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Those of you who hang out on the FDL foreclosure fraud front page have known for months that banksters were doing foreclosures using forged and perjurious documents. We here at the Lake have been trying to get that story out, so that judges would realize what was happening and would scrutinize foreclosure pleadings carefully and hold plaintiff banks/servicers/MERS to their burden of proof.
Well, thanks to the sudden decisions of Ally Financial (formerly GMAC Mortgage) and JPMorgan Chase to suspend some of their activities in judicial foreclosure states, the story has finally hit the front page of the NYTimes.
This morning, judges woke up to coffee and information that I hope will profoundly change their attitude toward the legitimacy of the legal pleadings being promulgated. All I ask is that when presented with foreclosure pleadings, they READ FOR CONTENT and allow defendants to present proof of fraud, instead of dismissing the very notion as absurd and some sort of stall tactic.
Let’s hope this story will hit the evening news broadcasts and the front pages of local papers everywhere. This is a good start.
[More investigative reporting on mortgage issues and foreclosures on the Firedoglake Foreclosure Fraud Page]
22 Comments
This is all well and good, but we must also counter the propaganda that judges are likely to internalize, that all of the borrowers are just deadbeats anyway, who bought houses they couldn’t afford, and thus deserve to lose their homes, so why worry about some sloppy paperwork.
In case you missed it, here’s what I posted on yesterday’s foreclosure diary:
It’s good that the print MSM is finally covering the foreclosure deceit, but what about TV?
oh hell yeah !
thanks Cynthia
Yves Smith blogged about the servicer issue today:
Congressmen Attack LPS, Servicer Misconduct; PR Counteroffensive Starting
Yves reminds us that people who can’t afford their home don’t try to fight in court to prevent foreclosure:
The post includes a video of Alan Grayson describing the servicers’ misdeeds, and Yves provides an explanation of how this affects MBS. But Yves tells us that “a predictable PR pushback is taking shape” in which the servicers claim ” that the document problems are mere “technicalities”.”
But the real stunner is a paragraph that describes how the servicers’ software doesn’t alert them to when a borrower ‘is a goner’ and thus the servicers keep sending payments (out of their own account) to the MBS, which eventually results in incentive to foreclose. But are they foreclosing on those borrowers who really can’t afford their loans, or is it a crap shoot, motivated solely by the need for cash to keep propping up the MBSs? Karl Denninger suspects that this is the case: the accelerating foreclosures are meant to recoup cash to keep paying the MBSs, to prevent the collapse of the house of cards.
Cynthia — Thanks once again for all your work in bringing this to light. Fortunately my house is long since paid off but I feel for the millions of others out there who are getting shafted.
Cynthia – You have done great and tireless work on this subject. But let’s not be naive. For 2 years these Banksters have been engaging in these practices…… which infuse not only taxpayer funded Ally but the HAMP program as well. The powers that be know damn well this has been going on.
And suddenly, 5 weeks before the mid-terms elections – a halt to alleged inappropriate foreclosures ensues. Forgive my cynicism, but I predict they will resume on Nov.3rd!.
I saw you comment on both threads and think you make a great point.
The rampant fraud in forelcosure though has resulted in foreclosure upon people who paid cash for their homes and didn’t even have a mortgage–why, yes, this DID happen in Florida, why do you ask?
I think the scenario i your last paragraph is probably largely accurate. There is another thing, the servicers make a ton more in fees from foreclosure thatn thye do from an uneventful mortgage that pays like clockwork, so they have every incentive to push reglaur solvent pay-on-time people into default.
The serviers don’t make any money on return of principal and interest, they make it on fees
Given the digitization of everything and a continuing environment of control fraud (h/t William K. Black for The Two Documents Everyone Should Read to Better Understand the Crisis ) and the enablement of that by the judicial system, every asset is a target. Hope you live in one of the more honest Venn Diagram-of-legal-jurisdictions (it’s like a Russian Doll– you have to look from the city to the federal district level). A few hors d’oeuvres for thought:
Persistent court corruption, Philip Bond, University of Pennsylvania, November 2004
Political rents in a non-corrupt democracy, Journal of Public Economics, Volume 93, Issues 3-4, April 2009, Pages 355-372, doi:10.1016/j.jpubeco.2008.10.008.
2 Years? It’s been a lot longer than that. Houses were going under before the financial crisis hit, supposedly it was the explosion of foreclosures that triggered the crisis (though I have some doubts about that)
Corporate Sodomy, extracting life out of you and me, seizing property, destroying life and liberty, no due process for you or me, just economically leveraged slavery to a corporate shell.
