A Victory for Home Owners in Massachusetts!

The New Bottom Line reports that
This is important. The banks are creatures of the law. They are only private business in a sense. Their accounts are protected by law and they have been given fast and favorable legal methods for foreclosure because in previous decades they had acted the role of responsible capitalism. Now that the banks have demonstrated they are unworthy of foreclosure favoritism, it is time to tighten the legal procedures and make them earn their money by legitimate means.
You may be tempted to argue that they have every right to foreclose on someone who has stopped payments on a home. That would be true if that is the only way they have been working it. But all over this nation, they have been using a somewhat different procedure. A home-buyer calls up and says he has trouble with paying this month’s mortgage. The bank kindly says, “Don’t pay it. Don’t make any payments for three months. That will qualify you for the HAMP program, and we can renegotiate the loan.”
The trusting home owner doesn’t pay for three months then resumes payments. He is stacked with penalty fees for late payments. Concerned, the home owner calls the bank. But the bank never seems to find the time to call him back. Eventually a letter is received saying that he has been denied admission to the government program and all payments including penalties are due now to avoid foreclosure. Then when the unfortunate client is unable to come up with the thousands of dollars in fees, they foreclose. I suspect the bank hands out a bonus and maybe a bottle of champagne per kill.
When the banks act in this manner, the legal procedures designed to protect their profits no longer make sense in a civilized society.
James Pilant

Bulldoze: The New Way To Foreclose (via Time Magazine)

Let me try and understand this. The banking industry seized these homes, these precious homes, often the most valuable single thing that a family had, and having seized the home and cast away the occupants like so much chaff, they bulldoze it?

The banks do the deals because once the properties are donated they no longer have to pay taxes or for upkeep. Tax experts say the banks may also be able to get a write off for the donation. That appears to be a better deal than trying to repair some of these homes, which according to a BofA spokesperson are more economical to demolish than fix up. The local governments like these deals because they get free land to develop or use for open space. Cleveland-based Cuyahoga County Land Reuntilization Corp., which inked the deal with BofA, has been one of the most aggressive local government organizations in striking these deals. Housing economists like these deals because they remove homes from the market that would otherwise sell for a low price or not at all, dragging down home prices in general. An oversupply of homes on the market has been once of the big problems plaguing real estate. At the end of June, it would take nine and a half months for the current number of homes on the market to sell. The housing market is considered healthy when supply equals six months of sales. So taking some of these homes off the market for good could remove some of the inventory drag.

Thank God, Time Magazine is on the story. They’ll give these banks a talking to. They’ll call down the righteous ire of the oppressed down upon these home destroyers.  But wait … !!! –

The question is whether the banks will ever put up enough housing for demolition to make a difference. The Obama administration says it is working on its own plan to revamp its loan modification program in order to help keep more people in foreclosure in their homes, reducing the number of foreclosed properties on the market. Some areas of the country are looking at how to speed up foreclosures in an effort to return some normality to the market. It’s not clear that any of this will work. Certainly, the idea that we are at the point where banks would be better off knocking down houses that reselling them shows there is still something very wrong with the housing market. But what is clear is that banks and others are at the point where they are ready to try something new to boost the housing market. And that is a good sign for the future.

Time Magazine says we’re not bulldozing enough homes. That’s right. We live in a nation where the weekly press has discovered that if only the banks had the guts to bulldoze a lot more homes, things would be better.

This is the wisdom of the beltway, a never never land generally located near Washington but often and more simply a state of mind. In the beltway, the concerns of people for jobs, homes and economic security are the cries of the weak and whiny. Really important people are concerned about “who is winning” in Washington. Really important people constantly read articles about where it’s most profitable to live, where the taxes are lowest and where to invest their money. Really important people sit up and take notice of every move on the stock market and if a man has made a fortune his lack of gentlemanly qualities, overt greed, and often actual crimes means he is quoted as an authority.

Go read the magazine if you can stomach it. They simply don’t live in a middle class world. And they don’t care.

James Pilant

Cloud on title forever post foreclosure {but wait the Banks own the title companies} (via Timothymccandless’s Weblog)

This is a (fairly outraged and rightfully so) discussion of MERS, the electronic system used by the foreclosure industry to prove ownership of homes. Depending on the state, it proves a little or a lot. It appears as time has gone by that the faults of the system have become more and more obvious.

Of course, many who lost their homes to companies using this system never really got a day in court since this weakness in the ownership status has only recently become well known. This was not fair and that it produces strong feelings of rage and hopelessness is not surprising.

