Gretchen Morgenson | FORECLOSURE FRAUD | by DinSFLA

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A Foreclosure Film in the Making Awaits Final Scene

A Foreclosure Film in the Making Awaits Final Scene


American Banker-

What do an insurance agent in Tennessee, a homemaker in Ohio, a private investigator from Wisconsin and a helicopter stunt pilot in Hollywood have in common?  Well, for one thing, they’ve all participated in some fashion in “Foreclosure Diaries,” the documentary that my company, Pacific Street Films, has been producing, in fits and starts, since 2006.

When work first started on the film, the original tag was “Follow the Money,” and the road seemed to lead towards a dark and confusing destination. There was all this talk in the industry about scads of money to be made in servicing “subprime” loans.  There were seminars, conferences, it seemed all the rage. 

[AMERICAN BANKER]

image: macgasm.net

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Gretchen Morgenson: A Bailout by Another Name

Gretchen Morgenson: A Bailout by Another Name


ED DeMARCO is a marked man.

NYT-

The acting director of the Federal Housing Finance Agency and overseer of Fannie Mae and Freddie Mac, Mr. DeMarco is a soft-spoken, career public servant — and under fire. In the thankless job of conservator for the loss-ridden mortgage finance giants, he has a duty to ensure that the companies operate in the best interests of the taxpayers who own them. That means working to keep a lid on the companies’ losses, which now total $183 billion.

But in recent weeks, Mr. DeMarco has come under increasing pressure to chuck his obligation to taxpayers and make Fannie and Freddie write down principal on mortgages held by troubled borrowers. He says, with reason, that such a program would run counter to his legal obligation to pursue only those activities that pose the least cost to taxpayers.

[NEW YORK TIMES]

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Robosigning focuses attention on title companies

Robosigning focuses attention on title companies


TIC-TOC…

SFGATE-

Chain of title – proof of who really owns a house – underpins the entire U.S. system of real estate.

Broken chain of title due to slipshod paperwork was a serious issue uncovered in the nationwide robosigning scandal and again last month in a city report that found San Francisco foreclosure paperwork riddled with errors.

Those revelations draw new attention to title companies, which insure a home’s clear title for both buyers and lenders.

“If there is not a clear chain of title in the foreclosure process, how can there be a clear chain of title for the person buying foreclosed property?” said San Francisco Assessor-Recorder Phil Ting, who commissioned the audit. “Given our report, it calls into question whether entities selling a foreclosure really have the right to transfer that property to somebody else.”

Read more: [SFGATE]

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Adam Levitin: Pushback on the San Francisco City Assessor-Recorder Foreclosure Audit

Adam Levitin: Pushback on the San Francisco City Assessor-Recorder Foreclosure Audit


Credit Slips-

Not surprisingly, there’s been some attempts to downplay the significance of the SF City Assessor-Recorder foreclosure audit. The attacks have come in three flavors:  questions about the auditors’ own background; questions about the accuracy of the report; and the “who cares, as these are just lousy deadbeats” argument. Even if we acknowledge that there is something to each of these attacks, they don’t take away from the core finding of the report, which is that things are FUBAR in mortgage documentation, and that is going to inevitably result in some honest, but unfortunate homeowners being harmed.

The first attack is on the credentials and former activities of the auditors. Given the deeply compromised background of the OCC foreclosure review auditors, this is a chutzpadik attack. The sad truth is that there isn’t a huge pool of people who can do this sort of audit. (Yes, takes it takes a thief and all that…) 

[CREDIT SLIPS]

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[VIDEO] SF Assessor-Recorder Phil Ting Uncovers Widespread (FRAUD) Mortgage Industry Irregularity

[VIDEO] SF Assessor-Recorder Phil Ting Uncovers Widespread (FRAUD) Mortgage Industry Irregularity


This is an explosive video and the AG’s better listen carefully because titles are in serious jeopardy. Forget the settlement… HOW do they prepare to correct the DEFECTS in YOUR TITLE?

Watch the video and listen to how the “New Lender” is stealing assigning Your Home to themselves… I hope AG Kamala Harris follows up and why haven’t the AG’s conducted these investigations? Truly sad.

