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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

“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.

The issue is not about the slob borrower who was reckless, which I share your position on, but a separate issue dealing with the ability of the mortgage business and Fannie Mae/Freddie Mac encouraging the set up of an electronic system that will allow mortgage backed securities to be traded like stocks. Problem is it wrecked the manual system of recording the deed/clear title for the property. The bankers, mortgage companies and Freddie Mac and Fannie Mae set up a system where huge amount of money was made on fees, commissions and etc on the MERS exchange at the expense of the legal support documents involving the mortgagor and mortgagee. Foreclosure crisis is exposing this mess, but it also involves people who are making their mortgages on time but the note is sold to so many times they may not have a clear title when they try to refinance, sell their home or pay off their mortgage. In other words the gov set up an electronic system and did not supervise it, thus allowing bankers to concentrate on making money on the exchange and in the process neglect the proper paperwork/document process that is critical to the homeowner down the road.

Not to mention, the turmoil it will cause in the market that will f*** you over with a further decline in already diminished real estate value.

The main thing is - how do you solve this? It does nobody any good to give a bunch of deadbeats free houses, but it also doesn’t do any good to circumvent the law here.

A “going forward” solution is easier than fixing the existing problem. In other words, setting rules for transactions that happen from now on, vs. those already done.

And he is probably voting Democrat, and that’s why Obama is vetoing this bill, because it makes it harder for out-of-state banks to do business.

In the long term, this bill will pass, or big banks will start charging more money for out-of-state loans to cover their increased costs of getting things notarized in each and every state.

This bill passed the Senate by UNANIMOUS CONSENT. To believe this was a horrible thing, you have to believe that every conservative senator was on board with doing the wrong thing, while Obama did the right thing.

Isn’t that too much of a stretch? I think so.

You might want to look into your own situation just to be on the safe side. The thing that some don’t understand is that if the people you are making payments to don’t have the original loan papers then they may not be able to deliver your title to you when you make your last payment. There is a process to resolve such situations by going through a “Master in Equity” but you don’t want to have to do that.

Half of the eight acres I live on was originally bought on a “land purchase contract” whereby I made payments to the owner of the property and when the final payment was made his duty was to deliver a clear title to me. He delivered the title but when I did a title search I learned that there was an old note that had been paid off but never discharged at the clerk of court’s office. A private detective had to find the man who was a thousand miles away and he agreed to sign papers releasing the debt which he said had been paid to him years ago but he didn’t know he was supposed to sign a release and no one had asked him to. All he asked was that the detective swear to tell no one where or how he had found the man. I don’t know who he was hiding from.

The point of this story is that had the man not been found we would have had to go through the master in equity process to clear the title and that apparently is where a lot of mortgage payers are going to find themselves when their mortgage is paid off. Be sure that the people who are accepting your monthly payment are in a position to deliver a clear title.

If I had one of these mortgages that no one can find the papers for I would immediately cease making payments to the mortgage company and get legal advice, I would not continue to make payments to someone who cannot foreclose because neither can they deliver my title when the debt is paid.

I think vetoing the bill will protect the people who are illegally, fraudulently, irresponsibly being foreclosed on. People who had been in their homes for years and were deceived and pushed into some terrible loans...the ones that were meant to fail, that investors bet on failing, and they were looking to get some equity out of their homes for remodeling or because there was a pregnancy, or for whatever reason...and loan officers were making it look so easy...you can refinance again in a couple of years, etc...and some loan officers were just as greedy as the banks by giving these loans out and telling people that their credit was bad and this was the only loan they could get..there are thousands of these kind of loans that have been foreclosed on without sometimes ever having missed a payment. These are the people that need protection. In non-judicial states people can be foreclosed on with never seeing a judge and never knowing that the servicing forecloser had no right to foreclose. The main trick that these servicing companies used to foreclose was offering the homeowner a payment plan prior to modificantion..charging them fees for those plans, then denying them and then giving them more chances...and more fees(even though they followed the plan to the t...they were always denied. )They would always say...for a 3 month plan..don’t pay the first month..skip one payment...and then they would report them to the credit bureau as late...Some got 5 or 6 payment plans..and their credit was ruined so they couldn’t even go out and refinance with another company. Same companies would put some in foreclosure while they were in a payment plan. Some never followed the foreclosure laws of respective states. No advertising. No foreclosure registered in cty records. Not giving the proper notice. And their foreclosure was based on the fees that accrued during the pretense that they were going to get a modification. There are thousands of these people. no judge in the world is going to let someone who really hasn’t made their payments for months and months get away with a produce the note strategy. First of all..they wouldn’t have the 500. to file an injunctive relief, a motion to dismiss, a restraining order...or any money to hire a lawyer...so please stop thinking that anyone is getting a free ride here..there may be a few crooks...but don’t think punishing a few crooks and passing this bill wouldn’t harm the thousands who are being screwed over by probably foreign investors who don’t give a shit about americans losing their homes.