I hope the thoughts here can help some people get justice.

James Pilant

Recently Discovered Flaw in Recording System Clouds Titles on Previously Foreclosed Properties   The modern system of mortgage refinancing and assignments created during the housing boom has left behind a wave of title defects on properties that have ever had a foreclosure in their history, due to a loophole in the property records recording system. This has been detected on a number of properties currently in foreclosure, and found to have … Read More

via Timothymccandless's Weblog

The Modern Face of Evil (via The Compulsive Explainer)

I’m a big fan of Iniside Job and apparently so is this gentleman. I agree with his remarks. I too believe that the instigators of this calamity were evil, not misguided, not just skirting the edge of legality, but evil.

I hope people like this embrace the concept of evil as a explanation for actions taken for unimaginable greed. This is a difficult time to live in. But one of the reasons we live in difficult times is because it was arranged that way. People were not held accountable for their own actions. Banking institutions did not suffer the results of their mistakes. Thus we have the a country where the free market is cited for every problem and in spite of that a tax supported, profit guaranteed, financial industry with the morals of a rabid dog was protected from it. If you use the mantra of the free market to discourage regulation, you shouldn’t be able to turn around and get taxpayer money.

This is a good post. My thanks to The Compulsive Explainer.

James Pilant

I am watching the movie Inside Job, and I am learning from it. I am watching the handful of guys who wrecked the world’s economy profess to be innocent as lambs. What I couldn’t see was the millions of people who let them get away with it. The modern face of evil is helplessness in the face of power – and people who are only interested in themselves. People who have lost the ability to be good – or to care for others. People who have ceased to ex … Read More

via The Compulsive Explainer

Satellite Tour of America’s Foreclosures (via Short Sale and Foreclosure Blog)

The foreclosure crisis continues. This is a nice piece of writing highlighted by intelligent illustration. The author has my admiration.

Often, when we have been dealing with a crisis for a long time, we want it to end, to find closure. I promise you my delight in another days’ fukushima crisis is very small. I want that thing to be fixed and stop hurting people every single day. I want to write about other stuff but the nuclear industry has conspired to create a disaster that will run at least ten years. So, I continue writing about it.

I am more than a little afraid this one, the foreclosure crisis, may come to a sudden end. Let me tell you why. There is talk of a settlement of 20 billion dollars by the states attorney generals. Many of our more loathsome congressman are complaining that this is too punitive. It takes a very comfortable distance from the situation and the facts to find compassion for the financial industry. They have in many cases either directly committed crimes, assisted in illegal activity or parsed the law so closely as to send shivers up the spine of the most casual moralist.

Well, these financial industry zealots are likely to ride like some debauched cavalry to the assistance of these banks. They intend to cut the amount and it is quite likely they will gut any proposals to rein in the illegal practices of foreclosure industry. The reform they will aim at with great intensity will be the one ending the abuses of foreclosing without a proper title. Allowing the banks to foreclose with a paper trail will greatly cheapen their costs and make it extremely difficult to police the industry.

So, I want stretched out court battles to reveal to millions of Americans how cruel and unfair this process has been. I want charges filed for false affidavits, penalties assessed for failing to pay state and county fees, and I want justice for those who have suffered fraud during the housing bubble.

James Pilant

Satellite Tour of America's Foreclosures A Frightening Satellite Tour Of America’s Foreclosure Wastelands From Business Insider Gus Lubin | Jan. 30, 2011, 3:42 PM | 693,239 RealtyTrac is out with the total foreclosure numbers for 2010. On the whole things are getting worse. 72 percent of major metro areas saw an increase in foreclosure volume. Although some of the worst hit areas in Nevada, California and Florida improved from 2009, the foreclosure rate in these areas remains shockingly … Read More

via Short Sale and Foreclosure Blog

Open Letter Re: Withdrawal of Proposed Consent Orders Regarding Mortgage Servicing Illegalities (via Foreclosure Fraud – Fighting Foreclosure Fraud by Sharing the Knowledge)

I strongly support this. The proposed consent orders fall far short of any fair settlement of the crimes committed by mortgage industry. I hope you are willing to join in this effort to find justice for millions of Americans whose property rights have been violated by a rogue industry that directly violated the law hundreds of thousands of times.

