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The Foolish Foreclosure Moratorium (Why it's shortsighted and will do more economic harm than good)
The American ^ | 10/13/2010 | Peter Wallison

Posted on 10/13/2010 6:44:16 AM PDT by WebFocus

Democrats are calling for a nationwide end to mortgage foreclosures. It’s hard to imagine a more shortsighted policy under our current economic circumstances.

The weekend’s newspapers were full of stories about Democrats—including the embattled Senate Majority Leader Harry Reid (D-Nevada) and Deputy Majority Whip Rep. Debbie Wasserman Schultz (D-Florida)—calling for a nationwide end to mortgage foreclosures. It is hard to imagine a more shortsighted policy under our current economic circumstances. For a party that claims it wants to put Americans back to work, the Democrats are instead advertising their willingness to sacrifice jobs and economic recovery for salvation in November’s election.

Without question, disclosures about bank employees signing affidavits without reading them are troubling, but calling these technical deficiencies in the foreclosure process “frauds on the courts” and a reason to halt all foreclosures is a reaction wildly out of proportion to the seriousness of the fault and—if it succeeds—potentially disastrous for the economy.

Clearly, people who are in danger of foreclosure will be helped by a moratorium, but who will be hurt? The first victims will be the nation’s banks—not only the large ones, but also the small ones, the local banks that kept these mortgages on their balance sheets. If they are not going to receive any revenue from these mortgages, and they cannot foreclose, they will be weakened. If that happens, they cannot continue to make loans to small businesses, to consumers, or to those people who would like to take advantage of today’s low interest rates to buy a home, whether or not it is a foreclosed property. So the foreclosure moratorium will further weaken local economies and produce yet more unemployment.

Another victim of the moratorium will be pensioners. Pension funds for public and private employees are major holders of mortgages and mortgage-backed securities. If people are not paying principal and interest on their mortgages, these funds will not receive the revenues they have been counting on to meet their pension obligations. They will be required to borrow to make the payments required, and the cost of those borrowings will weaken their long-term ability to pay.

Yet a third set of victims will be Fannie Mae and Freddie Mac. These two government-sponsored entities hold or have guaranteed well over $5 trillion in mortgages and mortgage-backed securities. Because they became insolvent in 2008, they are currently under the control of the government, and have thus far received about $150 billion in taxpayer funds to keep them afloat. If they do not receive the principal and interest on the mortgages they hold, the taxpayers’ costs for keeping them financially solvent will increase, adding directly to the enormous deficit that is already a problem for the United States. So the moratorium is another direct burden on the taxpayers.

The housing industry, which amounts to almost one-sixth of the U.S. economy, has always been the economic sector that led the United States out of recessions. This time, because of the huge buildup of weak and high-risk mortgages in the housing bubble that deflated in 2007, the housing market has been much slower to recover than in the past. This is because the inventory of unsold homes remains high, and potential buyers know that prices still have further to fall. As long as there are large numbers of unforeclosed homes—homeowners that are neither paying principal or interest on mortgages nor making their homes available for sale to buyers who will make these payments—the housing market will continue to languish, extending the recession indefinitely.

Voters who are paying their mortgages, who are looking for jobs and can’t find them, who are taxpayers hoping to reduce their burdens as well as the U.S. deficit, and all Americans who are worried about the weakness of the economic recovery, should recognize that the politicians who are calling for a nationwide moratorium on foreclosures are not their friends.

--- Peter J. Wallison is the Arthur F. Burns Fellow in Financial Policy Studies at the American Enterprise Institute.


TOPICS: Business/Economy; Culture/Society; Government; News/Current Events
KEYWORDS: foreclosure; housing; moratorium; mortgages

1 posted on 10/13/2010 6:44:21 AM PDT by WebFocus
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To: WebFocus
There has to be something done about all the fraudulent foreclosures going on. It is inexcusable for any private entity to try and steal property from persons who either do not owe any money on it or who are current on their loans. While a moratorium is an extreme option, something has to be done to these banks who insist on engaging in fraudulent practices that end up causing grief for homeowners who are NOT in foreclosure.

I'm still wondering how long it will be before repo men bang down the wrong door and get killed while doing this (not that I would be against such a thing of course, people have a right to protect their property).

2 posted on 10/13/2010 6:47:49 AM PDT by pnh102 (Regarding liberalism, always attribute to malice what you think can be explained by stupidity. - Me)
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To: WebFocus

This sums it up nicely! Once again, the people that are following the rules, the laws and achieving are the ones that will be hurt. This moratorium invites deadbeats.


