YOU CAN BLAME THE OLD WHORE SEN.
DIANNE FEINSTEIN FOR THE FACT AMERICANS CAN’T RENEGOTIATE THEIR MORTGAGES IN
BANKRUPTCY COURT.
WHORE FEINSTEIN, AMERICA’S
BIGGEST WAR PROFITEER, HAS TAKEN HUGE BRIBES FROM CRIMINAL BANKSTERS WELLS
FARGO and BANK of AMERICA. SHE FRONTED FOR THE BANKSTERS’ BANKRUPTCY REFORM
EVEN THOUGH HER PAYMASTERS AT WELLS FARGO HAD HAD THEIR CA MORTGAGE LICENSE
REVOKED SINCE 2003 FOR CORPORATE FRAUD.
NO CRIME BY ANY OF HER CRIMINAL
BANKSTER PAYMASTERS UPSETS THIS OLD WHORE!
WHEN THE BANKSTER-WRITTEN “REFORM”
CAME TO A VOTE, FEINSTEIN, BOXER, CLINTON AND BIDEN VOTED AS THE BANKSTERS
INSTRUCTED. WHILE OBAMA DID NOT VOTE FOR THE BANKSTERS’ “REFORM”, HE WENT LIMP
WHEN HE WAS HANDING OUT TO HIS BANKSTER DONORS BILLIONS IN WELFARE.
NO PRESIDENT IN HISTORY HAS TAKEN
MORE MONEY FROM BANKSTERS THAN OBAMA!
HIS CRIMINAL BANKSTERS’ PROFITS
ARE SOARING… SO ARE THEIR CRIMES…. And FORECLOSURES!
California Gold Rush? Righting
Underwater Mortgages
Posted: 07/16/2012 5:21 pm
Ever since the housing bubble collapsed, the Federal government has refused
to take major initiatives to help underwater homeowners. As a result, we are
likely to see close to one million foreclosures
both this year and next, with the numbers only gradually slipping back to normal
levels by the end of the decade.
The inaction cannot be attributed to a lack of opportunity. At the time the
TARP bailout was being debated in the fall of 2008 many progressive members of
Congress wanted to have a provision that would at least temporarily alter
bankruptcy law to allow judges to rewrite the terms of a mortgage.
Under current law, home mortgages are treated differently than any other
type of debt. Bankruptcy judges are prohibited from altering the terms of a
mortgage in any way. If a homeowner cannot meet the terms of the mortgage, they
lose the house. Congress could have allowed bankruptcy judges to rewrite
mortgages that were written during the housing bubble frenzy, but it backed
away from this opportunity.
Similarly, Congress could have temporarily changed the rules on foreclosure to
allow foreclosed homeowners to stay in their homes for a substantial period of
time (e.g. five years) as renters paying the market rent. This would have
assured underwater homeowners substantial housing security.
Either of these measures would have radically altered the relationship
between investors and homeowners. They would have given homeowners a serious
weapon that they could use to threaten lenders and hopefully persuade them to
agree to modify underwater mortgages. However, since Congress did not take any
action to shore up the position of homeowners, we are still sitting here with more than 11 million
homeowners underwater five years after house prices began their plunge.
This failure at the national level provides the backdrop for a plan by a
group of investors, Mortgage Resolution Partners (MRP), to try to get through
some of the morass in the housing market. MRP has been working with public
officials in San Bernardino, California, to arrange to use the government's
power of eminent domain to condemn underwater
mortgages.
As background, San Bernardino is ground zero in the housing bubble. Prices
doubled or even tripled in the bubble years. They then plunged when the bubble
burst, with prices now often less than half of their 2006 peaks. Half of the
mortgages in the county are underwater.
This collapse has not only destroyed the life savings of hundreds of
thousands of homeowners, it also has wrecked the economy of the region. In this
context, the prospect of using the power to condemn property to bring many
underwater homeowners back above water must sound very appealing.
MRP's plan is to have the county condemn underwater mortgages in private
mortgage pools. The logic is that these underwater mortgages are causing
serious harm to the community. When people are seriously underwater in their
homes they are likely to lack both the means and the incentive to properly
maintain their home. Of course, the monthly payment on a mortgage that might
exceed the current value of a home by 50 percent or more (and carry a high
interest rate) is a huge drain on the purchasing power of homeowners.
The case for focusing on mortgages in private mortgage pools is that it is
generally quite difficult to sell these mortgages out of the pool. This means
that even if, in principle, it might be advantageous for both the investors and
the homeowners to have pools sell underwater mortgages to third parties like
MRP who would rewrite the terms, the rules of the mortgage pools makes it
unlikely that the mortgage will be sold.
This is exactly the sort of situation where public action like condemnation
is appropriate. The public action allows for a solution that can benefit all
the parties but is obstructed by bureaucratic rules that were written to cover
a different set of circumstances. (It is important to remember that investors
can contest in court the compensation they are provided for condemned mortgages
to ensure that they get fair market value.)
It is difficult to see a good argument against this approach. Some have
claimed that this sort of tactic will cause lenders to be more reluctant to
lend in the future. If the point is that lenders may have second thoughts the
next time house prices go into a bubble, then we should certainly hope that
condemnation will have this effect.
Others have been critical because MRP is a private company that is doing
this to make a profit. I've met with several of the top people at MRP, they
certainly don't hide the fact that they expect to make money on this deal. But
that hardly seems a reason for nixing the plan. There are very few instances
where there has been a public condemnation in which private firms didn't stand
to profit in some way.
MRP's plan is not going to rescue the country's underwater homeowners. At
best it will directly help the limited segment of this group whose mortgages
are in private label securities. However, it may serve as an example of the
benefits of principal write-downs and perhaps prod Fannie and Freddie, as well as
the banks, to be more willing to go this route.
Follow Dean Baker on Twitter: www.twitter.com/DeanBaker13
CA IS A GREAT PLACE TO PERPETRATE MORTGAGE FRAUD ON CONSUMERS.
HERE'S THE CASE OF RUSSIAN CRIMINAL OLEG KHERSONSKY:
http://olegkhersonsky.blogspot.com/2012/07/lawsuit-for-mortgage-fraud-filed.html
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