States are taking settlement money right from under us!
It’s pretty hard to find a single housing advocate or foreclosure defense attorney, myself included, who didn’t find the national mortgage settlement to be, at the very least, flawed.
It may have been a necessary step to getting the housing market back on track, but we know that it didn’t come close to compensating homeowners who had been illegally kicked out of their homes, and in the end, the banks are getting off remarkably light for their robosigning crimes.
Which is why what a multitude of states are doing with some of the banks money is downright revolting.
Part of the settlement included $2.5 billion that was given outright to the states. Florida took in just over $334 million.
The settlement calls for these dollars to be used to “to avoid preventable foreclosures, to ameliorate the effects of the foreclosure crisis, to enhance law enforcement efforts to prevent and prosecute financial fraud, or unfair or deceptive acts or practices and to compensate the States for costs resulting from the alleged unlawful conduct of the Defendants.”
But much like much of the settlement overall, there is nothing in this language that has any real measure of enforcement. Some states are flat out ignoring these instructions and doing whatever they want with the money they are getting off the backs of good honest homeowners. (more…)
It’s been one of my mantrasfor years, and it’s a statement that is again reverberating across the country thanks to The Sun-Sentinel’s 3-part series “Bad Neighbor Banks”.
The grass no longer gets cut,the garbage accumulates, and before too long you end up with widespread blight not just in urban neighborhoods, but suburbia as well.
It’s the reason why I fight so hard to keep people in their homes. You and I are just better off when you have homeowners, vested in their houses and the neighborhoods they live in, keeping up their homes.
In the Sun-Sentinel’s series there is example after example of banks not doing even the most basic of maintenance. And their argument is usually, ‘It’s not our job’.
A bank has no investment in the neighborhoods you live in, beyond their own bottom line, and the banks have all but admitted it.
So I ask you again, why would you ever want a bank as a neighbor?
The numbers don’t lie. The Sun-Sentinel found 10,300 code violations in bank-owned homes in South Florida since 2007. In the cities they tracked 40 percent of bank-owned homes were cited last year.
So chances are you are living next to one of these eyesores. And I’m betting you’re not too happy about it. (more…)
First, homeowners should never have to pay anything up front for a loan modification or information on how to negotiate with their lender, says Roy Oppenheim, whose Florida-based law firm Oppenheim Law has handled more than 1,000 mortgage and foreclosure fraud cases over the past 5 years.
“If you’re paying upfront to a non-lawyer who’s claiming they can modify your loan, that’s a big scam,” Oppenheim says.
The foreclosure crisis isn’t over, but a new trend in real estate sales could be the light at the end of the tunnel for many borrowers and lenders. Short sales, which occur when homeowners sell their homes for less than what they still owe, outpaced foreclosures for the first time ever in January,according to a new report from Lender Processing Services, Inc.
The Federal Housing Finance Agency announced this month that mortgage servicers will be required to review and respond to short sale offers within 30 days and make final sale decisions within 60 days. The new requirements, which take effect in June, have kept lenders busy expanding and training the staff needed to catch up with growing short sale demand. (more…)
Maybe you weren’t convinced the first time I told you the era of the short sale was finally upon us.
I can’t blame you for thinking that banks were acting irrationally when it comes to the foreclosure process.
But Lender Processing Services just offered up the most convincing numbers to date that short sales are no longer just some pie-in-the-sky dream for distressed underwater borrowers.
In January short sales made up 23.9 percent of home sales, while foreclosure sales made up 19.7 percent of all home purchases.
Of course that means that over half of all real estate closings are for distressed homes.
A year before, the percentages were skewered in the opposite direction. In January 2011, 16.3 percent of home purchases came through short sales, and 24.9 percent were foreclosures.
Why are the banks now convinced, as I was long ago, that going through the long and harrowing process of a foreclosure is not their best option?
The proof is once again in the numbers. On average, foreclosed homes sold for 29 percent less than non-distressed properties in January.
