The criminals that caused this nation’s foreclosure crisis must be punished….severely. And no, of course, I’m not talking about the banks with the corrupt and criminal practices they engaged in to make the loans, to service the loans and to foreclose on the loans, I am of course talking about the families that live in the homes that are now being foreclosed upon.
Now, granted, the American families that are being throw into the street as a result of the foreclosure process already paid for their sins many times over. We have paid in the form of billion dollar payoffs, payouts and gifts to the banks. We’ve paid in the form of hundreds of millions of dollars to fund a state court system to process their foreclosures. We’ve paid in the form of trillions of dollars that are mainlined directly to the banks and financial institutions so that they can swirl this money around into the thin air and in the end only redistribute this money to their friends like Goldman Sachs and Deutshe Bank.
US Bank did not fully comply with HUD’s late endorsement requirements. Of the 4,406 loans tested, US Bank improperly submitted 67 loans with mortgages totaling more than $8 million for insurance endorsement when the borrowers did not make six monthly consecutive timely payments after delinquency but before submission to HUD. It also incorrectly certified that both the mortgage and escrow accounts for six loans and the escrow accounts for taxes, hazard insurance, and mortgage insurance premiums for 14 loans were current when they were not. The deficiencies occurred because US Bank needs to improve its existing procedures and controls over its late endorsement process. These improperly submitted loans provided unnecessary risk to the Federal Housing Administration fund.more here
The foreclosure process in Florida works to further reward the very banks that caused the problems and which continue to engage in abuse of public trust. The banks, working in collusion with our courts, continue to punish the American people, running a foreclosure process that rewards the banks and contributes to a colluded and corrupted real estate market. The “public” foreclosure auctions are only public in the sense that consumers are free to log on and see the backroom dealings, the colluding that is occurring between the banks and the institutional players. The market prices they are running foreclosure sales up to are not market prices that the general public can participate in because the general public does not have billions of dollars of Monopoly money to engage in bid rigging and market manipulation with. Here’s the way it works:
Every investor, realtor, appraiser and home flipper in the world knows the MAXIMUM price you could pay at auction for a home is $100,000 and still have any chance of turning any profit. But because the online foreclosure auctions are now online, you’ve got some ill-informed guy named Ned sitting in front of his computer screen in Montana blowing the inheritance he just got in order to start his real estate empire in Florida. He’s upped the bid price to $120,000. Bank of America would be insane not to just pocket the $120,000 from Ned because every appraisal they’ve ever gotten shows the home is not worth $100,000. But the bank keeps bidding it up until poor Ned taps out. And, like occurs in the vast majority of foreclosure auctions the bank takes the home back. Two months later, Bank of America deeds the property to Wells Fargo. They pay no documentary stamp or transfer taxes on the deed, but now Wells Fargo owns it. Wells Fargo deeds the property to Fannie Mae, they pay no documentary stamp or transfer taxes on the deed.
Finally six months after the alleged foreclosure auction, Fannie Mae deeds the property to a holding company, based in China or to Goldman Sachs for the same $120,000 that Ned was prepared to pay six months ago. But because of holding and transaction costs, the actual net return to the taxpayers that actually owned that mortgage and now property is 25% less than what it would have been had they accepted Ned’s cash offer at the foreclosure auction.
Oh, and what about the family that used to live in the home…and would have continued to pay a mortgage on the property if it had been reduced to the ultimate sales price of $120,000? They’re now renting a home, right across the street from their own home, but making their rent check payable to a shell corporation run by Goldman Sachs. The home is not properly insured because Goldman did not disclose to Citizens several key factors that are hiding right in the plain sight of this on-going crime spree.
How many tens of millions of dollars of dollars are being blown on this scam? Just take a look at the two June Auction reports below…