Who Owns Your Mortgage

Discussion in 'General Chat' started by rnoldh, Apr 3, 2011.

  1. Piobaire

    Piobaire Not left of center?

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    because life isn't fair? why does affirmative action exist? there's lots of examples of shit not being 'fair.' sure, it sucks that you're paying your mortgage and some people are getting away owning a house they can't afford, but is the solution to vindictively pursue their eviction even in circumstances that might not warrant it?
    The "circumstances" for foreclosure are fairly cut and dry, no? I mean, you either pay the entire bill at the end of the month or you don't. If you don't for a long enough period of time you have the house taken from you. Now, if life isn't fair, which I agree it isn't, time for the non-payers to move on. Since we both agree it's unfair, I'm puzzled as to why you would feel an attempt to make it so in this fashion is advisable.
     
  2. Teger

    Teger Senior member

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    The "circumstances" for foreclosure are fairly cut and dry, no? I mean, you either pay the entire bill at the end of the month or you don't. If you don't for a long enough period of time you have the house taken from you.

    Now, if life isn't fair, which I agree it isn't, time for the non-payers to move on.


    how about if one of the pre-conditions of accepting the settlement from rnoldh's hypothetical fund be that the payment is applied against the person's mortgage balance?
     
  3. Piobaire

    Piobaire Not left of center?

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    how about if one of the pre-conditions of accepting the settlement from rnoldh's hypothetical fund be that the payment is applied against the person's mortgage balance?

    I'm not sure what to make of this. I mean, what else would it get applied to?

    People talk about how we need help these people or risk putting the economy back into the crapper. Well, if you want to get things rolling through some mechanism like this, give those that can actually make payments a financial goose.
     
  4. Dakota rube

    Dakota rube Senior member

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    It might have been procedural but in some states it is necessary to implement the foreclosure. And as they showed on the segment, much of the paperwork was out and out fraud and forgery committed by the banks!

    What should the penalty to the banks be ( if any )? Should these people that could not or would not pay their mortgages ( could not and would not are quite different ) end up with free homes, because fraud was committed? Why should a deadbeat have a better result than someone who really struggled to keep current on their mortgage?

    Those people that were responsible and did not fall behind in their mortgages. They are being screwed by losing equity. Are they due anything?

    I see some huge fund being announced that will address this issue. And while it will be said that the banks are contributing to the fund I have an idea that it will come out of the taxpayers pocket.

    Finally, there are different categories of a Little Guy! If it is someone that bought a home for their family and was laid off and is struggling to save their dream home and have a place for their family, then I am all for a loan modification.

    But that is nothing like those that have 2nd homes or investment properties and have decided to let them go back. Or those that have chosen a strategic foreclosure ( there are many articles about this )and are walking on a property because they are so much upside down they would rather walk on the property rather than even attempt negotiating with the loan holder.

    I really did not realize how far we are from a healthy RE market.


    I think the banks' "fraudulent" paperwork is more along the line of robo-signing and improper notarizing. Re-filing papers is the way to fix the problems, and all it does is stretch out the process even longer. Most of the people who are "losing" their houses are doing so because, as Pio pointed out, they ain't making the payments. This paperwork shit is just obfuscation.

    I am not trying to be a bank-apologist here; they short-circuited the paperwork chain, but they haven't taken thousands of houses away from people who were making their payments. They had some drones in an office in Milwaukee signing papers when they should've had people in Minneapolis or Memphis doing it.

    The banks are going to take a massive ass-fucking in this mess: they're going to end up getting pennies on the dollar of their initial loans, and it will run downhill to fuck up the residential real estate market even more than it is now. We have a new "normal" in my industry now; it isn't pretty, but it is reality and there's still money to be made.

    The other shoe to drop in residential RE is the Fannie/Freddie thing and who is going to buy mortgages on the secondary market. If that isn't straightened out pretty quickly getting a mortgage is going to continue to be a pretty tough undertaking for all but the absolute prime buyer.
     
  5. rnoldh

    rnoldh Senior member

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    Why can't those of us that have been paying our mortgages get some free shit too?

    And I thought guys like you and Mark were smart!

    Home owners that pay a mortgage on time, My God[​IMG]

    Guys, just stop paying. You will probably get a year or so before there is even a problem. That is a lot of moolah. And make sure to vote as liberal as you can and there is a good chance there will be some super government agency like the RTC of the 1990s to clean up the crap. Measure the downside ( a hickey on your credit ) versus the upside ( 2 to 3 years of missed payments ). Sort of, but not exactly like the yuppies that are doing strategic foreclosures in Ca.