58% of conflicts with MERS.

by on Feb 15, 2012

Assessor-Recorder Phil Ting Uncovers Widespread Mortgage Industry Irregularity in San Francisco Foreclosures

 

[Click on Image Below]

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Pelosi, Speier Request Justice Department Examination into Possible Violations of Federal Law in San Francisco Foreclosures

Pelosi, Speier Request Justice Department Examination into Possible Violations of Federal Law in San Francisco Foreclosures


Washington, D.C. – Democratic Leader Nancy Pelosi and Congresswoman Jackie Speier sent a letter today to Attorney General Eric Holder requesting he direct the Justice Department’s Financial Fraud Enforcement Task Force to examine whether any violations of Federal law occurred in the processing of foreclosures in San Francisco. 

The County of San Francisco’s Office of the Assessor-Recorder recently commissioned a report assessing compliance with applicable foreclosure laws by certain entities in the mortgage industry operating in San Francisco.

Below is the full text of the letter. 

February 17, 2012

The Honorable Eric H. Holder, Jr.
Attorney General
Robert F. Kennedy Department of Justice Building
950 Pennsylvania Ave., NW
Washington, DC 20530

Dear Attorney General Holder:

We are writing to request that you direct the Justice Department’s Financial Fraud Enforcement Task Force to examine whether any violations of Federal law occurred in the processing of foreclosures in San Francisco.

The County of San Francisco’s Office of the Assessor-Recorder recently commissioned a report, which is enclosed, assessing compliance with applicable foreclosure laws by certain entities in the mortgage industry operating in San Francisco. The report, based on a review of a random sample of mortgage loans that entered into foreclosure between January 2009 and October 2011, found that 99 percent of the San Francisco mortgages reviewed showed irregularities in the foreclosure process, and 84 percent showed potential violations of California non-judicial foreclosure laws.  In addition, foreclosures involving mortgages that were part of the Mortgage Electronic Registration System (MERS), which are more likely to have been securitized, showed a high rate of conflicting information regarding the actual beneficiary, which raises questions about whether homeowners were denied their due process rights.  We find these findings very troubling. 

Because the report does not specify the mortgage servicers involved, it is not possible to determine whether affected borrowers can seek remedies under provisions in the multi-state mortgage settlement. However, even if some borrowers can seek redress through the settlement process, or through private rights of action, the irregularities and violations cited in the report convince us that further investigation at the Federal level is warranted to determine whether any violations of Federal civil and criminal laws might have occurred.

The Assessor-Recorder has already referred the report’s findings to California Attorney General, Kamala Harris, for her review.  We believe the severity of the report’s conclusions also warrant a thorough review at the Federal level by the Task Force. 

We appreciate the hard work of the Obama Administration and the state Attorneys General, including the helpful protections for borrowers secured by California Attorney General Kamala Harris, in achieving a multi-state mortgage settlement. We are hopeful that preserving the ability of the states and the Federal government to continue to pursue actions not covered by the terms of the settlement will ensure that homeowners who experienced losses unfairly, particularly where abusive practices were the cause, will be able to seek a remedy.

Thank you for your attention to this matter.

best regards,

Nancy Pelosi
Democratic Leader

Jackie Speier
Member of Congress

Cc:           The Honorable Kamala Harris, Attorney General, State of California
                The Honorable Edwin M. Lee, Mayor, San Francisco, California
                The Honorable Phil Ting, Assessor-Recorder, City & County of San Francisco

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Adam Levitin: Why No Investigation?

Adam Levitin: Why No Investigation?


The robosigning itself and similar lack of internal controls are the small potatoes. There are much more serious things in the SF City Assessor report.


Credit Slips-

Here’s a bombshell: the San Francisco City Assessor commissioned a serious audit of foreclosure documentation filed in the past few years. The audit examined 400 foreclosures.  It found problems with 85% of them, often multiple problems. What’s more, some of the problems are pretty serious as they implicate not only borrowers’ rights, but the integrity of mortgage-backed securities and the property title system.  

The San Francisco City Assessor’s audit also serves as a benchmark for evaluating the Federal-State servicing settlement.  The San Francisco City Assessor managed to accomplish in a few months what the Federal government and state Attorneys General weren’t able to do in nearly a year and a half with far greater resources at their disposal:  perform a credible investigation of foreclosure documentation with serious implications about the securitization process in general.  That’s a lot of egg on the face of Shaun Donovan, Eric Holder, Tom Miller, et al.  The SF City Assessor report shows that it really wasn’t so hard for a motivated party to undertake a serious investigation. And that raises the question of why the largest consumer fraud settlement in history proceeded with virtually no investigation. 

