needed just 10 hours of legal assistance, it would take 20 million man hours.  Assuming a six hour work day and a 260 day work year… that’s just under 13,000 years assuming only one lawyer were involved.  To help two million people, assuming 10 hours each, at best would require more than 10,000 lawyers trained and working efficiently.

How many attorneys do we have  trained and ready to help loans get modified, represent homeowners in foreclosure defense matters and/or in bankruptcy.  Nowhere near 13,000 that’s for sure… in fact, we might not find 1300 either… and many would say the number could be closer to 130, and with the proliferating fraudulent documents… the abuses by servicers… the number of people who are foreclosed on illegally… its become easy to see the disease, and trained ethical lawyers would seem the only cure.

Mandelman out.

~~~

We need a literal army of experienced litigators, and Max Gardner’s Bankruptcy Boot Camp has trained close to 900 attorneys to protect the rights of homeowners in foreclosure.  I’ve attended Max’s Boot Camp… I could never recommend it strongly enough… and often do.  But, there’s more than legal training that’s required here… and if we’re going to attract the number of lawyers we need to fight this war…

The Answer is Money…

What Was Your Question?

Ohio’s former Attorney General Marc Dann is a highly experienced foreclosure defense attorney and a graduate of Max Gardner’s Boot Camp. He’s proven in his own successful practice that lawyers have the opportunity to DO GOOD… and DO WELL at the same time by learning the ins and outs of this, unfortunately, very fast growing and specialized field.  And he’s developed a comprehensive training and ongoing support program that allows experienced foreclosure defense attorneys to immediately access new clients and the right clients, improve operations within their firms, and yes… increase their profitability dramatically.

 

Marc understands our need for an experienced army of foreclosure defense lawyers, but he also understands the reality that lawyers have to make money in order to operate effectively.  In a phrase, a lawyer that can provide effective representation for homeowners at risk of foreclosure today, should not be worried about losing his or her own home to foreclosure because that benefits no one.

So, Marc has developed and employed best practices in building his own successful foreclosure defense practice, and now he’s teaching other attorneys how to make money in foreclosure defense so that ultimately he will have provided countless thousands of homeowners all over the country with access to highly capable, ethical and experienced attorneys.

Marc Dann’s LAW PROFITS program will take experienced and effective attorneys committed to foreclosure defense and protecting the rights of homeowners, and help transform them into vibrant, profitable firms or individual legal practices.  Some of the innovative solutions Marc will be delivering include:

  • How to cut through the noise created by scammers, reaching out to homeowners in a very honest and compelling way.
  • When and how to sue the bad modification company or bad lawyer.
  • Suing the foreclosure mills for fun and profits.
  • Using Fair Debt Collection Practices and State Consumer Protection.
  • Learn about the new practices available under Dodd Frank.
  • Harnessing TILA and RESPA inside and outside bankruptcy court.
  • Unconventional approaches stay one step ahead of servicer practices.
  • Billing structures, methodologies, and practice accounting.
  • Designing compensation programs that balance the needs of homeowners with the needs of your firm.  
  • Never lose clients – Ongoing communications program that’s turn-key and educates clients so they become fans.
  • Fee agreements – for contingency and hourly clients.
  • Become part of a highly visible network of top foreclosure defense attorneys, and strategic partners.
  • Communications strategies and tactics proven effective and unavailable anywhere else.

Making little or no money in foreclosure defense isn’t doing your clients any favors because you cannot be your best without it.  Marc Dann’s LAW PROFITS is not a pot of gold, or a winning lottery ticket, but it is a proven process and suite of best practices that makes a law practice profitable… essentially immediately.  It’s work, no question about it, but it’s important and gratifying work.

I wholeheartedly support Mar’c Dann’s LAW PROFITS initiative.  And I strongly urge all of the lawyers reading this to take action now by clicking the link below, so you can find out more about what his LAW PROFITS program for foreclosure defense and bankruptcy lawyers can do for you and your firm.  The FRAUDclosure crisis and its ancillary topics, I’m sorry to say, are going to be with us for a long time… a decade plus, if we’re lucky.  Longer if we’re not.  It’s time to settle in and start capitalizing on being one of the best at solving on of the worst case scenarios.

Click below to find out more about…

Marc Dann’s 

LAW PROFITS

Jan
18

“Living Wills” | FDIC Board Approves Final Rule Requiring Resolution Plans for Insured Depository Institutions Over $50 Billion in the Event of the Institution’s Failure

FDIC Board Approves Final Rule Requiring Resolution Plans for Insured Depository Institutions Over $50 Billion The FDIC today approved a final rule requiring an insured depository institution with $50 billion or more in total assets to submit to the FDIC periodic contingency plans for resolution in the event of the institution’s failure. These resolution plans … Read more Related posts:
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  3. F.D.I.C. Approves ‘Too Big to Fail’ Plan, Looks for Public Comments
Jan
18

AFSCME | End Dimon Double Duty – “Jamie Dimon has gone from the ‘Last Man Standing’ to ‘the Most Dangerous Man in America

AFSCME Plan to JP Morgan: End Dimon Double Duty WASHINGTON, Jan. 17, 2012 /PRNewswire via COMTEX/ — The AFSCME Employees Pension Plan (“the AFSCME Plan”) today announced it filed a shareholder proposal asking JPMorgan Chase & Co. (JPM) to adopt an independent board chair. The AFSCME Plan, an institutional investor with more than $850 million … Read more Related posts:
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  2. JPMorgan CEO Jamie Dimon: Stop Bashing the Rich “Acting like everyone who’s been successful is bad and that everyone who is rich is bad – I just don’t get it”
  3. NJ Court Dismisses Bank of America Foreclosure Complaint due to Violations: Bank of America Lacked Standing – Wells Fargo Violated Fair Foreclosure Act
Jan
18

Utah Attorney General Moves to Intervene in Federal Judge’s Ruling Utah Foreclosure Trustee Law Inapplicable

Utah Attorney General Moves to Intervene in Federal Judge’s Ruling Utah Foreclosure Trustee Law Inapplicable (Salt Lake City, UT) – The Utah Attorney General has moved to intervene in a case filed by St. George attorney John Christian Barlow on behalf of Utah homeowner Garry Franklin Garrett in which senior Federal Judge David Sam ruled … Read more Related posts:
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  2. Utah Federal Judge David Sam is WRONG (IMHO) RE ReconTrust is Operating Under the National Bank Act Regulated by the Office of the Comptroller of the Currency (OCC)
  3. Bank of America Utah Foreclosures – Judge Clark Waddoups to Rehear Federal Jurisdiction Dispute TODAY
Jan
17

I’ve found the problem in Washington… it’s some sort of time warp, or they’re just dumb.

Saturday night, while I was searching around on iTunes for a podcast on the economy… (OMG, did I just say that out loud?  How sad is that?  Let’s just keep that part about Saturday night between us, okay?)

 

But, you know the deal, right?  I’ve been doing more and more podcasts and a lot of people really like them and I wanted to see how other podcasts are done in case there was something I could do better or add in, whatever.  In other words, I was checking to see if there were any ideas I could steal… LOL

 

So, I happen upon a podcast published a few days ago… January 13, 2012… available free on iTunes: NPR on the Economy.  The show’s host is David Green from Morning Edition, and his guest, David Wessell, is the Wall Street Journal’s Economics Editor, and the author of “In Fed We Trust: Ben Bernanke’s War on the Great Panic.”

 

The topic was the Federal Reserve and how Fed officials have been talking to congress about how our country’s economy can’t recover without the housing market, so I figured… perfect… it’s my favorite issue.  Green opens the show by saying:

 

“Lately, Federal Reserve officials have been focusing on housing… they’ve been out in public pushing measures they think will help the housing market.”

 

Have they now, I thought to myself.  How could I have missed the Fed doing that?

 

Green kicked the discussion into gear by broadly asking Wessell what the Fed is trying to do.  He replied that Fed officials have been saying in speeches and in a 26 page white paper that’s apparently been sent to congress recently, that one reason our economy isn’t doing better is that our housing market is not healing very fast.

