The whole foreclosure fiasco and a possible moratorium.

[DesiPower]

So whats going on here? I was not keeping up with the 1st part of the news. I heard it several times but never paid any attention, primarily because my though was - who can a foreclosures me "erroneous"? you had to have done something to get into this mess, like, maybe, not making a few payment?? You might be one of the loons who though that you social security can pay for a 500k house or you may be one of those unfortunate ppl who lost their job to Bush. Now there might be some new laws that might have protected you from a foreclosure for a while, but the bottom line is you are not making payment and the market need to move on...
Now here comes the second part, why the hell do we need a freaking moratorium on foreclosure??? isn't that just retard? and somehow it seems that the left is against it while the right is all for it!! WTF? I would have expected the opposite...

Obama administration does not support U.S. moratorium on foreclosures

 

[ebaycj]

So whats going on here? I was not keeping up with the 1st part of the news. I heard it several times but never paid any attention primarily because my though was - who can a foreclosures me "erroneous"? you had to have done something to get into this mess, like maybe, not making a few payment?? You might one of the loons who though that you social security can pay for a 500k house or you may be one of those unfortunate ppl who lost their jobs to Bush. Now there might be some new laws that might have protected you from a foreclosure for a while, but the bottom line is you are not making payment and the market need to move on...
Now here comes the second part, why the hell do we need moratorium freaking foreclosure??? isn't that just retard? and somehow it seems that the left is against it while the right is all for it!! WTF? I would have expected the opposite...

Obama administration does not support U.S. moratorium on foreclosures

Protip: Type slower or learn the English language better.





As far as the moratorium, it has come out that the big banks were engaging in foreclosure fraud at alarming rates, some in the thousands of frauds per day.
Banks engaging in title / foreclosure fraud:
http://seekingalpha.com/article/229048-mortgage-title-fraud-a-national-catastrophe

Banks try to buy law to "legalize/legitimize" said fraud, bill passes but is veto'd:
http://online.wsj.com/article/SB10001424052748704696304575538131744705958.html?ru=MKTW&mod=MKTW

More:
http://seekingalpha.com/article/228961-where-is-the-foreclosure-mess-leading
http://www.nakedcapitalism.com/category/real-estate
http://4closurefraud.org/
http://online.wsj.com/article/SB10001424052748703843804575534303696918076.html?ru=MKTW&mod=MKTW

Basically it looks like the banks/ibanks/loanservicers took LOTS of liberties with regards to legal proceedings when people stopped paying on their loans, banking on the fact that people wouldn't know the difference and/or wouldn't (or wouldn't be able to) hire a competent lawyer for their defense.

Now there will be a epic wave of legal BS to get this all sorted out, in addition to larger losses for the banks.

Hopefully the banks have learned their lesson, but likely they have not. Regardless, the lawyers are loving it (from both sides).

 

[drebo]

It's all about "keeping people in homes" and artificially inflating "home ownership" numbers.

Here's a clue: not everyone can afford a home and not everyone needs to own a home.

Efforts like these just keep the bubble partially inflated.

Houses where I am are still not at market-sustainable rates. They need to fall at least another 10%.

 

[Moonbeam]

Number one, the government should own all housing and you should live next to where you work, the worse and more meaningless the job, the better the amenities.

Two, there will be no moratorium. It will prolong the housing crisis.

 

[Zebo]

We need to let them live there. So whats the alt? bank takes it over place goes to shit, government pays off loan so bank can own it? Who are they going to sell it to? In the meantime housing prices in the neighborhoods drop further with huge abandoned properties all around hurting everyone again. (first was by taxes since gov securitizes most loans) And banks soon will own yours too when you begin to ask: why pay 500% more than something is worth and do a strategic default.

 

[swerus]

It's all about "keeping people in homes" and artificially inflating "home ownership" numbers.

Here's a clue: not everyone can afford a home and not everyone needs to own a home.

Efforts like these just keep the bubble partially inflated.

Houses where I am are still not at market-sustainable rates. They need to fall at least another 10%.

And we have a winner.

We need to let them live there. So whats the alt? bank takes it over place goes to shit, government pays off loan so bank can own it? Who are they going to sell it to? In the meantime housing prices in the neighborhoods drop further with huge abandoned properties all around hurting everyone again. (first was by taxes since gov securitizes most loans) And banks soon will own yours too when you begin to ask: why pay 500% more than something is worth and do a strategic default.