I can assure you it has been going on far longer than that! I am also very glad that the servicer and document recordings are being focused on as well.
There will always be deadbeats, but the majority of these people are good and hard working. That is when they had a job. This fraud began back in the Clinton years when jobs were plenty and RE prices were going thru the roof. No, I’m not blaming Clinton. I’m using his term to describe the time period.
Oh, I wish to say this again as well. The banks don’t even pretend anymore. They want that land and house haul. They want everything in America that is not sprayed with OFF.
I’m beginning to think they are playing “mine is bigger than yours” with Switzerland. Look out Genieva!
Great links..
I trace the official start of the US crime wave to the 1990s. Suddenly the public is on-ramped to the Toobz (commercialized) beginning in 1996. During that time I saw IT directors ORDERED to put everything into “websites” and through The Cloud {total WTF}. The transcontinental optical fiber is completed in 1999 just in time for the BS of Y2K. Yeah, other countries (not that some of them haven’t been involved) have been watching us write the textbook here as you’ve seen from the very few citations I’ve given. I’d say that the fall of the USSR could be quite an adequate preface. None of this is rocket science.
If you like it, pass it on. Ignorance = left standing stark neek’d in a gulag.
happened to catch this via Twitter last night – the sheer audacity of it’s truth had me howling
Yeah, this really begs clarification/qualification as I’m talking about “the recent one” now on the radar. Clearly, there have been other crime waves (some overlapping will others) as Bill Black has shown with the S&L scandal stuff and as Matt Tabbai discusses.
“Pernicious” is a great descriptor. Up there with the fabulous 1885 vintage descriptor, “poobah.” ;)
As to the paperwork being a mere “technicality”.
That paperwork is the key to preserving most American’s major asset. If shoddy paperwork, not to mention actual fraudulent and forged paperwork, is allowed to be brushed off as a mere technicality or nuisance, than virtually no one is safe and this has already been proven: the case of the foreclosed home with no mortgage, the case of the foreclosed home with 2 banks claiming the mortgage, the case of the home that was sold twice in foreclosure, the person who was foreclosed for a $75 dollar disputed late charge, etc. etc. NO homeowner or citizen should take the banks cavalier attitude cavalierly. David Dyan posted a blog in an article where the author, sorry I can’t remember to give credit, but the author rightfully pointed out it’s the largest assault on the rights of property owners since Kelo.
Sure everyone’s a deadbeat until it possibly happens to you. They lost your payment. You submit proof. They lose the proof. Late charges. Bad Report to the credit bureaus.. . It’s just an unending spiral where the homeowner is victimized. Customer service routed to India where no one has any real intention of helping the homeowner. It’s horrible that the idea is even being floated of mortgage servicers intentionally driving people into foreclosure because they make more money, but anything is possible.
I never thought I could possibly read in my lifetime a story about judges in Pennsylvania sending teenagers to jail in return for payoffs from a private prison , either. Or I never thought that insurance companies would base bonuses on successful denials of treatment to cancer victims either.
Alan Grayson made a very salient point- It is close to being accepted business practice to steal money as opposed to earning money by providing a product or a service. We are becoming a nation that is entrenching corruption into every fiber of the fabric of our being.
No, mass perception lags practice. However, the gap is shortening for many in this Age of the Toobz and only if the Toobz stay unrestricted/untampered with. Now that a whole new bunch of folks– generations at one fell swoop– have been so easily totaled by the unrestricted GREED of a a vast few, maybe folks will realize that zero tolerance is the prevention worth lifetimes of cure.
Cynthia — Have you seen Democracy Now today — NY Judge Schack is interviewed as well as the reporter from Mother Jones who wrote the big Florida foreclosure mill/rocket docket story:
Not too often we get to see one of the actual judges interviewed.
And I don’t know if it’s related, but Amy Goodman’s going to be on CNN John King tonight, I got a heads up in my e-mail.
Cynthia, thank you for providing solid coverage on this vital topic.
Mainstream media has been a year late and millions of forclosures short.
My state AG Blumenthal is currently pushing for a 60 day freeze on forclosures here in CT. Hopefully CT is turning the corner on this issue.
Nationally I really think they need to consider a 9 month freeze on forclosures while they sort out this mess. Can the courts even handle the work load that all these fraud and title problems will generate?
I think they should just nationalize the big banks, resurect title status and provide right to rent and cramdown options at current market rates.