James Pilant

Open Letter Re: Withdrawal of Proposed Consent Orders Regarding Mortgage Servicing Illegalities April 6, 2011 Ben Bernanke, Chairman Board of Governors of the Federal Reserve System John Walsh, Acting Comptroller Office of the Comptroller of the Currency Sheila Bair, Chairman Federal Deposit Insurance Corporation John Bowman, Acting Director Office of Thrift Supervision Re: Withdrawal of Proposed Consent Orders Regarding Mortgage Servicing Illegalities Dear Federal Regulators of the Financial Institutions of the United States: The undersign … Read More

via Foreclosure Fraud – Fighting Foreclosure Fraud by Sharing the Knowledge

Fed Report Finds No Wrongful Foreclosures By Banks, Consumer Advocates Slam Methodology (via Huffington Post)

WARNING – I will be venting my contempt angrily and pointedly.

First here’s the story – from the Huffington Post’s Business Reporter, Shahien Nasiripour.

A months-long investigation into abusive mortgage practices by the Federal Reserve found no wrongful foreclosures, members of the Fed’s Consumer Advisory Council said Thursday.

During a public meeting attended by Fed chairman Ben Bernanke and other regulators, consumer advocates on the panel criticized federal bank regulators for narrowly defining what constitutes a “wrongful foreclosure.” At least one member of the panel voiced concerns that the public would not take the Fed’s findings of improper practices seriously, since the wide-ranging review did not find a single homeowner who was wrongfully foreclosed upon.

Potemkin Village

Let’s see, how about some good descriptors. Which one is best? Fanciful, comedic, ridiculous, fantastic, bizarre, Potemkin like, Red Queen thinking, the king has no clothes, the same firm grasp of reality of Norman Bates, pitifully deluded, an administration without heart, courage or brains, a triumph of corporate PR over every shred of reality, a view from the predators’ terrace, …

I have three ideas for appropriate comparisons, the Potemkin Village, Baal worship and the music of the spheres.

First, the Potemkin Village:  … there were fake settlements purportedly erected at the direction of Russian minister Grigory Potyomkin to fool Empress Catherine II during her visit to Crimea in 1787. According to this story, Potyomkin, who led the Crimean military campaign, had hollow facades of villages constructed along the desolate banks of the Dnieper River in order to impress the monarch and her travel party with the value of her new conquests, thus enhancing his standing in the empress’ eyes.

It would appear that Obama’s soulless minions (retreads from the banking industry) think that Americans are gullible beyond belief or perhaps this is for the consumption of the great man himself. Maybe he is so removed from the tiniest vestige of reality that he is simply immune to the suffering of his countryman?

How about Baal worship? Small children were placed inside a metallic idol and cooked alive while the followers of the great god chanted and sang drowning out the screams of the victims. The listeners believed that the children were carted painlessly into the next world, a comforting delusion.

Too Strong? The newspapers, blogs, even the financial pages have been full of stories, one after another, discussing illegal foreclosures. But not just there, on television, cable, the radio,.. Can’t they hear or see?

Or the Music of the Spheres, in the time of the Greeks it was believed that we were all encased in multiple clear crystal spheres, one for the moon, another for the sun, and so on. The great majority of mankind, the lumpen mass, the pathetic herd were condemned by their lack of perception to a perpetual half life while those who were special could hear the music these spheres gave off, making them insiders to the secrets of the universe.

Are they so far above us that our voices are just a quiet drone against the elegant music  of a higher order?

What’s your preference?

Let’s try some reality. From The Washington Post, a column by Dana Milbank

The problem in the nation’s housing market now isn’t subprime lending. It’s subpar lenders.

Last fall, my wife and I refinanced our mortgage with Citibank. Sixty days later, we received a “cancellation notice” from our homeowners insurance company “for non-payment of premium.”

Turns out Citibank, which had been collecting hundreds of dollars a month from us to pay the insurer, hadn’t made the payments. It was, I later learned, one of the usual tricks mortgage servicers use to squeeze more cash out of their customers. About a month later, I learned of another trick: Citibank informed us that it was increasing our monthly payment by nearly $300.

Along the way, a simple refi became a months-long odyssey: rates misquoted, interest charged on a phantom account, legal documents issued in wrong names, a mortgage officer who disappeared for days at a time (first it was his birthday, then his laptop was in the shop), a bounced check from Citibank’s own title company, and the freezing of our bank accounts.

For me, this amounts to no more than the hassle of arguing with Citibank to fix its “mistakes.” But consumer advocates tell me these are typical of the screw-ups by the big banks that service home mortgages. And these errors – accidental or otherwise – are driving large numbers of people into default and foreclosure when it otherwise would not have happened.

How about that? Let’s hear a little more.

