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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Here we go again
Moratorium my arse

Some of the nation's largest mortgage companies are stepping up foreclosures on delinquent homeowners. That will likely lead to more Americans losing their homes just as the Obama administration's housing-rescue plan gets into gear.

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Banks Ramp Up Foreclosures

Increase Poses Threat to Home Prices;

Delinquent Borrowers Face New Scrutiny

Some of the nation's largest mortgage companies are stepping up foreclosures on delinquent homeowners. That will likely lead to more Americans losing their homes just as the Obama administration's housing-rescue plan gets into gear.

J.P. Morgan Chase & Co., Wells Fargo & Co., Fannie Mae and Freddie Mac all say they have increased foreclosure activity in recent weeks. Those companies say they have lifted internal moratoriums which temporarily halted foreclosures.

Some mortgage companies had stopped foreclosing on borrowers as they waited for details of the Obama administration's housing-rescue plan, announced in February, which provides incentives for mortgage companies and investors to reduce borrowers' payments to affordable levels. Others had temporarily halted foreclosures while they put their own programs in place, or in response to changes in state laws.

A foreclosure-auction sign in front of a home in San Jose, Calif., on April 3. Some of the nation's largest mortgage companies have lifted internal moratoriums on foreclosures and have begun determining which troubled borrowers are eligible for federal help and which to foreclosure on.

Now, they have begun to determine which troubled borrowers are candidates for help, and to move the rest through the foreclosure process.

The resulting increase in the supply of foreclosed homes could further depress home prices and put additional pressure on bank earnings as troubled loans are written off.

Some of the mortgage companies are themselves receiving funds under the government's financial-sector bailout, which could make their actions politically sensitive. But mortgage companies say they are taking steps to keep borrowers in their homes, and are only resorting to foreclosure when there are no other options.

Foreclosure sales had dropped in the second half of 2008 as mortgage companies delayed taking action against delinquent borrowers. But sales have been edging up this year, according to LPS Applied Analytics, which tracks loan performance. Foreclosure-related filings increased by nearly 6% in February from the month earlier, and were up almost 30% from February 2008, according to RealtyTrac. The backlog of seriously delinquent loans has been growing.

In California, notices of trustee sales, which are preludes to foreclosure sales, climbed by more than 80% to 33,178 in March, from February, according to data from and the Field Check Group. The increase reflects both the expiration of foreclosure moratoriums and a California law enacted late last year that temporarily delayed default and foreclosure notices, says Mark Hanson, president of the Field Check Group, a research firm.

Ronald Temple, co-director of research at Lazard Asset Management, expects home prices to fall 22% to 27% from their January levels. More than 2.1 million homes will be lost this year because borrowers can't meet their loan payments, up from about 1.7 million in 2008, according to Moody's

Mortgage-servicing companies, such as J.P. Morgan Chase and Wells Fargo, collect mortgage payments and work with troubled borrowers, both for loans they own and those held by investors.

J.P. Morgan Chase has increased foreclosure actions since the expiration of a moratorium on new foreclosures that began on Oct. 31, and a later moratorium put in place at President Obama's request. The Oct. 31 moratorium delayed foreclosures on more than $22 billion of Chase-owned mortgages involving more than 80,000 homeowners.

"We had stopped putting additional loans into the foreclosure process so we could be sure that delinquent borrowers would have every opportunity to take advantage of new initiatives that we were putting in place," a Chase spokesman says. Borrowers who are now receiving foreclosure-sale notices, he said, "own vacant properties, have not been in contact with us and/or do not qualify for the modification programs."

Citigroup Inc. says it stopped all foreclosures until March 12, at the Obama administration's request, on loans serviced for Fannie and Freddie. Since then, says a spokesman, it has "reverted to our previous business-as-usual moratorium." Under that policy, it will not initiate a foreclosure sale for any borrower who is working with Citigroup and is a good candidate for a loan modification, provided Citigroup owns the loan or has investor approval. "For borrowers who do not qualify under these criteria and where no other options are available, we will move forward with foreclosures," the spokesman says.

[foreclosure chart]

Wells Fargo has also increased foreclosure actions since the expiration of its foreclosure moratorium, put into place while it awaited details on the administration's plan. Wells Fargo "will continue to work with our customers to find solutions up to the actual point of a foreclosure sale," a Wells Fargo spokesman says. "But the expiration of foreclosure moratoriums is having an impact."

Both Fannie and Freddie have stepped up sales of foreclosed properties since their moratoriums ended on March 31. Freddie says it has started to complete some foreclosure sales, such as those involving investment properties or second homes, though it continues to delay foreclosures on loans that may be eligible for modification under the Obama plan.

Fannie has told servicers that "a foreclosure sale may not occur on a Fannie Mae loan until the loan servicer verifies that the borrower is ineligible" for a loan modification under the Obama administration's plan, "and all other foreclosure prevention alternatives have been exhausted," a Fannie spokeswoman says.

