Posted on 10/08/2010 1:21:45 AM PDT by paudio
President Barack Obama plans to veto a bill whose opponents say would make it harder for homeowners to stop foreclosures.
The move marks the Obama administration's most direct intervention so far into a growing debacle tied to how banks foreclose on homes, and the first effective veto of Mr. Obama's presidency. The veto could make it more difficult for banks to complete paperwork and speed the foreclosure process, and could give homeowners more time to rework loans.
Several of the country's largest banks, including Bank of America Corp., J.P. Morgan Chase & Co. and Ally Bank, have moved in recent weeks to halt thousands of foreclosures in 23 states amid revelations that the banking industry had used "robo-signers," people who sign hundreds of documents a day without reviewing their contents.
(Excerpt) Read more at online.wsj.com ...
Well, if the Kenyan Clown does veto this loathesome and stupid bill, it will literally be the first action that he has taken will occupying the Oval Office that I approve of.
Me too.
This mortgage/title/deed recording/MBS bullsqueeze is a HUGE mess!
Much to my shock, I agree with Pres. Obama on something.
“I wonder if he would have vetoed it had congress still been in session?”
Who knows? In any case, the bill is dead for now and that’s good news.
Oops... wrong date... it should be 10/8/10, not 9/8/10. Sorry...
besides all that, look how many people he can put in the streets with that ... more hardships more dem votes
saaaaaabe me obama, saaaaaaaaaaaaaaaaaaabe me
http://www.stopgreedybanks.com/
http://www.stopgreedybanks.com/
http://www.stopgreedybanks.com/
Below Explains the Root of the Problem:
MersCorp was created in the early 1990s by the former C.E.O.s of Fannie Mae, Freddie Mac, Indy Mac, Countrywide, Stewart Title Insurance and the American Land Title Association. The executives of these companies lined their pockets with billions of dollars of unearned bonuses and free stock by creating so-called mortgage backed securities using bogus mortgage loans to unqualified borrowers thereby creating a huge false demand for residential homes and thereby falsely inflating the value of those homes. MERS marketing claims that its paperless systems fit within the legal framework of the laws of all fifty states are now being vetted by courts and legal commentators throughout the country.
The MERS paperless system is the type of crooked rip-off scheme that is has been seen for generations past in the crooked financial world. In this present case, MERS was created in the boardrooms of the most powerful and controlling members of the American financial institutions. This gigantic scheme completely ignored long standing law of commerce relating to mortgage lending and did so for its own personal gain.
Without getting into a lot of complicated explanations, this is the root of the problem. Now, you need to understand the process of the mortgage market because this is EXTREMELY important in the entire crisis. Almost 100% of all residential and commercial loans made since the late 90s were made by a bank or lender. Almost immediately after closing (and often before closing), these lenders sold these loans in pools to an aggregator of loans. Ok, a little glossary break down here. A pool of loans is two or more loans combined into a package. Smaller lenders might sell a package or pool of 50-100 loans to larger lender. The larger lender might buy 30 pools of 100 loans from 30 different smaller lenders. Now they have 3000 loans that they pool together into one big pool. You with me so far???
Ok, next heres what happens a larger bank (Chase, Countrywide, Wachovia, GMAC, Homecomings Financial, Fremont, Option One, etc) then sells these 3000 loans to another entity. This other entity is often a subsidiary but sometimes not and this other entity is a Sponsor and usually a Master Servicer entity. This means that this company is going to be the servicer of these loans. A servicer is the company that is going to collect the monthly payments, manage the escrow accounts, etc. Now, most people think that this is who they owe the money to for the loan they have because they received that notice about 60 days after closing notifying them that the Servicing of their loans was being transferred to XYZ Company. Because they make the payments to this servicer they automatically assume that this is now their lender. Remember when I just said that these large pools are usually sold to subsidiaries of the large banks? Well, its no wonder that these Master Servicing companies have highly similar names. Whats the difference between Americas Wholesale Lender and Countrywide Home Loans, Inc.? Well, a lot and very little. Both do business as Countrywide. One is a lender and one is a Master Servicer. Confusing? Yes. Purposefully? Yes. If there is confusion in Wall Street, its on purpose because these guys arent stupid. Stay with me here
Now, this is important the Mortgage doesnt give just anyone the right to foreclose, It gives the actual OWNER of the Note the right to foreclose. The owner of the actual and original Note. Not a copy of the Note but the ORIGINAL note. This is a very important point that must be understood and grasped, by everyone, including the US Government. I think that its highly possible that this bailout package might be relieving financial institutions of defaulted debt even thought that same institution may not even have the actual Notes to evidence the defaulted debt. And, is it really defaulted? How do we know that these entities werent already paid for these Notes? It depends on exactly WHO they are bailing out but if its any entity other than the Trust, those entities have already been paid for the Notes!