My wife and I are reasonably savvy consumers – she has a brand-name MBA, and I began my career as a business reporter for the Wall Street Journal – but we were no match for a bungling bank. After five months of trying, we still haven’t been able to resolve all of Citibank’s mistakes – nearly all of them, curiously, in the bank’s favor.

Of all the miscues, the highlight was when we were handed, at closing, a large check that we didn’t want for a new home-equity line of credit. I tried to redeposit it into the home-equity account but was told that the account did not yet exist. I tried to deposit it into my checking account, and the check was returned unpaid – while interest accrued.

That so much can go wrong with such a simple refinance doesn’t bode well for the 5.5 million homeowners in default (on top of the 3 million already foreclosed). It’s impossible to know for sure, but by some estimates, half of them are victims of some form of servicers’ errors.

“What happened to you,” Ira Rheingold of the National Association of Consumer Advocates told me, “happens to people every single day.” And it will continue, with its resulting drag on the economy, unless and until the big banks can be brought to heel.

Is this all I’ve got? No, I can shower you with examples of vicious cruelty, lies, and every kind of chicanery resulting in wrongful foreclosures.

James Pilant

Cherokee tax chief quits to avoid foreclosing on more friends (via AJC)

From AJC – Cherokee County News:

Fields, 62, became a poignant reminder of the housing bust’s impact on thousands of lives across metro Atlanta, where almost 100,000 properties were foreclosed on in 2010. Property owners are not the only ones hurt; so are people, such as Fields, at the end of a ruinous process set in motion by recession.

“I was foreclosing on the homes of people I have known my entire life,” Fields said Monday, two weeks after he walked away from his job but still carrying its burden. “I tried to do all I could to help them. But there’s only so much you can do. Your job is to collect taxes.”

In the good times Fields said he seldom dealt with bad news. “There were almost no foreclosures, and the tax digest was in great shape,” he said. “We would have collected 97 percent of taxes by the end of the year.”

Then, about a year ago, the gravity of the downturn gripped him and wouldn’t let go. A man who described himself as “normally happy and upbeat” was suddenly nauseated all the time. He didn’t have any energy. Daily events he once took in stride turned into crisis after crisis.

“I would talk to somebody or deal with something, a foreclosure or a lien, and I would just have to step out of the office to regain my composure,” he said.

Sometimes, our bodies or our minds tell us to stop doing what we’ve been doing. This appears to be one of those cases.

Many of us believe we live in a world of hard, cold facts and reasonable decisions arrived at after due consideration. Well, guess what, the heart has its own rhythms and its own needs. Sometimes those take precedence.

James Pilant


Map of Foreclosures Nationwide (via ReReno’s Blog, Reno/Sparks Real Estate)

Here is an interactive map of the foreclosure crisis in the United States. If a picture says a thousands words …

James Pilant

Map of Foreclosures Nationwide Would you like to see what’s happening in foreclosures in your area? NPR has an interactive map showing foreclosures on a county by county basis. Click on the image to view the interactive map. … Read More

via ReReno’s Blog, Reno/Sparks Real Estate

BOA: BAD BANK, BAD BANK, WORSE BANK (via Livinglies’s Weblog)


This is how I feel as well. It’s a good read. Be warned, he’s really upset. But so am I when I’m dealing with this issue.

Here is my writing on the same subject. You can see that I get passionate about foreclosures too.

Robo-Signing Foreclosure Freeze Update (via Foreclosureblues)

Lots of Links on the Foreclosure Fraud Crisis (via Rortybomb)

“We Can Either Have a Rational Resolution to the Foreclosure Crisis or We Can Preserve the Capital Structure of the Banks. We Can’t Do Both” (via Foreclosureblues)

Sheldon Whitehouse Weighs In On The Foreclosure Crisis

Third Way Comments on Foreclosure Fraud Policy in the Post-Ibanez Landscape (via Rortybomb)

Foreclosure Speed Made Loan Modifications Impossible

The Vast Majority Of Foreclosures Were Done Correctly?

In total, I have 46 posts about the mortgage crisis.

James Pilant

BOA: BAD BANK, BAD BANK, WORSE BANK COMBO Title and Securitization Search, Report, Documents, Analysis & Commentary Bank of America to Create Troubled Loans Unit BANK STILL ATTEMPTING TO KEEP FORECLOSURES A POLITICAL ISSUE AS LEGAL OPTIONS RUN OUT EDITOR’S NOTE: As for what this means for homeowners, it is obvious that BOA is trying to come up with some formula that will be politically acceptable the final result of which will still be that they will get hundreds of thousands o … Read More

via Livinglies’s Weblog