Posted on 06/10/2011 12:41:30 PM PDT by Palter
No, TARP was not intended in any way to get the crap out into the open. It came with few, if any, conditions on opening the books of banks. The original intent of TARP was to allow only the SecTreas to see the books and decide what, if any, position to take in the banks. That was then amended by the Congress to place more consideration upon exec comp, lending practices, etc - but they still didn’t open the books.
That was, in part, the Fed’s doing. The Fed has, since the 30’s, protected the banks from the public TRULY seeing and knowing what is going on within a bank’s books.
When I say “get the crap out into the open” I really mean it. Fling open the books of banks for the investors, bondholders, customers, FDIC et al to see. Then get realistic about what loans are good, which are dubious and which need to be sold off for speculative recovery, ala the RTC in the S&L scandal.
So am I.
The problem here (or so I’m told by lawyers) is that quieting title is something that is a relatively narrow field of practice, with little prior request for these services on the part of residential property buyers/investors/etc. There is, however, a liability created for the attorney certifying that the titles are now quieted, and with the screwed-up nature of this whole mess, I can see why lawyers or even para-legals aren’t jumping into the situation. When the title insurance companies are faced with taking a loss as a result of imperfect title, they look for anyone to whom they can attach even partial liability to get out from under the full weight of a payoff. The title insurers have legal staffs that know the title law pretty well, so this isn’t a hypothetical liability for those who might be making a claim of a quiet title that then turns out to have a problem.
Add to that the pricing problem I spoke of. Let’s say that I want to buy a house that’s been foreclosed upon. Let’s say that it isn’t a super-nice house, just a nice enough house in a middle class neighborhood. Let’s call it a $200K house. Let’s say that due to the market, it is down to $175K.
Now I come along and want to quiet the title on it. Let’s say my lawyer charges $250/hour (not unreasonable for a lawyer and his staff) to do this. That’s $2000 for an eight-hour day of work. If the house is older, or it has been sold and re-sold a lot in the run-up to 2008... they could easily invest 16+ hours in the research alone, and THEN, if there are problems, it could take them 10’s of billable hours more over several weeks to get this whole thing unsnarled. OK, the way you minimize this part of it is to buy as new a foreclosure as you can find, so there’s comparatively little history on the title. One, two hours work and you’re done with the research.
For 90 to 100 year old properties, (of which there are a bunch around here - the population of Wyoming doesn’t go up or down that much, so we don’t have huge housing booms) I’ve had potential numbers of $5K for “nothing much wrong” to $10 to $15K for “a real modern mess” pitched at me.
OK, so add on the $10K to the housing price of $175K - we’re up to $185K. With the market continuing to go down, and possibly being in a state where it could continue going down for the next year, and then housing price recovery is based almost entirely upon organic growth of household income... maybe housing prices recover 1% to 2% per year for the next 10 years as we work off the overhang.... and it becomes a deal where I buy a house for $175K, add on another $10K (or more) in legal fees, then the price of the house on the market goes down (let’s say to... oh, $158K with only another 10% decline... (take the 10% off the 175K, giving $157,500... the $10K in legal fees I spent to quiet the title isn’t a selling point for most people - that’s why most people were suckers for these stupid blow-up loans in the first place - they can’t or don’t read, they don’t understand... they’re frankly, too stupid to be doing real estate deals)... and it could be 15+ years before I break even on the place again between the purchase price, the market downturn, other foreclosures or REO’s coming onto the market and depressing prices, then the relatively static nature of the markets here...
That’s not a hugely winning investment, IMO.
So Bank A Coutrywide made a mortgage loan to Mr. Jones and before the ink was dry they busted the whole thing up shreaded most of the paperwork and they sold the if with out legal transfer to International Mortgage Investors or World Wide Mortgage Money Managers or who ever (but they really aren’t sure and besides the think has changed hands unregisted a couple times since then), but they countinue servicing the loan, Now BOA buys Countrywide, but they could not have brought the mortgage as Countrywide has already sold it they did by the right to service the loans as well as the obligation to pay those whose money Countrywide took when the sold it them (who every that is)Now explain to me where BOA has the right to foreclose.
That was one heck of a run on sentence! Under your scenario:
1) Countrywide made a mortgage with Mr. Jones,
2) Countrywide then sold the mortgage, but when they sold it they did not sell the right to foreclose they just sold the cash flow,
3) then BofA bought Countrywide...
