These are the most interesting items I have come across on the current mayhem in the mortgage market. I do not expect this issue to pass very soon:
• Who’s Who in the Foreclosure Scandal: A Primer on the Players: This Pro Publica piece is a MUST READ that will get you up to speed quickly
• Blame The Victim – Or the Perp? The plain fact is that foreclosure law lays out a very specific series of steps intended to protect the rights of both the bank and the homeowner. This is critically important: mistakes or sloppiness in this process could easily (and grieviously) harm the homeowner or creditor. Accordingly, its vital that this process be followed to the letter of the law. Unless your a banker trying to evict people, apparently.
• This Fortune article gets my nomination for the single most clueless MSM piece so far: It’s time to stop blaming the lenders I guess the securitizers, servicers, underwriters, lawyers and banksters for sure — but not the lenders.
• Mortgage Mess: Shredding the Dream: Street’s unspoken strategy has been to kick mortgage losses down the road until an economic recovery reinflates the housing market. The faulty-foreclosure crisis has forced the issue back into the present tense, triggering a fight over who will bear the brunt of those losses. The combatants—all of whom are trying to minimize their share of the damage—include homeowners, lenders and mortgage brokers, loan servicers and the underwriters of mortgage-backed securities, the buyers of those securities, title insurers, rating firms, and the federally controlled mortgage buyers Fannie Mae (FNM) and Freddie Mac (FRD).
• Florida activists read between the lines on foreclosure paperwork: While meeting for the first time in November at an old one-story law office in this city, the four strangers compared notes and began to piece together the scope of the problem: All over the United States, big financial firms might have been using fraudulent paperwork to evict struggling borrowers from their homes. Now tight-knit, the group is largely responsible for setting off the growing firestorm over foreclosures
• Regulator Says Fannie, Freddie Cost at Mercy of Economy To be filed under Duh!
• Firm says foreclosure letters ‘mistake’ An East Bay law firm says it mistakenly sent out thousands of letters to San Francisco homeowners earlier this month warning them that their houses were in default — even though the loans weren’t delinquent. The letters were sent out by Provident & Associates, a Pleasanton-based law firm that is attempting to help people with loan modifications. Provident sent out what it estimated to be 2,000 letters to people telling them that they faced foreclosure on their mortgage. The letters went primarily to homeowners in San Francisco.
• And Who Pays for the Laws? DJMT puts all this into a bigger context
• The Foreclosure Mess: The Start of Another Bank Bailout? The foreclosure mess suddenly turned messier yesterday when a group of heavyweight investors, including the Federal Reserve Bank of New York, demanded that Bank of America buy back toxic mortgages that a subsidiary had sold them during the housing bubble. BlackRock, the world’s largest investment company, and Pimco, the world’s largest bond manager, joined the New York Fed in arguing that shoddy record keeping and other missteps by Bank of America subsidiary Countrywide Financial amount to a breach of their contract. Such a breach would allow the investors to sell the mortgages back to the bank at full price. The investors’ claims, which became public yesterday, probably marks the opening shot in a long legal battle that could cost B of A billions and possibly push it into insolvency.
• FBI looking at foreclosure mess Updated version of Tuesday’s article
• Clueless or putting up a good front? Banks Clueless About Foreclosure Mess Severity The biggest U.S. mortgage lenders and servicers say they’re putting the foreclosure mess behind them, and that it never was a major problem. The reality is these companies are so big and unmanageable, the people in charge of running them have no way to know if that is true. One thing that remains unknowable is how many flawed home- mortgage records and foreclosure proceedings are out there waiting to be unearthed. Dozens of federal and state agencies are investigating. It’s anyone’s guess what they might turn up.
• Here’s why the government should not own stock: Treasury on Foreclosuregate: “This is a problem for the banks and servicers to fix. They can fix it as fast as they feel like it.” (HuffPo)• WH Foreclosure probe: Problems aren’t ‘systemic’ Man, is this White House politically tone deaf or what?
Did I miss anything worthwhile . . . ?
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