The lack of investigation was the compelling criticism that led the NY and DE AGs to stay out of the settlement for quite a while. I’ve never heard an answer as to why no serious investigation. As the SF City Assessor’s audit shows, the documentation is all a matter of public record.  It’s not that hard to do, especially if you have the resources of the federal government.  So the resources were there. The capability was there. So why no investigation?  The answer has to lie with lack of motivation. Were the Feds and AGs scared of what they would find if they delved too deeply into the issue? 

I hope that members of Congress will question the Attorney General and HUD Secretary the next time they show up to testify on the Hill.  The issue is also worthy of a GAO or IG examination. 

[…]

[CREDIT SLIPS]

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Foreclosure Fraud, Abuse Rampant Across U.S., experts say

Foreclosure Fraud, Abuse Rampant Across U.S., experts say


* Report found 84 pct of San Francisco disclosures illegal

* High levels found across the country, experts say

REUTERS-

A report this week showing rampant foreclosure abuse in San Francisco reflects similar levels of lender fraud and faulty documentation across the United States, say experts and officials who have done studies in other parts of the country.

The audit of almost 400 foreclosures in San Francisco found that 84 percent of them appeared to be illegal, according to the study released by the California city on Wednesday.

“The audit in San Francisco is the most detailed and comprehensive that has been done – but it’s likely those numbers are comparable nationally,” Diane Thompson, an attorney at the National Consumer Law Center, told Reuters.

Across the country from California, Jeff Thingpen, register of deeds in Guildford County, North Carolina, examined 6,100 mortgage documents last year, from loan notes to foreclosure paperwork.

[REUTERS]

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AEQUITAS REPORT: FORECLOSURE IN CALIFORNIA A CRISIS OF COMPLIANCE

AEQUITAS REPORT: FORECLOSURE IN CALIFORNIA A CRISIS OF COMPLIANCE


1. Introduction

The City and County of San Francisco’s Office of the Assessor-Recorder retained Aequitas Compliance Solutions, Inc. to review 382 residential mortgage loan transactions (the “subject loans”) that resulted in foreclosure sales that occurred from January 2009 through October 2011.1 Over this period, there were 2,405 foreclosure sales. The subject loans thus represent approximately 16% of the total. (See Appendix B – Methodology.)

We analyzed the subject loans to determine the mortgage industry’s compliance with applicable laws. Specifically, we focused our analysis on important topics relating to six Subject Areas:

Assignments
Notice of Default
Substitution of Trustee
Notice of Trustee Sale
Suspicious Activities Indicative of
Potential Fraud
Conflicts Relating to MERS

[ipaper docId=81783176 access_key=key-23u7jv139fdxzsk3ytub height=600 width=600 /]

 

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MASSIVE: California Audit Finds Broad Irregularities in Foreclosures

MASSIVE: California Audit Finds Broad Irregularities in Foreclosures


“Almost all involved either legal violations or suspicious documentation”

Gretchen Morgenson-

An audit by San Francisco county officials of about 400 recent foreclosures there determined that almost all involved either legal violations or suspicious documentation, according to a report released Wednesday.

Commissioned by Phil Ting, the San Francisco assessor-recorder, the report examined files of properties subject to foreclosure sales in the county from January 2009 to November 2011. About 84 percent of the files contained what appear to be clear violations of law, it said, and fully two-thirds had at least four violations or irregularities.

The report comes just days after the $26 billion settlement over foreclosure improprieties between five major banks and 49 state attorneys general, including California’s. Among other things, that settlement requires participating banks to reduce mortgage amounts outstanding on a wide array of loans and provide $1.5 billion in reparations for borrowers who were improperly removed from their homes.

[NEW YORK TIMES]

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Robosigning = Smoking Gun

Robosigning = Smoking Gun


FDL-

There are a few voices emerging suggesting that the current iteration of the “50 AG settlement” is somehow wonderful, or at least OK, because it only immunizes robosigning. “Only,” as if robosigning was some relatively benign peccadillo, instead of a massive conspiracy to commit forgery and perjury that is systematically driving our population into homelessness AND continuing to drive down the value of our homes…

[FIRE DOG LAKE]

image: sodahead

 

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Expanding Reach, Cuomo Creates Second Cop on Financial Beat

Expanding Reach, Cuomo Creates Second Cop on Financial Beat


“It’s not common to have a combined regulatory and enforcement function,” he said, adding, “It’s effectively very competitive with the attorney general’s jurisdiction.”