Then BofA retains the right to foreclose. BUT they don’t seem to have cause to foreclose since they have not be harmed. So they cannot foreclose. They need to sell/transfer the right to foreclose (not sure if that is the title or the lien or what) to the person/investor who bought holds the right to the cash flow from the mortgage. Presumably the buyer and seller both wanted to sell that right, they just a) screwed up or b) could not figure out how or c) legally could not. If a or b, they can fix it by moving the title/lien to the current holder of the mortgage.
The problem is that the secualized moeny was put in one big pot. World Wide investor brought 1 billion, Intercontinetal brought 500 Million, and Acme Investments brought another 500 million, but Countrywide never tied Mr. Jones Mortgage directly to any of these investor they just collected the money from Mr. Jones and maybe this month some went to Acme and the next some to Worldwide and so on and how could countrywide sell the right to foreclose to BOA when they had been paid off and in no way harmed. Also how do you Identify which of the three investor’s money actual went to Mr. Jones’ loan? And how do you legallu prove it when ther was no recording of a assignment?
The Pooling and Servicing Agreement (PSA) the Court refers to, specifically lay out the the formula for Mortgage Back Securities (MBS). Typical these investment were done over the counter (OTC) at trading houses as private contacts.
You’ll see many lawsuit filed in New York or moved to New York concerning MERS and/or mortgages that were ‘pooled’ because the PSA originated on Wall Street and is the controlling document.
Of course MERS made many copies of mortgage loan documents and attached then to many PSAs for the investment collateral but basically used one mortgage in 20 different PSAs (derivatives) while the one mortgage should have only been used once.
Then using credit default swaps, Wall Street bet against the MBS (knowing they would fail) sometimes selling Swaps with the more risky MBS as an enticement to get the buyer to purchase as insurance against non-performance of the MBS.
The bank that first gave the house loan only remains as the servicer i.e. collects the payments (for a small fee now) and forwards the remaining balance to a chain of investors (MBS)...that’s how it supposed to work.
The PSA was not honored because a note with the attachment showing all investors is missing or more likely non-existent due to fraud... a no brainer if the Court asks for the note and it isn’t produced, then there is no legal claim to the property.
Where’s the note or any note that was used in 95% of all loans used in a MBS? I don’t know but I can tell you where the MBS ended up and 95% of all loans given out the last 10 years....with the GSEs like Freddie and Frannie which in turn sticks the taxpayers with the bad paper and still no note.
TARP made all the credit default swaps good as there was not enough collateral (property mortgages) to cover the bets made. Too big to fail was actually to big to lose or, if you will, a guaranteed winning fraud position.
Aside: Alphabet soup deciphered here...
The 3300 counties and their clerks are obviously no longer fulfilling a useful function, or it would not have been necessary to create MERS, jerry-built though it may be.
If the clerks and their assistants were canned, the cost of conveyance would decline, along with cost of fast food (gotta watch the pct of crew labor, dontcha know).
Are you joking?
That is just so wrong as to be maliciously misleading.
The MERS system was about avoiding the “3300 counties and their clerks”. It was a deliberate tactic to get around them altogether.
It is a deliberate undermining of the 400 years of common law on property assignments.
And the courts are finding MERS to not be legal. They don’t have the right to foreclose. They have detached the note from the collateral.
Precisely. And hopefully, the next iteration will cure the flaws and obsolete those redundant clerks once and for all. MERS may have jumped the gun, but it's the right idea. It's 2011, and we don't need no stinkin' overpaid, unionized paper pushers!
If I can trade tens of thousands of dollars of common stock in milliseconds, why should it take orders of magnitude longer to do the same with real estate?
MERS is a fraud and has destroyed the clear title of over 95% of the homes in this country and should be burned down to the ground.
Property laws are state laws and I don’t want to see the property laws of this country turned over to the federal government and nationalized. That is socialist/commie stuff.
Recording of title NEEDS to be local.
We don’t need no stinkin’ overpaid unionized federal employees mucking about in our property rights.
Who said anything about federal employees? Public employees suck, and federal employees suck the most!
Recording of title NEEDS to be local.
Why?