 

I couldn’t help but wonder how that idea could possibly take up 26 pages, but then remembering that it was the Federal Reserve we were talking about, I figured that the first 25 pages were probably cherry-picked data points showing how well the economy is doing, with this tidbit about housing on page 26.

 

Wessell went on to point out that the President of the New York Fed recently said the following:

 

“… it was difficult to achieve economic recovery unless the ongoing weakness in housing was addressed,” and that the new President of the San Francisco Fed, John Williams, talked about a “housing depression.”

 

The “housing depression” phrase caught my attention, as I’m sure it did yours, but then I figured he probably used the phrase in the context of what we would avoid, thanks to the swift and decisive actions of the Fed.

 

You see, I’m not falling for another goofy “we’re going to save the housing market plan,” that turns out to be another voluntary refinancing program that Fannie and Freddie have already pronounced DOA, but that we won’t hear the abysmal results for until next year at this time.

 

According to Wessell the Fed is now saying that they’ve done what they can to get the economy working better, and that now the other areas of the government are going to have to pay attention to getting the housing and mortgage market going again.

 

Sort of a funny way to phrase things, don’t you think?  It sort of made it sound as if we’re supposed to believe that the last three years have been somehow planned the way sub-contractors work together when building a home… “Okay, Congress… we’ve got the framing up, the electrical wired and the slabs poured so you can go ahead with the tile, the window treatments and doors.”

 

 

Of course, the reality is that the last three years have looked and felt more like a scene out of Ringling Bros. Greatest Show on Earth, when something like 50 clowns all come rushing in from everywhere, ten of them get out of a tiny car, one gets shot from a cannon, and three monkeys in spandex start circling on bicycles while blowing noisemakers.

 

Wessell then tells Green that the Fed is now saying that “the alphabet soup of programs that the government has tried to help housing and homeowners isn’t doing enough.”  Green asks if they had any suggestions as to what should be done and Wessell sounds almost exuberant when he replies that yes, “they’ve come up with a list of things they think the government ought to do.”

 

At this point, the anticipation was practically killing me, and I thought I might pee my pants if I didn’t hear what the Fed had in mind soon.  It’s an election year, you see… and as such, anything is possible.  If you don’t think so, just consider that Obama, after presiding over an administration that pumped $16 trillion into financial sector, is again running as some sort of populist.

 

So, Green and Wessell then start listing the things the Fed presented to congress in its white paper ostensibly in order to heal the housing market and thereby remove the last standing impediment to beginning our march back to economic prosperity in earnest.

 

And please remember… in the third paragraph from the top of this article, I placed a link to the specific NPR podcast to which I’m referring, and the reader is encouraged to listen to it after reading what follows to confirm that I have faithfully reprinted what was said by Wessell… verbatim, as it were.

 

What the Fed told congress will be in bold type, my questions and comments will be plain text.  I really need everyone’s help here, because I think I may have discovered some sort of glitch in the space-time continuum that would explain why Washington appears so entirely out of touch with reality and the rest of the country, if not the world. Either that, or maybe they’re all just dumb and that’s why they wanted government jobs.

 

 

 1.    The Fed thinks the government “ought to find a way to reduce the glut of houses for sale, because the banks have taken over so many foreclosed houses there’s just a glut of supply and they’d like to make it easier for banks and others to rent them out in order to reduce the number for sale.”

  1. First of all, why does the Fed think there’s a “glut of houses for sale?”  Did someone tell them that’s the case because I think that person may have just been pulling their little Feddy legs.  You see… there isn’t any sort of “glut” of homes on the market.  That’s why it’s called the “shadow inventory,” right?  If the homes were on the market and for sale, I think they’d just call it “the inventory,” and drop the whole “shadow” part.
  2. Banks renting out homes does nothing to reduce the number of homes for sale.  Renting out a vacant home does reduce the number of vacant homes, but renting a home doesn’t preclude its owner from selling it.  So, if a home was on the market before it was rented, it’s likely still on the market after you rent it out.
  3. The only ways that one could reduce the supply of homes for sale would be to: 1) Stop building new homes and listing them for sale. 2) Stop kicking people out of the ones they own.  3) Tear down the houses listed for sale. 4) Start promising doctors, lawyers, or other high income or net worth individuals that are citizens of foreign countries that if they move here, we’ll give them a new car and send their kids to Harvard for free.  5) Start giving away homes on game shows.
  4. And there are no anti-renting statutes in this country that I could find.  In fact, in this country it’s really already very easy to rent something to someone assuming there’s someone who wants to and can rent it.  Maybe someone should introduce the Fed to Craig’s list.

More importantly, are we experiencing a shortage of homes that are available for rent?  I looked online for rentals in zip codes all over the country, and there were rental properties available in all of them.  I think today there are two reasons that many people don’t have a home of their own in which to live: a shortage of money… or the shortage of jobs that pay good money.

If the Fed is so concerned that a glut of homes for sale will derail any chance we have for recovery in our housing market going forward, which in turn will prevent our broader economic recovery, then why doesn’t the Fed’s list suggest that congress do something to prevent the 10.4 million foreclosures that will occur in the next few years, as forecasted by numerous industry experts whose predictions at this stage are based on hard data and mathematics.

 

CONCLUSION:

 

Recognizing that without recovery in our housing market our nation can’t sustain any sort of broader economic recovery, the Fed thinks congress should concentrate on reducing the glut of homes for sale… the glut that technically doesn’t exist yet… by making it easier to rent out repossessed homes?

 

That’s what we should do instead of doing something to prevent the 10.4 million new foreclosures that are certain to occur in the next few years?  The Federal Reserve wrote a white paper to the United States Congress saying that instead we need to address a glut of homes for sale that isn’t here yet by making it easier to rent out repossessed homes?

 

Read the two paragraphs under CONCLUSION again… slowly.  Now, would anyone care to explain that whole situation to me, because I find the whole thing terrifying.

 

2. The Fed thinks that “more should be done to make sure that the lenders, Fannie and Freddie and the federal banking regulators haven’t over-reacted to the crisis and are being too stingy and too picky about lending.”  According to Wessell: “The Fed actually said that if mortgages had been this hard to get over the past few decades, we MIGHT today be a nation of renters.”

  • The Fed told congress that if people couldn’t get mortgages over the last few decades we MIGHT today be a nation of renters?  No mortgages available MIGHT have meant more renters?  The Fed is not sure that fewer mortgages being available would lead to more renters??  Okay, but I wonder what else MIGHT have occurred.Then, the Fed is UNSURE about why lending in this country is bordering on non-existent and they want Congress to do more to investigate whether there’s been an over-reaction among “picky and stingy” lenders?  Did I get that right?

    Aren’t the guys at the Federal Reserve supposed to understand the issues surrounding lending?  They are, right?

  • The Fed has lowered rates to right around zero percent and pumped TRILLIONS into the financial system through all sorts of vehicles… and it hasn’t had any more sustained impact on lending than had they burned incense while chanting Hopi fertility prayers.
  • Is it possible in anyone’s mind that the volume of lending available in this country is related to the degree of over-reaction on some sort of pickiness and stinginess index for bankers?
  • Or could it be that a powerful wizard has cast a super glue spell on our nation so that no matter what amount of cash is pumped into our lenders, it sticks to the walls of their vaults and therefore can’t be lent out no matter what.

Isn’t it clear by now that the problem with lending in this country is NOT a LIQUIDITY problem and therefore it cannot be addressed through the use of MONETARY POLICY, of which the Fed is in charge?

You don’t need to be an “industry expert” to know what I’m saying here is true.  If it were a liquidity problem, then lowering the rates and pumping cash into the system would have worked and increased lending.  It didn’t, so, it’s not… get it?

 

One more time…

 

In this country, ever since the third or fourth quarter of 2007, the securitization market, credit markets, and secondary mortgage markets collapsed and froze solid when investors stopped trusting the credit ratings on mortgage-backed securities and CDOs.  Since then, lending in this country had to be effectively NATIONALIZED.

 

I say that lending has been NATIONALIZED because over the last three or four years, something north of 95% of the loans related to residential real estate were either Fannie, Freddie, FHA, Ginny, and… well, no that’s it, actually.