GMAC's mortgage division, which had temporarily halted foreclosures while awaiting details of the Obama plan, is now reviewing loans to see which ones will qualify under the program. So far, about 10% of borrowers in some stage of foreclosure appear to be eligible for the federal program, a company spokeswoman says. Although GMAC may be able to work with investors who own these loans to come up with another solution, she says, many borrowers who don't qualify for help under the federal program are likely to wind up in foreclosure.

Mortgage companies are sorting through loan files to determine which borrowers are candidates for help. "At the time a moratorium expires, we have a team of folks who will pore through all of those loans where borrowers have not paid before we will take the next step in the process," says Jim Davis, executive vice president for American Home Mortgage Servicing Inc. "If there is any borrower contact, we will hold off on the foreclosure process until we've exhausted every effort to assist that borrower."

Still, some borrowers who are currently talking to their mortgage companies are also likely to wind up in foreclosure once their files are reviewed. "We are getting so many of these cases where people don't fit the new [Obama] program," says Michael Thompson, director of Iowa Mediation Service, which works with troubled borrowers. Many borrowers are unemployed or underemployed or have credit problems that go well beyond their mortgage troubles, he says.

Many have been "playing for time" while the moratoriums have been in place, he says. But the delays have only increased the amount of interest and fees they owe, making their loans "nonviable in the long run."

Many troubled loans will ultimately wind up in foreclosure because the borrower doesn't have sufficient income to make even a reduced mortgage payment, or doesn't respond to the mortgage company's requests for information. "Certainly half of the loans that would have wound up in foreclosure before the foreclosure moratoriums went in place" will ultimately wind up in foreclosure, says Michael Brauneis, director of regulatory risk consulting at Protiviti Inc., a consulting firm.

While many troubled loans are held by hedge funds, pension funds and other investors, the expiration of foreclosure moratoriums could also put a dent in bank profits, says Frederick Cannon, an analyst with Keefe, Bruyette & Woods. The moratoriums "have to some degree postponed the realization of problems" and "may help bank earnings in the first quarter" by delaying charge-offs of some troubled loans, he says.

Write to Ruth Simon at


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4 Justice Now
I light of what has happened and why... could they possibly be more wrong?

BTW: this is a rhetorical question, as we already know the answer... all too well. 
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803,489 properties received foreclosure filings in the first quarter of 2009, according to RealtyTrac’s latest foreclosure report, released today.  If FCs continue at current rate that would be:

3,213,956 foreclosures by year end


8,928 per day


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Wow that's some astonishing numbers. Way to many per day! Most of them could possibly be avoided with the right assistance and help. But NO it all goes to the LYING BANKERS, ATTORNEYS AND JUDGES.

I'M so Angry for all of us. My M-i-l says to let it go. To go on. Well it was my livelihood we're talking about. I've not gone into the modification biz bcuz not having an atty for myself how can I help anyone else?

It's a horrible thing their getting by with and they know it. Nor will they answer for hteir ways here in STl. They should all be DAMMED and NEED their safehouses NOW.

Our lives will be changing rather we want that or not.

Be Blessed!

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The Equitable One also had a similar article. I expect more like this are coming.
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tired and tattered
I just don't get it. There are so many houses sitting empty. Nearly none of them are selling. Why are they still taking our homes? What are they going to do with them? At this point it seems like their scheme has backfired. There are too many houses empty and many of the people who can buy are leary of the banks at this point. (As well they should be). I just don't understand how they can still be making any money. Especially when they are foreclosing on people like us that have no equity to speak of. There are homes that could sit empty for 2 or 3 years. The house next door to us has been for sale for over 7 months and is not selling. My nephews house has been empty for about as long and he is by a park and his has not sold.(Country Wide took his) Does anyone have statistics on how many of these foreclosed homes are sold. It just seems like with so many thieves out there stealing homes that there's not many people left to buy these homes. Also the fact that so many of our credit scores have been stolen that there are not many people able to buy. Did they go too far and have caused their own demise?
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They're foreclosing because it's pure profit.  They don't own them in the first place and anything they can get for them is all gravy.

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Gravy Train it is........even for pennies on the dollar, the crooks continue to ruin lives, small business's and families.......I should know, we are one of the families......and now the "CHANGE" in the White House appears to help out the crooks instead of those suffering.  I hope some day to read something positive on this website, Good Luck to all.
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ThinkAbout It
We are NOT talking pennies on the dollar....even with real estate values circling the drain.  The real game is mortgage insurance and credit default swaps profiteering.  It is played out on the backs of homeowners victimized by Wall St. investment banks' subsidiary or contract servicers manufacturing credit events, D E F A U L T S.  Servicers are more than happy to comply with this scheme and follow orders from higher up the food chain because they make so much more $$$ in default servicing.  Mortgage REITs are specifically chosen for ABX Index and targeted. Multiple CDS bets are placed on individual REITs, servicers go to work doing what they do best and the not so speculative speculators await their windfall.  It's that simple.  Even if your home has no equity, negative equity and your mortgage is under water, they WILL obscenely profit. 
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