Back to this pool of 3000 loans so the Master Servicer has sold the 3000 loans to a Depositor for about 102.5% of the face value of these Notes. When a sale of these 3000 loans is made, the Depositor literally pays the seller of the loans a lump sum of money and the Master Servicer in turn hands over the Notes for that payment of money. And then this same Depositor sells the 3000 loans to a Trust and deposits (hence the name Depositor) these Notes into the Trust. The Trust pays the Depositor a lump sum of money and in return receives the Notes. The Master Servicer or Servicer gives the Notes, receives a lump sum payment and then promises to pay the trust a monthly payment on the money that the Trust paid it. This large monthly payment to the Trust is usually guaranteed by the Servicer and is an aggregate or sum of all of the individual 3000 borrowers who paid their monthly payment to that Servicer. The servicer collects all of those monthly payments, takes off their fees, disburses some of it to escrow accounts, etc. and then makes the payments to the Trust. The Servicers also have multiple layers of insurance that insure them against borrower defaults because the Servicers do in fact make representations and warranties on the monthly payments to the Trust that really owns these Notes.
So heres what happens to this pool of 3000 loans. The Master Servicer then sells these same 3000 loans to a Depositor. What really and actually happens is a bona fide sale of all of these loans. Now, heres an EXTREMELY important point, pay attention right here. When a loan is sold, what is really sold is the Note. The Note is sometimes called the Promissory Note. The Note is the only and real evidence of the debt. The ORIGINAL Note that is. Thats why youll sometimes here this called selling the paper. The paper debt, the NOTE, is the debt and has an actual value because you, the homeowner and borrower, have signed that note with your signature and pledged (promised) to pay that debt back. The MORTGAGE is what you give to the original lender (and any subsequent purchase of the Note) as security in case you dont pay the debt back. The mortgage gives the owner of that Note the security (the home or property) and thus the right to foreclose if you dont pay it back.
This whole process is called Securitization. This is a simplified explanation of what happens. Through this Securitization process, these Notes are packaged into whats called Asset Backed Securities or Mortgage Backed Securities in whats called a CDO (Collaterlized Debt Obligation) and are sometimes called ABS or MBS Pools. The Depositor creates something called a Special Purpose Vehicle (SPV) to deposit these Notes into the SPV and then these Notes are sold and deposited into the Trust. The Trust is owned by all sorts of investors, individual and companies, pension funds, foreign investors. etc. They collectively own these Trusts. A Trustee acts as an Agent for the Trust and on behalf of the Trust in a fiduciary relationship.
So, now that youre a securitization guru, lets get the rubber to meet the road in all of this. Heres the real rub. I told you that, legally speaking, the only evidence of this debt (the loan) is the actual and original Note; and this makes sense! If not, anyone could create a Note, get a copy of your signature (which they can get in public records on the mortgage you signed and was subsequently recorded in public records), paste it on that created Note and allege that you owe them this money. Also, because this Note is changing hands some 3-6 times in the securitization process, everyone touching it can create a copy and allege you owe them the money even though theyve already sold the original Note and have been paid for it by the new buyer! Just like a personal check, the Note has to be Endorsed to the new buyer of the Note by the Seller of that Note. They literally need to stamp on the last page of the Note, Pay to the Order of Without Recourse and then stamp or write in the name of the new buyer. On a bona fide Note, this is EXACTLY what you will see and find. Everytime this Note changes hands, it needs an actual endorsement.
So heres what literally happening with ALL of these foreclosures the Trusts are the actual owners of the majority of all of these Notes. Yes, the Trusts. A trust has a funky name such as Harborview Mortgage Loan Trust 2006-5 or Meritage Loan Trust 2007-2. Theres no such Trust named Countrywide Home Loans or Chevy Chase Bank or Citimortgage or GMAC Mortgage Co. or Residential Funding Corporation or Amtrust Bank or Fremont Investment and Loan or Option One Mortgage Co. - you get the point. All of these entities are either lenders or servicers. Period. They are NOT the Trusts that your loan and everyones loans were sold to. Dont let anyone fool you. Over 98% of all loans made since 2000 were securitized in just the fashion I described above.
Now, I can only speak to the 100 or so foreclosure cases I have personally read the complaints on in Florida and a few in Ohio. In 100% of these foreclosure cases, the suit is being brought NOT by the Trust but by the servicer or the trustee. Both of these entities are agents for the Trust but they are NOT the owners of these Notes unless they show that they re-purchased that Note from the Trust. In about 70% of the foreclosure cases we have seen, the Plaintiff (usually the servicer) is also alleging that they have LOST THE NOTE or that is has been destroyed. No, that was NOT a typo or mistake. Well, if the Note is actually lost, they dont have any actual evidence of the debt anymore.
