Category Archives: Real estate

Cheer Up, FTAdviser: At Least You Don’t Publish Threadbare Excuses from Scammers, Like Reuters Does

This is the last day of Naked Capitalism fundraising week. Don’t miss the chance to participate. So far, over 840 donors have already invested in our efforts to shed light on the dark and seamy corners of finance. Join us and participate via our Tip Jar, another credit card portal or by check (see here for details). Read about why we’re doing this fundraiser and our current target.

By Richard Smith

Having hooted mildly at FTAdviser yesterday, for their somewhat skimpy fact checking, I found my eye caught today by a similar miss from Reuters (in bold):

Denial in the Mortgage Industrial Complex

I just came back from the AmeriCatalyst conference in Austin, which was a packed two days focused on the state of the housing and securitization market. The panels were very informative, and it was also good to see some of the people I’ve read or heard about, in particular the leading analyst, Laurie Goodman of Amherst Securities. She gave a talk that where she went through a very persuasive (and conservative) analysis that there are 8.3 to 10.3 million more foreclosures baked give how underwater borrowers are. And she had some striking bits of information. One is if you take out the homes where no one has made a mortgage payment in a year or more, homeownership in the US is 61%. In addition, Judge Annette Rizzo discussed a successful program she had developed in Philadelphia to do remediation. The success rate on modifications that come out of her court is 85% after 18 months.

I had quite a few people come and commend me on my comments. I think the main reason was that the viewpoint presented on this blog, that there are deep seated problems resulting from chain of title issues, and that servicers have engaged in a lot of abuses, was sorely underrepresented. I don’t blame the organizer, Toni Moss, who has an exceptionally well organized and prepped effort; I think this reflects the nature of who has expertise in this industry.

Foreclosure Law Firm, Vilified for Making Fun of Homeless, Now Attacks Constitutionality of New Rules to Assure It Verifies Court Documents

This is Naked Capitalism fundraising week. Over 550 donors have already invested in our efforts to shed light on the dark and seamy corners of finance. Join us and participate via our Tip Jar or read about why we’re doing this fundraiser and other ways to donate on our kickoff post and one discussing our current target.

To quote the immortal Forrest Gump, stupid is as stupid does. The biggest New York foreclosure mill, the Steven J. Baum law firm, is a textbook example.

Matt Stoller: 50 State Settlement Chatter – $65 Million of Fundraising and the Kamala Harris Network

This is Naked Capitalism fundraising week. Over 365 donors have already invested in our efforts to shed light on the dark and seamy corners of finance. Join us and participate via our Tip Jar or read about why we’re doing this fundraiser and other ways to donate on our kickoff post.

By Matt Stoller, the former Senior Policy Advisor to Rep. Alan Grayson and a fellow at the Roosevelt Institute. You can reach him at stoller (at) gmail.com or follow him on Twitter at @matthewstoller.

California Attorney General Kamala Harris is one of the key players involved in the 50 state negotiations. The state was the seat of a good proportion of mortgage fraud nationally, and the California Attorney General’s office is one of the only state AG offices with enough legal resources to impact the national housing framework. Understanding how she thinks about politics matters, because this is how critical decisions are made. Harris’s decision-making seems to be driven by personal connections and fundraising networks. This is not at all unusual, but it does contrast a bit with other types of public servants, who often see their job as serving the law itself. So what do her personal connections and fundraising networks look like?

Bank CEOs Lying When They Say They’ve Stopped Robosiging

Readers may recall that we posted on the credibility-straining claim by the former GMAC’s, now Ally’s CEO, that his bank was no longer engaging in robosigining.

Now in fairness, we might have a little clever use of terminology at work. Robosigning narrowly speaking, refers to the use of low paid staffers to execute documents used in court filings by the hundreds per day. This created a huge scandal when it broke because it was a flagrant violation of court procedures. Affidavits, for instance, are used in place of testimony and are required to be based on personal knowledge. A $12 an hour functionary churning out signatures clearly has not even read the paperwork, much the less has any knowledge of the various foreclosures he is pushing through the pipeline.

Ally and other major servicers now piously claim that these systematic abuses of legal procedures that date back to the 1677 Statute of Frauds were mere “sloppiness” or “paperwork errors” and they’ve cleaned up their act. Should we believe them?

While services like #5 Ally may well have dispensed with factory-style signing procedures. there is evidence on the ground that says that the banks have not made meaningful changes.

Is GMAC, Now Ally, Just Dishonest or Criminally Incompetent?

Here the major bank servicers are about to get a screaming bargain via a hoped-for multi-state-Federal mortgage settlement, and what is number five service Ally doing, but threatening to thumb its nose at the deal as being to hard on them.

