When will the Foreclosure write offs Turn Critical

Discussion in 'Economy' started by william the wie, Oct 14, 2010.

  1. william the wie
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    william the wie Gold Member

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    The current foreclosure mess is being presented in the MSM as the following:

    Banks trying to foreclose on deadbeats and being obstructed by the courts.

    However unless all mortgage data is wrong that is not what is happening.

    The overwhelming majority of deadbeat mortgages are owned or at least guaranteed by the Federal government. So the federal government is hiding behind the banks to avoid the public record of foreclosing on its own citizens. This is illegal.

    Why does the federal government own the mortgages? The short answer is that the interventions in the mortgage banking system going back to at least the S&L crisis in the late 80s/early 90s have involved the federal government taking on financial risk to avoid a real estate shake out. The long answer involves all the different ways $5+ trillion in BS notes ended up as an unfunded liability of the federal government. The long answer involves several books. Just go to the local library or bookstore (online or not) pick about 10 that suit your worldview and read them the story ain't simple.

    So the federal government in various ways is on the hook for the worse loans out there but what makes those loans so bad? Lack of documentation is the biggie. Mortgage originators who were sloppy about who they loaned to were most often sloppy about record keeping as well. If deed, note or other required documents either do not exist or cannot be found then the mortgage claim will most likely not be honored.

    GMAC/Ally the first problem child to surface is a subsidiary of the federal government. The relationship of MERS the electronic depository of most mortgage records in question was set up near DC in Reston VA which does sound suspicious even without its admitted ties to fannie mae and freddie mac. MERS has not kept ownership transfers updated at the county courthouses which is just as bad as no documents.

    So the federal government is trying to foreclose on its own citizens without legally valid claims to many and probably most of the properties. In fact it may have foreclosed millions of houses already without a defensible claim to those houses, that will be really expensive.

    So when does this mess go critical with class action lawsuits out the wazoo?
     
  2. uscitizen
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    uscitizen Senior Member

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    Umm a year or so ago.
     
  3. william the wie
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    william the wie Gold Member

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    Where are the trillion dollar lawsuits against the US government alleging taking by fraud in violation of the 4th amendment? I haven't heard of them.
     
  4. uscitizen
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    uscitizen Senior Member

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    Inertia. Takes a while after something as big as the US economy becomes critical.

    then politicians and lobbyists have to decide that there is trouble, all that takes time.

    then it takes more time for them to take action in the wrong direction.
     
  5. GHook93
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    GHook93 Aristotle

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    Simplistic people will say its all deadbeats. But what happened was in the 90s Clinton with the help of Democrats like Dobbs and Franks brought the Carter era Community Reinvestment Act back to life. This required banks to lend a certain percentage of their CASH to lower income people or face penalties and removal of tax relief. In essense they were forced to lend. The government meddling started the downfall we are seeing today.

    The banks are surly at fault also. Instead of listening to matrix that have been proven, then went away from the matrix and started to do no doc, no income, stated, 100%, 125%, ARMs etc. It started with subprime and eventually stated and 100% were given to everyone, good or bad credit! Subprime lenders that made a short-term fortunes (eventually going bankrupt) like Ameriquest and New Century made things worse. Since they not only gave very stupid loans that gauged the VICTIMS. The big banks saw the short-term gains and jumped on board with these even worse loans. They started to give money away to everyone regardless. Loan officers for brokers peddled these loans making them appear to be affordable, because once the ink dried they got paid.

    To make matters worse Fannie Mae and Freddie Mac provided a secondary market where these bad loans could be sold and purchased rather easily. Innitial lenders of these toxic loans could sell them on FM/FM nearly right after they wrote the loan. Wall Street investors started to package these terrible loans into groups slap a AAA+ rating on them and sell them also.

    All this, SHOT up property values to artificially extremely high levels. 5 years ago (hell just 2 years ago) a person who purchased a home for $500K would be lucky to get $400K for it.

    Now the bubble bursted and people are can't sell their homes, nor afford the payments. Its a mess. Its still years away from being fixed.

    Percentage Blame Game:
    Government (including FM/FM) - 60% (Clinton - 80%; Bush 20%)
    Banks - 25%
    Wall Street - 10%
    Consumers/Mortgagee - 5%
     
  6. loosecannon
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    loosecannon Senior Member

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    that is a huge question, but imo it still pales in contrast to the gross mismanagement of the mortgage originators and secondary mortgage marketeers.

    Blundered mortgages were pumped out at record rates then spread across the western world where they ended up primarily as actual banks reserves as securities, and as assets in pension funds and hedge funds. You like to throw around the $12 trillion figure as an estimate of the corrupt mortgage instruments involved.

    That could be a conservative figure.

    Everybody involved from the originators to the escrow agents, F&F, title insurance firms and ratings agencies deserves to be dechartered.

    If this was capitalism then capitalism must be retired as well. For the sake of the 7 billion people who depend on the economy for daily bread and fuel.

    This kind of overt fraud is dangerous to the stability of the world and is flatly unacceptable, heads must roll, blood must flow.

    Better to kill wall street than to allow them to bulldoze main street. It's us or them.

    That the government ended up smack dab in the middle of this.....god save us
     
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  7. william the wie
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    william the wie Gold Member

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    Well anger is really building and politicians in all 50 states are seeing this mess as their road to the big time.
     
  8. KissMy
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    KissMy Free Breast Exam

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    [ame="http://www.youtube.com/watch?v=k5GZcVGWc8o"]FORECLOSUREGATE REMIC and MERS[/ame]
     
  9. william the wie
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    william the wie Gold Member

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    Thanks for the video kissmy. I hope this does not sound smart ass but if I could go to my Yahoo bar and get 80% of the same story about two weeks ago then why didn't the MSM?
     
  10. georgephillip
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    georgephillip Gold Member Supporting Member

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    In my opinion our ongoing economic train wreck stems from big government/big business collusion that Republicans AND Democrats have taken turns inflicting on at least 80% of Americans over the past four decades.

    Whether I'm right or not, why aren't conservatives of all stripes up in arms about how the Wall Street Casino has succeeded in casting doubt on the ownership of American homes across the country?

    "Ever since the financial crisis hit, conservatives -- at places like the American Enterprise Institute and the Heritage Foundation, joined by some prominent Tea Party groups -- have fought tooth-and-nail to deflect new regulation of Wall Street’s wheeler-dealers.

    "...I note that the Right, following the advice of conservative message-maker Frank Luntz, derided new regulations that Wall Street was fighting hard to kill as a 'second bailout' of the big banks.

    "It was a lie so bold that one couldn’t help but be impressed with their chutzpah...

    "So there’s a certain amount of irony in new revelations that the banks, in their quest for easy profits, appear to have undermined one of the Right’s most important principles: the sanctity of property ownership."

    How Come...
     

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