“WE’RE NOT AWARE of a single case so far of a substantive error,” The Journal’s editorial said. “Out of tens of thousands of potentially affected borrowers, we’re still waiting for the first victim claiming that he was current on his mortgage when the bank seized the home.” The fund manager Barry Ritholtz, who writes the blog The Big Picture, and Naked Capitalism’s Yves Smith, whose chronicle of the foreclosure jumble has been encyclopedic, furious and convincing, would disagree. They’ve linked to stories in papers like the Sarasota Herald-Tribune and The South Florida Sun Sentinel about banks mistakenly taking over homes that hadn’t been foreclosed on. Not only was Fort Lauderdale’s Jason Grodensky not late on the payments on the house that Bank of American foreclosed on, but he didn’t even have a mortgage.
“Thanks for the query,” The Journal’s editorial page editor said, responding to an interview request, “but I think I’ll let the editorial speak for itself.”
(bold mine)
That’s how national journalism works these days. You imply something that isn’t true and when you’re corrected, you let that false implication speak for itself.
Thank FSM Murdoch’s going to bury this toilet paper factory within a few years.
Martin
I reject your reality and substitute my own.
I blame the Mythbusters.
Comrade Javamanphil
I think this only strengthens the Journal’s point.
slag
Either you’re extraordinarily optimistic or you know something I don’t.
ThatLeftTurnInABQ
Shorter Journal:
Le fourth estate c’est moi
Now run along all you annoying peasants, and go eat your cake.
SpotWeld
Well you gotta show both sides of the story.
Reality and whatever it is the banks want you to think is reality.
Citizen Alan
I give us another five years at the most before it is just accepted practice for banks to gain the power to just seize homes outright with no judicial process at all and no recourse at all for the Jason Grodensky’s of the nation. And then, another five years before a Republican Congress codifies this power into law (with the support of the Blue Dogs, of course).
kay
Parts of that are absolutely hysterical.
What’s mind-boggling is, these were, at one time, their customers.
Is there not enough competition in finance and lending? Is that how they survive while treating people like absolute garbage? They completely screwed up the work, and the answer to that is “you shouldn’t have borrowed the money from us, deadbeat, because we’re obviously incompetent, so there”.
MattR
These are the same clowns who complain about how they wont be able to make ends meet if the Bush tax cuts are allowed to survive yet they are dripping contempt with all those lower and middle class Americans who bought houses “beyond their means”.
fasteddie9318
@Citizen Alan:
It’ll take another 4-5 years beyond that before the banks are given the power to sell randomly conscripted children into slavery to finance their debts. After all, they eat what they kill and so forth, and they stripped America’s carcass pretty clean after they killed it, so we should all do what they want.
Steve
By the way, even if you’re totally in default on your mortgage, I’m pretty sure no one except the actual holder of the mortgage is allowed to come along and foreclose on it!
Omnes Omnibus
@Citizen Alan: You are just a little ray of sunshine, aren’t you?
NonyNony
@kay:
I also love the fact that we’re supposed to infer something nefarious from the fact that the homeowners who are arguing about administrative problems are the same homeowners who are getting kicked out of their houses.
There’s a reason for that, jackass. It’s because the people who aren’t being foreclosed on haven’t yet had cause to ask their mortgage holder to produce the paperwork to prove that they actually hold the damn mortgage. There’s nothing nefarious about it at all – I will lay good money down on a wager that a sizeable number of people who have houses that aren’t going through the foreclosure problems also have mortgages held by banks who don’t have the right paperwork and can’t prove they own the mortgage. But since no one is asking them to prove it, they can keep working behind the scenes to fix everything up and (hopefully) have it all worked out before the mortgage is paid and the title has to be sent to the homeowner. Because that’s the only other time something like this would be a problem – when it comes time to hand over the title.
Left Coast Tom
See?! Jason Grodensky _wasn’t_ current on his mortgage when the bank seized his home! How could he be current on his mortgage if he didn’t have one?
/bankster
fasteddie9318
@MattR:
RE: contempt,
Not “they can’t afford to be in that place,” they “don’t deserve” to be there. Dripping with contempt. And really, really lacking in self-awareness, because if there’s anybody who doesn’t “deserve” to be where they are, it’s criminal fuckwit bank executives like that source.
