Why Everyone Should Support Principal Corrections on Mortgages

First, let’s talk to the guy that says homeowners shouldn’t get a break because it would be unfair to him. After all he paid his mortgage and he is still paying his mortgage and nobody is helping him, right? Wrong. Everyone who has a mortgage is getting a federal subsidy. They get to pay less in taxes and the more they owe, the less taxes they pay. That is the interest deduction for home ownership. So the question is not whether homeowners should get help, because they all get help. And if the guy who still has his home doesn’t wake up to the fact that foreclosures mean fewer homeowners and fewer homeowners means that those who want to eliminate the home mortgage interest deduction will get more traction. They already have a number of people in high places who would like this federal subsidy eliminated because it does nothing for big business and big banking. Putting your support into whatever it takes for people to stay in their homes and pay on mortgages, even if they are lower, means more people that would join you in opposition to eliminating the interest deduction. Oppose them and it will cost you thousands of dollars in additional taxes.

Next, those who are ideologically opposed to any relief for someone who stops paying on a loan. They say that if we don’t hold the borrower’s feet to the fire, we will undermine the entire concept of credit because borrowers would think they could walk away from any debt and would do so. The evidence is in. Most borrowers don’t want to walk from their debt. They want the deal they were sold on by the banks — an affordable loan. They didn’t get it because the originators were not acting as banks. The originators were getting paid for signatures not good loans. What is undermining the credit industry is that nobody trusts the creditors and won’t take the deal on hedge products and swaps. It isn’t that the financial world trusts the borrower any more or any less. They don’t trust the banks because they corrupted the loan underwriting process and because it was the banks who screwed up real estate title and obscured the ownership of loans thus freezing the once liquid credit markets that were running very well on the Uniform Commercial Code. Now we are parsing words and splitting hairs — what is a possessor, holder, holder in due course, what is the effect of fabricated loans, assignments, substitutions, notices, auctions, credit bids, deeds and evictions? If you want confidence in the credit markets restored, we must show that we can control the banks so they can’t do this again.

The main reason everyone should support principal correction is that it is a correction. The values used were pure fabrication created to induce pension funds to throw money down a rabbit hole called a “REMIC POOL” and to induce the homeowner into thinking that he was getting the deal of a lifetime. That was fraud. And in this country when someone is defrauded we take the bounty away from the perpetrators and return it to the victims.

Tags: foreclosure fraud, Modification Fraud, mortgage fraud, mortgages, principal correction, principal reduction, taxes, wrongful foreclosure
Posted in bubble, Corruption, Eviction, evidence, expert witness, foreclosure mill, Modification, securities fraud, Servicer |