 

Remember when the Fed bought $1.5 trillion in mortgage-backed securities a few years back?   Do you understand WHY the Fed bought those mortgage-backed securities?  Because NO PRIVATE INVESTORS WOULD BUY THEM.  And why might that have been?  Anyone?  Anyone?  Come on now class… let’s not always see the same hands.

 

They don’t TRUST the securities anymore, very good class.  Why doesn’t the Fed remember any of this?  Or for that matter, the Economics Editor from the Wall Street Journal… to say nothing of the folks at NPR?

 

3.    According to Wessell, the Fed “is looking for alternatives to foreclosure, that if someone is not going to be able to pay their loan, and a lender is going to have to take it over, they’d like to find a way to speed the process up so it’s not so cumbersome.”

Okay, so the Fed is “looking for alternatives to foreclosure,” but what the Fed means by that is that they want the foreclosure process to be less “cumbersome?”  Less cumbersome than it is now?  Seriously?  What would that process look like, I’m curious to know?

I mean, now… in order to foreclose as a servicer, you don’t need much more than the relatively unsubstantiated claim that the borrower is not making their mortgage payments.  You don’t need to prove you’re the representative of the actual investor(s).  You don’t need to prove that the trust actually holds the note or that it was properly negotiated into the trust.   You can use a MERS assignment, even though it’s been established that the MERS database is often wrong.  You don’t need to show an unbroken chain of title.

In the non-judicial foreclosure states, you need even less, but my point is that you need so little to foreclose in either type of state that servicers have in numerous instances foreclosed on the wrong homes… yes, even with judicial oversight, the wrong home was foreclosed upon more than once or twice.

And, by the way, should you need any sort of paperwork to effectuate the foreclosure, is absolutely SOP to simply manufacture the documents and forge a signature or two… or three… a few hundred thousand times is fine.  Robo-signing is the norm, and I hear the forgeries are getting better, meaning they’re harder to detect.

Oh sure, Nevada has a new tougher law about these things, and other states are sniffing around the need to change things as well, but the Fed wants a “less cumbersome” foreclosure process?

 

So, what might such a process look like? 

 

Maybe the whole thing could be handled by phone or online?  That would probably cut down on the need for forged documents.  You could just call everything in.  The screen would just ask the foreclosing party a series of questions, like do you have the right to foreclose?  Yes.  Is this borrower in default?  Yes.  After one or two more questions, the servicer could just email the borrower the eviction notice.

 

That would be “less cumbersome.”

 

Look, 85% of homeowners go through the foreclosure process unrepresented by council… they just give up and leave.  Borrowers are not slowing the foreclosure process down or making it too burdensome.  Servicers are, in the vast majority of cases, and by vast I do mean almost all, able to mow down delinquent homeowners at will.

 

Last fall, I believe Treasury officials admitted that they thought HAMP a success because it slowed down the foreclosure process at a time when the banks couldn’t afford to take back that many homes.  That sentence speaks to accounting policy, and it’s why the banks haven’t taken more homes back to-date.  It’s not that the process is too cumbersome.

 

And I absolutely promise you… the Fed knows this intimately.

 

 

WRAP-UP…

 

After those stunningly brilliant and thought-leading insights, the host asked Wessell what the reaction from congress has been… and Wessell replied first by exclaiming what a good question that was.  I sounded like Wessell might have given Green a cookie, if he’d had one in his pocket.

 

Wessell then said the reaction has been “mixed,” and that Sen. Orin Hatch of Utah, a member of the powerful Senate Finance Committee, “sent a blistering letter to Bernanke saying that the Fed is treading on the turf of congress and the regulators and ought to back off and that he’s sure that the Fed wouldn’t appreciate a white paper from congress outlining how the Fed should be thinking about monetary policy.”

 

Ohhh, snap!

 

Wessell went on to explain…

 

“… some people think that this is putting pressure on the regulator of Fannie and Freddie… the FHFA… to do something more to help the housing market during an election season… the Fed says that’s not so.

 

Others say that maybe what the Fed is doing is giving the regulator some cover here by saying that the Fed thinks this is a good idea, it’s in the long-term interests of the taxpayer so we ought to do something here.”

 

Now, Wessell is talking about Ed DeMarco, the guy in charge of the FHFA, which is the conservator for the bankrupt Fannie and Freddie.  We’ve been over this with DeMarco in the past and he’s been very clear that his job is to protect Fannie and Freddie in the short run… period.

 

I want to be blunt here… whoever Wessell got either of those “insights” from… whichever nameless source… they’re both meaningless.

 

In fact, the whole podcast is meaningless, and that’s at some of its most useful moments.  What the heck is going on here?

 

How does the Fed write a white paper and present it to the United State Congress that is packed with proof positive of an entirely inadequate level of knowledge, understanding… education, even?  Am I going to find out that next week, the Fed sends congress a while paper about some issue from 4-5 years ago, and NPR treats it like it’s hot-off-the-press news again.

 

Is this evidence of a time warp of some design?  Am I on the Truman Show and none of this is real?  Are the politicians in D.C. that amateurish and obtuse?  Do our politicians simply not care, because so few of us pay any attention?  And what in the world happened to NPR?  Was that podcast produced for young children with Down Syndrome or some other physically or mentally impaired group?

 

I’m serious about this… I want to know how this podcast exists. It’s not 2008… are the people involved just that shallow as far as to their knowledge of the subject?  If you’re not with me here, I’d suggest you go back and read what was said slowly.  Or, better yet, go up to the third paragraph from the top and you can hear moron one and moron two do idiocy in harmony.

 

That was David Green on Morning Edition on National Public Radio with David Wessell, Economic Editor from the Wall Street Journal, who joins us regularly to talk about the economy…

 

Mandelman out.

Jan
16

Kim v. JP Morgan Chase Bank | Court Sets Aside Foreclosure Sale Where Assignee Of Mortgage Failed To Record Its Interest Prior To Sale

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Jan
16

Bank of America ATMs In San Francisco Turned Into Truth Machines

Bank of America ATMs In San Francisco Turned Into Truth Machines RAN activists took to the streets of San Francisco last night and turned every Bank of America ATM in the city into an Automated Truth Machine. The activists used special non-adhesive stickers designed to look exactly like BoA’s ATM interface. But instead of checking … Read more Related posts:
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  3. “Listen, it’s either settlement or trial today. That’s it” | Florida Cop-Turned-Judge Challenges Banks to Clear Foreclosure Backlog
Jan
16

JPMorgan Chase Bank Foreclosing on O.J. Simpson’s House But Can’t Find Him!

Flori-duh: Bank Foreclosing on O.J. Simpson’s House But Can’t Find Him! Memo to JP Morgan Chase Bank: O.J. Simpson‘s safely tucked away in a Nevada prison. So, if you need to serve him about foreclosing on his South Florida house, send your process server to 1200 Prison Road, Lovelock, Nevada! Showing once again the ridicule … Read more Related posts:
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Jan
16

At Bank of America, the Image Officer Has a Lot to Fix

The Image Officer With a Lot to Fix Her co-star on this day, Bill Clinton, is waiting offstage. The audience shifts in its seats. The spotlight goes up and … action! It’s a Thursday in early December, at a conference center near Orlando, and Ms. Finucane is busy shaping an image. Or, rather, trying to … Read more Related posts:
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Jan
14

Are they lying or are they stupid?


 

I was born and raised in the Northeast… born in Manhattan… father’s family from Boston with too many Harvard grads to count… and I grew up in Pittsburgh.  As a result… well, it’d be more than safe to say that I’ve never been at risk of being confused with a Southerner.  To my knowledge, after meeting me, nary a soul has later posited: “I forgot to ask, is Martin originally from Alabama or Mississippi?”

 

Truth be told, people from the Northeast are not bothered in the least by the fact that they’re never mistaken for Southerners.  Truth be told, as soon as many Northeasterners hear an opinion uttered in a Southern accent, we get tempted to respond by saying things like, “Thanks Ebb.  Now go on… don’t you have a lunch counter to segregate, or something like that?”

