Article

2010-10-05 Economy

As The RoboSigning Scandal Goes Mainstream - Mortgage meltdown emminent?

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Posted by Besoeker 2010-10-05 10:06|| || Front Page|| [5 views ] Top

#1 The biggest issue that is now developing, as we noted last week, is the fact that title insurers (firms such as Fidelity National, First American, Stewart Info and Old Republic) are refusing to insure mortgages in foreclosure or otherwise, uncertain as to who actually owns the title.

If the county administrators weren't already in the pocket of developers and banks, most of the foreclosure titles would already be on the country court house steps being auctioned off by the sheriff for delinquent back taxes the paper holders owe. New papers and titles would go a long way to clearing the books and raise revenue that local governments have been bitch'n about for operations. Now there's corruption in work to protect 'clients' over the duties of office.

Posted by Procopius2k 2010-10-05 10:25|| 2010-10-05 10:25|| Front Page Top

#2 No worries. Obama's financial team is coming to the rescue. Our government can assume the role of ~~401k, pension, precious metal, mutual fund,~~ mortgage guarantor. Seperate cheques please -mandetory throughout the life of the loan regardless of....what was that old term...yes, equity! Only a few short months should be needed to establish the proper agency, hire the patronage team, and print the tens of thousands of necessary forms. This is not a crisis! This is an opportunity. Everything are the governments, everything!

Posted by Besoeker 2010-10-05 10:41|| 2010-10-05 10:41|| Front Page Top

#3 Yes, we are mere stewards of the state's ownership of your labor and acquisitions. "We keep you alive to serve this ship. Row well and live."

Posted by Procopius2k 2010-10-05 11:16|| 2010-10-05 11:16|| Front Page Top

#4 For those interested, more This is a very big deal.

Posted by Nimble Spemble 2010-10-05 14:15|| 2010-10-05 14:15|| Front Page Top

#5 I submitted the following 3 days ago to the 'Burg, not published, still useful:
The foreclosure machinery that has forced millions of Americans out of their homes is beginning to seize up. NYT uses the euphemism of 'some lenders and their lawyers are accused of cutting corners in their pursuit of rapid home repossessions' while Judge Jean Johnson of Duval Co., Fl, stated 9 Aug 2010 in a foreclosure case "the Court finds by clear and convincing evidence that WAMU [Bank], Chase [Bank] and Shapiro & Fishman [bankster's law firm] committed fraud on this Court."
The law firm of Dewey, Cheatheam & Howe has offices in Cambridge, they specialize in such clients.
Jason Grodensky of Fort Lauderdale had his home foreclosed on by Bank of America this year, even though he owned it outright and had never had a mortgage on it.
GMAC, majority-owned by the feds, and JPMOrgan Chase have suspended all foreclosures in the 23 states where they need a court's approval. Investigations are being launched in several states.
A major title insurance company has sent a bulletin to its agents saying that until further notice it would not insure title to properties foreclosed upon by GMAC Mortgage, due to doubts about the validity of titles transferred under foreclosure procedures.

Were seeing a fundamental breakdown in the system, because no one cared that much about getting things right, said Representative Alan Grayson,D-FL.
You can say that again, and this applies to far more than the housing and banking industries.
Grayson also said, We are reaching a point where the easiest way to make a buck is to steal it."
I think we passed that point a few years ago. This may destabilize the banking system, among other things.
It's not a 'mortgage meltdown' but a 'foreclosure and potential bank meltdown.' All those MBS holders around the world now have more reason than ever to wonder whether the paper they 'own' represents anything other than a scam. Properties that have been or will be foreclosed on now have the cloud of a clouded title hanging over them - who is so foolish as to buy one of these properties? State law, not federal law, governs the law that supports who owns real estate. It's way more than the paperwork. The law behind the creation of MBS paper is pretty clear, if the paperwork establishing ownership is not done properly, the entire MBS is INVALID, and taxes are due the IRS (and potentially the state governments depending on their own laws) on the ENTIRE AMOUNT of the MBS. A lot of states need a lot of revenue right now.

Posted by Anguper Hupomosing9418 2010-10-05 15:00|| 2010-10-05 15:00|| Front Page Top

#6 It looks like the basic responsibility for this disaster lies in the hands of the banking and real estate industries, not greedy home buyers nor the state/local governments. No one else was responsible for keeping track of who owned what, filing documents at county courthouses, etc.

