This is how the United States repays its medal winners. (ht @pbump)
EDIT: Because this clearly got misinterpreted, this was not meant as the U.S. government, but the U.S. as a culture. The cultural climate of the United States made foreclosures a fact of life for many. Especially in Florida, of all places, where foreclosures have in recent years been among the country’s highest. That’s what the comment was intended towards. A single sentence probably wasn’t enough to make that clear. — Ernie @ SFB
Today in ways to turn toxic assets into something a little less toxic.
Backstory and nuance: Joe Nocera is the reporter who, late last month, broke the story of the “Homeless Halloween” party that the firm held in 2010. A couple of days ago, the head of the firm, Steven Baum, sent Nocera an email, saying that “there is blood on your hands for this one, Joe;” today, the firm announced that it’s closing its doors, citing “the loss of so much business.” While it was likely negative publicity surrounding the photos that caused the firm’s demise, it’s important to keep in mind that the firm had faced multiple legal battles in the past over the legitimacy of its foreclosures, a fact noted by Nocera in his original piece.
Much credit to these protesters: In some ways, these protests were arguably more effective in one quick burst than the Occupy Wall Street protests have been in one long, slow-moving one. With a specific target (Bank of America) and a specific reason (their overly harsh handling of foreclosures) the result is a protest that plays well for the cameras and effectively encapsulates the point of what’s going on. People got arrested, but they did peacefully. It took a while to draw some reaction from Occupy Wall Street; Bank of America was forced to dismiss the protests as a PR stunt right away. But the fact they had to say anything at all is a big deal. source
» And they’re far from alone: Nearby New Jersey has a backlog stretching back a solid 49 years, and noted foreclosure mecca Florida has a decade-long backlog. A big reason? The courts are overworked on this issue and can only handle so many cases. But even in the 27 states where courts aren’t involved, the wait is often still significant — at least a year in many cases. Beyond the courts, the entire system is overworked — and lenders seem to be in no rush to add any more repossessed houses to their balance sheet.
The current environment of heightened regulatory scrutiny has the potential to subject the corporation to inquiries or investigations that could significantly adversely affect its reputation.A statement from Bank of America • Noting in a filing with the Securities and Exchange Commission that the company could be subject to huge penalties over their abusive mortgage practices. They’re not alone; Wells Fargo and Citigroup ware in the same boat, and it’s all thanks to the shady way that the trio dealt with their foreclosures. The reports from the companies suggest that all three will take a financial hit for said shadiness. Bank of America says that the state and federal inquiries “could result in material fines, penalties, equitable remedies (including requiring default servicing or other process changes), or other enforcement actions, and result in significant legal costs.” In other words, they’re screwed for screwing over homeowners. Oops. source (via • follow)
» Oh yeah, some more good news: The annual rate of 5.28 million homes, while far below the mid-naughts peak of 7 million in September 2005, is a bit higher than analysts expected. The number hit a low of less than 4 million home sales back in the middle of last year. Granted, people’s homes are still getting foreclosed en masse, but this isn’t bad news.
The double-dip is almost here. There is no good news in October’s report. Home prices across the country continue to fall.Standard & Poor Index Committee Chairman David Blitzer • Expressing fear that recently-released housing numbers are a harbinger of a double-dip. The numbers, which showed a 1.3 percent decline in home prices in 20 key cities, were apparently much more dire than many analysts were expecting. “It was a bit of a surprise,” said IHS Global Research’s Pat Newport. “I wasn’t expecting it to lag so badly in all 20 cities.” source (via • follow)
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This is not the lotto. This isn’t something where we roll the dice and say, ‘You know what? Possibly this has been done legally. Maybe it hasn’t, but in the meantime you and your children go find some place to live. There’s plenty of homeless shelters out there.’ We can’t do that.Cook County, Illinois Sheriff Tom Dart • Informing mortgage companies that he WOULD NOT be evicting people due to foreclosure orders. Why? Well, his staff discovered that many of the foreclosure orders coming his way were from so-called “robo signers,” who have been ordering foreclosures en masse without even reading the documents. “This is so outrageous. These poor people are being put through this day in and day out, by people who don’t do their jobs,” he said. “It’s so hard for me to stomach these people. This isn’t just we are taking their bike away, or their car away. This is their house.” Dart, by the way, is noted for his attacks on Craigslist. source (via)
Know how we know that the government is taking this whole foreclosure thing seriously? Well, more than two-thirds of the state attorney generals are about to probe the mortgage industry to see what happened with all that questionable paperwork that they’ve reportedly been plowing through the legal system. Last week, Bank of America halted foreclosures in all 50 states, but other companies have yet to follow suit to that degree. source
» Why this is a big deal: In recent weeks, politicians (especially Democrats) have been attacking mortgage lenders for using aggressive, shady techniques to push through foreclosures – a process which was impeded after the companies’ documentation came under question. A leading mortgage firm, Ally (better known as GMAC) recently had to halt all evictions in 23 states as a result of these documentation problems – revealed by one of their own employees in sworn testimony. The big story there, though, is that the smorgasbord of eviction is still on in 27 other states.
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