Mortgage Servicing Fraud
occurs post loan origination when mortgage servicers use false statements and book-keeping entries, fabricated assignments, forged signatures and utter counterfeit intangible Notes to take a homeowner's property and equity.
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Nye Lavalle
REMEMBER, THE NAME OF THE "GAME" IS "BAILOUT" Those of you who said taxpayer funds would not be in play, should read up on this and more...

Bush Will Expand Government Role to Deal With Subprime Crisis
By Holly Rosenkrantz

Aug. 31 (Bloomberg) -- President George W. Bush today will announce steps the administration says will help people with subprime mortgages keep their homes.

Bush will let the Federal Housing Administration, which insures mortgages for low-and middle-income borrowers, guarantee loans for delinquent borrowers, allowing them to avoid foreclosure and refinance at more favorable rates, according to an administration official.

The change would affect borrowers who are at least 90 days behind in payments and let them continue living in their homes, the official said on condition of anonymity. Bush, in a statement in the White House Rose Garden, also will back proposals to provide tax relief for homeowners who refinance.

Tighter credit and higher borrowing costs threaten the housing market, which has been an engine of U.S. economic growth. Democrats in Congress and the party's presidential candidates have criticized Bush for not taking action to prevent the spread of foreclosures.

The president still opposes Democratic calls to let Fannie Mae and Freddie Mac, the two largest U.S. mortgage finance companies, boost purchases of mortgages as a way to ease lending constraints, White House spokesman Tony Fratto said.

Bush's proposals will address ways ``to prevent these kinds of problems from arising in the future,'' Fratto said.

Home Resales

U.S. home resales fell in July to an annual pace of 5.75 million, the slowest since November 2002, the National Association of Realtors reported on Aug. 27. Sales have declined for five consecutive months.

About 14 percent of banks raised standards for mortgages to their most creditworthy borrowers and 56 percent made it more difficult for people with limited or tainted records to get loans, according to a Federal Reserve survey of senior loan officers in mid-July.

Among the plans Bush will announce is a joint initiative of the Treasury and Housing and Urban Development departments to identify people who are at risk of defaulting on their mortgages, the official said.

Bush wants the government to work with lenders, insurers and others to develop more favorable loan products for those borrowers, the administration official said.

Congressional Plans

Congress also is looking at ways to minimize the fallout from the collapse of the subprime mortgage market, including rising numbers of foreclosures among borrowers with poor credit or high debt. Democratic presidential candidates also are pushing for action to stem the number of foreclosures.

Christopher Dodd of Connecticut, chairman of the Senate Banking Committee, said in an interview with CNBC last week that he plans to move legislation next month that would expand the FHA's role to ``provide additional avenues for people to get cheaper, reasonable, safer credit'' without relying on subprime loans.

Senator Hillary Clinton, a New York Democrat, said this month she planned to introduce legislation that would ban penalties for people who pay off mortgages early and require federal registration of mortgage brokers.

An administration proposal to give low-income homebuyers an alternative to subprime loans last month was greeted skeptically by Republican senators and congressional auditors, who said it might be too risky.

The FHA's plan to lower down payments and boost loan limits in its lending program doesn't include a pilot project or consider the impact on African-Americans, Senator Elizabeth Dole, a North Carolina Republican, told the Senate Banking Committee last month.

Risks

The FHA is trying to steer borrowers away from subprime mortgages that often carry higher fees and interest rates. The administration plan would also give the government flexibility to charge different premiums based on buyers' risk.

Bush is holding to his position outlined earlier this month that Congress should first strengthen oversight of Fannie Mae and Freddie Mac before letting the government- sponsored enterprises exceed their current regulatory limits on mortgage holdings.

Fannie Mae and Freddie Mac have said they can help market liquidity by being allowed to buy more of the mortgages and mortgage bonds shunned by investors.

To contact the reporter on this story: Holly Rosenkrantz in Washington at hrosenkrantz@bloomberg.net

Last Updated: August 31, 2007 00:00 EDT
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The only thing that should happen as far as any kind of "bailout" is that some form of national legal counsel should be established for borrowers who feel that they truly have legal issues with their loans. If someone was steered into a high rate ARM when they qualified for a lower fixed rate, if there are potential predatory lending issues, etc. then those borrowers should be able to have proper legal counsel available to them. But when you're just trying to keep your head above water you simply can't afford even a $100/hr attorney to help you out.