Judas Escargot
This sounds so… McMeganesque.
“Pshaw. So a few little papers here and there were misplaced. These people were deadbeats anyway.”
Never mind the question of how you’re supposed to be able to formally distinguish between a deadbeat and a non-deadbeat without any clear title or other paperwork. Or how undermining 800 years of Anglo-Saxon property rights and custom might, you know, break capitalism (which is Mr. Ritholz’ big point).
Today’s MBA programs must teach you how to peer into the souls of perspective customers to perceive the quality of deadbeat-qua-deadbeat directly: This notion of having to prove yourself to your underlings in a court of law is so last millennium, after all.
Warren Terra
What’s that great quote about how it’s very hard to get someone to understand something when their livelihood depends of their not doing so?
Or, in other words, you can lead a corporate whore to evidence, but you can’t make them think.
Maybe he will, but for all that he’s a malevolent SOB who leaves a trail of slime wherever he goes he does generally seem to make money in the media business. And it’s not even fair to blame him here: the WSJ’s editorial page was famously insane and fact free long before he contemplated buying the paper.
tamied
This all makes me very nervous. Even though I’ve not been late with a single payment on my mortgage, can my mortgage holder come and foreclose with no cause?
Poopyman
Duncan also says this:
I’m not at all so sure that this mess won’t somehow be swept under the rug. I don’t know how they’ll do it, but, based on everything we’ve all seen over the past dozen years and more, my suspicion is that backroom deals are being worked right this very minute between the govt and the banksters.
Jeezus! I can’t believe I have such a paranoid mindset! But after the Bush administration, anybody who’s been paying attention should feel the same way.
Warren Terra
@Left Coast Tom:
I’ll bet he never made a single payment. The deadbeat.
williamc
What really sucks about this foreclosure moratorium stuff is that it has created a false sense of security among people behind on their mortgages. Working on the ground in non-profit foreclosure mitigation, that part of our organization has been buzzing the past few months (though we don’t make any money off of it), and every since last week when BOA announced their moratorium, people have just stopped calling and coming in about saving their homes because they think that Bank of America holds their mortgage because that’s what the few docs they have say, but most of them had their loans originate at BOA, but they are serviced by other companies who are still foreclosing. This shitstorm is about to turn into a shithurricane really quickly.
Napoleon
Of course even if the person wasn’t paying that kind of misses the point that the defaulting borrower will want to make sure if the house is siezed that proceeds are actually applied to a debt that he owes, so that the real debt holder does not show up some day looking for payment.
Also if the bank is not properly secured it is their own damn fault and the borrower is totally with their rights to raise it as an issue. That does not stop the bank from enforcing the debt as an unsecured debt.
beltane
See, McMeganism is contagious! Over the past year I’ve become a big Ritzholtz fan. He explains the nuts-and-bolts of the problem without delving into CT territory. His recent post about the world being divided into the ultra-rich vs. everyone else as opposed to left vs. right was a classic.
The WSJ is nothing more than very expensive wood stove kindling.
slag
@kay:
No.
I recently went through the refinance process. After calling our lender twice to try to discuss refinancing and receiving no help whatsoever, I ended up having to go with a mortgage broker who would put the work into finding us a better rate. So, after going through all the hassle, paying all the fees, and signing all new paperwork, we got our new, cheaper mortgage. Which, after a single mortgage payment from us, was subsequently bought by our original lender who wouldn’t help us in the first place. With the added bonus that they f’d up the paperwork, making it harder for us to set up our payment schedule.
A lot of time, money, and effort wasted. Because they’re all assholes, and mortgagees don’t have enough leverage throughout the entire shell-game process. Assholes. Did I mention they’re assholes?
fasteddie9318
Lewis Black’s words stick with me when I read stories like this. Talking about the family that looted Adelphia Cable, he says “It’s shocking to me that the people who worked for that company didn’t rise as one and slay them.” I’m shocked that assholes like the bankers in this article not only aren’t in hiding for fear of their lives, they feel safe enough to say shit like this for public consumption.
