Matt Taibbi’s new piece on foreclosure fraud
I’m currently reading through Matt Taibbi’s new piece in the Rolling Stone about the foreclosure process in Florida: http://www.rollingstone.com/politics/news/17390/232611?RS_show_page=5. If you’re unsure about the big debacle we’re in with the banks this is a great read. It covers the following:
- In Florida they don’t care about whether a foreclosure is justified, they just want to rubber stamp it
- Banks are supposed to keep track of who owns the note to the loan and they don’t
- Banks are creating paperwork to make it appear like they’re keeping track of the notes they own. They also submit different documentation to support their case.
- Banks are committing fraud by falsifying documents to support their case. They basically submit a note with one set of stamps on it, which can be proven to be false in some cases. Then retrying to foreclose and submitting the same note with different information on it. Instead of, you know, actually researching and figuring it out before they try to foreclose
- If you’re in foreclosure and you don’t have a lawyer, you’re fucked
- Banks hire people, called robo-signers, to basically make up paperwork.
- Banks committed fraud when they packaged together loans to sell by saying they meet a certain criteria when it can be shown in some cases that they don’t. IE a credit report was filed, income was checked, etc.
- Rating agencies committed fraud by giving mortgage back securities triple-A ratings without looking at the details. They can claim first amendment protection for these statements though as they’re not legally obligated to tell the truth.
- Predatory lenders are real, in that they’ll give you a loan without making sure you can pay it so they can sell it to someone else to package into a mortgage backed-security. The government might have fixed this to make it illegal, but it still happened for several years unchecked.
- The government is protecting banks instead of people by not creating laws to prevent this sort of thing, nor prosecuting fraud, and basically giving a blind eye because it makes everyone look bad on their end.
- Loan modification programs tell you to stop making payments before they can help you. Which then starts the automatic foreclosure proceedings against your home. These can often and probably almost always end up in foreclosure.
- If you don’t make a payment, the loan servicer has to pay into the trust setup for the Mortgage-backed-security part of it. So they’d rather just foreclose than try to unwind and help you continue to make payments.
- BOTTOM LINE: We’re fucked. The banks get away with fraud and robbery of people’s homes. Lenders get away with fraud. The courts don’t give a rats ass about anything and merely want less work to do, so they’re not upholding their oaths to uphold the law and allowing this fraud.
I really can’t keep reading stuff like this, its so depressing. But it is enlightening and I thank Matt for doing a great job making this whole confusing debacle understandable and a little bit entertaining, like going to the dentist and getting your teeth pulled without Novocaine when nothing is the matter with them.