Once there's an accurate description of a property, who owns it is just a database problem. That's what MERS was after, but they took too many shortcuts. Nonetheless, something like MERS is ultimately the right solution. (Oh, and BTW, MERS is not federal, state, nor local. It's a private entity).
So someone with the ‘right’ idea should be able to trump the laws of all 50 states and just implement it on their own? And once they do implement it there should be no consequences for their action, but their actions should just be excepted and overwrite existing law, because hey its a good idea! And who gets to decide what’s a right idea with you? Apparently not the people or their elected legislatures. Last time I check we were a Republic and conservatives were fighting to keep it that way. I am not against changes in the laws and I agree that changes especially changes to keep up with the times are often needed, but there is a proscribed method for making those changes and for anyone to defend the breaking of long stand existing of all law of all 50 states and treating the bypassing of the legitimate legislatures of all 50 states like it was some small breach of etiquette just because they have determined that it’s a good idea to be diametrically opposed to principle this nation was founded on. Some people think it would be a good idea that guns be taken away from the general public, some people think it would be a good idea to decide if and how many children people can have or that it would be a good idea for the state to order the abortion of children like Trig Palin, there are so so many ‘good ideas’ that some people would like to implement and it would be so much easier if they could just do it with out the people, their elected representatives or their foolishly outdated existing laws getting in the way.
PING!
Are you coming around to supporting the rule of law yet?
The banks screwed themselves by creating MERS to do an end-run around already established and long upheld title law in all 50 states.
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First off Thanks for helping get the word out ,, it often takes years of pounding people over the head with the truth before they open their eyes...
Second ,,lets not forget that other MAJOR players ,, most notably WELLS FARGO , did exactly the same thing as MERS but kept it in-house... If you have a securitized mortgage that has no assignments recorded at the county and it isn’t with MERS it’s probably hidden behind the Stagecoach from Hell’s veil...
If there never was a serious intention to honor the civil contract, then yes we have crime.
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The real purpose of the MERS veil of secrecy was to allow the wall street banks to sell the same mortgage into multiple SPV’s as they never transferred the original paper that wouldn’t get caught... with the proceeds from the homeowner split a few ways the obligation to the investors couldn’t be met , the SPV’s/Trusts would default , the wall streeters would collect on their insurance and dissolve the trust... the investors would be screwed with no way to determine what actually went wrong ... pretty neat larceny ... but to work they have to refrain from getting TOO greedy ,, don’t inflate real estate too quickly and don’t scam the insurers or investors too many times...
The banks now need to go back, obtain an assignment from the original lender, record it, and then proceed to foreclose. And yes, they will have to pay those annoying recording fees to the counties
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EASIER SAID THAN DONE ... almost 100% of the securitized mortgages were table funded by an unnamed 3rd party ,, a party that is not currently recognized on any of the docs.
They have to decide if they want to forge an assignment from bank “A” to depositor “B” to Trustee “C” and risk being caught in the lie that bank “A” didn’t actually own anything because bank “AA” actually wired the money for the purchase...
Or do they want to acknowledge bank “AA’s” role and blow out the mortgage on TILA grounds as a void instrument..
By the way, I notice that you didn’t say anythnig about the second set of crimes most of these banks have committed the massive fraud, forgary, perjury and Fraud on the Court they have done in an effort to make their good idea look legal, but then maybe you consider their massive and illegal effort to cover-up the illegality of their good idea a good idea as well?
“But. The forgiven amount has to go on your income taxes. Can’t bankrupt out of that.”
Not if the mortgage was a “no recourse” mortgage.
Let us not forget that not only are many of these banks uninjuryed parties to begin with as they have already been paid back the money from the investors, but many of them have been paid a secondtime after the foreclosure, because they sold the house for what it was worth and then turned around and claimed and were paid money from the mortgage insurance for the difference and all the while they were making money hand over fist from fees being charged to both the borrower and the investors. Nice tiddy sum and that doesn’t even included the TRAP money they got to help them with their ‘losses’.
FOR YOUR ENJOYMENT:
ORDER GRANTING TRUSTEE’S MOTION TO SET MOTION TO COMPEL
FOR EXPEDITED HEARING AND TO REQUIRE RESPONSE FROM
CITIMORTGAGE
http://www.ksb.uscourts.gov/images/ksb_opinions/JMK_10-41685-45.pdf
Nobody wants to get tangled up in this fraud..
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