Chris
Well, I’m hoping that the members of the editorial board of the WSJ, already being that conservative and indifferent to the rule of law, have done something similarly stupid and criminal in the real world (as opposed to merely endorsing the “Banksters get whatever houses they want!” rule of “law”), for which they can be busted.
Hard.
Because now, they’re just apologists for organized crime.
fasteddie9318
@tamied:
Are you saying you’d have a problem with your mortgage holder doing that? Why do you hate America?
Poopyman
@tamied:
Earlier today I went to the website of the bank that holds our mortgage and downloaded the records of all our transactions for the past 2 years. At least I’ll have that if something “happens”.
Call me paranoid, ’cause I am.
Bob L
@tamied: From what it sounds like the risk is some lender you never heard of might try to foreclose on your house.
Apparently the banks don’t know what they own and don’t care. The whole attitude sounds more like stoners and than bankers. Is Wall Street on drugs? One news story was asserting Wall Street was on Zoloft during the bubble, that still going on?
kay
@NonyNony:
We’re the good customers.
These other deadbeats, their 2004-2008 customers? Very, very bad.
Suffern Ace
@fasteddie9318: One of the reasons we have, say, courts and procedures and rules and crap like that is so that when we sign contracts, we don’t have to subject ourselves to the moral judgements of bankers. What we “deserve” varies considerably depending on whose asking.
Joshua
It’s like the Rule of Law doesn’t matter anymore, unless you are rich, and the person on the other end is rich too. There is no concept of a society under the law, just a society where money speaks and if you don’t have money fuck you.
And the government should never step in to help a person on unemployment keep a roof over their head, even if the rich people on the other end are committing blatant fraud. However, if that rich person owns a baseball team and wants to put a new roof over his player’s heads, then by all means the government should give him what he wants.
Corner Stone
@Poopyman:
Maybe a policy of Looking Forward, not Backward?
Martin
@Suffern Ace: Uh, no. Courts are paid by taxes, and that’s big government. Contract disputes should be resolved by dueling, as the founders wanted.
jl
The bankers’ and servicers’ propaganda is an attempt to minimize their criminal and negligent behavior by portraying all this as a fuss over nothing. They say: well these people can’t pay and will lose their houses anyway, so they are deadbeats trying to wriggle out of their problem on technicalities.
But even for those who will lose their homes to foreclosure eventually, how much money was taken from them fraudulently? How many hundreds or thousands of dollars did they pay in fees or payments that they may not have had to, or chosen to, pay?
Then there are those who choose to try to struggle through and have a chance to avoid foreclosure, but are foreclosed upon anyway?
How much money is being sucked out of these people because the servicers are not abiding by the terms of the note, wherever that is?
Oh, yea, and how is the money divvied up from foreclosure sales if ownership is not clearly established?
I read that for major banks from 25% to 50% of the mortgages did not meet requirements for being bundled up into securities. The banks apparently knew it, used that information to get discounts on those dodgy mortgages and then did not tell the investors that the criteria for mortgages that were stated in the legal contracts governing the mortgage securities were not met.
So the pension funds, private investors, governments who bought the mortgages were cheated too.
So, they try to keep all these issues out of view by saying over and over again that it is a big fuss over deadbeats who will lose their homes anyway.
Really foul stuff going on.
First thing that comes to my mind over this is that the DFHs William Black and James Galbraith were dead on about the importance in investigating the criminal and negligent behavior in this crisis, and that was, what, like two years ago? (this is probably third time I have said this, but we need to make a record of how many times people like Summers, Geithner, Rubin, and the usual gang of GOP suspects were wrong about everything).
Bullsmith
I ain’t laughing. These fuckers screw up the fundamental bedrock of private property- the ability to prove you own your land- and the universal response of the political and media class (as always, best represented by Rupert Murdoch’s mouthpiece of choice) is what? “Deadbeats don’t deserve the protection of the law, nor do Bankers deserve to be limited by it.” That’s capitalism right now.
Not laughing.
ed drone
@Warren Terra:
That was the allure of it, don’t you know?
