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President Obama has now filled in the details of his plan to help homeowners that he first unveiled in late February. This means banks now have all the rules they need to, as the administration's guidelines (pdf) put it, "immediately to modify eligible mortgages so at-risk borrowers can better afford their payments."
Are banks on board? Some reports say yes. There are financial incentives built into the program to attract mortgage servicers and banks, such as cash payments for modifiying mortgages people can't meet anymore.
Others wonder how committed to the full program banks are. They point to a fight over giving bankrupcty judges leeway to re-write mortgage terms, a plan the US House of Representatives just passed. Banks generally don't like it, but judges do. As bankruptcies climb, how important is that tool in stabilizing homeowners?
On our most recent program about the foreclosure bailout, plenty of people wanted to know why they couldn't negotiate with banks as they saw payment problems coming. Several people said they had to miss payments before banks would even talk with them — and then they had to just get in line and let the defaults pile up. Are banks now ready to take those calls? What about banks that sell loans? What are they doing to prevent foreclosures down the road?
Are you a banker? A mortgage broker? Are you trying to explain this program to homeowners? How much will this rescue plan actually affect your business, and the economy?
GUESTS:
- Stacey Howard: Community development and home ownership director as well as foreclosure counselor for Neighborhood Economic Development Corporation
- David Kittle: Chairman of the Mortgage Bankers Association and executive vice president of Vision Mortgage Capital
- Hunter Robinson: Assistant Vice President of Timeline Management at Wealth Bridge Mortgage
- Linda Navarro: President and CEO of the Oregon Bankers Association
- Frank Alley: United States Bankruptcy judge in the district of Oregon
Tagged as: banking · foreclosure · mortgage
Photo credit: opacity/ Flickr /Creative Commons
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Lack of original mortgage document:
1) Does not happen very often
2) Electronic versions are usually acceptable
3) Documents recorded with the county support the bank's lien position.
4) Mucho circumstantial evidence - title company documents, why have you been paying the bank all this time, why does the tax statement go to the mortgage servicer? Etc, etc.
5) Finally, the "you've got to be kidding" angle, i.e., if there is no mortgage, how did you buy the property?
Always someone looking to dodge their responsibilities.
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I see, but "lenders" would never do such a thing as dodge their responsibilities.
How did we get into this credit cruch again??
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I noticed there were no regulators in the cartoon (2 links below), and no discussion about the need for laws
http://www.youfreeweb.com/additives/ http://helpgodme.21publish.com/ -
The financial schemers hired physicists and top level mathematicians to create Derivatives, a new financial monster (think about Dr. Frankensteins man-created monster) and then when American Conservative Republicans learned about Derivatives they pushed trough a law in 1999 that prevented any Regulation and/or oversight of the new financial monsters.
Financial schemers and American Conservative Republicans are to blame for our current Re-Great Depression.
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There was no way that a borrower could have made a fully informed financial decision when he/she was up against top level physicists and mathematicians hired by the bankers to create these financial scams and schemes.
When you think about it these are really Financial Crimes Against Humanity, and the bankers and their Conservative Republican protectors have brought the worlds economy to a stop. They have created homelessness and poverty and put numerous small businesses out of business, while creating joblessness among many millions of workers.
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Traditionally, refinancing costs money (home appraisal, title fees, etc.). Under the Obama plan, will a homeowner wanting to refinance still have to pay $1,000 or more in fees? Or will those be waived somehow?
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Should someone who is currently not behind on any mortgage payments successfully refi under this new program , will there be a negative impact on their credit score?
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2% refi now, but it adjusts in time.... Isn't that how many borrowers got into this pickle?
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On March 4th, I phoned the holder of my mortgage, Countrywide, to start the process of a re-fi under the recently-announced program. I wanted to find out if my mortgage (conventional loan) is held by Fannie or Freddie. I gave some basic information - name, property address, loan number - to a customer service representative - but all she could give me was the statement I now had a 'reservation' to speak with a loan officer, who would return my call within 2 weeks. She was unable to give me a 'reservation' number or any other information, just an open-ended promise of a call back within 2 weeks. I am concerned that this process will falter under the weight of poor staffing, procedures, etc. Can any of your guests comment more about the contracting process between the government and the servicers that was mentioned briefly at the beginning of the show? Thanks!
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If you REALLY want to know what's going on with this bailout, read "The Best Way To Rob A Bank Is To Own One" by William K. Black. Black is a Federal Bank Regulator....
