BANKS DEMANDING AMNESTY FROM NEW BUREAU FOR CONSUMER PROTECTION

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FLAWED MORTGAGE ORIGINATION AT ISSUE

EDITOR’S COMMENT: “If you don’t give us amnesty and allow us to claim value for these ‘assets’ on our balance sheet, we will collapse, and you will be responsible for the ensuing collapse of the financial system.” — That is essentially what the Banks are saying.

The Bureau is not an agency that should respond to such false assertions. With 7,000 OTHER banks that could pick up the pieces already existing in this country the only thing that would happen is that banking would, for a time, become decentralized and the Banking oligopoly would be broken. The Bureau is charged with protecting consumers not selling them out. This demand must be rejected.

The very fact that the Banks are demanding the waiver of liability on mortgage origination should give anyone pause for thought. If they are saying they can’t do the deal without that waiver then they are also saying that they have fatal flaws in the mortgage origination process just as we have been saying on these pages for more than 4 years. Those flaws are not simple “paperwork” problems.

The issues are fundamental to property and contract law. From my perspective, the mortgages are invalid and unenforceable under existing law because they were never perfected into liens against the real property. The notes are defective because they lie about the identity of the lender and give no notice to the borrower or anyone else as to the identity of a party that could execute a satisfaction or even provide an estoppel letter for future closing. And the obligations of the borrower are the result of fraudulent inducement and non-disclosure as to the promises made by third parties in connection with covering the principal and interest on the loan.

BY NICK TIMIRAOS, RUTH SIMON AND DAN FITZPATRICK

SEE FULL ARTICLE IN WALL STREET JOURNAL

Banks are demanding that the Consumer Financial Protection Bureau relinquish the right to sue over certain flawed mortgage originations, in exchange for their participation in a proposed multibillion-dollar settlement of alleged foreclosure abuses.

The banks say their inability to secure a sufficiently broad release from the new bureau, which was sidelined in earlier discussions as it launched, would be a deal breaker. The five biggest U.S. mortgage banks, state attorneys general and Obama administration officials are pushing to finalize a deal before the end of the year that would be worth $19 billion or more.

Tags: bankruptcy, borrower, Consumer Financial Protection Bureau, countrywide, disclosure, foreclosure, foreclosure defense, foreclosure offense, foreclosures, fraud, LOAN MODIFICATION, modification, MORTGAGE ORIGINATION, quiet title, rescission, RESPA, securitization, TILA audit, trustee, WEISBAND
Posted in bubble, Corruption, Eviction, securities fraud |