Ed
Joshua
@Bullsmith: I think Krugman’s editorial today said it best – it’s like the ancient days when noblemen would take whatever the fuck they wanted, knowing the people they were taking it from had no redress in the courts.
We spent a long time building up a system to get rid of this behavior, but now it’s back.
kay
@slag:
It just reads really funny. I’m not yet used to the people who were supposed to do the work, and screwed it up, blaming the people who paid them to borrow money. This is a new and unusual customer relationship to me.
If you wrote the loan, and the borrower defaulted, would your immediate reaction be “that darn borrower is such an idiot!” If you prepared the paperwork, and screwed it all up, would your reaction be “there’s that stupid borrower again, pestering me!”
It’s like a rant you would hear in a break room. I think it’s fabulous they have no qualms about their reputations, or concerns people might suspect they don’t know what they’re doing. Must be freeing.
beltane
@jl: It’s not that they were wrong about everything. It’s that they were willing accomplices to everything and should probably be in jail with a whole lot of other well-heeled co-conspirators. Just as it’s more important to go after mob bosses than the poor schmoes who work for them, I’d rather have these “deadbeat” homeowners have the principles on their mortgages dramatically reduced en mass if it meant the bankers who had actual criminal intent and who profited off of the whole business were to lose everything.
Here’s a link for those who want to find their mortgage note:http://www.ritholtz.com/blog/2010/10/where%e2%80%99s-the-note/
Earl Butz
@tamied: Yes. READ YOUR MORTGAGE, every damn page of it, like you should have in the first place. They can.
The problem here is not that YOUR mortgage holder can foreclose on you for no cause, apparently any financial institution can as well if they fucking feel like it.
Zifnab
@Bullsmith: Man. I wonder where the “Right to Property” Tea Baggers are on this one? Let’s ask Glenn Beck.
Hmm… Glenn Beck says all those stupid home owners should have bought vintage french gold coins.
Martin
@Bullsmith: Yeah, that’s where I am too. I’m not kidding when I say the large banks should be burned down. Revoke their corporate charters. Set up additional rules for bank regulation above FinReg. Start over.
We had a working system for centuries and greedy fuckers, whose sole industry is paperwork, couldn’t be bothered to do goddamn paperwork right.
Chris
@tamied: Correct! Or even if you have no mortgage, a bank can come along and foreclose on your mortgage-free house! Isn’t it great?
Omnes Omnibus
@Judas Escargot:
There is a reason that property law is one of the slowest areas of law to change.
ThatLeftTurnInABQ
@Bullsmith:
That sounds like a rather revolutionary act, does it not? Somewhere in hell, Lenin is laughing at us.
Poopyman
@Poopyman: Ah, crap. That wasn’t from Duncan that was what digby said.
Sorry for the wrong attribution.
Joshua
@Earl Butz: How about we all start the Bank of Balloon Juice and foreclose on Jamie Dimon’s house?
Brachiator
@MattR:
I can top this.
These are the same clowns who insisted that Obama was mean to bankers who got TARP money, but still insisted on paying out bonuses because (wait for it) “a contract is a contract” and if these agreements weren’t honored the entire financial system might be endangered by the evil federal government, who are now insisting that defective foreclosure documents don’t mean squat because here a contract ain’t worth the paper it’s written on.
Poopyman
Looks like now’s a good time to take up knitting.
(Of course, things didn’t turn out so good for her, either, in the end.)
Maude
@jl:
The laws have to be on the books before anyone can be prosecuted. The derivitives mess wasn’t illegal. If it’s contract law, that’s civil.
Try beating on Bill Clinton for a bit. He is responsible for too big to fail and the shadow banking system.
It’s easy to toss out accusations, but hard to back them up with facts. It is complicated.
Don’t lay this on certain people like Summers. Reagan began deregulation and it went all the way through Dumb Son.
The finreg law prevents the too big to fails from being bailed out.
Be glad that this stuff is becoming talked about as unacceptable. It used to be considered SOP.
Omnes Omnibus
@Maude: Fraud can be both civil and criminal.
vor
Reality has a well known liberal bias.