Competent legal representation should be the only thing made available here. TROs should be given to those with legitimate potential issues. Mortgage payments should be escrowed until such time as the legalities are figured out. Other than that, lenders, brokers and borrowers that either attempted to cheat the system or simply bought "too much house" should go down with the ship. To issue a blanket bail out the borrowers without looking good and hard at who really deserves to be bailed out only ends up helping keep the lenders/originators and borrowers that may not be deserving afloat at the end of the day. Other than that, everyone should get out of the way and let the "market" dole out it's own justice. After all, the "market" did it to itself.

Just make sure that those truly taken advantage of are properly cared for. Justice should not be reserved only for those who can afford it.


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Stephen

The legal system is not available to the average citizen.  Get real, Nye.  $250 an hour and $29k up front is what lawyers charge.

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anon2

I have (had) a FHA loan. Like that is going to stop them. They traded securites based on FHA loans. Also they attempted to foreclose twice without any kind of loan mod, nada....

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A mortgag holder

Bush outlines aid for mortgage holders

 

By DEB RIECHMANN, Associated Press Writer 35 minutes ago

WASHINGTON - President Bush outlined ways the federal government can help troubled borrowers keep their homes Friday in an effort to address rising foreclosures fueled by the mortgage crisis.  

The administration's first attempt at dealing with a wave of defaults is not aimed at bailing out lenders, however.

"It's not the government's job to bail out speculators or those who made the decision to buy a home they knew they could never afford," Bush said in the Rose Garden. "Yet there are many American homeowners who could get through this difficult time with a little flexibility from their lenders or a little help from their government."

The U.S. economy enjoyed a strong revival in the spring but since then has been threatened by the worst housing slump in 16 years and a widening credit crisis that has sent financial markets on a roller coaster ride.

The president insisted that the economy was strong and could weather turbulence in the markets.

He said the mortgage market, especially the subprime sector, has shown particular strain. One of the most troubling developments has been an increase in adjustable-rate mortgages, which start out with low interest rates, then reset to higher rates after a few years.

"This has led some homeowners to take out loans larger than they could afford based on overly optimistic assumptions about the future performance of the housing market," Bush said. "Others may have been confused by the terms of their loan, or misled by irresponsible lenders. Whatever the reason they chose this kind of mortgage, some borrowers are now unable to make their monthly payments, or facing foreclosure."

Foreclosure and late payments have spiked, especially for so-called subprime borrowers with blemished credit histories or low incomes. Higher interest rates and weak home values have made it impossible for some to pay or to keep up with their monthly mortgage payments. Some overstretched homeowners can't afford to refinance or even sell their homes.

Mortgage foreclosures and late payments are expected to worsen. Some 2 million adjustable rate mortgages are to reset to higher rates this year and next. Steep penalties for prepaying mortgages have added to some homeowners' headaches.

Bush said the Federal Housing Administration, a government agency that provides mortgage insurance to borrowers through lenders in the private sector, would launch in coming days a program called FHA Secure. The program would let homeowners who have good credit histories but can't afford their current mortgage payments to refinance into mortgages insured by the FHA.

"This means that many families who are struggling now will be able to refinance their loans, meet their monthly payments and keep their homes," Bush said.

Bush also urged Congress to modernize and improve the FHA so more homeowners could qualify for the mortgage insurance provided by the agency. Last year the House passed legislation to modernize FHA, but Congress has not yet sent a bill to the White House. "I look forward to signing a bill as quickly as possible," Bush said.

Bush also pledged to work with Congress to reform a key housing provision of the federal tax code, which will make it easier for homeowners to refinance their mortgages.

"Let's say the value of your house declines by $20,000 and your adjustable rate mortgage payments have grown to a level you cannot afford," Bush said. "If the bank modifies your mortgage and forgives $20,000 of your loan, the tax code treats that $20,000 as taxable income. When your home is losing value and your family is under financial stress, the last thing you need to do is to be hit with higher taxes."

