Multiply this by HOW MANY mortgages out there?

Pirate-Bartender-Zombie-Monkey — Tue, 16 Nov 2010 13:21:48 -0800

Dan Ekstrom is a guy who is in the right place at the right time. His profession? He performs securitization audits (Reverse Engineering and Failure Analysis) for a company called DTC-Systems. The typical audit includes numerous diagrams... The following flow chart reverse engineers the mortgage on the Ekstrom family residence. It took Dan over one year to take it this far and it clearly demonstrates what happens when there are too many lawyers being manufactured.

Dear Homeowners Of America, if you can't walk after reading this, it's because you've been well and truly...

Diablevert — Sat, 09 Oct 2010 08:00:24 -0800

Somebody fed the hydra a hand grenade. The “robo-signer” scandal began September 20th when news broke that GMAC/Ally was suspending foreclosures in 23 states due to flawed affidavits submitted in foreclosure proceedings there. Since then, JP Morgan Chase, and Bank of America, and now possibly Littleton Loan Servicing (a subsidiary of Goldman Sachs) have admitted similar problems. With yesterday’s announcement by Bank of America that it will be suspending foreclosures in all 50 states (not just the ones where foreclosures go before a judge) all signs point to the fact that mere false affidavits are no longer the issue; other, more serious problems are now being uncovered, e.g. forged assignments and failure to serve papers. Up to 40 state’s attorney’s general are poised to announce a joint investigation. What does all this mean? Well…uh…can you actually prove you own your house? And can your bank? And can the investment bank who’s been collecting the payments from the bond they made out of your mortgage? If you can’t, you’re going to have a hell of a time selling it.* And so will all the banks.* Did I mention that bank-owned (REO/forclosures) sales are 25 percent of the housing market? For more background, try Yves Smith, 4ClosureFraud, Calculated Risk, and previously. *NB: Those links relate to title insurance, which many people may not be familiar with (even though they probably have it if they own their home). Cliff Notes: Back in the 19th century, it was a fairly common for scamsters to try and steal property with forged deeds, or conversely sell property they didn't have the right to sell. Title insurance arose to combat this: After checking to make sure there's nobody out there claiming rights on the property, the insurer writes a policy which guarantees to pay back the purchase price of the home if someone does turn up later with a legitimate claim. Banks require prospective homeowners to purchase title insurance when issuing a mortgage, in order to protect their loan. However, nowadays claims are exceedingly rare, so much so that even Forbes has called title insurance a racket. If, however, judges were to rule that banks have been foreclosing on homes improperly, previously foreclosed homeowners could sue to try get their houses back. They may not win, but the mere possibility makes it a hell of a lot riskier to issue title insurance on any property which has been foreclosed on. And banks won't issue mortgages if there's no title insurance.

Why yes, the wording & paperwork matter. A lot.

Pirate-Bartender-Zombie-Monkey — Fri, 20 Aug 2010 21:46:22 -0800

Over 62 million mortgages are now held in the name of MERS, an electronic recording system devised by and for the convenience of the mortgage industry. A California bankruptcy court, following landmark cases in other jurisdictions, recently held that this electronic shortcut makes it impossible for banks to establish their ownership of property titles--and therefore to foreclose on mortgaged properties. The logical result could be 62 million homes that are foreclosure-proof.

MetaFilter posts tagged with securitization

Multiply this by HOW MANY mortgages out there?

Dear Homeowners Of America, if you can't walk after reading this, it's because you've been well and truly...

Why yes, the wording & paperwork matter. A lot.