It is amazing that this type of behavior is allowed to exist – and is being covered up. This is the type of reckless behavior that has got us into financial trouble in this country. What’s really unbelievable is the government’s reaction to all of this.
The Next Housing Shock – 60 Minutes CBS (14 minutes)
A breakdown of the 60 Minutes Segment with an excellent explanation (if you are not familiar) can be heard here.
Street Talk Live – 4/6 Hour 1 (skip 20 minutes ahead)
Street Talk Live – 4/6 Hour 2 (skip 6 minutes ahead)
The nation’s overburdened foreclosure system is riddled with faked documents, forged signatures and lenders who take shortcuts reviewing borrower’s files, according to court documents and interviews with attorneys, housing advocates and company officials.
Here’s the cliff notes. Normally when transferring real property titles, there needs to be an actual pen & paper physical transfer. However, with the bundling of mortgage backed securities, and the amount of money to be made, banks shortcut the process and did not do paper transfers because it took to long.
So now banks have all of these foreclosures, and they are going to the homeowners about the foreclosures – but they can not prove they have the right to foreclose the property, because they have no paper.
So they got signature sweat shops to sign thousands of newly created fake documents – but it isn’t working.
In Georgia, an employee of a document processing company, Linda Green, for years claimed to be executives of Bank of America, Wells Fargo, U.S. Bank and dozens of other lenders while signing off on tens of thousands of foreclosure affidavits. In many cases, her signature appeared to be forged by different employees.
Green worked for a foreclosure document company owned by Lender Processing Services. The company is being investigated by a U.S. attorney in Florida for allegedly using improper documentation to speed foreclosures.
Lenders have already started to withdraw foreclosures that had Green’s name on them.
The government regulators didn’t say anything while the fraud was taking place. They did speak up when the people sued the banks – and they are suggesting a bailout. Incredible.
So we got the government and the Community Reinvestment Act forcing banks to make loans to people who can afford the loans in 1997.
We have citizens who misrepresent have much they make on their mortgage paperwork.
We have financial institutions bundling and selling these bad mortgages off for profit – and in their haste to make money, short cutting the process for transferring titles – and now they are busted – and they are trying to scam their way out of this with help from the government who started this mess.
How do we get out of this mess? No more bailouts – that’s for sure.