So you would rather the market stay over inflated? I want to buy up houses at a reasonable rate. People will have to live somewhere, and rentals is where it will be. I am placing my bets on that, but I won't buy these houses at these crazy prices of 2008.

 

[ConstipatedVigilante]

Number one, the government should own all housing and you should live next to where you work, the worse and more meaningless the job, the better the amenities.

Two, there will be no moratorium. It will prolong the housing crisis.

I hope you're kidding, because that first point is utter insanity.

 

[PJABBER]

All I know is that, DAMN, it feels good to be a banka.

 

[drebo]

All I know is that, DAMN, it feels good to be a banka.

LOL @ Asians rapping.

 

[piasabird]

This topic came up on the Kudlow Report. He has a Stock Market oriented show and what they were talking about was that some banks can not handle the flow of the real estate properties they are trying to manage and keep track of. Banks are not set up to be real estate agents on such a large scale and it takes a lot of legal paperwork to inspect and foreclose and sell the properties. I think they were also worried that the banks may be breaking some real estate laws by not processing the properties in a completely legal manner.

 

[Moonbeam]

I hope you're kidding, because that first point is utter insanity.

To the insane sanity looks insane.

 

[Fern]

-snip-
..somehow it seems that the left is against it while the right is all for it!! WTF? I would have expected the opposite...

Other than the Obama admin, the 'Left' I have seen are pushing the moritorium and Repubs arguing against it.

I see both good and bad to it, but I'm not sure that we can forsee all the possible consequences. Being a conservative, I'm therefor opposed to it ATM.

I can see how forclosing (kicking people out of their homes) has some bad consequences so you might wanna put a moratorium on it. Empty houses in neighborhoods drag down everyones' property values. Then you have to deal the personal disruption to peoples' lifes and homelessness etc.

OTOH, you start telling people there's moratorium and they will realize they can stop making mortgage payments without risk of forclosure. That will be a problem, and the banks will be in trouble (and we know who'll have to bail them out). Then when this moritorium ends the forclosure rate is gonns shoot like like crazy, that can't be good. Also, you may end up chilling the home loan market for new loans and refinancing. why would banks lend with that kind of risk?

You also might just be doing nothing other than delaying the necessary and inevitable housing market correction.

-------------------
What kind of lobby do the lawyers have? A pretty big one, you think they wanna just drop all their work-in-progessive and lose new business from forclosures for some period of time? I don't. I'll bet they scream if this happens. Their practices are gonna be in trouble.

Fern

 

[Jhhnn]

Foreclosure is a legal proceeding, requiring certain proofs and paperwork trails on the part of the plaintiff. In their haste to offload bogus MBS onto investors, investment banks cut a lot of corners when the securities were originated, and it's now coming back around to bite 'em in the ass as the servicers. They can't provide what the law demands for foreclosure to proceed, in many cases.

This is an extremely long and dry read, but it provides the basic case against mortgage servicers' current practices-

http://www.scribd.com/doc/38654717/...Nation-Star-Aurora-Bac-Citi-Us-Bank-Lps-Et-Al

 

[Robor]

So you would rather the market stay over inflated? I want to buy up houses at a reasonable rate. People will have to live somewhere, and rentals is where it will be. I am placing my bets on that, but I won't buy these houses at these crazy prices of 2008.

WTF are you talking about with 2008 prices today? According to Zillow places in my neighborhood are selling for 70% of what they were in 2008. In fact, my place is now worth just 10% more than when I purchased it in early 2000 and I've put far more than that into it in maintenance, repairs, improvement.

 

[swerus]

That is because of the foreclosures. Put a stop to that and demand will go back up, its not a difficult concept to grasp. Foreclosures mean more houses on the market which means prices fall.

I don't feel sorry for the ones who get foreclosed on, that is what happens when you don't pay your mortgage. The ones I feel sorry for are those that bought at the peak of the market and are now way upside down and are still paying to get back to what the home is worth.

 

[Jhhnn]

WTF are you talking about with 2008 prices today? According to Zillow places in my neighborhood are selling for 70% of what they were in 2008. In fact, my place is now worth just 10% more than when I purchased it in early 2000 and I've put far more than that into it in maintenance, repairs, improvement.