 

All right, calm down… it’s a joke… sort of… but my point here is that I’m familiar with the pompous air of intellectual superiority invariably inbred in the stereotypical cartoon Northeasterner, but let’s face it… you held onto the whole segregation thing far too long, and whenever there’s controversy over whether evolution should be taught alongside “creation science,” in public schools, it’s never coming out of Philadelphia.

 

Alright, I’ll stop fooling around… you know what I’m saying, and besides my point is that while I perhaps used to be capable of leaning that way when it came to southern accents, once I turned 18 years of age, enlisted in the United States Air Force, and found myself sans hair wearing fatigues and combat boots and saluting second lieutenants like they were four-star generals, all that Northeastern intellectual superiority crap flew straight out the window… of the pick-up truck for which I was now inexplicably longing.

 

 

You meet and come to respect all kind of folk when you serve in the U.S. military, and before you know it you’re craving SOS on toast, and saying, “Thank you, Ma’am,” with Gomer Pyle-like enthusiasm for the extra scoop of sausage gravy ladled onto your plate.

 

The fact is, joining the service, as we used to call it, does wonders to wipe any sort of superior smirk of your face, no matter how it got there in the first place.  You act like an idiot at the NCO Club bar, as I did once just after my 21st birthday, and a Master Sargent cured me of that little behavioral shortcoming with just one punch to my not-so-superior nose.  Say what you will about his methods, but that man knew how to get a point across.

 

So, why was I telling you about all this?  Heck if I know.… no, wait… I remember… it’s because although I grew up in the Northeast, over the years I’ve learned to love the English language as spoken by those that hail from our nation’s southernmost states.  It’s not that I still didn’t cringe just a little every time Jesse Helms stepped to the podium, but I sure do love the way Southerners communicate with each other.

 

 

I remember sitting at the counter of a Waffle House in the Florida panhandle one time, watching these two women waitresses interact as they went about their work serving us all breakfast one morning.  One woman was clearly the more experienced of the two, and you could tell that she was in charge, even though they were both taking orders and refilling coffee cups as they communicated back and forth with each other as needed.

 

The less experienced waitress was having a problem with the coffee maker and figured she’d solicit help from her more experienced co-worker by calling out to explain the specific nature of the problem she had brewing.  Without missing a single beat in the tempo of the dialog, her more experienced co-worker replied in a tone and cadence straight off of the Steel Magnolia’s set: “Why Sugaah, I’m sure I don’t caahar.”

 

And that was that… the problem got solved and I can’t remember how… it didn’t matter… and I returned to my biscuits and gravy.

 

See, the New York City version of that same sentiment would have been something like, “Hey, what do I look like, Mrs. Coffee over here?  Figure it out yourself, bafangool.”  And then, silently… the patrons would have immediately divided into two camps, with half agreeing that the less experienced waitress was in fact, bafangool… and the other half thinking the more experienced waitress was a jerk… picking back up a dollar or two that they were about to leave her as a tip before she had revealed her true self through her chosen reply.

 

“Why Sugaah, I’m sure I don’t caahar,” was a much better way of saying things.  It was Southern speak for… “F#@k you,” but in a way that didn’t make anyone feel like taking sides.

 

So, why am I going the long way around the barn telling you this story?  Well, because of Federal Reserve Chairman Ben Bernanke, silly.  Aren’t you following me yet?  Okay, let me spell it out for you.

 

Yesterday, the Federal Open Market Committee or FOMC, which is a group of Federal Reserve Bank presidents and members of the Fed’s Board of Governors, that since being established by the Banking Act of 1933, meets eight times a year to set “monetary policy” by establishing the Fed’s short-term “open market operations,” which is what they call it when the Fed buys and sells U.S. Treasury securities.

 

 

The FOMC sets the target for the “federal funds rate,” the interest rate that banks charge each other for overnight loans, and that target rate impacts the interest rates charged on various loans to both businesses and consumers, which in turn impacts the U.S. money supply.

 

(If that’s all Geek to you and you’re interested in learning more about how it all works, here’s a link to a Wikipedia page about the FOMC, or send me an email and I’ll be happy to help you translate it from finance geek to regular English.)

 

Anyway, the FOMC releases transcripts of it’s meeting minutes and slide presentations five years after they’ve taken place, and yesterday the 2006 meeting transcripts were made public.  (You can find the entire year of 2006 FOMC transcripts, etc. HERE.  However, please consult your physician before reading too much of them, as certain combinations of medications and FOMC transcripts can lead to depression and suicidal thoughts… I’m pretty sure.)

 

That’s why you’ve seen a flurry of articles over the last 48 hours talking about how Bernanke, who assumed the throne in 2006, following the Reign of Greenspan that had lasted as long as anyone could remember, had totally blown it as far as seeing what the housing bust would bring.

 

Now, first let me just point out that none of this should be considered “news,” unless of course you’ve been incarcerated in Kazakhstan until quite recently, and even then, I have it on good authority that many Eastern Block prison guards were involved in flipping condos in Tampa, so you should have even been able to keep up with U.S housing market news from there.

 

That Bernanke blew it as related to the housing bust is legendary, although at this point, he’s blown it on so many other pivotal events that criticizing him for this is about like going after Joseph Stalin for overlooking the idea of a Bolshevik dental plan for Siberia’s Gulag-imprisoned dissidents.

 

Quite a few of my readers obviously felt as if this newly released evidence that Bernanke had in fact blown it would exert a vindicating influence on my psyche, as I’ve been known to rail on about how Bernanke couldn’t keep a hot dog stand on Atlantic City’s boardwalk open for the summer, let alone handle the responsibilities of guiding our country through what will someday be understood to have been, the Great Depression Part Deux… so, many sent me links to the plethora of “Ben blew it” type stories.

 

 

I, however, had already visited my personal physician and had him write me a note excusing me from having to expose myself to the 2006 FOMC transcripts… hey, I turned 50 this year and you just have to start limiting the risks you take at a certain point.  I mean, no one lives forever, and although I once went out on Lake Erie in a metal canoe during a lightning storm after drinking, as I recall, about half a gallon of Thunderbird wine, I was like 18 at the time and thus invincible.

 

Today if I tried something like that, I’d need to stop for Dramamine and TUMS at the very least, and then I’d realize that I didn’t really have the right shoes on, talking myself out of the whole thing and ending up back at the room in time for “The Daily Show,” with Jon Stewart, and perhaps some skim milk and Nilla Wafers if I felt like I needed a treat.

 

After maybe a dozen calls alerting me to the FOMC’s release of 2006 meeting transcripts, and another 25 people sending me links to this new evidence of Bernanke’s boobery, I somehow weakened and clicked on one that took me to AP ‘s coverage of the apparently earth shattering news.

 

Here’s how the story began…

 

WASHINGTON (AP) — Ben Bernanke presided over his first meeting as Federal Reserve chairman in March 2006 believing the nation’s economy could pull off a “soft landing” from falling home prices. Three months later, Bernanke had begun to grasp that he and others had underestimated the risk housing posed to the economy.

 

Okay, so… no.  That’s not even true.  Three months later than March of 2006 Bernanke realized he had underestimated something related to risk to the U.S. economy?  No, sir… not a chance in the world that’s even close to correct.  In fact, there’s so much wrong with that sentence, that I don’t even know where to begin, so all I’m going to say is…

 

“Why Sugaah, I’m sure I don’t caahar.”  And let’s move further into AP’s article…

 

Newly released transcripts of Fed meetings during Bernanke’s first year as chairman show that, among Fed officials, he often expressed the most concern about housing. But no official, according to the transcripts, recognized the extent of the damage a housing bubble would cause. A year later, the housing market’s collapse helped send the nation into its worst recession since the Great Depression.

 

Nope… again that is not a correct statement.  Do you see the inconsistencies here?  A minute ago the article said that Bernanke had realized something three months after March of ’06, which would have been June of ’06.  Now the article is saying that it was a year later that the housing market collapsed, sending us hurdling towards rampant overuse of Depression era metaphors.

