foreclosure scandal: Why Shouldn’t Banks Try Robo-Modification? - 11/02/10 08:09 AM
 
The recent foreclosure scandal, exposing the methods by which lenders attempted to speed up the foreclosure process, has spawned the question: Why shouldn’t banks try robo-modification?  If they were truly interested in modifying loans for those who qualified, and if their staffs were overloaded, it seems logical that they should have assigned some robe-signers to process the applications.  Banks seemed to have had no reservations for approving foreclosures when documentation was missing, and were reported to have forged documents when necessary.  If they were suffering staff shortages, why not apply the same loose standards to the modification process?
 
Of … (41 comments)

foreclosure scandal: Surprise—Surprise: The White House Finds no ‘Structural’ Foreclosure Issues - 10/20/10 11:01 AM
An article on MarketWatch reports that HUD Secretary Donovan has stated that there are no “structural” foreclosure issues and that the “housing recovery that has begun can continue.” And while the government would like foreclosure scandal to just go away, many attorneys and homeowners facing foreclosure seem intent on getting their “day in court.”
 
Additionally, the states’ attorneys general are all performing investigations to see if the laws in the various states have been broken. It seems probable that most foreclosures will proceed, perhaps on a slightly longer schedule, but I do believe that the impact of this crisis will … (22 comments)

foreclosure scandal: Foreclosure Crisis And The Significance of “Broken Chains of Title” - 10/17/10 07:08 AM
While most of us have had our fill of articles and blogs on the foreclosure crisis, I’ve found one more that I think is worth the time of those who want to better understand the issue and its potential affect upon both housing and the economy. A recent article by John Mauldin in his weekly newsletter, Thoughts from the Frontline, provides an analysis of how we arrived at this point in the foreclosure crisis and describes the potentially disastrous consequences.
 
I found this week’s entire newsletter to be informative, but it is long; and those who wish to read only … (9 comments)

foreclosure scandal: The Little House That Could Bring Down The Big Banks - 10/15/10 02:39 AM
A small, nondescript farmhouse in Maine may one day host a monument marking it as the spot where the first volley of Foreclosure-Gate was fired. The house, owned by Nicolle Bradbury, is just one of millions facing foreclosure, but, according to an article in the NY Times, the owner refused to go quietly and sought help from a local nonprofit group offering legal assistance to foreclosure victims.
 
The article provides additional insights into what may become the biggest story of this recession, a “political football” that most don’t yet know how to grasp; and a crisis so complex, it has … (14 comments)

foreclosure scandal: FHFA Releases Statement Regarding Foreclosure Process Deficiencies - 10/14/10 04:02 AM
Acting Director of FHFA, Edward J. DeMarco, has released a statement addressing the recent foreclosure filing deficiencies and providing guidelines for dealing with those deficiencies. In his statement, DeMarco presented a four-point policy framework:
 
1. Verify Process – Mortgage servicers must review their processes and procedures and verify that all documents, including affidavits and verifications, are completed in compliance with legal requirements.
2. Remediate Actual Problems – When a servicer identifies a foreclosure process deficiency, it must be remediated in an appropriate and timely way and be sustainable. (and must review) . . . Pre-judgment foreclosure actions . . . … (6 comments)

foreclosure scandal: A Foreclosure Moratorium Won't Solve The Problem - 10/13/10 01:26 PM
While recent news stories have focused upon the “robo-signing,” of foreclosure documents, including some allegations of forgery and fraud, a foreclosure moratorium won’t solve the problem.  The securitization of mortgages and the potential processing of illegal foreclosure documents are merely components of the crisis they helped spawn; the issue that has yet to be addressed is negative equity.  Until the banks and political leaders can agree upon a solution, the economy cannot begin a path towards robust growth. 
 
The packaging of mortgages and Wall Street’s insatiable thirst for more—more profits required that more mortgages be created, causing banks to … (46 comments)

foreclosure scandal: Foreclosure Scandal Demonstrates The Value of Owner’s Title Insurance - 10/11/10 03:10 AM
Many homebuyers, eager to reduce their expenses during the purchase process, question the need for purchasing owner’s title insurance. After all, the bank’s attorney has already researched the title for the bank, how much risk could there be? However, the recent allegations that the country’s major mortgage lenders improperly processed foreclosure documents, and in some cases, actually forged signatures or made false statements, have demonstrated the value of title insurance.
 
The foreclosure issue is just one of many potential scenarios which consumers and attorneys cannot identify in advance, and the problem should serve as an incentive for homebuyers to ALWAYS … (13 comments)

foreclosure scandal: The Foreclosure Scandal Has Become Pandemic - 10/09/10 03:34 AM
As more mortgage companies “fess-up” regarding their apparent fraudulent processing of foreclosure documents, the foreclosure scandal has become pandemic.  And while the early response from many, including myself, was that this issue would soon be swept under the rug, with no benefit for struggling homeowners, and allowing banks to proceed with foreclosures, the problem has exploded in significance.
 
Attorneys and state courts around the country have begun to question the manner in which banks have processed thousands of foreclosures each month, and numerous errors have been discovered.  Court documents have revealed the casual manner in which foreclosures were often allowed … (104 comments)