Dunno where you live, but if it's in one of the more bubblicious markets, don't expect it to get any better anytime RSN. If Repubs make sufficient gains this election, forget about stimulus money, be prepared for a deflationary spiral. It's what they want.

Housing in what were the country's hottest markets is extremely overbuilt with lots of home-loaners extremely over extended, so when this foreclosure imbroglio is settled, the market will be awash in empty dwellings with few qualified buyers wanting to buy them.

Self regulated free market world economy banking... ain't it grand?

 

[Jaskalas]

This is a crisis. Screw the banks, not one person should have been kicked out of their home since Fall 2008.

 

[Fern]

For anybody to say that there is widespread abuse in home forclosures is nothing more than a claim that our judges are incompetent, that our judicial system is incompetent.

Each state has it's own rules on forclosure proceedings. I can imagine some states may have problems because of a weaker system (in terms of protecting the homeowners' rights), but to make a claim that we require a nationwide moratorium begs for evidence justifying it need.

Just fix what is broken in the system(s).

Fern

 

[sandorski]

This is a crisis. Screw the banks, not one person should have been kicked out of their home since Fall 2008.

Yup. I can see the Bank taking back Ownership, but given the state of the Economy it seems foolhardy to be kicking People onto the street.

I think a Law making a temporary alternative to traditional Foreclosure would be helpful:

1) Home Owner gets X Amount behind on Payments, then Bank takes Ownership back

2) Despite last half of Point 1, previous Home Owner has the option to resume Ownership if they can Afford to make Payments(including past missed Payments), within a certain time period.

3) Previous Home Owner pays Rent to the Bank until they choose to leave, Resume Ownership, or the Temporary Alternative ends, whichever comes first.

 

[Jhhnn]

For anybody to say that there is widespread abuse in home forclosures is nothing more than a claim that our judges are incompetent, that our judicial system is incompetent.

Each state has it's own rules on forclosure proceedings. I can imagine some states may have problems because of a weaker system (in terms of protecting the homeowners' rights), but to make a claim that we require a nationwide moratorium begs for evidence justifying it need.

Just fix what is broken in the system(s).

Fern

I don't think you understand quite how deep the fraud runs on the part of parties attempting to foreclose, Fern. Many times, servicers attempt to foreclose w/o the legal authority to do so, particularly wrt entities involved in bankruptcy. The bankruptcy trustee must grant that authority, but no record of that happening is ever presented. There are other numerous irregularities that left unresolved can effectively cloud the title for honest buyers of foreclosed properties. When and if the real owners ever come forward, they can sue both the innocent buyer and the guilty forecloser/seller.

Many times, what's broken was broken from the start by MBS creators, broken before the borrowers ever signed on the dotted line.

If anything, a moratorium would serve the interests of the banks, the servicers, allowing them time to (fraudulently) create their paper trails after the fact. And it moves the whole thing up a level, taking the load off of local courts who are ill-equipped to deal with fraud on such a massive scale. They have little or no precedent to lean on, and must interpret the law themselves, leading to a huge number of cases postponed while the individual court figures it out...

It's not a simple matter of A loaned B money and B hasn't been making the payments, at all. It's that parties attempting to foreclose aren't A at all, and often lack standing to act for A, who may be involved in bankruptcy or who may have been informed by the servicer that their interest has been wiped out... In many cases, the only person standing to gain from foreclosure is the servicer themselves, who had no stake in the first place...

It really is a mess of monumental proportions.

 

[Darwin333]

So whats going on here? I was not keeping up with the 1st part of the news. I heard it several times but never paid any attention, primarily because my though was - who can a foreclosures me "erroneous"? you had to have done something to get into this mess, like, maybe, not making a few payment?? You might be one of the loons who though that you social security can pay for a 500k house or you may be one of those unfortunate ppl who lost their job to Bush. Now there might be some new laws that might have protected you from a foreclosure for a while, but the bottom line is you are not making payment and the market need to move on...
Now here comes the second part, why the hell do we need a freaking moratorium on foreclosure??? isn't that just retard? and somehow it seems that the left is against it while the right is all for it!! WTF? I would have expected the opposite...