Homes sold via short sale? They went for 23 percent less. Here in Florida, LPS says short sales have outnumbered foreclosures since July.
That means short sales are a better deal for the banks, plain and simple.
The truth is banks don’t want to own these properties, they certainly can’t handle maintaining these homes, and they just end up laying waste to neighborhoods by hanging on to them. (more…)
This comes after the settlement was filed in court last month. DC District Judge Rosemary Collyer did the honors Wednesday.
I won’trehash my thoughtsabout what’s good and what’s bad about this settlement. Everything that needs to be said about it has been said.
You and I know that the banks will get more of a pass than they are entitled to for all of their robosigning shenanigans. In reality they are really only paying out about $5 billion in actual money, and I’ve still haven’t seen a single banking officer jailed.
Just remember this fight ain’t over yet!. This settlement was a necessary step, in order for the feds to move on to their investigation intosecuritized trusts.
THAT is where the banks will hopefully get what’s really coming to them.
Now that the settlement is official, the new government agency that will be watching the banks is now open for business.
North Carolina Banking Commissioner Joseph Smith is going to oversee the office and how the banks will receive “credits” towards the settlement for providing homeowners mortgage relief.
Relief, unfortunately, will often come in the form of transactions, such as short sales, that the banks were already doing before the settlement was announced.
“By itself, this settlement will not remedy every problem that system faces. But trust in our mortgage system can move forward if we use this opportunity to show fairness, transparency and accountability,” Smith said. “ (more…)
That’s because the Mortgage Debt Relief Act, which was passed in 2007, is set to expire at the end of this year. If that happens you’ll have to pay taxes on any forgiven debt that comes out of a short sale.
I remain skeptical that Congress, in this election year, will come through and extend the MDRA, but at least some Congressmen haven’t forgotten how important this legislation is. Then again, in an election year anything is possible.
U.S. Reps. Jim McDermott, D-Wash., Shelley Berkley, D-Nev., and John Larson, D-Conn., have introduced the Homeowners Tax Fairness Act. It would extend the Mortgage Debt Relief Act for another three years.
Let’s hope Congress gets their act together and passes this bill.
It remains to be seen if a foreclosure dismissal will have an impact here in Florida, but none the less it has the chance to be a real game changer.
The case is OneWest Bank, FSC vs Galli. OneWest had tried for a partial summary judgement against the Gallis, but the judge in the case denied it and instead ruled in favor of Mr. and Mrs. Galli.
As I’ve always said, you have to make the banks prove they own the note, but in reality it’s more than that. I could pick up a note off the street and say I owned it, but it wouldn’t necessarily be true. (more…)
Banking officials, as a general rule, are old school. They are very resistant to change, and usually refuse to think outside of the box.
Over the years I’ve seen the banks hold little to no regard for the customers they serve. Their philosophy has essentially been ‘You can’t pay your mortgage, then out on your butt you go!’
Forget that they’ve screwed people, or caused the worst recession in 80 years.
Forget that homeowners often have good reasons for not being able to pay. Banks have had very little heart and even less common sense.
So I was blown away by Bank of America’s new test program, called “Mortgage to Lease”, which was unveiled this week. In a few select markets, BofA will give about 1,000 customers facing foreclosure the chance to stay in their homes by turning them into renters.
Bank of America will offer these borrowers the opportunity to have their mortgage debts forgiven, and instead of kicking them to the curb, BofA will lease these homes back to the borrower for up to 3 years for less than the market rental rate.
No more mortgage, no more property taxes or homeowners insurance! And people can stay in their homes! Imagine that!
Turning foreclosure properties into rentals is an idea I’ve long advocated. It only took Bank of America a few years to listen to me!
I was wondering why now, what finally turned Bank of America over to my way of thinking?
I could tell you that Bank of America’s small heart grew three sizes like the Grinch’s, but we all know that’s not true. (more…)
