Banks face foreclosure fraud crisis that could give you a free home (page 3)

BurnTheShips

“The Fed Didn’t Cause the Housing Bubble,”

http://online.wsj.com/article/SB123672965066989281.html

Shit. He actually makes good arguments. He is correct on many points, but he is wrong on the big picture.

BTS

If memory serves me, the law in my state is that changes in mortgage ownership have to be recorded in year they take place. Florida makes tons of money on document fees for mortgages- . They can't legally go back after the fact and change the records- well at the moment they can't- laws can be modified, if the lawmakers can be persuaded by the banks to change them.

Deputy Dog

I wonder where Barny Frank fits into all this

BurnTheShips

I wonder where Barny Frank fits into all this

I mentioned Congress.

Barney Frank had more than a little bit to do with stopping any action on Fannie and Freddie a few years back. Chris Dodd also.

Some of the polling seems to show him to be in some electoral doodoo against Bielat.

Here's hoping!

BTS

moshe

just shows you that a congressman can head up a committee and be incompetent at the same time.

sammielee24

There are lawyers advising people who bought foreclosed or short sale properties in the past 3 years, to tread carefully. The amount of fraud is staggering...if found to be absolute, what is the answer?

Should we force the banks and lenders to take responsibility for their actions? If they fail, do we allow them to fall, which will erode the industry and crash everything..but in effect reset us to zero? Or do we allow the government to give them all immunity and backdate laws that make what they all did legal? On one hand we do nothing and they learn nothing - on the other hand, we do something and everyone pays.

This is a huge issue and pretty complex..a million layers...a lot of players... sammieswife

Satanus

Greenspan Shrugged? How Did Ayn Rand Influence Greenspan's Policy

In other words, Ayn Rand's theory of the "morality of self-interest" exactly parallels Alan Greenspan's testimony today about his now-shaken belief in the ability of "self-interest of lending institutions to protect shareholder's equity."

Early in his career, Alan was an avid Rand acolyte, a frequent guest at the Manhattan salon of the novelist and philosopher, and those who gathered to hear the litanies of like-minded notables were loosely known as "The Collective." It was there that the Rand philosophy of Objectivism was discussed in the context of current events, world markets and religion.

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http://www.huffingtonpost.com/2008/10/24/greenspan-shrugged-how-di_n_137465.html

S

zarco

If I buy a foreclosed home and borrow money to buy it, I am required to purchase title insurance. If the title is questioned then the title company does have some risk. If I pay cash and do not have title insurance then I do have some risk, but the risk is minimal.

The questioning of the title and the legality of the foreclosure would come from the previous homeowner. The prior home owner would have to remedy the deficiency even if the claim that the foreclosure was fraudulent was correct. In most cases the courts side with the current homeowner since he/she acted in good faith and the prior homeowner defaulted on the obligation. The problems with the title and mortgage chain of ownership are rectifiable - time consuming but not difficult.

There will not be free homes for people. People will have to pay their debts if they want to remain in the home and remedy past deficiencies if they want the home back and even then they might not get the home back. A homeowner might be able to negotiate some concessions from the bank, but these concessions are roughly equal to what the bank projects it will cost to go through the foreclosure process.

With regard to banks failing because their loan portfolio is worth very little - now that is a big issue and it seems like they should be allowed to fail. But the US will need a national bank or some sort of substitute otherwise the economy will fail with the big banks.

It will be interesting to see this play out.

zarco

JeffT

There are lawyers advising people who bought foreclosed or short sale properties in the past 3 years, to tread carefully.

Good point, as is Zarco's point about title insurance. But title insurance may only change who takes the hit. After the title insurance companies go under, what happens?

kurtbethel

I wonder where Barny Frank fits into all this

He's a bottom....I mean, at the bottom

Banks face foreclosure fraud crisis that could give you a free home

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