On a personal note, I re-financed my mortgage back in 2003 before things got bad. We had three closing sessions because they kept screwing up the paperwork. Basic crap was wrong, like addition errors, wrong address, etc… What really bothered me was that it didn’t bother the mortgage company. No big deal, happens all the time.
It must have been surreal by 2007.
David Brooks (not that one)
@NonyNony: Ouch. So I am completely up to date with my payments, good honest citizen, still above water, and want to sell my house because, well, I don’t have to give a reason. But when I come to pay off my mortgage with the sale proceeds, the apparent holder can’t produce the note, so I can’t be certain I aren’t paying some gangster.
Then the real note-holder steps up six months after I moved and wants his cash.
What a fucking mess.
mapaghimagsik
Seriously? Seems like taking something you didn’t own used to be called theft. I can see where there will be good money in the private security market to protect ‘corporate assets’
David Brooks (not that one)
@Martin: No, the glibertarian response is that there are courts, and loser pays for them as well as both sides’ lawyers. That includes a share of the cost of constructing the courthouse, etc etc.
Buffalo Rude
I’m curious as to how a bankster’s flawed and defective lien, potentially fatal btw, is the concern of the fee simple owner? Aside from having one less lien on the premises. Has anyone here who owns a home with a mortgage ever prepared the loan originating/closing/clearance/post-closing docs? Unless you work in the biz. . . yeah, I didn’t think so. But you pay a lot of money for people to do so and are required to buy insurance to protect your lienor’s interest and possibly your own. If their lien is defective, sans provable fraud on the borrower’s part, they are fucked in most states. That is, until they purchase the legislators.
Enforcing a debt by separating a property owner from their fee interest is serious business given this is a country that cherishes property ownership. If the dickwads fucked up their paperwork, and it sounds like they massively did so, they fucked themselves. I wonder if this round of bravado has more to do with their real property lawyers telling them they may be royally screwed, then their inherent psychopathy.
In some ways this may be sweet, albeit painful, justice.
Martin
@Maude: These are legal documents that the banks knowingly falsified – and way beyond ‘a few bad eggs’. That’s unquestionably criminal. No new laws need be written. Even the Skilling ruling won’t save them here.
MattR
@Brachiator: Can’t believe I forgot to bring that up. Especially since it popped into my head yesterday at a sports blog where a bunch of idiots were talking about how Obama loved the unions and would use the government to screw over the NFL owners. And I am thinking that must be a different Obama than the one who broke the contracts of the car unions as part of their bailout while leaving the bonuses of Wall Street executives intact as part of theirs.
NonyNony
@David Brooks (not that one):
Exactly.
On the other side, I’m starting to wonder if people who have mortgages with GMAC, Chase and other lenders who claim to be holding their notes but who are having paperwork issues might not want to be a bit pro-active about things. If you’ve got the money, maybe finding an attorney and getting them to request that GMAC or Chase or whoever actually show you a legit copy of the goddamn note might be in order. If they can’t provide it, work with the lawyer to setup an escrow account for your payments to pay out to whoever eventually shows up holding the legit note.
Because seriously, IANAL, but if they don’t have the note then they don’t own the house. And it seems like they shouldn’t be getting the money and whoever really does have the note should. And the only way to guarantee that would seem to be to stop giving them the money and to set it aside in escrow until the legit noteholder shows up to claim it.
And I am soooooo glad I didn’t listen to my dad and found a bank that refuses to treat their loans as securities. The bank I signed with is the same one that has my mortgage today. But if they weren’t, I think I’d be finding a lawyer to find out how much it was going to cost to cover my ass.
fasteddie9318
@David Brooks (not that one):
Hence the precious phrase from our Pledge of Allegiance, “liberty and justice for all…those who have enough lucre to pick up the court costs if they lose.” God bless America…’s wealthy elite.
Mnemosyne
The only possible good thing that can come out of this is when the actual mortgage holders discover they got cheated out of their money by the fake mortgage holders that foreclosed and BofA and Wells Fargo start suing the shit out of each other to recover the money.
I use the term “good thing” advisedly here.
Tom M
codifies this power into law (with the support of the Blue Dogs, of course).