3 posted on 10/13/2010 6:48:37 AM PDT by albie
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To: pnh102

Not to diminish the documentation problem, but a tiny, tiny portion of those being foreclosed upon are actually paying their mortgages.

Fact is these people are NOT paying their mortgages (aside from a few high-profile exceptions that I’d agree with you on about them getting killed about).

The quesiton isn’t whether the homeowners shouldn’t be foreclosed upon, rather, it’s WHOM should be doing the foreclosing.


4 posted on 10/13/2010 6:50:27 AM PDT by RockinRight (if the choice is between Crazy and Commie, I choose Crazy.)
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To: WebFocus

A lot of these”deadbeats”shouldn’t have loans to begin with!Now that they are being foreclosed,a lot of these houses could sell at these depressed prices.The market would “right”itself,but(once again)the government is interfering with”The Market”!!!!!


5 posted on 10/13/2010 6:50:44 AM PDT by bandleader
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To: pnh102
Lose more jobs, kick the problem of housing down the road.

These people who took out loans and can't pay them get out.

I know I can't afford a multi- Million dollar home, no matter what kind of loan they offer. Get out of you house so this country can recover.

6 posted on 10/13/2010 6:50:57 AM PDT by scooby321
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To: pnh102
It is inexcusable for any private entity to try and steal property from persons who either do not owe any money on it or who are current on their loans.

It is likewise inexcusable that anyone should be allowed to borrow hundreds of thousands of dollars to buy a house and then refuse to pay it back and expect to live in that house indefinitely for free.

7 posted on 10/13/2010 6:52:18 AM PDT by P-Marlowe (LPFOKETT GAHCOEEP-w/o*)
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To: pnh102

I agree that the guilty and incompetent should be prosecuted.

Having said that, WE ALL KNOW THAT MANY PROPERTIES NEED TO BE FORECLOSED !

To make a sweeping declaration saying NO PROPERTY WILL BE FORECLOSE FROM HERE-ON will lead to disaster.

It would be like Obama banning off shore drilling because of the one disaster BP made and then punishing the rest of the drillers who made sure they followed safety rules.

Think of how many unemployed people that will create.

BTW, Obama relented and rescinded the offshore drilling ban yesterday.


8 posted on 10/13/2010 6:53:14 AM PDT by WebFocus
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To: WebFocus

“Bank Holidays” (and a moratorium on foreclosures could be seen as such) are usually a last desperate measure to stave off complete economic collapse.....

I don’t think we’re quite there, yet - but the fact that it’s being ‘trial-ballooned’ is a bit scary.....


9 posted on 10/13/2010 6:58:00 AM PDT by Uncle Ike (Rope is cheap, and there are lots of trees...)
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To: pnh102

>> people have a right to protect their property

Doesn’t that right extend to lenders too? If not, why not?

Put another way: a government that regulates away the property rights of lenders can JUST AS EASILY regulate away the property rights of homeowners and landowners.


10 posted on 10/13/2010 6:58:40 AM PDT by Nervous Tick (Trust in God, but row away from the rocks!)
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To: pnh102

“It is inexcusable for any private entity to try and steal property from persons who either do not owe any money on it or who are current on their loans.”

Of course.

And of course that’s not the case.

What we’re seeing is people searching for technicalities to hold onto property on which they are in default.

Plain and simple.

Many here applaud that (those “evil” banks and all).

Yet when lawyers use technicalities against any of their favorite interests, they cry that something needs to be done to rein in the lawyers.

Taked your pick.


11 posted on 10/13/2010 7:02:03 AM PDT by Pessimist
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To: pnh102

I just hope people look at their own records.

My sister and her husband are upper middle class 6 figure earners. Not exactly deadbeats by any means. My sis checked out their mortgage with the registrar of deeds and found that in the 5 years they’ve been paying on there home, its gone through 9 different servicers that she and her husband were totally unaware of.

On the other hand, the ACORN crowd is licking their chops. I’m also concerned about how our government will behave. Its a perfect opportunity for them to take over the properties and begin “diversifying” who neighborhoods.


