NYT Magazine Writer Roger Lowenstein hits it on the head when he takes Mortgage Bankers to task, Plus why I believe MBA President John Courson is WRONG and CLUELESS
Roger Lowenstein, an extremely well respected financial journalist took the trade association for mortgage bankers (the MBA) to task in Sunday’s New York Times Magazine for calling homeowners “immoral” who strategically walk away from their mortgage obligations. Lowenstein points out that Wall Street walks away from their obligations all the time and effectively asks how they dare call the kettle black.
For more than a year now through the South Florida Law Blog, monthly Florida foreclosure defense workshops and social media outlets like Facebook and Twitter @OPLaw, Oppenheim Law continues to help homeowners and other real estate holders such as investors and second homeowners. A constant and key consideration is determining the sense of continuing to pay a mortgage that is upside down and may remain that way for many years to come.
Oppenheim Law believes foreclosure defense strategies are not a moral issue, but an issue of what is economically rational. However, John Courson, President of the Mortgage Bankers Association, decided this past week to enter into the discussion when he was quoted in the WSJ as saying: “Homeowners should think about the ‘message” they will send to their families and their kids and their friends.” He was somehow trying to convince all of us that there is still a social stigma to walking away.
JOHN COURSON READ MY WORDS: YOU ARE SO WRONG…. IN FACT YOU DON’T EVEN HAVE A CLUE!
The fact is the evidence has arrived that the social stigma of foreclosure is eroding quickly, and once one embraces the process, there is a sense of freedom or liberation that my clients frequently experience. They no longer feel enslaved to the bank or to the payments and are able to get on with their lives. Of course there is nothing wrong with first fighting the Bank over whether the loan was even valid in the first place.
Ironically, or paradoxically, Courson stepped into the largest of hornets’ nests. Lowenstein points out that Wall Street and the businesses they acquire walk away from debts all the time! Just ask Morgan Stanley that walked away from commercial mortgages after they purchased certain properties at the wrong time. Or private equity firms that buy businesses and then close them down to pick out the bones. Is that not a form of walking away? As opposed to keeping the folks employed and trying to build a better company? But NO… NO ONE would call John and his lobbyist friends immoral for allowing the banks to get bigger than the government and then have the nerve to flaunt it over and over again with the mantra that the banks are “too big to fail.
John… let me tell you a little secret: The banks are not too big to fail… THEY are TOO BIG! You know if the banks were still like the one Jimmy Stewart ran in “It’s a Wonderful Life,” folks would still feel an obligation to their banks and bankers. But not when the Banks have an asset base larger than most countries in the world, and when you never get to talk to someone that you personally know.
So John answer me this… what do you tell your children at night?
Do you tell them you lobbied the taxpayer for the largest bailout in the Nation’s history after creating a system that allowed for unfair and deceptive trade practices to rule the day due to lax oversight because of pure politics?
Do you tell them that the Attorney Generals are now after your members for creating an organizational environment from the top down that created a festering hive of immoral and unethical activity such as making loans to folks who one knew would default, yet the loans were bundled and sold to teachers and firemen all over the world as their retirement?
Or the fact that mortgage applications were intentionally doctored by your members staff or brokers who also helped get inflated appraisals?
And John don’t forget to let them know you had a big hand mortgaging their futures and their grandchildren’s future. Tell them NOW that one day they will need to add a zero onto every dollar bill because the dollar will be so devalued we will copy our neighbors in South America. Let them know now, John, who the moral one was! Make sure you send them the right “message.”
I invite your comments, tell us what you think?