Let’s make that perfectly clear.

Depending on what you have read, you might be outraged, you might be relieved, you might be overjoyed. And the target of your wrath or sympathy might depend on your own personal perspective.

But make no mistake about it, yesterday was a day of reckoning, for me, and much more importantly, for the people I represent.

Yes, the banks got a slap on the wrist and the money they are trickling back to the homeowners won’t make up for the systemic fraud these lenders engaged in, and make no mistake it was fraud at the highest level.

I wish I could personally put the handcuffs on each CEO who allowed robosigning to occur.

But here’s the silver lining, now we have a reengaged President, who is anxious to see the job done. We have Eric Schneiderman on the case, and he is going full-speed right at the banks.

They may have not gotten the flogging they deserve, but I am optimistic that they surely will.

Conservatives can blame the borrowers all they want, and certainly not all were faultless. But the banks were the grown-ups here, they should have known better. They had the chance, in the midst of the housing boom, to stop, take a breath and take a look back at what they had done.

They didn’t.

The truth is no amount of money would have been enough. And since we can’t put the banks in jail, they got what was in essence a very public shaming. And people’s eyes were opened. What you have now learned, can not be unlearned.

The banks for years, had their hands in their cookie jar, and tried as I might, I could not get people to glance over at the jar to see.  I felt like a lone wolf calling out the banks on this blog.

Here was my challenge to borrowers back in 2009!!

Make the banks prove they own your note. Many times the banks are clueless who owns their note.

People thought I was Chicken Little, telling everyone the sky was falling.  Well it was, and now everyone knows it. I went from being a lone wolf to a man lost in the crowd. My voice was far from the loudest voice yesterday, and that’s just fine by me.

When I first discovered that banks were essentially hiring people to impersonate banking officials and crank out thousands of fraudulent signatures, and were paying them what your average burger flipper makes, I couldn’t believe it. It was perjury and forgery, and those are crimes.

If not for the banks’ own arrogance and stupidity, yesterday’s settlement would never have come. If they had just plugged away and kept things running as they always had, they would have made money hand over fist and my clients would have been kicked out of their homes.

And what’s really bad for the banks is that robosigning is the key into the much larger world of securitization fraud, which is the real crime here.

Robosigning would have never been necessary if the banks hadn’t bundled up all these mortgages and sold them off to the highest bidder in the first place. If they had been satisfied with making millions, instead of trillions, we would not be where we are today.

What’s even worse for the banks is that robosigning provided the proof to investigate the banks for the larger fraud.

We are looking forward to the final day of reckoning, when the President and Schneiderman wrap their latest investigation because trust me, when they do, no one will give a damn about robosigning.

As always I am talking to you from the trenches.

Roy Oppenheim

President Barack Obama delivers remarks on the economy at Shaker Heights High School,Shaker Heights, Ohio, Jan. 4, 2012. (Official White House Photo by Chuck Kennedy)

We really haven’t seen President Obama insert himself directly into the housing crisis, but there are rumblings that he may do just that during Tuesday’s State of The Union address.

The fact is that is what homeowners have been clamoring for. A new USA TODAY/Gallup Poll found 58% of Americans want the government to do more to help people keep homes.

According to HousingWire, Ohio senator Sherrod Brown told reporters today that there was evidence that Obama would address the robo-signing case which involves several major banks.  A North Carolina congressman even said there were rumours that Obama would announce a settlement, something HUD secretary Shaun Donovan suggested last week was ‘very close’, as we mentioned in our Week In Review on Friday.

For the record, Obama’s press secretary refused to confirm any details, saying only that the President was “focused on the issue of housing”.

Between Dononvan’s comments and the recent white paper sent out by the Federal Reserve, it seems that more and more top government officials are finally realizing how important the housing market is to our economic recovery, not to mention their own political survival.

This is not news to us here at the South Florida Law Blog.

In our last blog we talked about the stories that resonated with Roy Oppenheim in 2011, but what stories mattered to you?

We reviewed the most popular stories on the South Florida Law Blog this year and came up with our list of the top 10 posts for 2011

# 10 — Florida Deficiency Judgments FAQs . . . By Popular Demand

Some of Oppenheim Law’s most popular videos and blog posts this year were on the topic of deficiency judgements. Understanding deficiencies and the Florida rules which pertain to them are key to avoid getting a deficiency judgment.

The unpaid mortgage debt associated with a residence is a deficiency.  A bank can foreclose and force a judicial sale of a home if the mortgage borrower fails to pay the associated mortgage debt.  The deficiency is the difference between the proceeds from the sale and the remaining mortgage loan balance. A deficiency can also result from a short sale, which is an alternative to foreclosure.

