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The
Foreclosure Fiasco
The
crooks have screwed themselves
Amid evidence of sham documents and
widespread paperwork gaffes, if not systemic fraud that
increasingly looks like it may be terrifically deep, Bank of America
recently halted all foreclosure
proceedings around the country. That followed similar announcements
from the home-loan giants
JPMorgan Chase and GMAC.
But Wall Street does not sympathize. "You had people putting zero down
to get massive houses they
couldn't afford to be in," he said Monday morning, "but now they want
to stay. And the government
wants to let them stay, because they're voters." A few hours later, the
Goldman Sachs arm Litton Loan
Servicing said it had suspended certain foreclosure proceedings, too.
"Talk about a financial scandal,"
a Wall Street Journal editorial this weekend joked. "A consumer borrows
money to buy a house,
doesn't make the mortgage payments and then loses the house in
foreclosure--only to learn that the
wrong guy at the bank signed the foreclosure paperwork. Can you
imagine?"...
In order to understand Wall
Street's shrug during this foreclosure crisis, which as many as 40
attorneys
general are expected to announce an investigation into this week, the
key is to appreciate just how deeply
connected the gesture is to Wall Street's view of who's to blame for
the financial crisis.
The feeling is that even if Wall Street aggravated the crisis by
bundling and betting on mortgage-backed
securities that turned out not to live up to high ratings, it was not a
matter of, as Citi chairman Richard
Parsons told The Observer this summer, "bad people trying to do bad
things." The loans wouldn't have
been there in the first place if American home buyers, driven by
"immediate gratification without
personal responsibility," hadn't overstepped their bounds.
Have you heard how bad this is?
Years ago, when you bought or sold a mortgage, you drove
to the county courthouse
and filed a lien on the property and you recorded the deed that had all
the particulars on it.
When computers and modems arrived, they decided to do it
"better."
Instead of going to the courthouse, they just wrote the name of the
mortgagee
in a computer at the M.E.R.S., which is the main clearing house for
mortgage leins.
But the lazy sons of bitches didn't write down what
happened, which is Bank A sold
your loan to Bank B, which then sold it to Bank C which then sold it to
Bank D.
They just wrote, "Current lein holder is Bank D."
So now Bank D wants to foreclose on "their" property, but
Bank D doesn't have
the lein on the mortgage or the proper papers you need to foreclose on
a home.
and ask Banks A, B and C for copies of their paperwork.
The crooked banks hired
homeless people to sign thousands of phoney loan documents
and now the crooked banks have
no paper trail so who knows how this will end up.
I suggest the crooked banks eat their losses and whoever
is in that home gets it free.