Obama administration does not support U.S. moratorium on foreclosures

So basically you disagree with the rule of law or do you just not understand the issue? I only ask because I really don't understand a couple of your sentences (not trying to be a grammar nazi, mine sucks too).

The problem is that there are very specific requirements needed to foreclose on a house. In most states one of these requirements is a document with a "wet ink" signature. Not a copy, not a scan, the original wet ink document. Even worse is there are potentially thousands of cases in which a representitive of the banks signed a sworn affidavit stating that all of the required documents were in order and then admited, again sword testimony to the court, that he didn't check a damned thing. You or I go to jail for perjury and maybe contempt if we try to pull a stunt like that. Why should they be any different?

In some cases the bank trying to foreclose can not prove they have ANY interest in the property whatsoever.

I find it rather ironic that the kings of "fine print" are having it bite them in the ass. The way it currently works for the normal folk is if you don't have the documents to backup the collateral and you can't come up with them the loan basically turns into an unsecured loan. The people still owe the money but you can't take the collateral from them without the legally required documents. I personally believe that those documents have either been destroyed or are unrecoverable in someway because if they weren't Congress wouldn't have tried to sneak HR 3808 (without a recorded vote in either the Senate or House mind you) through.

 

[Darwin333]

Other than the Obama admin, the 'Left' I have seen are pushing the moritorium and Repubs arguing against it.

I see both good and bad to it, but I'm not sure that we can forsee all the possible consequences. Being a conservative, I'm therefor opposed to it ATM.

I can see how forclosing (kicking people out of their homes) has some bad consequences so you might wanna put a moratorium on it. Empty houses in neighborhoods drag down everyones' property values. Then you have to deal the personal disruption to peoples' lifes and homelessness etc.

OTOH, you start telling people there's moratorium and they will realize they can stop making mortgage payments without risk of forclosure. That will be a problem, and the banks will be in trouble (and we know who'll have to bail them out). Then when this moritorium ends the forclosure rate is gonns shoot like like crazy, that can't be good. Also, you may end up chilling the home loan market for new loans and refinancing. why would banks lend with that kind of risk?

You also might just be doing nothing other than delaying the necessary and inevitable housing market correction.

-------------------
What kind of lobby do the lawyers have? A pretty big one, you think they wanna just drop all their work-in-progessive and lose new business from forclosures for some period of time? I don't. I'll bet they scream if this happens. Their practices are gonna be in trouble.

Fern

This is about black letter law, nothing more and nothing less. You and I have to follow it and so should the banks. If black letter law states that they can not foreclose on a property with document X and Y and they only have Z, should they allowed to foreclose on it anyway even though it is a clear violation of black letter law?

 

[Darwin333]

For anybody to say that there is widespread abuse in home forclosures is nothing more than a claim that our judges are incompetent, that our judicial system is incompetent.

Each state has it's own rules on forclosure proceedings. I can imagine some states may have problems because of a weaker system (in terms of protecting the homeowners' rights), but to make a claim that we require a nationwide moratorium begs for evidence justifying it need.

Just fix what is broken in the system(s).

Fern

Didn't seem to be a problem before the banks started slicing and dicing the mortgages up and putting a bunch of confetti in a box, slapping a AAA rating on it, and selling it to the biggest sucker they could find.

There is also good reason the banks might not have included certain documents. Maybe because it would have, ooooh I dunno, proved the box was really half full of shit and not a AAA investment? It gets better though, if the banks didn't provide the proper docs when selling their boxes of shit then the people who bought it might be able to legally force the banks to buy it back from them at face value. I wouldn't exactly call that justice but its better than nothing.

 

[ayabe]

In FL there are huge backlogs 6-12 months in some areas, this is complicating things and could lead to speed signings where the paperwork isn't being reviewed as thoroughly as is necessary.

It's pretty simple.

 

[Jhhnn]

What it amounts to is that the banks should have been nationalized rather than bailed out, reorganized, recapitalized and sold back into the market, with the assets of the perps seized under RICO statutes.

None of that was going to happen with GWB in the Whitehouse, which is why the crisis was deliberately precipitated while he still was in the Whitehouse. Investment houses knew that up front, acted accordingly, squeezed out every nickel they could into execs' pockets, sometimes to the point of riding their corporate steeds into the dirt.

Who Cares, right? I got mine, and that's all that matters....