The rules pertaining to deficiencies differ from state to state. In Florida, if the bank is successful in obtaining a deficiency judgment, it will be recorded in the public records and collectable for up to twenty years. To avoid the possibility of getting a deficiency judgment, before deciding to walk away from your home, hiring a good foreclosure defense attorney is necessary.

#9 — #Fail – Government Plan to Help #Florida Homeowners

At first glance, it looked  like Florida foreclosure victims were finally getting the help they need from the feds. Reading the fine print it looks like if we had to describe this in one tweet word: #fail.

The two agencies that are in charge of overseeing the Independent Foreclosure Review went  have gone out of their way to keep the details of this program secret.  The most alarming issue is the possible conflict of interest between the consulting firms that were chosen by bank regulators to administer the foreclosure reviews. The fact is these consulting firms are actually getting paid by the banks.

The same banks that ultimately led the economy into the mortgage crisis were placed in control of deciding which homeowners are entitled to compensation for the banks own wrongdoings.  It is doubtful homeowners will receive any meaningful relief from this program.

#8 — Law Review Executive Summary: Black Magic of Securitized Trusts

Deconstructing the Black Magic of Securitized Trusts by Roy D. Oppenheim and Jacquelyn K. Trask-Rahn gives an in-depth analysis of the process of securitizing mortgages and how it has gone awry. The article begins with a focus on the rise of subprime lending, the impact that subprime loans, such as “interest-only” and “negative amortization,” had on the American Dream of home ownership, and how “securitizing” these loans led to a false sense of security for homeowners and investors during the housing bubble.

During the spike in foreclosure filings that followed the implosion of the market, in an effort to prove proper standing to bring the action, banks began producing tens of thousands of assignments predating the filing of the foreclosure action. This mass production of assignments proved that trustees had not properly transferred the mortgages from inception thus the banks laced standing to foreclose.

#7 — Banks Desperately Seeking Short Sales

Oppenheim Law has represented hundreds of homeowners’ short sales over the past few years and as a result has seen millions of dollars of homeowner deficiencies waived by the banks, who are becoming more eager to avoid foreclosure and complete short sales.

On New Year’s Eve we’ll post our top 5 stories for 2011 — Happy Holidays!

On a high note – we are pleased to report Roy Oppenheim has been selected by his peers for inclusion in The Best Lawyers in America® 2012 List in the practice area of Real Estate Law.

“I am truly honored and humbled to garner this recognition by my fellow attorneys,” said Oppenheim, who has created a reputation as the homeowner’s advocate when it comes to foreclosure defense in Florida by educating homeowners and attorneys on the subject.

In other noteworthy highs and lows, Roy Oppenheim offered his foreclosure defense insight to reporters from the Palm Beach Post, Associated Press, Huffington Post and his recent column in the South Florida Law Blog.

Will Clearing Foreclosure Logjam Revive Florida’s Economy? – Palm Beach Post

Housing Danger: Slump a 2012 Liability for Obama – Huffington Post

Foreclosure Mediation Program’s Low Success Rate Leaves its Future in Doubt – Palm Beach Post

News Embargo? Americans Protest, Occupy Wall Street – South Florida Law Blog by Roy Oppenheim From The Trenches

As we enter into the last quarter of 2011, Oppenheim Law and South Florida Law Blog keeps its eye on the Florida real estate market and continue to update subscribers on headline news and views.

Wishing you a safe and happy weekend.

The Oppenheim Law and South Florida Law Blog  News Team

South Florida Law Blog’s Roy Oppenheim says we’re not out of the woods yet! A second wave of Florida foreclosures will hit in the third quarter of this year, Florida Double Dip? Foreclosures, Zombie Foreclosures, Fraud-closures from Oppenheim Law on Vimeo.

Oppenheim Law Predictions:

1. Government programs such as unemployment benefits as well as the reduction in payroll tax benefits are coming to an end.
2. Florida banks have supposedly gotten their “fraud-closure” crisis and issues of robo-signing under control and are going to submit many new foreclosures.
3. If that wasn’t enough, foreclosures that were initially dismissed by the courts due to incomplete and inaccurate paperwork are now being “revived” and will also contribute to the tidal wave of foreclosures.
4. Sustaining housing prices will be difficult with the ending of government programs, new foreclosures hitting, and “Zombie” foreclosures coming in because there simply isn’t enough economic support.

Shelia was probably the only person in the Obama administration who really “got it.”

As a financial regulator, she understood the crisis as we do at Oppenheim Law, on the ground and in the trenches.

Truly the champion of the little guy, Sheila really understood that there were two sets of rules in this country:one set for big banks and another set for everyone else.