Bush also said the administration would launch a new foreclosure avoidance initiative to help homeowners figure out a way to refinance. He said Housing Secretary Alphonso Jackson and Treasury Secretary Henry Paulson would reach out to groups that offer foreclosure counseling and refinancing assistance for homeowners.

And he said the federal government was taking actions to make the mortgage industry more transparent, more reliable and fair to reduce the likelihood of these lending problems happening again.

Sen. Charles Schumer, D-N.Y., said he was pleased to hear Bush and Federal Reserve Chairman Ben Bernanke address the escalating crisis in the mortgage market. "The current situation is simply out of hand. It's bad and it's getting worse," he said.

He said Bush's proposals — increasing FHA loans, reducing down payment requirements on loans to be insured by the FHA, eliminating tax liabilities for foreclosure victims — were all Democratic proposals.

Schumer said additional steps must be taken — increased funding for non-profits that help people facing foreclosure to refinance, allowing Freddie-Fannie to spend more, federal regulation of mortgage brokers.

John M. Robbins, chairman of the Mortgage Bankers Association, said the president's attention to turmoil in the mortgage markets and the plight of homeowners facing foreclosure will help push Congress to reform FHA.

"It is essential that the Federal Housing Administration have the tools and flexibility to adjust its products and programs to meet the evolving needs of borrowers," Robbins said.

Soure: http://news.yahoo.com/s/ap/20070831/ap_on_go_pr_wh/bush_housing_slump;_ylt=AjN0Z.XPdFApy6.PpDBkwskDW7oF

 

 

 

 

 

 

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arkygirl
Bush is going to save everybody??!! Mortgage companies and borrowers alike??!! Is Bush an economist? A CPA? Does he even balance his own checkbook or is that Laura's job?

Considering Bush's record, that just scares the heck out of me! Things tend to turn to doo-doo when this bunch becomes involved. Why add MORE regulation when the laws already exist are unenforced?? TILA, RESPA, they have broken them all with impunity.

If I didn't know better, I would say that the current government operates exactly like the mortgage servicers....anything to confuse, muddle, obfuscate and HIDE what is really going on. And, yes, it will ultimately involve taxpayer funds. It always does. And it always involves keeping corporate thieves up and running until the scandal gets so big and stinky that there is no hiding the bodies any longer.

I vote "NO". *SIGH* "No" again.  Let the thievin' rustlers DIE. Stop pumping them full of life support. They need to be gone. Quickly.

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srsd

Hey Arky...did you see that if you have GOOD credit you will be able to refinance....well I guess that lets anyone involved with a crooked company still fight things along because it seems like one of the big complaints is things have been reported to credit bureaus that is not true.  That is a big complaint of mine. How are they going to handle that situation??  I guess if you are with a company that didn`t screw you, you can refinance for a lower rate. This still doesn`t help the mortgage fraud situation that I can tell. If it does, I wish someone would help me understand how.

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O -
Bush is part of the problem.....



Local experts say no bailout on mortgages, but help needed
Newsday - 5 hours ago
A more modest government plan to enforce predatory lending laws and help allowing some borrowers with risky mortgages to change the terms or refinance at a fixed rate is more realistic and would be critical to easing the subprime mortgage crisis ...
Bush Pledges FHA Help for Subprime Mortgage Borrowers (Update3) Bloomberg
UPDATE: Troubled Housing Market Looks To Washington CNNMoney.com
Politico - CNNMoney.com - Canada.com - Guardian Unlimited
all 758 news articles »
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arkygirl
srsd, I understand your plight. You are among what will probably total millions of American citizens once the numbers are known. It is how they played the game.

Subprime loans=higher origination fees>put people with good credit into crappy loans for the higher fee>ding borrowers credit scores ASAP so that they will never escape the subprime high fee and interest trap>borrowers being forced to refi over and over into ever-crappier loans with ever-higher origination fees/payoff penalties, fees, fees, fees without end>....and so on, the wheel turns.

The dumba$$es ran over themselves with their own wheel, though (and this is what can tickle a sense of humor as warped as mine). They have rendered what amounts to an entire generation of potential borrowers unable to borrow for years to come with their efforts to push those subprime loans and credit cards by cavalierly ruining their credit scores for their own gains.

