Survey: Bad Foreclosure Practices Still Rampant

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Editor’s Note: Each time there is a new development in the attempts to get foreclosures settled, modified or mediated the homeowner hits a stone wall. It’s a game. The Banks took the money from investors. That means they were not using their own money. The Banks took out a huge chunk of money as “fees” or “trading profits” by selling loans with inflated values to the investor pools. So before the first loan was funded, the banks were “in the money,” and the investors were out of luck.

Then the Banks used the balance of the funds left after they took they fees. They used it to fund mortgages, buy insurance payable to the banks, buy credit default swaps betting against the investor pools payable to the banks, and in some cases even traded for profit in the mortgage bonds that they had already sold to the investors. Once again, the Banks were in the money.

The point here is that the Banks never owned either the loans nor the mortgage bonds but managed to claim both without objection from the U.S. Government. The Banks own or control (or both) all the trustees, servicers and foreclosure specialist operations giving them some layers of protection against liability for bad acts committed in connection with origination of mortgages and the process of foreclosure, auction, deed upon foreclosure and eviction all in the banks names.

Since the Banks have clearly demonstrated their willingness to use fabricated documents with false declarations of fact contained in those documents and have them forged by unauthorized signatories, it should come as no surprise that the banks have the Obama administration sold on the myth that the banks and servicers are the people with whom we should be doing business. The s-called modifications, satisfactions, settlements and mediation are all a ruse worth no more than a wild deed which is why I keep saying this all comes down to title.

NO! The banks and servicers are the people with whom we should be litigating for committing civil and criminal violations. The people we should be dealing with for modifications, settlements and mediation are the actual people who have an actual interest in preserving their investments — the investors who purchased bogus mortgage bonds.

Using the standards of any reasonable person these investors, if allowed to participate without subjecting themselves to liability, would do some very simple arithmetic: if the homeowner wants a mortgage obligation that equals 125% of the current fair market value and can pay it under favorable terms with low interest and long amortization periods, then the investors clears up all potential title problems and gets far more than the zero, or less than zero they get from the foreclosure process.

The banks and servicers continue to give the misleading impression that they are the ones with whom we should be doing business, but their only economic incentive is to drive the home foreclosure into the ground even if it means literally bull dozing the property into the ground. They “grant” modifications”, “short-sales” and settlements as though they owned the loans when they do not own the loans. But by doing it anyway with the same false documents they use for foreclosures and loan origination, it makes it appear that they are in fact the people to go to as decision-makers. It’s a living lie.

The truth is that there will never be any large-scale change in origination, foreclosures, auction sales or evictions as long as we leave the banks and servicers in charge of the process. They have no interest in doing anything for either the investor or the homeowner.

Like the loan origination, they continue to collect MORE than the fair market value of the property in fees and “trading profits” as the bond market picks up. Each time we negotiate with a bank or servicer without demanding and getting proof that they are in fact the authorized representative of specific investors whose money went into the deal of funding mortgages, we compound the housing crisis, we add to the pile of corrupted titles, and we avoid the real solution to the economic problems that are making the economy sag — we are adding to the money and property that goes to the banks and servicers who at best are conduits or intermediaries with no money nor any other economic interest in the deal.

Survey: Bad Foreclosure Practices Still Rampant

by Meg Handley, www.usnews.com

Tags: 60 minutes, AHMSI, appraisal fraud, attorney general, auction fraud, Chris Koster, credit bids, DocX Indictment, foreclosure fraud, FORECLOSURE SETTLEMENT, foreclosures, forgery, housing market, housing prices, investors, linda green, LPS, Missouri, mortgage fruad, mortgages, Robo-Signing, settlement, strategic default, Wells Fargo
Posted in bubble, Corruption, Eviction, securities fraud |