Her opinion was always dismissed and considered inferior to that of the Treasury and the Federal Reserve. She knew that the Obama Administration, while maybe understanding the plight of the little guy, always capitulated to the interests of big business, Wall Street and the banks.

Sheila understood that from Day One her responsibility was to protect the consumer, the depositor, the homeowner, and most importantly, the taxpayer.  In a major piece written in the New York Times magazine this past weekend, she questioned why investment banks that were “counterparties” to AIG, like Goldman Sachs, received 100 cents on the dollar from the AIG bailout. Goldman, in fact, received over $12 billion from the bailout. As is well known, many people in the administration were in fact in some way connected to Goldman.

Before the crisis had truly descended upon our nation in 2007, Sheila understood that if banks were required to modify mortgages there was a possibility that the foreclosure crisis which led to the meltdown of the real estate market and subsequent destruction of the economy could possibly be contained.

No one listened to Sheila!

Shelia constantly tried to convince both the Bush and Obama Administrations that something needed to be done, however, her warnings were not heeded until it was too late.

Had the government listened to Shelia on early mortgage modification, it is possible “that the government could have prevented lots of pain and might have helped stabilize the economy a lot sooner,” according to the NYT.

However, Shelia states that maybe one of the reasons that mortgage modifications never really took off was that “maybe people thought that [she] was overstating the problem.” She added that in many cases regulators didn’t believe that borrowers were worth helping.  The sense was that borrowers had probably overstated their income and assets and thus deserved to be thrown out of their homes.

Shelia also felt that the Treasury and the Federal Reserve did not lay the blame with overzealousness and greed on Wall Street but rather with a “system come undone.” We of course know that it was precisely greed on Wall Street that caused the crisis.

Needless to say, we here at Oppenheim Law will miss Sheila Bair and we hope, whatever she does, that she will not give up the good fight for what is right for the homeowner, the depositor and the taxpayer.

Three cheers for Sheila Bair!

From The Trenches,

Roy Oppenheim

With a foreclosure fraud financial crisis this intense and prolific, there’s certainly enough blame to go around for everyone, but we have one more culprit to add to the list!  News broke this week that the SEC is investigating and considering civil fraud charges against credit rating companies for their role as “key enablers” of our country’s financial meltdown.

Critics of the leading credit rating companies like Standard and Poor’s argue that these firms fueled the $1 trillion Wall Street mortgage-securities machine before the boom ended.

Regulators, however, should not be free from blame: there is clear evidence of incompetence and deliberate neglect by the SEC in keeping credit rating companies in line.  The fact is that credit rating companies and the SEC itself have served as co-conspirators with Wall Street banks to bury us in this seemingly insurmountable hole.

According to the Wall Street Journal, SEC officials are finally investigating whether the ratings companies committed fraud by failing to do enough research to be able to adequately rate the pools of subprime mortgages and other loans that underpinned mortgage-backed securities.

Allegations continue to swirl that the credit rating companies relied on incomplete or out-of-date information about the pools of loans in the mortgage-backed securities or ignored obvious problems among subprime loans to give unduly high ratings to slices of deals, known as collateralized debt obligations (CDOs), that were then sold to investors.

The ratings firms assigned coveted triple-A ratings to many of these CDO slices in the run-up to our real estate and national financial crisis, before doing mass downgrades when the housing market collapsed and the subprime mortgages soured, according to the Wall Street Journal.

Whether charges against the credit rating companies are ever actually filed or not, the blame game is in full swing and doesn’t appear to be stopping any time soon.

From The Trenches

Roy Oppenheim

The President is well aware of the uphill battle he faces when it comes to convincing voters and campaign financers that his economic policies and regulations have not only been what we needed the past three years, but also what we need in the next four. According to The New York Times, President Obama has already started reaching out to the skeptical financial industry on Wall Street, hoping to win back one of his most vital sources of campaign cash.

While many on Wall Street view the President’s financial rhetoric as unfair to their industry, his apparent goal is to prove that his fiscal policies have helped to bring the banks and financial markets back to health and toward sustained growth.

The argument goes that the economy would have been dramatically worse at this stage had the Obama administration not taken the action it did in the wake of the real estate and financial crisis.

But how do you prove a negative? You can’t.

Historically, recessions have been ended by a wave of homeowner refinancing that predictably follows a lowering of interest rates. The President faces a number of obstacles to accomplishing a refinancing boom, however.

First, the number of homeowners who are underwater continues to rise.

Second, the banks have no motivation to lower interest rates of homeowners who are stuck in their homes.

Our current refinancing and banking system is stacked against the premise (and promise) that refinancing would push cash back into the economy, spur a consumer stimulus, and in turn promote spending, job creation and financial growth.

