Beyond Foreclosuregate - It Gets Uglier

http://truthout.org/beyond-foreclosuregate-it-gets-uglier/1304731308

The ForeclosureGate scandal poses a threat to Wall Street, the big banks, and the political establishment. If the public ever gets a complete picture of the personal, financial, and legal assault on citizens at their most vulnerable, the outrage will be endless.

Foreclosure practices lift the veil on a broader set of interlocking efforts to exploit those hardest hit by the endless economic hard times, citizens who become financially desperate due medical conditions. A 2007 study found that medical expenses or income losses related to medical crises among bankruptcy filers or family members triggered 62% of bankruptcies. There is no underground conspiracy. The facts are in plain sight.

ForeclosureGate represents the sum total illegal and unethical lending and collections activities during the real estate bubble. It continues today. Law professor and law school dean Christopher L. Peterson describes the contractual language for the sixty million contracts between borrowers and lenders as fictional since the boilerplate language names a universal surrogate as creditor (Mortgage Electronic Registration System), not the actual creditor. Other aspects of ForeclosureGate harmed homeowners but the contractual problems that the lenders created on their own pose the greatest threats.

When the Massachusetts Supreme Court upheld a lower court ruling that the actual creditor must named in the mortgage agreement (a legal requirement that the banks forgot to meet in their contracts), there wasconsternation on Wall Street. What would happen if a class action lawsuit challenged these flawed mortgages? Isn’t the Massachusetts decision the latest of many attacking the legal basis of the shoddy business practices and boilerplate industry contracts? What if homeowners started walking away from their underwater mortgages based on the legally flawed contracts? If there were a viable prospect of a class action suit against financial institutions threatening to invalidate these contracts, wouldn’t that crash the stock values of the big banks and some Wall Street firms?

More at the link --

And how conveeeenient that the Supremes just outlawed class action lawsuits....

"If there were a viable prospect of a class action suit against financial institutions threatening to invalidate these contracts, wouldn’t that crash the stock values of the big banks and some Wall Street firms?"

There's so much good information in this article. Thanks for posting.

THEY are the biggest threat we have -- WE being the American middle class.

United Citizens was a dead letter until mystery Chief Justice Roberts pulled it up from a lower court. It was so apparent, no hidden conspiracy, just out front fixing. I wrote about the oral argument before the decision came out. Ginsburg's questioning, in the piece, nailed it. She was a very serious scholar and a patriot. Now we've got foreign contributions by definition for every US based corporation with any foreign ownership. In the case of Fox, that would be 10% or above right (the Saudi prince minority share holder). Decline by Design

Foreign Contributions and the Supreme’s Overdue Decision on Campaign Funding

& THNX for reposting this here.

...class-action lawsuits? Really?

I'll Google.

I don't get how that could happen. But then again, corporations are now people.

http://articles.latimes.com/2011/apr/28/business/la-fi-court-class-action-20110428

"Companies can block customers' class-action lawsuits, Supreme Court rules
Justices rule in a Southern California case that firms can force customers to arbitrate their complaints individually. The ruling is seen as a major victory for corporations."

:kick:

at their economic levels is an ADVANTAGE.

The SAME yard stick that is used to chastise our economic class, how much debt anyone is carrying, justifies REWARDS at their level, i.e. how much debt upper-levels in our economic structures carry is a justification to allow them the rewards associated with MORE DEBT.

Debt BAD for the Middle Class and lower.
Debt GOOD for the Upper Middle and higher.

When is excessive debt good for anyone?

or else . . . it's going to cost us X number of jobs.

Isn't that the basic concept of executive compensation? "Let's pay this person XXXXXXXX$s, because s/he has a,b,c relationships all of which represent somekind of promise to deliver (or NOT deliver) something."

Isn't that the whole concept of a credit score? "We will not lend even this small amount to A, or we will lend it only at ridiculous interest rates, because A has this credit history." But further up the food chain what happens is determined by the fact that x,y,z are dependent upon B getting the loan, or B getting the promise to receive some ridiculous salary and bonuses, ALL of which is made possible by debt. At some level in there, the more in debt you are, the more the rest of the schema needs you, so the highest debts are the most necessary of all, while lower individual debt, especially at the bottom, is more expendable in service to what's above it.

The ones with too much debt either went under or got sold.

Except citi and AIG. Those were the ones in real trouble. But citi isnt in that great shape. They just had to reverse split their shares.

that a lot of us have been living with imply their own self-destruction, eventually.

Given the necessity of debt in a system that can't really just "settle-up" tomorrow without leaving a lot of people unpaid for what they are legally owed, what is there to prevent further iterations of the process?

Otherwise every rumor would start a run on some bank and then it collapses. The Federal Government enables people to feel secure enough to leave their money at the bank. They can also require more reserves to be held or leverage to be reduced.

