Just as Oppenheim anticipated, this year we’ve seen how big this foreclosure mess really is. There were numerous investigations, and a self-imposed moratorium on foreclosures during parts of 2011, resulting in a massive backlog of cases.
It was ludicrous, as Bank of America officials first said, that they would only need 60 days to review their inventory of files.
“It took them virtually a year to figure out that they were doing were just not kosher and had to stop,” Oppenheim explained.
There were several huge financial settlements offered to the banks over their illegitimate foreclosure practices, but the majority just did not stick. Judges told them the settlements were unacceptable and did not go far enough. With various attorneys general and the IRS among the agencies getting involved, these cases are nowhere close to settled.
“The banks literally got their hand not just caught in the cookie jar, but the lid was slammed on it, and everyone got to see the hand just hanging there,” said Oppenheim.
2011 is leaving us with a still unstable market, so people are looking for tangible investments, Oppenheim continued, and with the dollar still weak, Florida real estate is not a bad deal. When you add the fact that there is an excess of distressed properties, prices are not expected to rise anytime soon. he said.
Now every year there is an X-Factor, and this year it was Occupy Wall Street. It was a movement no one really saw coming, and despite some right-wingers attempts to limit Occupy as a fringe movement, Oppenheim said, there is no question the message of Occupy has resonated with middle America.
It brought to the forefront two huge truths. One being that there is a huge economic inequality between the so called ‘1%’ and the rest of us.
The 2nd is that the veil has been lifted on how intertwined the government, the big banks and the Federal Reserve have become.
“The banks have grown so big and so large that the government itself is afraid to really, truly regulate it, because you really can’t tell where the government starts, where the federal reserve ends, its a really ugly sight.”
Anyone looking for an example need look no further that the 7.7 trillion dollars the Fed loaned to the largest banks — at essentially 0 percent! And what did the banks do with those assets?
Well its not only what they did, Oppenheim said, but what they DIDN’T do.
“They didn’t lend it to mainstream America, which would have seemed like they were going to do to help reverse this deflationary cycle.”
Instead it only led to more profits,which “came off the backs of you and me” to pay themselves bonuses and to help elect officials that were sympathetic to the banks, and not the average Joe.
Some politicians have floated the notion that corporations are people, but then, Oppenheim asks, how do you arrest a corporation and hold them accountable?
He concedes that it’s possible that individuals within these companies may not have committed a crime, but it’s clear that some companies as a whole did.
“I don’t buy into the notion that a crime wasn’t committed,” Oppenheim said, “We have not advanced our legal system sufficiently to deal with these very complex financial crimes.”
While foreclosures may have slowed down in 2011 he expects them to pick up in the new year.
“There’s this new wave, It’s not going to be as large, but it’s going to be a continuous stream coming through.”
Then there is what he calls zombie foreclosures, which had been dismissed, but not permanently. Oppenheim would not be surprised to see them spring up in 2012.
“So far we haven’t seen them come back, but the banks have the right to bring them again,” he said.
If that happens, he fears the system would once again become bogged down with an overload of foreclosure paperwork, that will go through at a much slower pace.
The truth is, if banks brought all foreclosures to market right now it would crash the market, Oppenheim said, and the banks would become insolvent.
So what does Oppenheim predict for the real estate market in 2012? While he knows he can’t predict the future, Oppenheim says to expect the unexpected.
“I see that they’ll be something that we completely don’t anticipate,” Oppenheim said, “I’m not sure what it’s going to be.”
Coming up in our next blog, we’’ll review our top 10 stories for 2011. Happy Holidays!
Tags: 2011, 2012, douglas lodmell, economics, Florida real estate, foreclosure, foreclosure attorney, foreclosure practices, foreclosures, mind of money, mortgage, oppenheim, Oppenheim Law, Real Estate, Roy Oppenheim, wall street