12 posted on 10/13/2010 7:05:48 AM PDT by cripplecreek (Remember the River Raisin! (look it up))
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To: Pessimist

So a bank throws away the documentation that proves that they own the house because they want to lie about the documentation to the Bond buyers they are selling the mortgage to...(which includes us, mutual funds, pensions, etc.)

then later on they need to foreclose? Screw the banks, let me get out the worlds smallest violin. The bondholders need to prosecute the banks for fraud.

And if you want to foreclose on me? Prove you own the note, then we’ll talk.


13 posted on 10/13/2010 7:07:16 AM PDT by delapaz
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To: Nervous Tick
Doesn’t that right extend to lenders too? If not, why not?

And who is saying it doesn't? Lenders have a right to foreclose and seize any property in default but we're seeing too many lenders use shady legal practices which too often result in people who have nothing to do with the property being foreclosed upon being screwed.

Banks should not be allowed to use the "clerical error" defense when it comes to defending attempts to seize the wrong property in a foreclosure process. If any common crook tried breaking into someone's house and then waved a piece of paper signed by someone that states it was OK to do this, I don't think the police or the courts would buy that as a defense. Why shouldn't banks be expected to obey the law when it comes to foreclosures?

14 posted on 10/13/2010 7:09:09 AM PDT by pnh102 (Regarding liberalism, always attribute to malice what you think can be explained by stupidity. - Me)
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To: pnh102

It is very troubling that there is so much fraud taking place on foreclosure paperwork, and the problem of deciding who has clean title has to be addressed.

That said, I have not heard of one single case so far of anyone who was fraudulently foreclosed upon. Neither has there been a single report that I have heard of a person being mistakenly evicted from their home due to a fraudulent foreclosure.

There have been incidents of contractors hired by banks to secure a property, showing up at the wrong address to change the locks or disconnecting utilities, but that is an entirely different matter that is not, repeat, NOT related to the issue at hand.

This crisis in the short term is going to hurt the banks and help anyone that is going through foreclosure and still living in the house (about half of existing in-process foreclosures). In the long term, depending on how long this takes to sort out, the housing market will continue to decline and when all of these properties hit the markets all at once, home prices will sag even further. That means people who want to sell their houses probably won’t be able to, or at least will get far less for it. It also means that people who are underwater now will be even further underwater as home prices drop further.

A lot of the hype the media is throwing around for the Democrats misses the mark on what the impacts of this defacto freeze are really going to be. The problem is not that these foreclosures should not have taken place, it is in the way the paperwork is being handled.

No matter what, the best possible thing to do is get these foreclosures finished as quickly as possible and get the properties back on the market. That is being delayed even further, and therein lies the real problem here.


15 posted on 10/13/2010 7:10:45 AM PDT by Bean Counter (Now what kind of a geroo are you anyway?)
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To: WebFocus
Last night I attended tax school for the franchise that I prepare personal taxes. Our subject was Foreclosures and Abandonments.

Foreclosures may cause a "Gain" or "Loss" which has tax conseqences. It is very complicated and will certainly confuse the unemployed downtrodden with economic complexities which certainly hurt.

A gain would mean extra taxes for these foreclosured citizens!

The IRS is still updating the tax code and guess what?

Bend Over!

16 posted on 10/13/2010 7:10:56 AM PDT by Young Werther ("Quae cum ita sunt" Since these things are so!)
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To: pnh102

>> And who is saying it doesn’t?

By disallowing all foreclosures, the government is saying lenders have no property rights. Or how did you want to spin it?


17 posted on 10/13/2010 7:14:29 AM PDT by Nervous Tick (Trust in God, but row away from the rocks!)
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To: Pessimist
And of course that’s not the case.

Actually it is. Go look for yourself and you will see that there are rising numbers of property seizures being attempted on people who are either current with their mortgages or who do not owe money on their houses.

What we’re seeing is people searching for technicalities to hold onto property on which they are in default.

If a bank screws up its documentation process and cannot legally seize a property as a result then that is the bank's problem. This version of "the dog ate my homework" excuse did not work in school and it certainly should not be able to work in the real world... especially when those of us who have been on the receiving end of a bank mistake have to spend our time and efforts digging up proof to show that it was indeed the bank that screwed things up.

Yet when lawyers use technicalities against any of their favorite interests, they cry that something needs to be done to rein in the lawyers.

Agreed. But if the law provides for these technicalities and they are not respected by the litigants, then they have no one to blame but themselves for things not going in their favor.

18 posted on 10/13/2010 7:16:06 AM PDT by pnh102 (Regarding liberalism, always attribute to malice what you think can be explained by stupidity. - Me)
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To: albie
Spot on.