Now we all know that the entire fake economic system relies on a frenzied orgy of borrowing to work at all (if you watched the little "Money as Debt" film you know this). There are far many fewer borrowers than there were ten years ago because of the deceitful tricks used to create "subprimers". What can be done?

As this entire subprime/servicing issue forces its way up from the underground shadows where it has dwelled for so many years, attention will have to paid to this very thing. The credit bureaus. Borrowers will have to be recreated-FAST- or else the system crashes for everybody and that will include the a-holes who dreamed up the scheme. Once the dollar is worth nothing, then everybody has nothing regardless of class. We would all be equal and there is no way the "rich" will tolerate THAT!

My only slightly cracked crystal ball tells me that once the worst of the worst originators and servicers are identified (nearly all of them, it seems), those who can provide evidence of payments made on time but "played with" by these companies (you know, fake insurance, suspense accounts, weird fees and fake credit dings) will be offered a way to rectify their credit reports immediately. Something official and binding that the credit bureaus will not be able to ignore without severe penalties. Then there will at least be an opportunity to get a decent loan. And that is basically what everyone here wants; not to shed their debt, but to be treated justly and buy a home without being raped in the process.

The economy is suffering cardiac arrest right now. A severe "electrical jolt" is required immediately. This is one way to deliver it. Don't lose hope yet. Some smart brain in the system will figure it out and take steps.

Well, I hope so anyway. If I can sit here in Podunk, AR and figure it out, surely all those highly educated economic idiots in power can do the same.....if not, somebody had better put it in their suggestion box soon! There is literally no time to waste.

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srsd

Hry Arky,  How far are you from a place called Conway Ark? My husband and I got a speeding ticket there about 20 years ago....going 85 off a ramp...the trooper was so short, I thought a hat was driving the car.

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arkygirl
No place in AR is very far from any other place....four hours will get an average person anyplace they want to go within the state.

I cannot reveal the location of Podunk or all sorts of undesirables might move in with their big city schemes and plans and ruin the view. We like to keep it simple here. That is why we can spot a con a mile away and see how it works.

Despite the stereotypes that abound, we are not really stupid here in Podunk. When cousin Clem tried his own version of a Ponzi scheme, we threw him into the pigpen and told him to cut it out or the next time we would make sure that the hogs were hungry when we tossed him in. Justice is sure and swift on the local level.

All the Podunkites have been wondering how long it would be before they tripped on their own game. We were pretty much on target as to when they would reach critical mass. Actually, we had predicted late 2005-early 2006 and it took until late 2006...its that little crack in the crystal ball that messes things up for us.

"going 85 off a ramp"...eek! Were you in labor and heading for the hospital? That is about the only thing that makes us speed up like that around here, lol. Sounds like "the hat" earned his paycheck that day.

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srsd

Was going to Las Vegas

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4 justice now
Arkygirl,

Now that would be a fitting punishment for the ones who are responsible for all the MS Fraud, etc. Feed them to the hogs. Although, I'm sure even the hogs wouldn't touch them... After all, I would think, even a hungry hog knows better than to eat feces.


r,

4J
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srsd

LOL...you are so funny

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He said that those with good credit would get special FHA loans.

That's the same response he had to Kelo V New london, the government won't engage in property seizures for profit. Well the government is not a business so that was non-sense statement.

What he's really saying those with no problems with their loans will be given the option for special finacing.

That doesn't apply to ms fraud victims since the servicer manufactures the default and bad credit.

It doesn't apply to those with arms they are trapped into because they will be behind and have bad credit, it doesn't apply to those tricked or duped into loans they cannot afford becuase their credit will be trashed if it wasn't before.

It doesn't apply to people who were trapped into loans because the lender forged the docs.