The two agencies are publicly cordial, but behind the scenes they are much like two boxers feeling each other out in an opening round. Already, turfs are overlapping.

 NYT-

Benjamin M. Lawsky is not the attorney general of New York State.

But one could be forgiven for being confused. Since Gov. Andrew M. Cuomo installed him as superintendent of a new state agency, the Department of Financial Services, which became active in October, Mr. Lawsky has been making headlines normally associated with attorneys general.

He has forced insurers to turn over more than $100 million in unpaid death benefits to surviving family members, dispatched rafts of subpoenas to banks, and pressed lenders to curb abusive foreclosure practices.

[NEW YORK TIMES]

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UP w/ Chris Hayes | NY Attorney General Eric Schneiderman on President Obama’s Mortgage Crisis Unit

UP w/ Chris Hayes | NY Attorney General Eric Schneiderman on President Obama’s Mortgage Crisis Unit


I’ve watched several of Chris’s videos and he has a way of explaining foreclosure fraud very well & always asks the right questions. This is a great video for those who are just in the beginning stages.

Must watch in its entirety…

New York Attorney General and co-chair of President Obama’s new mortgage crisis unit Eric Schneiderman talks with Chris about his expectations for the new mortgage crisis investigations.

Visit msnbc.com for breaking news, world news, and news about the economy

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MATT TAIBBI | A Victory for the Public on Foreclosures? Half of Wall Street May End Up In Jail.

MATT TAIBBI | A Victory for the Public on Foreclosures? Half of Wall Street May End Up In Jail.


Rolling Stone-

So there was big news yesterday on the foreclosure settlement front. We still have to wait and see what the final deal looks like, but there are reports out that the long-awaited settlement is a far, far better deal for the public than expected. If these reports are true, it looks like New York Attorney General Eric Schneiderman and California AG Kamala Harris have scored an enormous victory in narrowing the scope of the settlement to the point where it really only covers robosigning abuses.

[ROLLING STONE]

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Mortgage Task Force Has a Fancy Name, but Will It Get Tough?

Mortgage Task Force Has a Fancy Name, but Will It Get Tough?


Where was Obama these last years, millions getting thrown out in the streets?

This is purely political and this is election year…coincidence? NOT.

Gretchen Morgenson-

PRESIDENT OBAMA told the nation last week that he was convening a task force to investigate the abusive practices in the mortgage industry that led to our economic woes. Both lending and the practice of bundling loans into securities will come under scrutiny, he said, adding: “This new unit will hold accountable those who broke the law, speed assistance to homeowners and help turn the page on an era of recklessness that hurt so many Americans.”

Some greeted this new task force — its unwieldy name is the Residential Mortgage-Backed Securities Working Group — with skepticism. It is an election year, after all, and many might wonder if this is just a public-relations response to the outrage against the institutions and executives that almost wrecked the economy.

If this task force nailed some big names, and soon, it would help to allay deep suspicions that the authorities have given powerful people and institutions a pass during this awful episode.

[NEW YORK TIMES]

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Force-Placed Insurance | “a silent killer harming both consumer and investors while enriching the banks and their affiliates.”

Force-Placed Insurance | “a silent killer harming both consumer and investors while enriching the banks and their affiliates.”


ONE of the richest and most secretive sources of profit in the mortgage business is coming under scrutiny.

It’s about time.

 Gretchen Morgenson-

Investigators are training their sights on a type of hazard insurance policy known as force-placed insurance, a type of policy that has driven up costs for homeowners and pushed some into foreclosure. People who buy certain mortgage securities may be getting hurt, too.

Benjamin M. Lawsky, the superintendent of the New York State Department of Financial Services, is investigating institutions that underwrite and sell force-placed insurance. Last fall, his office began sending subpoenas to insurance agents and brokers. Requests for information also went out to insurance companies that write such policies.