 

Let’s keep going…

 

In fact, Treasury Secretary Timothy Geithner, then a Fed official, expressed confidence in September 2006 that “collateral damage” from housing could be avoided.

 

Well, big beans for Timmy.  In September of 2006, the housing bubble had barely even started to deflate… credit was still flowing like boxed wine at a Sunday afternoon Open House in Phoenix.  Heck, Bear Stearns wasn’t even institutionally lying to clients yet, and someone was able to convince BofA CEO Kenny Lewis that Countrywide was worth $4 billion.

 

(Besides, when Tim said that he thought we could avoid “collateral damage,” he was probably referring to FDIC Chair Sheila Bair.  I’m told that was his pet name fore Sheila… “Collateral Damage.”  Don’t look at me like that, that’s what I was told… prove I wasn’t.)

 

Back to the AP article…

 

… Geithner, who was then president of the Fed’s New York regional bank, expressed more confidence that the economy could weather the troubles in housing, saying the issue would be the impact on consumer and business spending.

 

The discussion by the members of the FOMC, the Fed board members in Washington and 12 regional bank presidents, gave no indication that any of them foresaw the devastating impact that the collapse of the housing bubble would have. The country fell into a deep recession and severe financial crisis that led to the loss of more than 8 million jobs.

 

Stay with me here… are you starting to see where this is going?

 

So, first of all we see that Tim Geithner is a babbling brook.  He’s talking about the economy “weathering” a cooling off of the housing market and how the issue would be some resulting impact on “consumer and business spending.”  Why is he saying that?

 

“Why Sugaah, I’m sure I don’t caahar.”  Let’s keep going…

 

Bernanke and other Fed officials have said that they failed to see the severity of the shock waves from the housing bust. But the transcripts of their closed-door discussions in 2006 provide new details about how the central bank was responding to the unfolding crisis.

 

No they don’t.  The transcripts don’t provide any “new details about how the central bank was responding to the unfolding crisis,” unless maybe this reporter is 11 years old and everything he reads is to him, a “new detail.”  The transcripts could provide any such new detail, because the crisis hadn’t happened yet.

 

The “crisis,” we’re all referring to today didn’t begin until August of 2007.  The official “recession,” didn’t officially begin until December of 2007, and it wasn’t announced as having begun in December of 2007… UNTIL NOVEMBER of 2008.

 

And the article wraps up with…

 

The transcripts of the final meeting of the year, in December, showed that Bernanke was still expecting that the economy would experience a “soft landing” in which growth would slow enough to cool inflation but not drop into a recession.

 

You see, as I’ve written many times in the past, our “CRISIS” has never been the deflating of a housing bubble.  It would have been… but it wasn’t.  It would have been… but in July of 2007… a year after the housing bubble started deflating in earnest, the sudden downgrading of debt securities tied to mortgages caused investors to turn cold essentially overnight, the credit markets froze solid making loans far less available overnight… and soon very near entirely unavailable.

 

Home prices went into a free fall, and various fleeting stimulus programs and tax incentives notwithstanding, they continue in that free fall today.

 

As more and more homeowners found themselves underwater, owing more than their home’s value… life events such as job loss, divorce and illness/injury started fueling foreclosures, which added to the other forces that were also creating record numbers of foreclosures… and the deflationary spiral slowly but steadily gained speed incinerating to-date more than $10 trillion in consumer wealth and eroding state revenues at an increasingly alarming pace.

 

The reporter who wrote the story for AP News referenced above, simply lacked the knowledge base to interpret the FOMC meeting transcripts.

 

The transcripts, in a way, do show that Bernanke and the Fed missed the housing bust, but only because the housing bust was entirely eclipsed by the global credit crisis, and that’s what we’ve been dealing with ever since the summer of 2007.

 

Want to have some fun?  Come with me… follow the bouncing boobs, Ben Bernanke and Hank Paulson… and don’t forget to watch the dates… with compiled quotes courtesy of austrianfilter.blogspot.com.

 

March 28th, 2007 – Ben Bernanke: “At this juncture . . . the impact on the broader economy and financial markets of the problems in the subprime markets seems likely to be contained.”

 

April 20th, 2007 – Paulson: “I don’t see subprime mortgage market troubles imposing a serious problem. I think it’s going to be largely contained.  All the signs I look at show the housing market is at or near the bottom.”

 

June 20th, 2007 – Bernanke: (the subprime fallout) “will not affect the economy overall.”

 

July 12th, 2007 – Paulson: “This is far and away the strongest global economy I’ve seen in my business lifetime.”

 

October 15th, 2007 – Bernanke: “It is not the responsibility of the Federal Reserve – nor would it be appropriate – to protect lenders and investors from the consequences of their financial decisions.”  (That was the last time we heard from Bernanke on this subject until February of 2008.)

 

February 29th, 2008 – Bernanke: “I expect there will be some failures. I don’t anticipate any serious problems of that sort among the large internationally active banks that make up a very substantial part of our banking system.”

 

February 28th, 2008 – Paulson: “I’m seeing a series of ideas suggested involving major government intervention in the housing market, and these things are usually presented or sold as a way of helping homeowners stay in their homes. Then when you look at them more carefully what they really amount to is a bailout for financial institutions or Wall Street.”

 

March 16th, 2008 – Paulson: “We’ve got strong financial institutions . . . Our markets are the envy of the world. They’re resilient, they’re…innovative, they’re flexible. I think we move very quickly to address situations in this country, and, as I said, our financial institutions are strong.”

 

March 18th, 2008 – Bear Stearns Bailout Announced

 

May 7, 2008 – Paulson: ‘The worst is likely to be behind us,”

 

May 16th, 2008 – Paulson: “In my judgment, we are closer to the end of the market turmoil than the beginning.”

 

June 9th, 2008 – Bernanke: Despite a recent spike in the nation’s unemployment rate, the danger that the economy has fallen into a “substantial downturn” appears to have waned,

 

July 16th, 2008 – Bernanke: (Freddie and Fannie) “…will make it through the storm,” “… in no danger of failing.  … they are adequately capitalized.”

 

July 20th, 2008 – Paulson: “It’s a safe banking system, a sound banking system. Our regulators are on top of it. This is a very manageable situation.”

 

August 10th, 2008 – Paulson: “We have no plans to insert money into either of those two institutions.” (Fannie Mae and Freddie Mac)

 

September 8th, 2008 – Fannie and Freddie nationalized. The taxpayer is on the hook for an estimated $1-1.5 trillion dollars. Over $5 trillion is added to the nation’s balance sheet.

 

September 19th, 2008 – Bernanke: “… most severe financial crisis” in the post-World War II era. Investment banks are seeing “tremendous runs on their cash. Without action, they will fail soon.”

 

September 21st, 2008 – Paulson: “The credit markets are still very fragile right now and frozen. We need to deal with this and deal with it quickly.  The financial security of all Americans … depends on our ability to restore our financial institutions to a sound footing.”

 

September 23rd, 2008 – Paulson: “We must [enact a program quickly] in order to avoid a continuing series of financial institution failures and frozen credit markets that threaten American families’ financial well-being, the viability of businesses, both small and large, and the very health of our economy.”

 

Look… are you feeling me here?  Do you see what I’m saying?  What’s the deal?  Are they lying or are they stupid, because there’s no way in the world we should be talking about whether the FOMC meeting transcripts show Bennie and the Feds missed the housing bust.

 

So, to everyone who sent me the news of the FOMC’s transcripts being released… thank you.  I always appreciate it when my readers send me links to news events they think I should know of, so don’t let my sarcasm about the whole thing prevent that from happening in the future.  But on this subject, I don’t need to be vindicated… what I need is for people to realize how distorted the coverage of the subject has been from the beginning.

 

Think about it… the banks and the mainstream media have us looking for love in all the wrong places.  We’ve been told to blame borrowers, brokers, servicers… everyone but the bankers who caused the global credit crisis and have continued to defraud… well, everyone involved as they’ve driven our nation’s economy to new lows.

