Then, JPMorgan Chase was forced to do the same, citing problems with documentation. From the Chase article:
The Associated Press said that the company has acknowledged its employees "signed some affadavits about loan documents without personally verifying the files," and said the bank has asked judges to hold off on entering judgments on the foreclosures in question until its review is complete.
Now, Bank of America is following suit. These banks, their employees, and their attorneys are being caught committing perjury, yet there are still people out there who are blaming this economic meltdown on the borrowers by accusing them of borrowing money they couldn't afford to repay. They blame the Government for "requiring" banks to lend to people who couldn't pay.
They blame everyone except the banks, who took in trillions in profits by making sub-prime loans, then got a government bailout when the loans collapsed, and are now committing fraud to take people's homes.
Why aren't people being put in jail for this? Why are these lawyers not being disbarred?
Another problem being overlooked is this: When a foreclosure is found to have been awarded because of fraud, that foreclosure is void or voidable. When a lawyer, who is considered to be an officer of the court, is found to have fraudulently presented facts to court so that the court is impaired in the impartial performance of its legal task, the act, known as “fraud upon the court”, is a crime deemed so severe and fundamentally opposed to the operation of justice that it is not subject to any statute of limitation.
What does this mean for the future of Real Estate? That means that no one can issue title to a single piece of property without considering the possibility that someone can have a previous foreclosure voided, and that property returned to the previous owner. Think about the implications of this, and the effect it will have on prices.
The 10 largest mortgage lenders in the Nation control 78% of the mortgages. They are:
1 Bank of America- 26% market share - suspended foreclosures due to fraudulent documentation
2 Wells Fargo - 24% market share
3 JP Morgan Chase- 10% market share - suspended foreclosures due to fraudulent documentation
4 GMAC- 4% market share- suspended foreclosures due to fraudulent documentation
5 Citigroup - 3.5% market share
6 US Bank Home Mortgage - 3% market share
7 PHH Home mortgage - 2.5% market share
8 SunTrust - 1.75% market share
9 Provident Funding -1.65%
10 Branch Banking and Trust 1.6%
There is plenty of blame to go around in this mess. The government is certainly a culprit. That's why Chris Dodd retired rather than face questions about his role in the process AND his sweetheart mortgage deals. It's why even Barney Frank is in election trouble in MA, although he'll likely win. These are the people who pressured the banks to give out loans even when it was obviously impossible for some people to pay them back.
ReplyDeleteThen there were the people that bought much more house than they could afford. They had no means of paying back those loans and some of them damned well knew it. There were others (like me) who borrowed against the equity of their houses and didn't foresee the housing bubble collapse. I'm assuming you fall in that category as well. Should we have known better? Maybe.
Then there are the banks. No doubt they took advantage of the system because they figured that the government would be there to bail them out. In fact, they were told by Frank and Dodd that the government would in fact bail them out. Only now the government doesn't really have the money to bail them out.
My daughter works in the housing finance industry and from what she tells me the banks aren't all that thrilled about owning all of this unsellable housing stock.
It's a mess and all of us are likely to spend years digging out from it.