That there same WSJ says such Blue Dogs won’t be none no more
jl
@Maude: That is why I said ‘criminal or negligent’. Negligence might or might not be criminal, if not criminal it would be relevant to a civil case.
I singled out Summers, Geithner and Rubin because they claimed to understand the economic implications of the housing boom and bust, and financial panic, but they were wrong, as was the consensus opinion of the supposed ‘mainstream’ economists.
I was talking about supposed financial and economic experts being wrong about responsible financial market and economic policy response to the crisis after it occurred the dimensions and resulting stakes were becoming clear.
Sly
In all fairness, the Wall Street Journal op-ed page has always been a flaming pile of zebra shit.
Brighton
Can we back up? People have a right to decent housing if they are willing to work and pay by the rules. As a lawyer, I am ready to fight foreclosures by any means necessary. The banks deserve to lose on technicalities. The recession was their fault, not homeowners’. Read here please
PaulW
Every.
WSJ subscriber.
Should sue.
FOR FRAUD.
The fact that their editorial was a blatant lie, that there WAS open and unimpeachable evidence that false foreclosures have been happening, it is the height of criminal malpractice for any profession – be it lawyering, doctoring, or reporting – to perform so incompetently and so blindly to the truth.
Omnes Omnibus
@NonyNony: I am not a property lawyer, but the escrow account idea sound like something that might be worth looking into.
**This is not is not legal advice. Consult a lawyer licensed in your jurisdiction, etc., etc..
Tonal Crow
@Buffalo Rude:
Here are two scenarios.
1. O mortgages house to M1. M1 sells mortgage to M2, but M1 and M2 GOP up the paperwork so neither M1 nor M2 have clear title to O’s mortgage. O attempts to sell house to B. B cannot get mortgage from M3 because M3 can’t figure out whom to pay off to discharge O’s mortgage. Issue drags on for months, preventing O from moving/taking new job/caring for ill parent/whatever.
2. O mortgages house to M1. M1 sells mortgage to M2. M2 sells mortgage to M3. M2 and M3 GOP up the paperwork. O defaults. M2 thinks it still owns the mortgage and forecloses. M2 sells (usual quitclaim deed) to P. Later M3 realizes it owns the mortgage and attempts to foreclose on P. P experiences much heartburn — or worse. (Note that P might not be a BFP for value without notice, depending upon what — if anything — about the mortgage sales got recorded).
Others scenarios more convoluted (e.g., ones involving notary fraud, ones involving due process violations — can you say “Supremacy Clause”?) will suggest themselves.
[This is blogging, not legal advice. Consult your favorite landshark for legal advice.]
Bill Arnold
@slag:
The whole point of the WSJ is that outside the editorial pages, it is factual, and doesn’t lie or bend the truth in ways that might cause a reader to lose money.
Faux news pages will make readers lose money.
sparky
@Maude: thanks for pointing that out. when or if the history the last 25 years is written, Clinton will be right behind Bush as one of the worst presnits of the era. the combination of adopting GOP speak & rules, coupled with narcissism and a literal pissing away of the peace dividend, not to mention ensuring that Bush would be elected in 2000, make him a horrid president, no matter how charming you may think him (which, i might point out, is simply the other side of the “wanna have a beer with” coin).
anyway, there isn’t much here that looks like actual criminality (knowing rule-breaking), just regular short-cutting* and hubris (we’re FIRE and we don’t need to pay attention to no stinking real property statutes).** pretty much SOP for the USA since, well, quite a while now.
*anyone with experience in the legal system will tell you that there is a tremendous amount of crap filings. and if anyone thinks that the people who actually dreamed up this “parallel universe” of securitized real property is going to jail, well this explanation by Dealbreaker explains it for you:
**the bankers are probably correct–that little notary gambit the other day is an example. since the RE rules can’t be rewritten quickly and might upset foreigners (imagine if your REITs were worthless) worst case the Fed will buy up or guarantee all the mortgages and so once again the world’s only fake free market will be supported by the peasants. at this rate, the US will be overtaking Haiti. wheeeeeeeee!
slag
@kay: Exactly. And the fact is that because mortgages get bought and sold all the time, I, as a borrower, can’t necessarily choose a company I want to borrow from. Or I can, but then the next day I can have a totally different lender. Whether I like that company or not.