    Of course, you two might be honest or have morals ( as well as real life experience ). That is a problem.

    NB:As to myself, it is both good and bad. I sold in the beginning of 2008, so no crash had occurred. But now I rent ( a house from a friend ) and I cant just say F/U each month when the rent is due.
     
  6. Teger

    Teger Senior member

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    I'm not sure what to make of this. I mean, what else would it get applied to?

    People talk about how we need help these people or risk putting the economy back into the crapper. Well, if you want to get things rolling through some mechanism like this, give those that can actually make payments a financial goose.


    what do you mean what else would it be applied to? there is going to be some sort of settlement by the banks/fine levied against the banks, and the people whose mortgages are in foreclosure are going to be the recipient of some sort of money. id rather that money go back to the banks in the form of a mortgage credit than just being a free payout.

    an interesting comparison is lawsuits against debt collectors. theres rigid federal guidelines about how/in what shape a debt collector can operate. if they violate these laws you can sue em and make bank.
     
  7. Piobaire

    Piobaire Not left of center?

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    Rube, thanks for that input. It's for this reason that I see home prices continuing to fall for the next several years. People that are prime credit risks and cash buyers are going to be getting some great deals.
     
  8. rnoldh

    rnoldh Senior member

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    I think the banks' "fraudulent" paperwork is more along the line of robo-signing and improper notarizing. Re-filing papers is the way to fix the problems, and all it does is stretch out the process even longer. Most of the people who are "losing" their houses are doing so because, as Pio pointed out, they ain't making the payments. This paperwork shit is just obfuscation.

    I am not trying to be a bank-apologist here; they short-circuited the paperwork chain, but they haven't taken thousands of houses away from people who were making their payments. They had some drones in an office in Milwaukee signing papers when they should've had people in Minneapolis or Memphis doing it.

    The banks are going to take a massive ass-fucking in this mess: they're going to end up getting pennies on the dollar of their initial loans, and it will run downhill to fuck up the residential real estate market even more than it is now. We have a new "normal" in my industry now; it isn't pretty, but it is reality and there's still money to be made.

    The other shoe to drop in residential RE is the Fannie/Freddie thing and who is going to buy mortgages on the secondary market. If that isn't straightened out pretty quickly getting a mortgage is going to continue to be a pretty tough undertaking for all but the absolute prime buyer.


    I really respect your opinions and this is 99% true.

    But I bet you did not see the 60 Minute segment.

    It was not just robo signing. There was out and out willful fraud. People were being paid strictly to sign a false name in Signing Mills! And there were known willful false notarizations.

    I am certainly not for deadbeats getting free homes, and that would be a horrendous precedent. Eventually this will all get played out but it will be lengthy and painful.

    I remember that when O'Quinn died I said he was a pioneer and first on the scene of the Mega semi extortion huge PI cases. I am far away from that but I bet there are literally 100s of big time PI Attorneys that are salivating on the prospects of this case, which will come. You dont get much deeper pockets than Banks.
     
  9. Dakota rube

    Dakota rube Senior member

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    I really respect your opinions and this is 99% true.

    But I bet you did not see the 60 Minute segment.

    It was not just robo signing. There was out and out willful fraud. People were being paid strictly to sign a false name in Signing Mills! And there were known willful false notarizations.


    No, I didn't watch the program.
    If there was out and out fraud, the banks should obviously be punished. But the result of that punishment shouldn't be some asshat who quit making payments getting a "free" house. (Which I don't think you are advocating.)

    Your insight about people who stop making their mortgage payments and continue to live in the house for 12+ months "free" is accurate in some markets, especially those where the foreclosure rates are sky-high. Around here you can probably expect to coast for six months maximum. The banks hire servicing companies to come in and change the locks, turn off the utilities and secure the properties.

    In Minneapolis, I know for a fact, there are a lot of people living in foreclosed houses, but they are mostly unrelated people who just moved into a vacant house. The homeowners vacated and these squatters simply crash there.

    I'm not sure of the universality of deficiency judgments but in some states, the lender who loses money on a house they financed for you can come after you, even after taking the house, to collect the spread between what you owed and what they netted when they re-sell the house.
     
  10. rnoldh

    rnoldh Senior member

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    No, I didn't watch the program.
    If there was out and out fraud, the banks should obviously be punished. But the result of that punishment shouldn't be some asshat who quit making payments getting a "free" house. (Which I don't think you are advocating.)