 

And in the event that you’ve read all of this and still don’t agree, then at this point all I can think of to say to you is…

 

 

“Why Sugaah, I’m sure I don’t caahar.”

 

Mandelman out.

Jan
13

The Quiet Man… Utah Attorney Walter Keane – A Mandelman Matters Podcast

 

Utah Attorney Walter Keane is the lawyer that filed four quiet title claims last year, which means he was seeking to obtain a court order granting clear title to the properties in question.  And all four were granted by the Utah courts… four quieted titles to the four homes.  And at least one of the homeowners subsequently sold his home and went on his very merry way.  This month’s in Harper’s magazine, Christopher Ketcham wrote a feature story about Walter, among other things, titled: “STOP PAYMENT! A homeowners’ revolt against the banks.” 

I got to know Chris Ketcham as he was writing the story for Harpers, and yes I was a bit concerned that Walter’s experience obtaining quiet title would be met with… well, I don’t know… problems of one sort or another… and sure enough the state appeals court ended up saying no way.  Free houses are just few and far between, so what’s new?  Maybe if Walter Keane was your average foreclosure defense attorney, the story would have ended there, but Walter is anything but average… in fact, he’s nothing if not interesting… fascinating even.  So, the story is not over, far from it. In fact, he’s more fired up than ever to help homeowners battle the banks.

Walter Keane is a very knowledgable and experienced lawyer who is also an out-of-the-box thinker.  I really enjoyed interviewing him on this podcast, and whether you’re a homeowner or foreclosure defense attorney, I think you’ll find him sincere, interesting, smart… and very entertaining. You can find out more about him at his firm’s Website: www.waltertkeane.com.

This podcast is divided into Part One and Part Two.  Part One is all about the quiet title experience, but in Part Two the real fun begins.  Click PLAY below for Part One… and then come back for Part Two when you’re ready.

He’s The Quiet Man… Utah Attorney Walter Keane…

a Mandelman Matters Podcast

PART 1:

###

PART 2:

Mandelman out.

Jan
13

Arizona | M & I vs. Mueller – Appellate Ruling Says Actual Occupancy of Home is Not Necessary, Bars Lenderr from Pursuing Deficiency Judgement

Court: Statute also protects would-be owner Appellate ruling says actual occupancy of home is not necessary A would-be homeowner has the same right to walk away from a mortgage as someone who already is living in the house, the Arizona Court of Appeals has ruled. The judges acknowledged that laws which bar lenders from pursuing … Read more Related posts:
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Jan
13

Can We All at Least Agree on This?

 

 

Oh, I know… it’s such a complex problem we’re having lately.  Clearly, it’s far too complicated a problem for any normal mortal brain to grasp…. there seems no hope that we shall ever be able to come to terms with what’s transpired.

 

Fine.  Absolutely ridiculous… but fine, I guess.  It’s rocket surgery… so be it.

 

It’s no wonder that we’re struggling to understand things, because according to some, the contributing factors to today’s too-complicated-to-understand crisis go all the way back to 1979.  I’m frankly surprised no one has tracked its roots back to the 1930s… although as I say that, I’m sure some have done just that.  Some are even blaming excessive regulation, a claim so entirely preposterous that it defies imagination.  To blame our global economic meltdown on excessive regulation, is like blaming 9-11 on excessive airport security.

 

The Attorneys General in Nevada, Massachusetts, Maryland, Arizona, and it is all but certain that there will be others to be named later, have all filed foreclosure process related lawsuits that read like John Grisham novels and in a few cases have even brought criminal charges having to do with what is clearly rampant forgery and fraud in the foreclosure process.

 

The Office of the Comptroller of the Currency (“OCC”) concluded their investigations in April of 2011, issuing “consent orders,” which basically said that the bankers were guilty of unsafe and unsound practices related to foreclosures, also specified a laundry list of felonious acts and nefarious behaviors.

 

And, although many are complaining… and perhaps justifiably so… about the absence of criminal prosecutions related to the bankrupting of our financial institutions, we have seen some record-setting settlements to civil lawsuits brought by the SEC… the agency’s settling with Goldman Sachs for $550 million related to the bank’s lack of disclosure in the Abacus 2007-AC1 CDO comes immediately to mind.  Oh, I know… GS admitted no wrongdoing, but that’s the sort of statement issued to placate lawyers and young children.  No one agrees to pay half a billion dollars for doing nothing wrong.

 

The proposed $285 million mortgage securities fraud settlement between Citigroup and the Securities and Exchange Commission was more of the same non-admission nor denial of guilt silliness, but at least it was rejected by Judge Jed Rakoff who described the deal as being “neither fair, nor reasonable, nor adequate, nor in the public interest,” and further that it deprived the public “of ever knowing the truth in a matter of obvious public importance.”

 

Citi is to face trial over the allegations in July 2012, but grown-ups should all know the score here… these banks were dirty in their dealings and they are guilty as all get out.  If that weren’t true, they would not be readily offering to settle for three hundred million dollars, and saying that the settlement does not include an admission of guilt is laughable.

 

There’s also a cadre of class action lawsuits against banks and mortgage servicers whose complaints filed with the courts make damn clear that laws have been broken with reckless abandon, regardless of the settlements-to-come, which I’m sure will also be delivered in no admission of guilt wrapping paper.

 

Okay, but for the moment anyway… I’m going to say something that will no doubt bother many engaged in the battle for truth, justice and the American way: So what and who cares?

 

I don’t want to debate with anyone whether they think the problem is bigger than I’ve made it out to be… or smaller.  That’s right… I don’t care which side of this fight you’re on.  For the purposes of this article, you can be a foreclosure defense fanatic who believes that our democracy, the rule of law, and entire free world’s fiscal future hangs in the balance, or you can be a banking industry apologist still claiming a victory in the Ibanez decision and describing robo-signing as merely dotting t’s and crossing i’s… and I don’t care which.

 

In simpler terms, maybe you think the situation related to foreclosures in this country is a floor wax… or maybe you see it as being a desert topping… my point here applies equally across the board regardless of your view.

 

However the debate is ultimately resolved, whether foreclosures are ultimately judged floor wax or desert topping… can we all agree on one thing?

 

The ANSWER to the problems we’re debating related to foreclosures CANNOT and WILL NOT be allowed to be forging signatures on fraudulent documents presented in courts and recorded in our public records.  Can we all please agree that there is NO CHANCE THOSE ARE THE ANSWERS… and I don’t give a rat’s petute how you want to frame the questions… the solution cannot be forgery and fraud, right?

 

It’s become abundantly clear that Wall Street’s investment bankers, in their bubble-inspired rush to securitize anything with the potential to generate a payment stream, and then rip someone’s face off, derivatively speaking… they screwed up everything but their bonus calculations.  (That documentation they unwaveringly get right, don’t you know.)

 

Who owns your loan?  I don’t know… and for the moment, I don’t care.  Is the MERS business model salubrious and copacetic, or has it undermined and permanently destroyed property rights in this country?  Not sure, and for the moment not interested.

 

Did investors invest in “Mortgage-backed Securities?”  Or, does the acronym MBS more appropriately stand for, “Mouthy-backed Sacrilege,” or perhaps, “Monetary-babbled Sacrifices?”  For the purposes of today’s discussion… just give it a rest.

 

 

For the moment, I don’t care about Pooling and Servicing Agreements unless they are in place to make sure a pool stays both clean and heated through the winter months.  And if the word “tranches” is really French for “slices,” then I’ll take a couple of tranches of the French Toast, three tranches of bacon, not too crispy, and your finest maple syrup, Garçon.

 

And I recognize that there is a veritable cluster of you still insistent that the irresponsible acts of Stockton, California’s homeowners effectively eviscerated all of Wall Street’s investment banking powerhouses along with most of the Sovereign Wealth Funds on the planet… and for today… why not… have at it.  For today, I’m even willing to endure your distinctive brand of faith-based foolishness.

