Oppenheim Tells @FoxNews – AG Settlement is Deal with Devil

Is this the next big bank bailout or a sell out to homeowners?

The foreclosure settlement deal is too sweet for the banks and not worth a “deal with the devil” South Florida Law blogger and foreclosure defense attorney Roy Oppenheim told Fox News national correspondent Phil Keating. The national story aired on FoxNews America’s Newsroom to more than 2 million households.

View Roy Oppenheim’s interveiw on Fox News.

Oppenheim contributed to the Fox News segment detailing the latest insult aimed at homeowners, this time by the state attorneys general. The penalty for grand larceny in Florida carries a maximum prison sentence of five years, but the banks that caused a worldwide economic meltdown in 2008 may only get a slap on the wallet. There is currently a deal in the works that would offer lower penalties brought by state attorneys general in exchange for the banks cutting $25 million worth of principle off distressed loans.

“It is a drop in the bucket,” says Florida foreclosure defense attorney Roy Oppenheim, “and I don’t think it’s worth the deal with the devil to give up our rights to bring the proper action against the banks.”

Rolling Stone Magazine recaps the crime: the banks lent money to firms like Countrywide, who in turn created billions in dicey loans, who then sold them back to the banks, who chopped them up and sold them to, among other things, your state’s worker retirement funds.

Approximately six million distressed homeowners facing foreclosure are eligible for home mortgage modification, but banks have been slow and even downright resistant to providing any meaningful assistance. Federal efforts to help alleviate the logjam have been modest. With an eye on fixing the problem, state attorneys general (spearheaded by Iowa’s Tom Miller) began negotiating the deal a year ago.

In the beginning, all 50 attorneys general were on board. However, recently 7 states have dropped out including California and New York. It would seem strange that California, which has the highest foreclosure rates in the country with 1 out of 570 homes being served notices, would drop out of the negotiations.

Ultimately, experts think there will be a settlement, but one that’s fair to everyone. Like Rolling Stone Matt Tabbi reported “It’s probably up to the states to stop this TARP-on-crack of a deal.”