Really the comment and plan is just plain forked tongued, deceptive, double talking non-sense.
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Still Fighting
In response to what Arky said about some brain being able to figure this out if she can. The majority of us on here are realists  and can see the way things are really happening. It seems the  bulk of people in government  or  banking think that the system works perfectly because they have had the  "This is the greatest free market capitalist economy ever"  smoke blown up their  rears since they were young and then by their professors.  None of these people want to admit that the whole system is flawed because that would cause their whole belief in the system and what they have been told to come crashing down. The whole economy is just like corporate America, numbers and  outlooks are constantly changed to satisfy the needs of the fed.
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4 justice now

FWW:

 

We should all know by now... That, If Mr. Bush has anything to do with something, someone somewhere is going to profit/benefit from it, and it certainly won't be anyone of us, or any other honest, hard working tax paying types. I find it absolutely amazing that this blatant fraud has continued to be such a non-issue for most of the media. Once again, just as in the S & L scandal, the American tax payers are being expected to write another blank check, with no questions asked, in order to bail out those directly responsible for the fraud to begin with.

 

The system should be allowed to cleanse itself of the scum, which corrupted it and caused its failure. This so-called "bail out" money should be earmarked for enforcing the existing laws, which were so clearly violated by dishonest: Real estate agents, appraisers, attorneys, brokers, lenders, servicers, and stock rating companies, and just about everyone else who has dealt in Real estate industry during the past ten years or so. At the very least, those who had their mortgage serviced by any of these well know swindlers should be immediately assumed as being innocent and be made whole again, if at all possible. 

 

After all, the penance that will be provided as part of any of the many Class Action settlements aren't going to help anyone, other than the law firms (but of course their winnings won't be a penance). First of all, anyone who currently has an unaffordable loan that is a direct result of the lending/serving fraud should be provided with a 30-year fixed (Fed prime rate) mortgage with the payoff being determined by the property's current appraised value minus all previous payments etc that have been made.  

 

All those who obtained even a dime of profit based on their fraudulent activities should be forced to disgorge themselves from any and all monies and/or assets that they or their families have obtained. Their homes should immediately be sold and all profits turned over to those who were swindled out of theirs. The swindlers should remain incarcerated at least until any and all assets can be retrieved and be divided amongst their victims.

 

Just My Opinion

 

4J


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Good post still fighting. Many people keep attributing the problems to free market and capitalism we really don't have either.

We have progressive tax rate which transfers the wealth of the middle, upper middle, and so-called rich to supposedly subsidize the poor and poor-middle class but really goes to pay interest on the debt. If we had true capitalism you you get to keep what you earn and own. Every year the classification of rich targeted by politicians as the fortunate haves gets lower and lower I just heard Barney Frank state on the news he supports free market capitalism but the income disparity (haves v have nots) 70-80,000 were the comfortable class inferring we should direct our ire at them and put them in their place with IRS attacks. Hm-mm I haven't noticed to many people making $70,000 with butlers, maids, a 21 room hunting cabin, a limo driver, and a pilot for their private jet. At this rate in few years the politicians will classify the privileged class as those with the shortest walk to get their welfare checks.

As far as free market that's a farce the monetary system and policies and therefore our wages, inflation, money supply, interest rate, monetary value relative to foreign currency, therefore trade deficit and companies relocating overseas are set by the FED.

Our financial system is based on the bank of England model which allowed super expensive full scale wars to be fought now and paid for later, through a fiat system. (paper money backed by government decree)
Not surprisingly this created poverty, debt prisons and indentured slavery for Europeans and actually most of the white Europeans came to the U.S. as indentured servants because of the great costs of the European wars.

Not surprisingly the Fed was created on the eve of WWI some could argue it was needed as an emergency to arm our allies, why then is the Fed/IRS system still in place almost 100 years later?

We have come close to a low or no tax system, with full property rights under the direction of Thomas Jefferson and Andrew Jackson and they were the most pro common people Presidents we have ever had.

Anything that increases the debt makes the ultra rich richer and everyone else poorer, we need to remember that when we are picking politicians who claim they are restoring the power to the people and fighting corporate and lending fraud.

We certainly don't have access to fair and equal government protection of property rights which is the cornerstone of common peoples right to own private property or capitol. I doesn't say anywhere in the Constitution that a select unelected group of people will be granted the right to lend other peoples money at fractional reserve rates or to create money with no intrinsic or actual value backing.

Add in Kelo V new London and its clear we have some sort of feudalistic corporate dictatorship with some limited degree of control by common citizens and some limited degree of influence by voting and it would appear by our experience very little if any governmental or legal protection.

The Constitution guarantees our right to a trail by jury and a right of self representation but as we can see that very rarely happens in real life.
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