Posted by Anguper Hupomosing9418 2010-10-05 15:04|| 2010-10-05 15:04|| Front Page Top

#7 It would be great if the mortgage meltdown was eminent, but I'm afraid it's imminent

Posted by Dinah Kanser 2010-10-05 15:25|| 2010-10-05 15:25|| Front Page Top

#8 Representative Alan Grayson,D-FL. should not be quoted for anything.

Posted by Dinah Kanser 2010-10-05 15:27|| 2010-10-05 15:27|| Front Page Top

#9 Representative Alan Grayson,D-FL. should not be quoted for anything. The truth hurts, doesn't it?

Posted by Anguper Hupomosing9418 2010-10-05 15:31|| 2010-10-05 15:31|| Front Page Top

#10 Barry Ritholz put it this way: This is the third and final step to the disassembling of Capitalisms property rights. It is indirectly related to prior two steps. Mostly it reflects the same disrespect for legal process int he headlong rush for profits, legal and otherwise.
I don't know about '3rd and final', but otherwise he is saying the same thing Rep. Grayson said. Our financial oligarchs live & die by the concept of "What's ours is ours, and what's yours is ours, too."

Posted by Anguper Hupomosing9418 2010-10-05 15:46|| 2010-10-05 15:46|| Front Page Top

#11 A Canadian commenter to Barry Ritholz's blog posted this reaction to the scandal:
What happened to America? What will happen to America?

Its one thing to watch a person / company / team / country lose its stature based on a clean beat by the competition. We can all handle that. It is quite another to watch a country (b)eat itself from within.
This is where the real estate disaster connects to the Jihad.

Posted by Anguper Hupomosing9418 2010-10-05 16:08|| 2010-10-05 16:08|| Front Page Top

#12 I have very little sympathy, people were told that falling affordability was not a sign of economic growth, but of robbing their own children. They believed the path to wealth involved no work ,and maximum loans.

It couldn't happen to a more deserving generation.

Posted by Bright Pebbles 2010-10-05 17:09|| 2010-10-05 17:09|| Front Page Top

#13 It couldn't happen to a more deserving generation. No generation deserved this breakdown of the rule of law and centuries of tradition in maintaining property rights. It is easy to read this as being about generational theft, but that's not the core of this issue. This is about an oligarchy overreaching itself.

Posted by Anguper Hupomosing9418 2010-10-05 17:22|| 2010-10-05 17:22|| Front Page Top

#14 Wrong, This boomer generation ignored the problems until it all inevitably turned sour. Then it's WAH WAH WAH!

The signs were there FOR YEARS, no one did anything, because they didn't want to upset those potmekin rich.

Posted by Bright Pebbles 2010-10-05 18:25|| 2010-10-05 18:25|| Front Page Top

#15 Even governments don't have enough money to bail out the housing bubble mess as Ireland is currently discovering.

And as for who's to blame, the regulators should have stopped the sale of the sliced and diced mortgage backed bonds and in particular their purchase by other banks. Anyone who knows anything about bank lending risk could see that was a recipe for disaster.

Posted by phil_b 2010-10-05 20:52|| 2010-10-05 20:52|| Front Page Top

#16 The regulators should have repealed Basel2, and raised reserves AT THE START of the credit bubble.

Basel2 turned credit in the currency into a commons.

Posted by Bright Pebbles 2010-10-05 21:09|| 2010-10-05 21:09|| Front Page Top

#17 While I wonder how this nation will survive the boomer generation, it will certainly be everyone after that generation that has to sort out this mess.

Posted by 49 Pan 2010-10-05 21:24|| 2010-10-05 21:24|| Front Page Top

#18 Looking on the bright side, this house I'm upside down on just might not belong to me. I hope the rightful owner is ready to take it over....

Posted by 49 Pan 2010-10-05 21:25|| 2010-10-05 21:25|| Front Page Top

#19 this house I'm upside down on just might not belong to me. I hope the rightful owner is ready to take it over. Check your state laws on 'adverse possession' Stay there long enough, and you'll own it. Unless the powers that be get rid of those laws too.

Posted by Anguper Hupomosing9418 2010-10-05 21:57|| 2010-10-05 21:57|| Front Page Top

#20 ION RENSE > [$$$] BROKE US CITIES TURNING TO BANKRUPT STATES FOR HELP | CITIES TURN TO BELEAGUERED STATES FOR HELP.

e.g. HARRISBURG, PA.

Posted by JosephMendiola 2010-10-05 22:51|| 2010-10-05 22:51|| Front Page Top

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