[NEW YORK TIMES]

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Gretchen Morgenson  | A Year of Me-Firsts, and of Lessons Relearned

Gretchen Morgenson | A Year of Me-Firsts, and of Lessons Relearned


A great piece from Gretchen about the whole truth and nothing but the truth, so help ourselves because no one else will.

Fair Game-

LIVE and learn. And well we should, given that 2011 was packed with teachable moments.

Some of this stuff we already knew. Like the fact that banks love the perks that come with being too big to fail. They will lobby shamelessly to hang on to their riskiest businesses and stay perilously large. No surprise, really. A heads-we-win, tails-the-taxpayers-lose model has a lot going for it, at least for executives atop these institutions.

[NEW YORK TIMES]

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TYT: Feds Won’t Prosecute Banks Despite Evidence Of Crimes

TYT: Feds Won’t Prosecute Banks Despite Evidence Of Crimes


by on Dec 23, 2011

A devastating report by Reuters shows that the federal government is focusing on small scale swindlers while ignoring crimes by big banks despite a wealth of evidence against them. The Young Turks host Cenk Uygur breaks it down.

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Adam Levitin: More Rot in the OCC Foreclosure Reviews

Adam Levitin: More Rot in the OCC Foreclosure Reviews


Credit Slips-

Michael Olenick, Gretchen Morgenson, and Yves Smith have all written pretty damning things about the foreclosure reviews persuant to the OCC consent orders with major mortgage servicers. (For my own previous thoughts, see here and here.) I’ve just started to peruse some of the engagement letters with the firms conducting the reviews, and the rot is even worse that these other critics portray.

What follows is in no way a comprehensive cataloging of the problems in the OCC foreclosure review process–this is just what I spotted from the briefest of perusals.  Yet it is clear that there are two types of serious problems:  conflicts of interest and flawed substance of the review process. I’ll lay both out below and then give some thoughts as to what could and should be done to remedy this farcical process in order to ensure some accountability to the public and justice for homeowners. The post concludes with some thoughts about the core problem–the OCC–and what can be done to remedy it.   

Conflicts of Interest

[…]

[CREDIT SLIPS]

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Still Waiting for Cleanup in Foreclosure Mess – ProPublica

Still Waiting for Cleanup in Foreclosure Mess – ProPublica


by Marian Wang ProPublica, Dec. 27, 2011, 10:56 a.m.

This is part of our year-end series, looking at where things stand in each of our major investigations.

If last year [1] was the year in which faulty foreclosures and bank errors became a full-blown scandal, this has been the year of waiting for something to be done about it.

First, there’s the still-to-come multi-state settlement over alleged fraud on the part of the country’s five largest mortgage servicers. That’s the settlement being brokered by a coalition of state attorneys general and once touted [2] as homeowners’ best bet for redressing banks’ flaws in foreclosure and mortgage documentation. Over the past year, one story after another declared such a deal was imminent, but the details — the total price tag [3], the deal’s framework, and the expected date — have continually been changing.

Earlier this month, the Des Moines Register reported Iowa Attorney General Tom Miller — a point man for the attorneys’ general probe — as saying that the final deal should be complete before Christmas [4] and would include a measure to reduce the total debt owed by underwater homeowners. No deal has yet been announced. Miller wouldn’t disclose a dollar figure on the size of the settlement — or whether California, one of the hardest-hit states, would participate.

Over the course of the year, some state attorneys general seemed to lose faith in the coordinated effort, voicing concerns that the eventual settlement would be too easy on the banks.

California Attorney General Kamala Harris signaled her hesitation too [5], as did the attorneys general of New York [6], Delaware, Nevada, Massachusetts [7], Kentucky [8] and Minnesota [9]. These state attorneys general — many of whom have filed their own suits against major servicers [10], foreclosure processing firms [11], and other players [12] — questioned whether the settlement would limit their ability to take more aggressive action against foreclosure abuses in their states and either expressed doubts about whether they’d sign on to the final settlement or pulled out of the talks altogether.

Banks, meanwhile, have pushed for the settlement to include broader releases from legal liability over mortgage-related abuses. According to a recent Wall Street Journal piece, they’ve tried to make their participation in the settlement contingent on being shielded [13] from the possibility of lawsuits brought by the new Consumer Financial Protection Bureau.

Also still to be determined? An official to monitor the banks and servicers [14] and ensure they comply with whatever agreement is eventually reached.