I left my mortgage company because I didn’t like how they treated me. They wouldn’t take the time to take my inquiries seriously, even though our mortgage was in exceptional condition and my request was basic and straightforward. And yet, here I am…stuck with the exact same mortgage company whether I like them or not. Even though I had the means to go elsewhere with my money, I couldn’t.
“Freeing” is right. Freeing for them and not for me.
Citizen Alan
@Tom M:
Can you summarize that part of the article since I’ll be damned if I subscribe to one of Murdoch’s rags.?
burnspbesq
@Napoleon:
“That does not stop the bank from enforcing the debt as an unsecured debt.”
Technically that’s probably correct, but as a practical matter I don’t see it. How many people do you know who have enough liquid funds sitting around to pay off their mortgage? And if you’re a financial institution, to you really want to be an unsecured creditor in a chapter 13 case?
Ruckus
@NonyNony:
Exactly.
And do you want to bet that they won”t be “fixing” the paper the correct way, but the fastest, cheapest way, correct or not.
OTOH, with so many foreclosures happening they probably don’t have the time/resources to check on and fix the mortgages that haven’t been exposed yet.
Omnes Omnibus
@Brighton: I am going to a foreclosure defense CLE next month.
Bill Hicks
Here is a good quote from Barry Ritholtz earlier in the week demonstrating his competence at financial math:
“They were just so haphazard and so gloriously incompetent to save a few pennies here and there,” says Barry Ritholtz, director of equity research at Fusion IQ. “But a few pennies times millions of documents is a billion dollars.”
http://news.yahoo.com/s/ap/20101011/ap_on_bi_ge/us_foreclosure_freeze_outlook;_ylt=A0wNdPiFq7NMCU0AxgGs0NUE;_ylu=X3oDMTQxMzJqYTZzBGFzc2V0A2FwLzIwMTAxMDExL3VzX2ZvcmVjbG9zdXJlX2ZyZWV6ZV9vdXRsb29rBGNjb2RlA21vc3Rwb3B1bGFyBGNwb3MDNwRwb3MDNARwdANob21lX2Nva2UEc2VjA3luX2hlYWRsaW5lX2xpc3QEc2xrA2ZvcmVjbG9zdXJlZg
Sorry for the crappy long link, I don’t remember the html code for embedded links and also too lazy to look it up.
sparky
one more time: the real issue is not the foreclosures, but rather the entire securitized RE market. while some of the notary issues relate specifically to foreclosures, the title issues are common to all of the securitized mortgages, since they were all dealt with the same way. consequently all of the entities that purchased mortgaged backed securities may be holding worthless paper. or at least someone is going to start thinking about it, soon.
that’s what is going to blow up, perhaps over the weekend. i would expect some sort of low-flying guarantee from the Fed/UST to reassure investors, presumably before the market freezes up ala the CDO market. or who knows, maybe we need a monday freeze and crash before anyone gets alarmed.
burnspbesq
@Poopyman:
“Call me paranoid”
It’s not paranoia if they really are out to get you.
Juicebaggers, ho!
Maude: Which Bank do you work for?
MattR
@Bill Hicks:
Methinks Barry needs to work on his math.
burnspbesq
@PaulW:
Hold on a sec. You clearly aren’t a lawyer, and therefore can’t be expected to understand all of the elements of the cause of action for civil fraud, but seriously … Are you telling me it was reasonable for someone to rely on a representation that the WSJ editorial page would get the facts right?
Martin
@NonyNony: I can tell you that we are going to be proactive. Our last refi was bought and sold several times and now resides with Wells Fargo. I’m thinking the likelihood they fail to produce the note is non-trivial.
I’m not trying to get out of my mortgage, I just want to make sure that 10 years from now when I’m trying to sell, or I’ve paid the place off or whatever, that I can get out in one piece. Better to fix the problems close to when they happen rather than a decade later, and I’m not about to fuck around with a half million dollar investment just to avoid using my legal service.
burnspbesq
@PaulW:
P.S. There is no such thing as criminal malpractice. You should strive to calm down and get your facts straight before accusing someone else of not having their facts straight.