So heres the question to start asking your Congressman or Congresswoman, your State Senators, your Governor and every other politician that has any influence and may want to be re-elected if the Federal Government is going to buy all of these non-performing or defaulted loans (ie. Notes), who are they actually going to buy them from? The Trusts or the Servicers?
And, if they can actually tell us this in plain language, are they actually going to buy the original Notes? Not a copy and not some affidavit from some $15/hour employee who is swearing that they saw the original note before it was actually lost or destroyed but the originalNote?
Im not kidding here. Im seeing 70% of the cases allege a Lost Note! When they produce the Note, what this Servicer alleges is the original note is, in fact, only a COPY of the note and is NOT the original. Want to know how I know its NOT the original?
This is easy folks. The entire securitization process that any and all Notes are involved is and must be disclosed in filings with the SEC. Yes, every Note is involved a securitization. And this MUST be filed with the SEC. And in these filings with the SEC, these companies MUST disclose all of the parties involved in that process and what that chain of securitization actually follows. That chain MUST be evidenced on every single Note on the last page of that Note in the form of an endorsement. Pay to the order of Every Note should have at a minimum of 2 endorsements and more likely, 4-5 endorsements. If a Servicer or an attorney for that Lender or Servicer produces a copy of a Note that they allege is the original Note, all one needs to do is look for those endorsements. If the endorsements dont follow EXACTLY what they have already filed with the SEC, they got real problems folks. Either they are lying to the court (called fraud) or that Note is faulty in that the proper endorsements arent there and most likely, both are real legal issues.
So I’m stuck paying my mortgage each month while my reckless neighbor bought a house with an adjustable rate mortgage he is defaulting on. But now he gets to live there rent free for 2-5 years while this mess gets sorted out
So the person who took on a too big mortgage gets to live payment free and rent free
The modest, the sober, the prudent get penalized while the “free lunch” goes to the imprudent & the stupid
ELO?
“The modest, the sober, the prudent get penalized while the “free lunch” goes to the imprudent & the stupid.”
Yes and no. You’ll still have a house over your head in 2-5 years for the same amount it’s costing you now. The same can’t be said about your imprudent neighbor. Yeah, he might not have to pay rent now, but he will have to pay dearly when the foreclosure goes through. And rents will be going up, up, up when it becomes virtually impossible for people to buy a home without impeccable credit and a huge downpayment because you can’t get a mortgage.
The tortoise wins the race.
Keep in mind that the lenders were imprudent and stupid as well. The imprudent and the stupid deserve each other.
What idiot proposed this bill in an election year? Don’t tell me it was a group of republicans.....
The stupid (banks) got bailed out and thier profits go up. Only smaller banks are allowed to fail.
“The vetoed bill, written by Rep. Robert Aderholt (R., Ala.), moved through Congress without attracting much attention and appears aimed at a much broader target than the foreclosure process. It would have required state and federal courts to accept documents of many different kinds that are notarized by people or computers in other states. The House passed the bill in April by “voice vote” and the Senate passed it unanimously Sept. 27.”
ONce again, it’s not what it seems, and sounds like the bill is being totally misunderstood.
I reckon that Obama will misrepresent the intent of the bill and insinuate that the republicans are backing the banking industry.
No wonder we hate Congress....
BTW...the idiot vetos a bill that passed unanimously? Tell me this anything but politics.
It is a mistake to think that foreclosure or short sale or simply walking away from a house ruins your credit. It may or may not. I hear plenty of stories of people religiously paying their credit card bills but not making mortgage payments. Then keeping the bank from evicting them for months or years. Their credit may or may not be impacted or ruined. They make credit card payments because (as wacky as it seems) messing up on your credit cards hurts your credit score a lot more than walking away from a house or a foreclosure. Every case is different of course.
They can still buy a house and get a mortgage in many cases
I heard one story where a family bought a huge house they could not afford. The house went underwater. They walked away from it and in the same time frame bought and moved into another house that was far more affordable at today's prices. I don't have details on that one
I would have though that bringing the foreclosure suit as the agent for the Note Owner would be straight forward, with the only problem being showing that the servicing agreement included the ability to act for the owner in this fashion.
“Well, if the Kenyan Clown does veto this loathesome and stupid bill, it will literally be the first action that he has taken will occupying the Oval Office that I approve of.”
Not sure if anyone is getting this. By forcing mortgage companies not to foreclose (legally) you are tearing down the mortgage industry. Which I guess will mean that you will be buying homes from the government eventually.
Gee, didn’t see this one coming.
Disclaimer: Opinions posted on Free Republic are those of the individual posters and do not necessarily represent the opinion of Free Republic or its management. All materials posted herein are protected by copyright law and the exemption for fair use of copyrighted works.