Excellent piece by Richard (RJ) Eskow
HuffPO-
Imagine that a group of arsonists was terrorizing your town. First they’d buy insurance on a stranger’s home, then they’d show up with a blowtorch and a tanker truck filled with gasoline and burn the place down. Imagine that they’ve burned down a thousand homes this way, ruining the lives of the homeowners — and everyone else’s, too, as real estate values plunged and the local economy collapsed.
Now let’s imagine that the Mayor, the DA, and the Chief of Police said they’ve come up with a great “settlement”: The arsonists will pay a small fine, and they’ll never be prosecuted for arson. Plus, if they’re asked very nicely, they’ll also agree to provide a little help to 27 out of the 1,000 families they made homeless — although they’d control the ‘help’ process and the town might wind up footing the bill anyway.
And one more thing: They get to keep the gasoline truck and the blowtorch.
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I would carry this indictment of the proposed settlement even further and categorize it as nothing more than another bailout for the banks. If you agree that court decisions favoring homeowners on chain of title, produce the note, etc are the proper interpretation of the our real property laws including contracts and conveyances, UCC, recording, foreclosure, etc, then you must recognize that these re-fi options being offered to qualified “responsible homeowners who are current but underwater” are a farce – an empty show in terms of helping the harm to the market. Assuming the validity of those court decisions decrying the fraudulent actions by the bankers and barring them from acting on those invalid docs,then it follows that the banks are holding worthless notes and mortgages – unenforceable and uncollectable particularly in most bankruptcy cases. As such, the homeowner owes nothing to the pretender lenders and therefore should have no need to re-fi what they do not owe. This “settlement” is just a huge subterfuge that will permit the banks to remake the worthless notes and mortgages into good paper (debt instruments) that will be both enforceable and collectible. Why would any reasonably well-informed homeowner agree to any such re-fi? This is a ludicrous mockery of the settlement talks that were rightiously supposed to penalize the banks for the harm they have done. These re-fi options provide no relief nor restitution to the homeowners already harmed by past fraudulent actions.
Another plan that belongs to that same farce is the current proposal to extend the re-fi provisions that is causing Pres Obama so much criticism. I heard Megyn Kelly interviewing Lou Dobbs on Fox News today about Pres Obama’s authority to do this. Within her question to him she stated a presumption that this proposal is for people who bought houses they could not afford. LD did nothing to refute this notion and neither made any meniton of any culpable recklessness by the banksters. This is a huge example of irresponsible journalism and circular reasoning.