    Your insight about people who stop making their mortgage payments and continue to live in the house for 12+ months "free" is accurate in some markets, especially those where the foreclosure rates are sky-high. Around here you can probably expect to coast for six months maximum. The banks hire servicing companies to come in and change the locks, turn off the utilities and secure the properties.

    In Minneapolis, I know for a fact, there are a lot of people living in foreclosed houses, but they are mostly unrelated people who just moved into a vacant house. The homeowners vacated and these squatters simply crash there.

    I'm not sure of the universality of deficiency judgments but in some states, the lender who loses money on a house they financed for you can come after you, even after taking the house, to collect the spread between what you owed and what they netted when they re-sell the house.


    I think free houses for deadbeats would be a horrible precedent ( see below ). I am even against Strategic Foreclosures, but how do you stop them?

    As to living in a home for free ( no mortgage payments ) till you are foreclosed, I think it is very much area impacted. Florida and Southern Cal are particularly bad with people staying 2 years plus without making any payments. If 6 months is the amount of time they get where you are, that is lightning quick.

    As to how to punish the banks. And how to make whole those who have never been late on a mortgage payment, I have no idea. I do believe there will be huge amount of litigation and posturing that will gum up the works and prevent a quick solution to this mess.

    .

    I am certainly not for deadbeats getting free homes, and that would be a horrendous precedent. Eventually this will all get played out but it will be lengthy and painful.
     
  11. poorsod

    poorsod Senior member

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    I think the banks' "fraudulent" paperwork is more along the line of robo-signing and improper notarizing. Re-filing papers is the way to fix the problems, and all it does is stretch out the process even longer. Most of the people who are "losing" their houses are doing so because, as Pio pointed out, they ain't making the payments. This paperwork shit is just obfuscation.

    No the problem with MERS is even worse than that. My understanding is what the banks did with MERS was circumvent property law. Usually, the county clerk documents the owner of the home and mortgage and thus creates a paper trail of the owners of the property and mortgage. It is this paper trail which give legitimacy to the rightful owners. But this process takes time and money. MERS was created so that the banks could trade these mortgages without having to wait or to pay a fee. This makes securitization efficient so you can pool millions of mortgages and buy/sell them repeatedly, quickly and at low cost.

    But this creates a number of problems.
    1) This process turns out not to be exactly legal in a number of states and the banks are losing many cases.
    2) MERS did not keep track of who owned the loans. There is no paper train (to improve efficiency). So you have to trust MERS when they say Bank X really owns the loan. There is no 3rd party to verify as they didn't log these transactions with the county clerk. This is a problem if Bank Y comes and says that they are the real owners of the loan. Or if the property owner says they owe no mortgage.

    I think all outcomes are bad. You either have to throw out property law or bail out the banks (again).

    This is an old Washington Post article
    http://www.washingtonpost.com/wp-dyn...100702742.html

    This is a good thread with the various news reports and such.

    http://streeteasy.com/nyc/talk/discu...reclosure-mess
     
  12. rnoldh

    rnoldh Senior member

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    I think all outcomes are bad. You either have to throw out property law or bail out the banks (again).


    Yup, this is what I see coming.

    What about guys like Mark and Pio ( that paid their mortgages on time )? I guess they are not that Little Guy[​IMG]

    And finally, I have a feeling that you agree, but I certainly feel that there will be massive litigation and PI Civil Suits. And I mean mass tort litigation and not Rubinacci!
     
  13. rnoldh

    rnoldh Senior member

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    And here is a link to the 60 Minutes segment on strategic default.

    In many ways it makes logical sense.

    But it is a bitch when one thinks of things like honesty and morals.

    I would not do this. But if the US did a strategic default on its debt to China, it would not bother me.

    But it might bother the credit rating agencies and other entities.
     
  14. poorsod

    poorsod Senior member

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    And finally, I have a feeling that you agree, but I certainly feel that there will be massive litigation and PI Civil Suits. And I mean mass tort litigation and not Rubinacci!
    Yes this will delay foreclosures and drag out the unwinding of the real estate market. But I don't understand these issues enough to figure out how this affects the banks capitalization requirements and if that will force a bank bail out. First, there is a push by companies to force the banks to buy back loans. From Bloomberg:
    Second, how do you mark to model these irregularly traded Tier 4 assets the banks hold? Will it impact capitalization requirements? A finance friend tell me this is not an issue but I don't know.
     
  15. Fraiche

    Fraiche Senior member

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    Why would anyone believe people would get free houses? The most they should get is there money back, which probably wasn't much anyways.
     

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