Meanwhile, federal banking regulators have also begun to act. In April, the Office of the Comptroller of the Currency, the Office of Thrift Supervision, and the Federal Reserve accused eight mortgage servicers and two third-party mortgage processing firms of 201Cunsafe and unsound [15]” foreclosure practices and ordered them to come up with a plan to prevent the same errors going forward. (Read the orders [16] they received.) But the revamp plans drawn up by the banks are kept confidential [17]. And no financial penalties [18] have been issued, though regulators have said that they’re still to come.

Regulators also launched an interagency foreclosure review program [19] [PDF] this year to identify and compensate homeowners who were wronged in the foreclosure process. The plan is to review sample loan files pulled from the files from 14 largest mortgage servicers, as well as files from homeowners who submit a request for a review.

The regulators in charge of the program have so far declined to disclose information on key aspects of the review, such as what kinds of compensation are available to homeowners, how compensation would be calculated, and for what specific offenses. (Homeowners with questions can see our FAQ on the reviews [20] to see whether they’re eligible for review and how to apply.)

The reviews themselves are being conducted by outside consulting firms [21] that will be supervised by the regulators but paid by the banks. As we’ve reported [22], some lawmakers have raised concerns about the experience of the reviewers and whether they will truly be able to operate independently of the banks.

Finally, it bears mentioning that despite the efforts on both the federal and state level to address the systemic failures of banks and mortgage servicers, errors are continuing [23] — and they’re still causing wrongful foreclosures.

The only subset of homeowners who seem to have gotten a break — or redress for botched foreclosures — is military families. Earlier this year, the Justice Department settled lawsuits [24] against subsidiaries of Bank of America and Morgan Stanley over allegations that they wrongfully foreclosed on active duty service members, in violation of a law that specifically offers them greater protection from foreclosure. As part of that settlement, the two companies apologized [25] and paid a combined penalty of $22 million, plus compensation to certain service members who suffered wrongful foreclosures.

 

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Details of Mortgage Servicing Settlement Between Banks and AGs Begin to Emerge – TIME

Details of Mortgage Servicing Settlement Between Banks and AGs Begin to Emerge – TIME


Well, not really because what ever “negotiations” there is, we always know you’re out to help the banks and the not people.

Time-

The never-ending negotiations between the 50 state attorneys general (minus a few big ones) and five major banks over penalties and standards for past, present and future mortgage servicing are finally ending, and some details are beginning to emerge from sources familiar with the deal. The big number is the $25 billion that the banks will commit to three categories of the settlement: $5 billion in cash payments, mostly to the states, $3 billion in refinancing for underwater mortgages, and $17 billion in principal reduction. Here’s the breakdown:

Of the $5 billion, $1.5 billion will go to people who have been foreclosed on and were abused in some way during the process. The claims are nearly instantaneous–”we don’t read anything, it’s check the box,” says one state AG negotiator. But the payments are also small: $1,500 to $2,000. Now, the vast majority of people who lost their homes over the last several years probably would not have been able to make their payments even if the banks had been behaving well. For them a no-questions-asked $2,000 check from the bank for the poor treatment they received in the process may be fair. On the other hand, those who were unfairly evicted may be insulted by the small amount. But no one taking the payment would be giving up any rights to bring cases against the banks for wrongful eviction or other claims they may have. The federal regulator with oversight of the issue, the Office of the Comptroller of the Currency, has sent out 4.5 million forms to potentially wrongfully evicted families; processing those claims will be paid for by the banks.

[TIME]

 

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Foreclosure Relief? Don’t Hold Your Breath – Gretchen Morgenson

Foreclosure Relief? Don’t Hold Your Breath – Gretchen Morgenson


No matter how much corruption is exposed from the government, they simply don’t care.

It’s up to the few AG’s like CA, DE, MA, NY, NV to bring the fraud (CEO’s & not the low level employees) to jails.

Gretchen Morgenson-

THROUGHOUT the foreclosure crisis, Washington has done little to help people hang on to their homes. All those programs that were supposed to help — HAMP, HARP, Hope for Homeowners — have mostly failed.

So many were skeptical when the Office of the Comptroller of the Currency announced yet another program in April. This one was intended to provide reparations to homeowners who’d been hurt financially by foreclosure abuses at banks.

[NEW YORK TIMES]

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