Too many people with good credit and jobs are stuck with high interest rate loans. The President would be wise to focus on developing a system for refinancing homeowners to stimulate an organic bailout of our financial crisis.

The fact that the President has more work to do to bring the country out of its funk and needs a different path to economic growth is backed up by a recent Time Magazine article debunking the myths of the new American economy.

Myth #1: This is a temporary blip, and then it’s full steam ahead.
The vast majority of economists do not believe we are on the way to a double-dip recession, but avoiding a double-dip is not the same as stimulating economic growth strong enough to revive the job market. The fact is that estimates point toward a five year recovery time before we return to a healthy unemployment rate of 5%.

Refinancing borrowers with strong credit and jobs could help speed up the process.

Myth #2: We can buy our way out of this.
Widespread government stimulus for loan modifications isn’t effective if homeowners don’t have jobs that allow them to make payments at all. There has been a decline in foreclosures, but the supply of foreclosed homes continues to undermine the national real estate market and dampen consumer spending.

The previous federal stimulus attempts have focused too much on homeowners who were already in trouble with their mortgages. While these homeowners certainly need help, shifting the focus to encourage refinancing of borrowers not underwater on their mortgages would allow this group to put its savings back into the economy. As the saying goes, “A rising tide lifts all boats.”

Myth #3: The private sector will make it all better.
Companies are making plenty of money. The problem is that they aren’t spending it to hire American workers. According to Time, American companies generated $1.68 trillion in profit in the last quarter of 2010 alone. Clearly, it’s a myth that American companies are waiting for economic and regulatory “certainty” before investing at home.

Myth #4: We’ll pack up and move for new jobs.
Most people couldn’t afford to move if they wanted to because they are underwater on their mortgages. While there are currently 3 million job openings, an additional problem is that the current labor pool’s skill set doesn’t match up with available jobs.

Myth #5: Entrepreneurs are the foundation of the economy.
New business creation has been shrinking since the 1980s. Is it coincidence that this started just when the financial sector began to explode? Lenders still aren’t lending, and the old methods of self-funding new business ventures through home equity loans or maxing out credit cards are no longer viable.

‘Hope’ was the foundation of President Obama’s victory in 2008.

The reality is Americans are still hoping for change.

The question is whether the President, or anyone for that matter, will be able to deliver.

Right now, it looks like if you want a bailout you better have your own plan in mind.

From The Trenches,

Roy Oppenheim

Mortgage Rates Set Fresh 2011 Low After Jobs Report

Fixed rate home mortgage loans dropped for the eighth straight week to a new low for 2011 amid concerns of another economic slowdown this year, according to data from Freddie Mac and a report by The Wall Street Journal.

The 30-year fixed-rate mortgage averaged 4.49%, down from 4.55% last week and 2010’s  4.72% average. Rates on 15-year fixed-rate mortgages fell from 3.74% to 3.68%.  15-year fixed-rate mortgages averaged 4.17% in 2010.

Lawyers Get More Time to Finish Foreclosures

Florida foreclosure defense is translating into more time for plantiff bank attorneys to complete a foreclosure, according to an article in the Palm Beach Post.

Due to the reality of Florida’s overloaded court system and swirling questions surrounding the validity of foreclosure paperwork, Fannie Mae is now allowing bank attorneys up to 450 days (about 15 months) for lawyers to complete a foreclosure before fines are levied.  The previous time limit was 185 days, or about six months.

The increased time needed to complete a foreclosure legally and correctly against a homeowner is due in large part to Florida foreclosure defense attorneys working to protect the rights of South Florida homeowners, according to Roy Oppenheim.

Obama Blames Wells Fargo, Bank of America, Chase for Modification Failures

The three largest U.S. mortgage lenders are getting some heat from the Obama administration for the failures of the federal foreclosure-prevention program, according to The Associated Press.

The lackluster performance of Wells Fargo, Bank of America and Chase with helping homeowners lower their mortgage payments has led the Obama administration to remove financial incentives it had given these lenders.

Only about one-third of the 1.4 million people who applied for mortgage modifications through the federal program have had their payments lowered permanently.

Angry Homeowners ‘Foreclose’ on Lenders

Owners of a house in Florida have engineered a “reverse foreclosure” against a Bank of America branch in Naples, according to The New York Times.

The homeowners paid $165,000 in cash to buy their home from the bank and never borrowed against it. But last February, the bank began foreclosure proceedings against them.  The homeowners hired a Florida foreclosure defense attorney and the case against them was dropped, however they were able to recover a judgment for $2,500 in attorney’s fees against the bank.

When the bank didn’t pay, the homeowners’ lawyer showed up at the bank with sheriff deputies and a moving truck to clean out the building.

The bank eventually settled with the homeowners for more than $5,700 to cover the fees and additional costs.