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If you are a homeowner facing foreclosure, demand that your mortgage servicer "produce the note" and prove that they own the original home loan with your original signature. If the mortgage has been bundled and/or flipped to other investors and the servicer can't "produce the note," and they instead want to recreate the mortgage paperwork, you're on very solid ground to renegotiate the terms of the loan.
More information:
http://www.consumerwarningnetwork.com/2008/06/19/produce-the-note-how-to
http://portland.indymedia.org/en/2009/02/385922.shtml
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I designed and built my own home 20 years ago for my first family. Thousands of dollars in landscaping that I cannot re-grow. I lost it in foreclosure last year due to job loss and the WAMU bank that ruined my mortgage. In court I was jeered at and cut off by the judge when I tried to ask questions about the bank loan note. I was told to go to the hall and talk to the banks attorney who threatened me to get out of the house. The same happened in Bankruptcy Court. It was the most humiliating and intimidating experience in my life of 54 years. I offered to make partial payments while I was employed again at that time. I only received an emphatic “no” from Washington Mutual Bank’s representative attorney. They evicted me.
The news does not report that this condition leaves one from being a great example of an artfully designed home in the neighborhood for many years that sets a respectful example, to then becoming homeless. It destroys your life. It should not be thought of as a bankers investment. Our homes are our lives. Mine was also my art studio where I produced award winning art seen in NASA web sites. Where is the reward when this homeowner is now at retirement age and had planned to spend their life in that home that they maintained for twenty years? WAMU bank went under as we all know. It took many months for me to find an attorney that helped to recover the $100,000 for me that was rightfully my equity. But what can I do with $100,000 now and still out of work again? Will the Presidents new stimulus package consider those homeowners who were abused by the banks a year ago? I would like to rebuild my own design again. Should there not be a national contingency plan for those who have the cash to re-invest and rebuild their own home? I want to give back to the bank that took it all away. It should behoove them. Yet I am underemployed again but will receive early retirement income Sept 2009.
-Mark
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"Linda Navarro: President and CEO of the Oregon Bankers Association"
All too typical of a banker stereotype, she argues for the sacredness of "Contracts" and completely sidesteps the devastating effects of the newly created Derivative Financial Contract Monsters that have stopped the world economy, destroyed small businesses along with large businesses, put people out of work, and created homelessness and poverty.
But Contracts are sacred and who cares about human beings!
Sheesh!
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George Bailey: This rabble you're talking about, they do most of the working and paying and living and dying in this community. Well, is it too much to have them work and pay and live and die in a couple of decent rooms and a bath?.... with Lionel Barrymore as Henry F. Potter/Linda Navarro.
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Listen to Freshair from Monday night. Terry Gross interviewed a Elizabeth Warren, a law professor that really hit it home for me on the severity of the mortgage crisis.
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I did listen to this last night, and wish that Elizabeth Warren would be given dictatorial power to straighten out the whole banking sector. She was also on a Frontline special within the last couple of years, explaining how the banks would use their one-sided credit card agreements to increase their income, by jacking up interest rates at the most inopportune times for the cardholders. It seems the robbers that cleaned up on the S&L debacle of the 80s just moved over to the banks and continued their redistribution of wealth scheme (the trickle-up economy).
If their lobbyists hadn't presuaded lawmakers to abandon usury laws in the 70s or 80s, they'd all be in jail by now...but, I think they pretty much own congress. -
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It seems when big business, government and large amounts of money all get together, big business with it's all important bottom line and 60,000 lobbyists in Washington DC have an uncanny knack of getting politicians to make "mistakes" which result in large amounts of undeserved money flowing back to these corporations. The Iraq war is a good example because we have the cause, 9/11, the war in Iraq, whoops, wrong county, and result, whoops big oil with record profits.
Lets try that with Phil Graham. We start with a regulated market. We invent new trade interments that are not regulated, credit default swaps or derivatives of derivatives, jack the market up with a bubble, cash out, when the market crashes, buy up as much as possible and do it over and over, it is simple; buy low and sell high.
When you get tired of that, find a way to freeze the world's credit, perhaps by pushing ninja loans on everyone and his uncle, creating a real estate price bubble, securitise the loans and sell them world wide with the full knowledge that they will default like crazy and boom, the whole thing comes down in pieces. the funny thing is there are so many loans that have been securitised and all the original loan papers have been lost. There is no way to unravel this back to the original loan and place it back with the original lender, even with super computers that do DNA sequencing, even with the world's economy at stake, it is just too hard.
So here is my question, how will the banks legally foreclose on the borrower if the lender doesn't have the original signed documents, aren't the borrowers all off the hook if they are savoy to know the lender needs those original papers? Is this why the banks don't like the bankruptcy court route?