America used to be a nation of makers. Then, somehow, a new class developed - takers. People who believe that they were entitled to everything the makers produced without doing any work.

I have attempted to chase this trend backwards and have hit an apparent starting point - LBJ's war on poverty. Some of the political terms surrounding this “war” are very interesting. Everyone above the average was the most illuminating one.

Final thought - since we have lost the “war on poverty” can we now surrender and stop of of its losing programs?

19 posted on 10/13/2010 7:20:19 AM PDT by Nip (A COIN carrier since 1975.)
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To: WebFocus
This is a very simple problem to solve. If you're in the process of getting foreclosed upon, have a lawyer review all the relevant documentation. The foreclosing party must be able to document clear ownership of the mortgage in question, just as the property title has be be unencumbered prior to transfer.

This is apparently a high hurdle for some companies to get over, given the intricacies of the mortgage securitization process... so says Karl Denninger.

In any event, there are very specific and straightforward laws that govern the foreclosure process. All we have to do is follow them.

20 posted on 10/13/2010 7:23:12 AM PDT by Oberon (Big Brutha Be Watchin'.)
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To: pnh102
Here's more of Karl Denninger on the topic.
21 posted on 10/13/2010 7:25:55 AM PDT by Oberon (Big Brutha Be Watchin'.)
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To: delapaz

“So a bank throws away the documentation that proves that they own the house because they want to lie about the documentation...”

LOL!

Yeah! That’s it !

They did it on purpose because they wanted to lie about it.

Boy! You’re sure showin’ ‘em now!


22 posted on 10/13/2010 7:34:31 AM PDT by Pessimist
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To: pnh102

Agreed.

Technicalities or not, they should be observed.

I disagree with your asessment of the scope of the problem though. Just because the media can find a few people who are wrongly accused doesn’t make for a majority, or even a substantial minority.

I’m sure you’ve seen how whenever someone wants to cut welfare - jsut as an example - the media trots out the rare legitimate sob story to convince people against it.

Bottom line to me is still this (and it’s obviously a genrallization): A lot of people got in way over their heads and think nothing of using any means necessary to avoid that realization.

The whole thing is an ugly situation.


23 posted on 10/13/2010 7:40:08 AM PDT by Pessimist
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To: albie
Once again, the people that are following the rules,

What about the tens of thousands of probable cases of Perjury by the banks, mortgage companies, and their agents? Do we give them a pass?

What about the people who are paying on their mortgages who may never be able to get a clear, unencumbered Title Deed to the homes they've been paying for for decades?

Do we let the sleazeballs skate?

24 posted on 10/13/2010 7:46:49 AM PDT by Lurker (The avalanche has begun. The pebbles no longer have a vote.)
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To: Oberon

There appears to be a lot of different issues involved with this whole mess.

To me it looks like mortgage companies buy and sell the debt for the interest. My mother unexpectedly paid off the last of her mortgage in one lump sum and triggered a foreclosure attempt. Somebody bought the debt expecting interest to be paid over time. She paid it all at once and someone was left holding an empty bag. The mortgage servicer dropped the foreclosure attempt but her deed is still getting straightened out.


25 posted on 10/13/2010 7:46:49 AM PDT by cripplecreek (Remember the River Raisin! (look it up))
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To: Bean Counter

As a paralegal working in the bankruptcy field, I have secured many deeds and mortgages. I have not run across one mortgage that has been fradulent.


26 posted on 10/13/2010 7:51:01 AM PDT by carton253 (Ask me about The Stainless Banner - a free e-zine dedicated to the armies of the Confederacy.)
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To: pnh102
I tend to disagree with your assumptions. Of course there will always be fraud in lending on both sides, but the borrower's fraud has far exceeded that of the lenders.

Loans were given to people that didn't even have jobs or flat out lied on their applications. One report I read said there ware approx. 44.4 million mortgages in the US and of that about 9% were underwater. Underwater does not translate into foreclosures. Shutting down the whole process is absurd for the minimal numbers involved here. If there is fraud by the banks, prosecute them.

The fed has already dumped bond holder rights to the auto companies and given the assets to the unions. Contract law is becoming null and void is this country.

Why would anyone loan anything if there is no recourse?