Per Housing Wire, Ally CEO Michael Carpenter made some pretty cheeky statements on an investor conference call today:

Hubris Watch: US Bank CEO Sniffs About Breaking Rules When His Bank Has Huge Trustee Liability

One of the benefits of the Occupy movement is that it is flushing out some particularly egregious behavior among the top 1%.

A writer for the Minneapolis CityPages managed to worm his way into a presentation to the annual meeting of the Minnesota Chamber of Commerce by US Bank’s CEO, Richard Davis. Even though Occupy Minnesota was protesting outside, Davis chose to ignore them. His speech made clear that the business community does not care about long-term self interest, let alone social responsibility. Housing and the foreclosure crisis were absent from the 2012 legislative priorities. But tax reform, which is code for shifting even more of the cost of government on to the small fry? Yeah, that’s a big deal.

Davis’ apparent lone comment on the public ire against the banks was dismissive:

Matt Stoller: Why a Foreclosure Fraud Settlement is a RIDICULOUS Idea

By Matt Stoller, the former Senior Policy Advisor to Rep. Alan Grayson and a fellow at the Roosevelt Institute. You can reach him at stoller (at) gmail.com or follow him on Twitter at @matthewstoller.

Gretchen Morgenson is ringing alarm bells that a 50 state settlement on the foreclosure fraud issue is on deck, and is spelling out some of the details. There would be some principal write-downs, random cash payouts for those who were foreclosed, and money to buy off nonprofits in the states that work on housing issues (a classic Fannie/Freddie Dem friendly tactic Morgenson and Rosner exposed nicely in their book Reckless Endangerment). The settlement looks vague and stupid, and will probably be executed with the care and competence of HAMP. But let’s put that aside.

Latest Leak on State Attorney General Mortgage Settlement: A Shameless Sellout to the Banks

There have been so many rumors about the so-called 50 state attorney general settlement (which now is more like a 43 state settlement) being on the verge of having a deal that we’ve discounted them. We’ve said from the beginning that this was a cash for release deal. Basically, because the Federal regulators and state AGs, by design, had done no meaningful investigations, they didn’t have any threats to bring the banks to heel. So they’d have to offer a bribe, and the bribe has always been a “get out of jail free” card.

Put it more simply: The banks got bailed out, and the rest of us got left out.

Delaware Attorney General Sues MERS Over Deceptive Practices, Asks for Halt of Foreclosures Relying on MERS (Updated)

The mortgage securitization industry has just had a new major front open on its battle with those who are less than happy with the way it has run roughshod over the law. While there are a significant number of court rulings questioning foreclosures in the name of MERS or other practices commonly associated with the use of MERS (for instance, in Oregon, its violation of recording requirements mandated at the state level), no major regulator or public official (beyond county registers of deeds) has gone after MERS in a serious way (New York’s AG has opened an investigation, but it has not led to any litigation).

This has changed with the Delaware attorney general Beau Biden’s filing.

New York Attorney General Eric Schneiderman Discusses Mortgage Mess on Rachel Maddow

Since we’ve been big fans of New York Attorney General Eric Schneiderman’s investigation of mortgage abuses, we thought readers might like to see this interview on the Rachel Maddow.

On the Administration’s Latest Potemkin Help Struggling Homeowners Plan

I’d heard about a week ago that the Administration was readying the Mother of All Homeowner Rescues, to be administered via Fannie and Freddie. Given that Team Obama has never done shock and awe on the financial front, and the Bush Administration engaged in it only on behalf of banks, I was plenty skeptical.

The program revealed on Monday is true to form: greatly underpowered and more likely to benefit banks than homeowners.

Bank of America Setback: $8.5 Billion Mortgage Settlement Successfully Removed to Federal Court (Updated)

Bank of America can’t win for losing.

Latest Attorney General Bailout Plan: Give Banks “Get Out of Jail Free” Card for a Few Refis

Attorney General Tom Miller of Iowa, who is leading the whitewash once known as the 50 state attorney mortgage settlement negotiations (7 have defected), reliably, every few weeks, has gotten word to the media that a deal is weeks away. This has been going on so long that it is easy to ignore it, particularly since the absence of key states is going to reduce the importance of any settlement being reached.

Note we’ve been skeptics of a deal happening unless the AGs capitulated on a release of liability. And that is the latest plan.

We have a combo plate of stories, one in the Wall Street Journal yesterday morning and a further critical tidbit from Reuters this evening that together give an overview of Miller’s latest effort to push a deal over the goal line. The latest idea is as bad as we feared.

Attorney General Beau Biden on Investigating the Mortgage Mess

The Dylan Ratigan show is on a roll this week. The program today included a segment with one of our heros, Delaware attorney general Beau Biden, who was early to join New York’s Eric Schneiderman in questioning the now less than 50 state attorney general mortgage settlement. He also joined the FDIC, Schneiderman and a large number of investors in objecting to a proposed $8.5 billion mortgage settlement by Bank of America.

Biden makes a clear and concise statement of the major issues: