Oct 10
7
As much as I would like to give a whole lot of deep analysis on this, there’s just too much news this week.
Bank of America has joined Chase and GMAC in freezing foreclosure in states where a judge must actually sign off — not Nevada! — but Wells Fargo insists that there is no need because all their documents are in order.
Old Republic Title is no longer granting title insurance on properties sold by Chase. That means they think there is reason to believe that Chase may not have the right to sell the properties they have foreclosed upon. Meanwhile, Chase joins the ranks of banks that have hired burglars to break into the homes of people who are behind on their mortgage payments and change the locks. As far as I am concerned, this is breaking and entering, and any homeowner who has had this happen needs to press charges. The Attorney General in Ohio is suing Chase for foreclosure fraud related to “robo-signing” and is talking to representatives of the other big mortgage banks. There is talk of a $25,000 fine per offense, which could easily turn into millions of dollars.
Meanwhile, Texas, California and other states are talking about halting all foreclosures until this mess is settled once and for all. Several state AGs, Congress and the Federal Attorney General is talking about an investigation. Some experts insist that what has happened is not merely signing off on some — well, thousands of “flawed” documents that maybe shouldn’t have been signed, but outright fraud and forgery of non-extant documents, and on such a scale as to suggest that the banks have been acting as a criminal entity. In fact, Kentucky has gotten that ball rolling by starting a class action racketeering suit against GMAC and Citigroup. It seems to me that the obvious first legal salvo should be a restraining order on all foreclosures. The results of this suit will surely be used as evidence in other states and/or the Federal level.
The banks are scared now. That’s the only possible explanation for a law that buzzed through the Senate without anyone seeming to know anything about it. Reuters says (emphasis mine): “The legislation could protect bank and mortgage processors from liability for false or improperly prepared documents.” In other words, it could make all the illegal shenanigans perfectly fine, overriding any and all consumer protections in all 50 states. Wisely, once news of this bill and its contents became known, President Obama decided it would be wise to not sign the bill. He won’t actually veto the bill, but rather will use the “pocket veto.”
Be sure to come back tomorrow for Friday Figures, and join me over on the Vegas Video Network at 1PM for Getting REAL (Estate) in Vegas.
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