When the banking system gets out of hand that is the fault of a lack of regulation and oversight. In this sad world too many are willing to push up to government limits instead of being prudent and cautious.

fractional reserve lending standards that are too wide? How can that work? Better, more honest, more transparent securities ratings?

whatever THEY want? And isn't that possibility part of what gave synergy to what happened in the Derivative Crash?

I'm not sure what kind of requirements the govt could have done because it was a problem with the quality of the work so the numbers didn't necessarily tell the tale. Maybe they need to audit random loans to make sure everything is in tip top compliance from the origination to foreclosure. I've never even heard that suggested though.

This truly was a housing bubble that was propped up by loans that were unaffordable. It was a systemwide failure, even global, with so many complicit people the mind simply boggles.

I slogged through the financial crisis inquiry commission report. Just about the only GOP criticism of it with which I agree is the way its comprehensiveness undermines its comprehensibility: in pointing out so many causes, it singles out none. But if I had to pick one culprit, it was the way that financial institutions moved from a model wherein they would originate only mortgages they intended to hold, to one in which they originated them for securitization. This front-loaded the incentive structure in such a way as to practically guarantee that bad loans would be made. Interestingly, those institutions that did not engage in this, such as credit unions, have much lower rates of delinquency and foreclosure: it is an irony of the crisis that banks had, for years, fought relaxing loan standards at credit unions, mainly because these were loans they wanted to make themselves.

"If you owe The Bank $10,000, you have a problem. If you owe The Bank $10,000,000, THEY have a problem..."

We need reform to prevent consumer confusion, exotic financial instruments designed to hide risk, and therefore create dangerous speculative bubbles like the one we just went through, and sloppy or misleading paperwork like undocumented assignments.

But there's no viable path for people who borrowed money to finance the purchase of a home to a) not pay it back and b) keep the property. You can't invalidate one side of a contract, and leave the other one intact, so that one party gets the benefit of the bargain, but not the other.

I still think the best way to recognize the damage lenders have wrought would be a streamlined process for the cramdown of first mortgages. Bankruptcy courts could do it easily, as they already do the same for secondary liens. Or, a separate Federal act to require lenders to markdown principle to present market value for mortgages given during the bubble, for anyone who needs it. And no more of the insane runaround people are getting under Obama's "ask the bank nicely" programs. Banks should have a short, definite period of time to modify according to present value, or suffer defined, significant sanctions.




editted for speling and the grammars.

But the attorneys I spoke to said that if you have an insufficient filing, i.e., without required paperwork, then the claim should be dismissed. That's the nightmare of ForeclosureGate. The big banks and mortgage companies are freaking out about this legal problem, which came to a head with the Mass Superme Court upholding the Albanez decision. The equitable application of the law is precluded by the technical application, in this rare case helping homeowners. Your point about cram downs is a good one but I don't think they can treat the first as you describe the second. The Durbin foreclosure relief bill that failed in 2009 had provisions to give bankruptcy judges more latitude but it was defeated. The hiring of a lot more judges and specific congressional language on intent for cram downs wouldhave done the job. But it didn't happen and here we are.

There's more on bankruptcy on the article below.

Bankruptcy Hell-The Sequen to ForeclosureGate by Michael Collins - Economic Populist

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The author ia a big goofball!

Nah. he's a total stud of the world. For realz.

LOL Somewhere between those two, I hover, perilously, awaiting your wonderful PM's telling me about this stuff. You are a Prince!

Relax and listen to some radio http://psyradio.fm

But I'm also here to remind you that a free toaster can be yours for the price of your immortal soul...

I have been in the middle of negotiations with Bank of America (BOFA), for a mortgage loan modification, for close to a year. After the sale I called BOFA once again and discovered that my loan modification is complete. I then asked them to reverse the foreclosure sale. They told me that they have placed a Recision ( meaning cancellation) of the sale and at, this time, only needs approval by the investor (Fannie Mae)to take affect. BOFA is difficult to work with because, every time that you call them, you speak to a different person.I should add that I made attempts to postpone the foreclosure sale and, each time I was told that the postponement had been initiated, and it never happened.

We are working on helping my mom to make her house affordable. Best of luck to you, oldlib.

I hope that your mother also survives this ordeal. I am working with HUD now and I am hopeful that Fannie Mae will be more forgiving then BOFA.

We already have. She went back to work, and her income is now in the acceptable range. We will see how long they continue to lie and make up obstacles,

I love the "F" in there. BOFA, I THINK that's an addition. :)

Well, keep plugging away and don't let them scam you out of what's yours. be very watchful.

acronym as you have implied. It is, however, an apt application for that horrible organization.