27 posted on 10/13/2010 7:54:15 AM PDT by SouthTexas ("Global Climate Disruption" = More bovine excrement)
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To: pnh102

I think the truth is that very few of the foreclosures are ‘fraudulent’. In the vast majority of cases, money IS owed. However, it sounds like the banks have screwed up the documentation - not in the sense of not having any, but not having a strong enough paper trail to allow a court-ordered foreclosure.


28 posted on 10/13/2010 7:56:28 AM PDT by Mr Rogers (When the ass brays, don't reply...)
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To: pnh102

Don’t forget the possibility exists in this mess that a homeowner could get foreclosed on by two, three or even more “servicers” on the same property.


29 posted on 10/13/2010 7:57:00 AM PDT by mad_as_he$$ (Playing by the rules only works if both sides do it!)
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To: pnh102

Don’t forget the possibility exists in this mess that a homeowner could get foreclosed on by two, three or even more “servicers” on the same property.


30 posted on 10/13/2010 7:57:10 AM PDT by mad_as_he$$ (Playing by the rules only works if both sides do it!)
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To: cripplecreek

I’m surprised they tried to pull that on your mother. Modern mortgage agreements specifically authorize an early payoff by the mortgagee. You would think that all your mother would have to do is pull out her mortgage and point to Paragraph X subsection Y, and that would be the end of it.


31 posted on 10/13/2010 8:02:40 AM PDT by Oberon (Big Brutha Be Watchin'.)
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To: pnh102

“Go look for yourself and you will see that there are rising numbers of property seizures being attempted on people who are either current with their mortgages or who do not owe money on their houses.”

I say that is a crock. Got evidence?


32 posted on 10/13/2010 8:02:52 AM PDT by Mr Rogers (When the ass brays, don't reply...)
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To: Oberon

A few calls from her attorney and they decided to drop in. However there was some insurance fraud involved too and they really didn’t want to go to court over that.

Her homeowner’s insurance was to be paid with her mortgage. At some point someone dropped the insurance and pocketed the money. A tree fell on the house and she discovered that she didn’t have insurance. Bank of America gave her 30 grand in hush money and she fixed the house and paid off the remaining 10 to 15 grand she owed.


33 posted on 10/13/2010 8:08:34 AM PDT by cripplecreek (Remember the River Raisin! (look it up))
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To: RockinRight
"...... but a tiny, tiny portion of those being foreclosed upon are actually paying their mortgages."

I think you have that backwards. I'm betting most have been paying reduced amounts the banks offer in the form of Trial Modifications. It's far from uncommon for this to go on for well over a year only to have the bank then claim the borrower is unqualified for some minor reason.

34 posted on 10/13/2010 8:16:26 AM PDT by moehoward
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To: WebFocus

Time after time and day after day, politicians of all stripes demonstrate their breathtaking lack of any economic sense or knowledge at all. They are totally bereft of common sense as well.


35 posted on 10/13/2010 8:18:59 AM PDT by Bloody Sam Roberts ("Give me a secret. Bring me a sign. Give me a reason to walk through fire.")
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To: albie

Well the other side of the coin is that if the deadbeats are living rent free they can go out and stimulate the economy by buying more tvs and eating out at fancy restaurants. They will have more disposable income. Maybe they will even pay down thier credit cards and pay off thier BMWs!


36 posted on 10/13/2010 8:25:06 AM PDT by CJ Wolf
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To: Lurker

“What about the tens of thousands of probable cases of Perjury by the banks, mortgage companies, and their agents? Do we give them a pass”?

...absolutely not! I’m a Realtor and I gotta tell you, people are given a choice in Va to whether to purchase title insurance or not. I always suggest it but sometimes people opt out to save $900-$2000+/- and say no. That’s a real problem for them. I don’t think they deserve to lose their home, but they have made their own bed.

Also, there are several channels to go through when purchasing a home and all (at least in my experience) explain the ups and downs of home ownership. The foreclosure procedure, inspections, deeds, title, you name it.


37 posted on 10/13/2010 8:38:24 AM PDT by albie
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To: WebFocus
"To make a sweeping declaration saying NO PROPERTY WILL BE FORECLOSE FROM HERE-ON will lead to disaster."

Overly dramatic. No one is making such a statement. At least no one credible.

There is nothing wrong with taking a breather to assess exactly what's going on. I realize that would put a crimp in all those fees the Servicers are making right now, but in the long run it'll be smarter.

38 posted on 10/13/2010 8:38:50 AM PDT by moehoward
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To: albie
I’m a Realtor and I gotta tell you, people are given a choice in Va to whether to purchase title insurance or not.