Martin
@sparky: Can we shoot for a week from now? I really would like to get through AAPL earnings before the stock market blows up again.
I keep waiting for CalPERS and the other large pension funds to start chucking lawsuits. That’s going to be apocalyptic.
Juicebaggers, ho!
Is “Jump, you fuckers!” a tag yet?
Steve
@Napoleon: Can you really enforce it as unsecured debt? It’s a nonrecourse loan. If you don’t have rights against the collateral cause you screwed up, how can you just take a money judgment?
arguingwithsignposts
A totally off the wall question here: Are there any banks who actually hold onto mortgages anymore? Other than in securitized pieces of paper?
Martin
@arguingwithsignposts: Smaller ones do, credit unions, etc. They actually need the cash flow that comes from the mortgages to pay out interest on accounts rather than the profit boost that comes from selling them.
Breaking that model was a colossal fuck-up.
Tonal Crow
@Martin: Yeah. The big banks need a serious (serious) spanking. They nearly brought down the entire world’s economy once, and there seems a not inconsiderable chance that they might do it again.
Tonal Crow
@PaulW: I dunno. The WSJ editorial page has specialized in ginormous dripping whoppers for decades, so I think subscribers have received the benefit (as it’s called) of the bargain they struck when they subscribed. I suppose they could argue that the lying is worse under Murdoch, but I don’t think it can really get much worse than it ever was. Were a WSJ editorialist to deny the Holocaust, I’d probably yawn and say “Whatta you expect, a lox bagel?”
Steve
@Tonal Crow: I expect a kosher salami at the absolute minimum.
Omnes Omnibus
@Steve: @Tonal Crow: I would be just fine with a lox bagel.
burnspbesq
@Juicebaggers, ho!:
“Is “Jump, you fuckers!” a tag yet?”
We’re waiting for you to show them how it’s done.
Steve
@Omnes Omnibus: So this Martian lands on Second Avenue. He sees he has a flat tire so he goes into the closest deli and says, hey, I need one of those tires please. The deli guy explains, those aren’t tires, they’re bagels. What are bagels? Here, try one. The Martian curiously extends a pseudopod and attempts to consume the strange little round thing. Hmm, he says, this would go great with lox!
daveX99
Gaah:
I’m sick of these guys. How about “Maybe they were late on their mortgage, but how the fuck do we know you own the note?” These guys want the homeowners on the street so they can flip the house, and it’s like there’s some gentlemen’s agreement (heh.) among the banks that they won’t quarrel with each other over who holds the note. First one to the house with a locksmith gets it.
As I screeded over on eschaton earlier, I would put more trust in an occupant’s showing me a utility bill than whatever these bank guys are saying – At least the home owner can back up their connection to the house. The banks have to put up or shut up.
Gaah, I say.
Steeplejack
Another gem from the article:
Fucking notaries! How do they work?!
grumpy realist
Well, there’s already been one case in Florida where two different banks filed for foreclosure on the same property, each assuring the court that yessirree judge, that’s the certified gen-yoo-wine note. The judge, IIRC, was not amused.
Just give it time. I guarantee that there are already hordes of lawyers out there sharpening their teeth trying to figure out how to massage this all into one or more class-action suits. Get some organization like CALPERS behind them and a lot of the banks are going to start to feel like shark kibble.
dirge
Entirely beside the point. If the bank offered you a mortgage while having no ability to and no intention of maintaining clear title, that is to say fully intending to breach on their most significant contractual obligation, the bank was negotiating in bad faith and the whole agreement is garbage.
IANAL, but I do know that a clear demonstration of bad faith is pretty much nuclear in contract law.
That still shouldn’t get you a free house, but is sure as hell ought to get you off the hook for your underwater mortgage if you can get a fair hearing in a fair court. Big if, that.
futzinfarb
Also from the article:
Well it’s quite a comfort to know that Corporate America’s underlying philosophy is to be accomodating of sloppiness and clerical error.
dirge
When your business model requires clerical errors in order to work, that is something that would be nefarious.
liberal
@Steve:
Only in some states.