 

But… regardless of how the questions associated with the foreclosure crisis continue to be answered, whether in the courts or state legislatures, we should be able to agree that whatever the questions are… the answer isn’t to allow forgeries of signatures on a fraudulent documents in order to evict someone from a home that can’t be sold for years anyway.  Fraud and forgery are never the answer to anything in a society governed by the rule of law.

 

If that is going to be allowed to happen, we… and I mean WE, as in ALL OF US… should demand that we stop signing such things altogether.  If a Linda Green look-a-like is going to sign a fraudulent affidavit so that it can be illegally notarized… just don’t sign it or notarize it. 

 

We don’t need to sign and notarize things if we are committing fraud and forgery every time we do so.  And we very clearly are… it is NOT, as the banks have told us in the past… any sort of isolated incident.

 

How do we know that?  It’s simple.  Nevada gave us the proof when it passed Assembly Bill 284, which took effect in October 2011. 

 

 

The new state law requires those foreclosing on a home to file an affidavit proving they have the right to bring the action — and it increases civil and criminal penalties for using fraudulent documents in a foreclosure.  That same month, foreclosures in Nevada declined by 75 percent.

 

History cannot be permitted to look back on this crisis and say… well, we fixed it looking the other way on issues that are quite literally forgery and fraud.  It’s as simple as that.  I don’t care who is or isn’t making their mortgage payment… that’s irrelevant.  I don’t care if it’s inconvenient for the banks to do something else.  But we cannot continue to allow our nation’s financial institutions to lie about the nature of the problem and then continue to attempt to solve whatever it is through rampant forgery and fraud.

 

It has to stop and I do mean NOW.  If you are reading this and you don’t see it the same way, you either lack the capacity for rational thought… or you are just an ass who would be well-served to avoid debating me in public, I assure you.

 

Euphemistically, they’re called austerity measures.  They hurt the oldest, youngest and poorest in a society.  And although you may not feel their sharp edge quite yet, such programs are very much upon us.

 

Those who know me know my views about foreclosures today.  In my view, it’s an economic crisis of endemic proportion that is needlessly incinerating the accumulated wealth of our country’s middle class to such a degree that at 50 years old, the idea of recovery in my lifetime is already laughable.  I see the foreclosure crisis as nothing more than a lose-lose scenario… a pointless race to a cancerous bottom with no prospects for winners to be present at its finish line.

 

I also see the foreclosure crisis through its numerical realities that will soon leave us with no choices… no options… like flotsam and jetsam, a society entirely lost, doomed to invariably and inadequately react, but with no hope of meaningful improvement.  I see the iceberg dead ahead, as the band plays on.

 

According to the Center on Budget and Policy Priorities, states are facing record shortfalls in fiscal year 2012 because state tax collections remain low, the cost of providing services is rising, and emergency federal aid has largely been depleted.  In 2012, state budget shortfalls started at $103 billion, but some percentage of that amount has already been closed by spending cuts as shown below.  However, 24 states have already projected shortfalls totaling $46 billion for FY2013.  As more states prepare estimates, this total is likely to grow.

 

The U.S. Census Bureau reports declines in state tax collections during this economic slowdown are the worst ever.  Sales taxes provide the largest source of state tax revenue, and they are steadily declining due to reductions in personal consumption and business purchases. Income taxes and other taxes are also falling as wages and investment income decline.

 

Of course, spending cuts also reduce economic growth even further.  With the federal aid for states now essentially over, taxes have to be increased and at least 30 states already have enacted tax increases, closed loopholes, restricted tax credits, increased tobacco taxes, raised tuitions, or implemented other revenue-raising measures.

 

And for those who think they are somehow going to remain above it all… the plain fact is, tax increases on higher-income families are understood to be the least damaging mechanism for addressing state fiscal deficits in the short run. Cutting government spending, or reductions in transfer payments to lower-income families have been proven to be more damaging to a state’s economy than tax increases focused on higher-income families.

 

When this has happened in Europe, we call them “austerity programs,” and they negatively and significantly impact everyone.  As I’ve assured my readers on countless occasions, no one is getting out of this unscathed.

 

In California and Massachusetts, recent studies have been conducted to quantify the monetary costs directly attributed to the foreclosure crisis.  Massachusetts found the grand total to be $4 billion a month, including lost equity, a number especially striking because it’s twice the amount forecasted by the CBO in 2007-08.

 

California’s study, conducted by the California Reinvestment Coalition in conjunction with the Alliance of Californians for Community Empowerment, broke down the costs of the crisis by county.  The following represents the costs of foreclosures for Los Angeles County alone, realized to-date:

 

  • Costs to local governments – $19,229 PER FORECLOSURE for increased costs of safety inspections, police and fire calls, trash removal, and maintenance.  Total costs to LA County to-date… $1.2 billion.

 

  • Property tax revenue losses of $481 million.

 

  • Homeowner equity lost to-date – $78.8 billion.

 

  • Between 2008 – 2012 Californians will have lost 2 million homes to foreclosure.  The costs to the state’s homeowners, local governments and property taxes are estimated to be $650 BILLION statewide.

 

For fiscal year 2012, California faces a $9.6 billion budget shortfall.  The state has already cut nearly all funding for services supporting HIV/AIDS patients, and it has completely eliminated funding for the state’s domestic violence shelter program and maternal, child, and adolescent health programs.

 

In addition, California has cut funding for the state’s Healthy Families program, the state’s CHIP program. To make up for the lost funds, the nearly 1 million children in the program will have to pay more for visits to health care providers, and many will have to pay higher premiums as well. These cost increases are certain to cause some percentage of families to drop from the program.

 

These types of cuts to state spending are only the tip of the iceberg, no pun intended. 

 

  • An estimated 8,200 families in Arizona lost eligibility for temporary cash assistance. The time limit for that assistance was cut to 36 months from 60.
  • Alabama has ended homemaker services for approximately 1,100 older adults. These services often allow people to stay in their own homes and avoid nursing home care.
  • Colorado cut public school spending by $260 million, nearly a 5 percent decline from fiscal year 2010. The cuts equal more than $400 per student.
  • Florida’s 11 public universities raised tuition by 15 percent for the 2010-11 academic year and with a similar increase in 2009-10, means a total two-year increase of 32 percent.
  • In Minnesota, as a result of higher education funding cuts, approximately 9,400 students lost their state financial aid grants entirely, and the remaining state financial aid recipients will see their grants cut by 19 percent.
  • Virginia’s $700 million in K-12 education cuts for the current biennium include the state’s share of school district operating and capital expenses, and funding for class-size reduction in Kindergarten through third grade.
  • Washington reduced assistance for thousands of people physically or mentally incapacitated and unable to work in 2011. For 28,000 adults enrolled in the state’s Disability Lifeline program, the typical monthly benefit has fallen by $81 to $258 from $339.
  • Changes in Connecticut’s Medicaid program will result in over 220,000 pregnant women, parents, caretaker relatives and disabled and elderly adults losing coverage for over-the-counter medications and nutritional supplements.
  • Massachusetts has cut $2.2 million from HIV/AIDS prevention programs, and cut dental benefits for approximately 700,000 low-income residents. The cuts also ended a health insurance program for low-income legal immigrants.
  • Michigan will end a medical coverage program for 950 adults with dependent children unable to afford employer-sponsored health insurance after transitioning from welfare to work and exhausting the 12-month transitional medical assistance available to them.
  • New Hampshire’s fiscal year 2011 budget reduced the state hospital’s beds by 15, which will result in 500 fewer patients treated per year.
  • New Jersey’s cuts will result in approximately 50,700 low-income adults losing access to health care coverage.
  • Washington is increasing premiums by an average of 70 percent for a health plan serving low-income residents.  Premiums for the poorest plan members will double and are expected to cause between 7,000 and 17,000 enrollees with no medical plan coverage.
  • Several states, including California, Michigan, Nevada, and Utah, have dropped coverage of dental and/or vision services for adult Medicaid recipients.

And that’s not even close to the whole story on what are a growing number of austerity programs that will soon be felt by every American citizen in one way or another.

  • At least 31 states have implemented cuts that will restrict low-income children’s or families’ eligibility for health insurance or reduce their access to health care services.