The major Title Insurance companies have already told the banks to take a flying leap in the case of foreclosure sales. So that product isn't even available any longer.

And we're not talking about the buyers here. We're talking about tens of thousands of probable cases of Perjery by the banks and their agents. That's damned serious and if it's true then people need to be going to prison.

Then there's the issue of 'who's got the Title?'. There seem to be many, many cases of "we can't find it" syndrome. How is anyone supposed to get a clear, unencumbered Title Deed ever?

That's damned serious, too.

These banks, mortgatge and insurance companies, and yes many, many realtors were more than happy to cash the checks for the last few years. Your entire industry is in this up to the metaphorical eyeballs.

Now you can live with the consequences of playing fast and loose for the last decade. I have no sympathy for any of you. None.

39 posted on 10/13/2010 9:01:27 AM PDT by Lurker (The avalanche has begun. The pebbles no longer have a vote.)
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To: Mr Rogers
I say that is a crock. Got evidence?

Bank of America just suspended all of its foreclosures because they themselves admitted there could be legal problems. JP Morgan Chase also halted foreclosures after they admitted they never verified loan documents. Why would these banks do such things if the problems were not that widespread?

40 posted on 10/13/2010 9:26:48 AM PDT by pnh102 (Regarding liberalism, always attribute to malice what you think can be explained by stupidity. - Me)
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To: pnh102

There is a huge difference between admitting that the banks need to clean up their paperwork so it can be supported in bankruptcy court, and claiming they are trying to “...steal property from persons who either do not owe any money on it or who are current on their loans.”

The folks getting hit by foreclosures OWE money. They are NOT current on their loans. Where the banks have screwed up is in using electronic tracking where some states require paper. But the owners are not folks who own their own homes, and suddenly have a bank pretending they owe money...


41 posted on 10/13/2010 9:49:25 AM PDT by Mr Rogers (When the ass brays, don't reply...)
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To: moehoward

Anyone who buys a house without insuring the title is too stupid for me to care about...


42 posted on 10/13/2010 9:55:07 AM PDT by Mr Rogers (When the ass brays, don't reply...)
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To: Mr Rogers

Unless they pay cash, or go with some ‘owner financing’ scheme, it’s a requirement.

Other than that, I’d agree that anyone who blindly pays cash for real estate these days, is indeed too stupid to care about.


43 posted on 10/13/2010 10:25:29 AM PDT by moehoward
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To: Bean Counter
the best possible thing to do is get these foreclosures finished as quickly as possible and get the properties back on the market.

I agree with you.

The problem is that the banks holding the mortgages have a vested interest in letting the properties slowly trickle onto the market.

It's the only way they can avoid revealing how over-valued their mortgage portfolio is, and how insolvent they are.

The consequences of housing finally reaching a market clearing price would be far worse for the banks than allowing the deadbeats to stay in the homes a while longer.

So when Harry Reid calls for a national foreclosure, I suspect the banking industry will reply... "Oh Lawd, Senatuh, don' throw us in that briar patch!!

44 posted on 10/13/2010 12:16:00 PM PDT by Notary Sojac ("Goldman Sachs" is to "US economy" as "lamprey" is to "lake trout")
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To: carton253

As a paralegal, you probably understand the problem here better than any of us. As I understand it, the large banks (Chase, Wells Fargo, BofA, et al) set up foreclosure shops to try and clear as many of these defaulted mortgages as possible. In the States that require some sort of judicial review, they tried to get by with hiring people with little or no experience to process paper that rightfully ought to be prepared, reviewed and submitted by a paralegal at a minimum. In some States an attorney could be required depending how complex the foreclosure is.

I’m not making excuses for anyone here. Process is process and every State is different. But at the same time Fannie Mae and Freddie Mac have been pushing the banks to foreclose as quickly as possible.

This is also a good distraction 2 weeks before the election, to keep people from talking about HAMP mortgage modifications that the Treasury has been bonusing Fannie Mae employees on. What has been happening is that people apply for a temporary 90 day mortgage modification from Fannie, they pay a reduced payment for three months, then the Bank lets them know they really didn’t qualify, are now in default, and owe back interest and penalties. That is potentially a much larger scandal than this one, and would make one hell of a statement about this Regime, if the media ever gets around to reporting on it.


45 posted on 10/13/2010 2:40:07 PM PDT by Bean Counter (Now what kind of a geroo are you anyway?)
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