Another instance of a judge declaring that contracts, willingly entered into by both parties, are invalid.
Why don't the aggrieved parties just give the money back?
The problem, I think, is that to foreclose one must present to the court physical evidence in the form of the recorded instrument. That is what has been thrown out, in willful disregard of the foreclosure statues. It’s hard to believe that stupidity can exist on so grand a scale, but evidently it can.
The criminal part was when the Freddie Mac and Fannie May were giving away federal guarantees for loans. That was a promise to engage in theft to further fraud.
That's actually not the case.
In the old days, a bank that made a mortgage loan was loaning its own money. They made sure that the people they loaned money to could pay it back, because it was their money. The bank would service the loan over the life of the mortgage. They kept the original paperwork with all the signatures and supporting documents in a physical file on site. Twenty years after the loan was made they could produce all the paperwork to prove the money was owed to them.
Nowadays, with the securitization of most mortgages, the originating bank sells loans to Wall Street firms that bundle thousands of mortgages together into bonds and sell them to investors.
Along the way, the original mortgage documents are destroyed and replaced with a few entries in an electronic database.
The bonds are not traceable to source mortgage documents because the source mortgage documents no longer exist.
If somebody gives you a signed, notarized IOU, what would you do with it? Would you make a few entries on a computer file and destroy the IOU, or would you hang on to the IOU to prove that the money was owed to you?
Good luck getting somebody to pay you back without the physical IOU. For one thing, even if you pay them, they can't return the IOU to you for you to destroy. You could pay them, then a year later they might "find" the old IOU and demand you pay them again.
Not really. When your bank sold your mortgage to someone else, were you a party to that contract?
Not being able to prove standing to foreclose is a problem. I’m not so sure you’ve thought this through completely. Yes, there are anticapitalist deadbeats promoting this. But, do you seriously want to allow parties not holding title, the legal power of foreclosure? Think of the potential for abuse, against those who are not in arrears. Mortgages have gone international. All manner of further, criminal michief would be made possible.