  • At least 29 states plus the District of Columbia are cutting medical, rehabilitative, home care, or other services needed by low-income people who are elderly or have disabilities, or are significantly increasing the cost of these services.
  • At least 34 states and the District of Columbia are cutting aid to K-12 schools and various education programs.
  • At least 43 states have cut assistance to public colleges and universities, resulting in reductions in faculty and staff in addition to tuition increases.
  • And at least 44 states and the District of Columbia have made cuts affecting state government employees.

The Center on Budget and Policy Priorities also reports that at least 34 states and the District of Columbia have cut spending on K-12 educational programs…

  • Arizona eliminated preschool for 4,328 children, funding for schools to provide additional support to disadvantaged children from preschool to third grade, and funding for books, computers, and other classroom supplies. The state also halved funding for kindergarten, leaving parents with the cost of keeping children in school beyond a half-day schedule.
  • California reduced K-12 aid to local school districts by billions of dollars and cut a variety of programs, including adult literacy instruction and help for high-needs students.
  • Colorado reduced public school spending in FY 2011 by $260 million, $400 per student.
  • Georgia cut state funding for K-12 education in FY 2011 by $403 million.  The cut has led to exempting local school districts from class size requirements.
  • Hawaii shortened the school year by 17 days and furloughed teachers for those days.
  • Illinois cut school education funding by $311 million in 2011.  Cuts included the elimination of a grant program intended to improve the reading and study skills of at-risk students from kindergarten through the 6thgrade.
  • Mississippi cut by 7.2 percent funding for the Mississippi Adequate Education Program, a program to bring per-pupil K-12 spending up to adequate levels in every district.
  • Massachusetts cut state education aid by $115.6 million in FY 2011.  It also made a $4.6 million, or 16 percent cut to funding for early intervention services, which help special-needs children.
  • New Jersey cut funding for afterschool programs aimed to enhance student achievement and keep students safe between the hours of 3 and 6 p.m. The cut will likely cause more than 11,000 students to lose access to the programs and 1,100 staff workers to lose jobs.
  • North Carolina cut by 21 percent funding for a program targeted at small schools in low-income areas and with a high need for social workers and nurses. As a result, 20 schools will be left without a social worker or nurse.
  • In Virginia a $500 million reduction in state funding for some 13,000 support staff such as janitors, school nurses, and school psychologists was made permanent.

Other services are being cut as well…

  • California is eliminating cost-of-living adjustments to assistance programs for low-income families and cutting child care subsidies.
  • Colorado is cutting payments for mental health providers and eliminating funding for treatment for an estimated 626 patients each year in the state’s mental health institutes.
  • In Connecticut, the governor has ordered budget cuts that help prevent child abuse and provide legal services for foster children.
  • The District of Columbia cut its homeless services funding by more than $12 million, or 20 percent. It also reduced its cash assistance payments to needy families and cut funding for services that help low-income residents stay in homes and communities.
  • The South Carolina Department of Juvenile Justice has already lost almost one-fourth of its state funding, resulting in over 260 layoffs and the closing of five group homes, two dormitories, and 25 after-school programs.
  • Connecticut, Delaware, Maryland, Michigan, Minnesota, New Hampshire, New Jersey, New YorkOhioRhode IslandVirginiaWisconsin, and Wyoming, have implemented reductions in funding for policing, child care assistance, meals for the elderly, hospice care, and various services for veterans and seniors.

 

The U.S. Bureau of Labor Statistics reports that state spending cuts are having a significant impact on employment. The total number of people employed by state and local governments has fallen by over 400,000 since August 2008, while the need for services produced by those workers has increased.

 

We’ve ignored it so long it’s become insurmountable… well, that’s just great.

 

Today, California has 2 million homes in some stage of the foreclosure process… 40 percent have made no payment for over two years, and 70 percent have made no payment for over a year.  If each of the 2 million homeowners availed themselves of just 10 hours of legal assistance, it would require roughly 15,000 years for a lawyer to help everyone.  To get through that workload in a year, we’d need 15,000 trained professionals and attorneys to help… and yet the state continues to offer no guidance to it’s citizens outside of “call your bank or a HUD counselor,” a strategy that hasn’t changed a single thing for the better over the last four years.

 

Quite incredibly, our responses and attempts to mitigate the damage caused by the foreclosure crisis at both state and federal levels have ALL been spectacular failures… and there have been dozens of plans and programs backed by un-spent budgets rising into the hundreds of billions of dollars.  Nineteen “hardest hit states” have received billions… and there is nothing meaningful to show for any of it.

 

Alabama - $162,521,345

Arizona - $267,766,006

California – $1,975,334,096

Florida - $1,057,839,136

Georgia – $339,255,819

Illinois - $445,603,557

Indiana - $221,694,139

Kentucky - $148,901,875

Michigan - $498,605,738

Mississippi - $101,888,323

Nevada - $194,026,240

New Jersey - $300,548,144

North Carolina - $482,781,786

Ohio - $570,395,099

Oregon - $220,042,786

Rhode Island - $79,351,573

South Carolina - $295,431,547

Tennessee - $217,315,593

Washington DC - $20,697,198

 

In point of fact, HAMP is our country’s superstar success by all measures, a program that began with $75 billion, first reduced to $50 billion, and most recently to some $37 billion… while amounts spent to-date are reported by the GAO to be $2.4 billion, and not all of that was spent on HAMP.

 

So, consider this… If we had a crisis affecting hamsters and we budgeted $75 billion or $37 billion to address it… and three years later we had only spent a couple of billion, there would be a national outcry denigrating those in charge as being guilty of cruelty to hamsters.

 

And just in case you weren’t moved by the state budget cuts I listed above, please don’t be lazy about this… read them again.  Put yourself in the shoes of the people who have lost access to the programs described.  And understand that I didn’t even list half of the cuts already in place… not even half.

 

And think about what happens when you take away access to a doctor for a child with special needs from a parent who has nowhere else to turn.  They often find a way, however, a parent’s love knows no bounds.  And sometimes the way they find puts a gun in your face.

 

Mandelman out.

 

 

 

ENOUGH FAILING… NO ONE FAILS THAT MANY TIMES IN A ROW.

Send me your email TODAY and be a registered MandelmanDOER.  We don’t have much time left before none of this matters anymore.  Don’t worry… I only need your email so we can communicate without my needing to post everything on Mandelman Matters… in some things we’ll want the element of surprise.  It’s not any sort of business gimmick… I hate having to keep track of emails, believe me.

 

Jan
13

MERS Suit Seeks Class Status | TREVINO et al v. MERSCORP, CITIGROUP, COUNTRYWIDE, FANNIE, FREDDIE, GMAC, HSBC, CHASE, WAMU, WELLS

MERS Suit Seeks Class Status Plaintiffs suing Merscorp Inc., which runs an electronic mortgage registry system, moved for class certification Thursday in a suit alleging Merscorp overcharged mortgage borrowers during foreclosure and loan modification proceedings. The complaint seeks to represent hundreds of thousands of mortgage borrowers across the U.S. who were subject to enforcement actions … Read more Related posts:
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  2. Xee Moua – Class Action Robo Suit REGINALD JONES, v. HSBC Bank USA, N.A., Wells Fargo, et al
  3. Lawyer Seeks Class Status for Lender Processing Services (LPS) Robo-Signing Lawsuit
Jan
13

American Banker | JPM Chase Quietly Halts Suits Over Consumer Debts

JPM Chase Quietly Halts Suits Over Consumer Debts Robo-signing, or the high-volume production of signed legal documents, has been a key element of the governmental and media foreclosure reviews. Chase’s current pullback raises at least the possibility that at least some banks may have documentation problems in other business lines. Academics and attorneys who defend … Read more Related posts:
  1. JPMorgan Chase and Bank of America, Quietly Reducing Principle Balances for Tens of Thousands of Borrowers
  2. Fraud Anyone? Suits Filed Against Credit Suisse Group AG, Deutsche Bank AG, JPMorgan Chase & Co. and Bank of America Corp
  3. American Banker | Robo-Signing Redux: Servicers Still Fabricating Foreclosure Documents