some things need to be re-read..
Mark E Hoffer Says:
September 23rd, 2010 at 11:04 am
QOTD:
The difficulty lies, not in the new ideas, but in escaping from the old ones, which ramify, for those brought up as most of us have been, into every corner of our minds. —John Maynard Keynes, The General Theory of Employment, Interest and Money (13 December 1935)
Robespierre Says:
September 23rd, 2010 at 11:11 am
@constantnormal Says:
September 23rd, 2010 at 10:36 am
“This is where we are heading, in our journey to reshape the US into the world’s largest banana republic.”
I think it is becoming more like a feudal system than a banana republic.
Arequipa01 Says:
September 23rd, 2010 at 11:14 am
The De Soto interview is interesting and embedded in it is an interesting tidbit:
“Fink: This is how the de Soto model works. Property ownership allows poor people to obtain credit, amass capital, and climb out of poverty. Legal reforms make all of that possible. Right now in most developing countries, a morass of laws and bureaucracy keeps the poor from being able to gain title to their property, register their businesses and secure loans.
But de Soto’s ideas have run up against some hard realities. Governments have tended to implement only some of the reforms he champions. And few Peruvian shanty dwellers have been able or willing to borrow against their homes. Most banks don’t extend credit to owners of straw huts and rickety wooden shacks. And taking out a loan is risky for the poor. The owners of the garment factory de Soto and I visited have taken on considerable debt.
De Soto: “About $114,000.”
Fink: They’re paying a high interest rate.
De Soto: “Their interest rates are 2% per month.”
Fink: And they’re worried about keeping up with the payments. Less than a year ago, the factory operated at full capacity. Now it’s at just a quarter of that. As we drive away from the factory, de Soto questions what the future holds for these entrepreneurs.
De Soto: “They may have gone in over their heads. We don’t know.”
The other side of that coin is indebtedness. “obtain credit, amass capital” It’s just that easy! why didn’t I think of that.
You see, while I am very much in favor of improving the titling of property in Peru*, but the assumption that there is a liquid market for properties in an area like Huaycán is unwarranted. There is not. So, you secure a loan with a bank and pledge your property in an illiquid market. Hmmm, would any of you all be interested in that?
* This is a fascinating reality to study and some bright United Statesian kid in CRE should be figuring out how his/her organization can participate in the CRE boom in Lima.
rktbrkr Says:
September 23rd, 2010 at 11:19 am
Real systemic risk!
“We’re not just talking about isolated incidents of problems with foreclosures, we’re talking systemic,”
GMAC suspends foreclosure evictions and sales of seized property
By KIMBERLY MILLER
Palm Beach Post Staff Writer
Foreclosure evictions and homeowner lockouts have been halted by Ally Financial Inc.’s GMAC Mortgage in 23 states including Florida as the nation’s fifth-largest home loan servicer addresses legal challenges to its foreclosure procedures.
A two-page memo dated Sept. 17 and marked “urgent” told brokers to immediately stop evictions, cash-for-key transactions, lockouts and to suspend sales of properties already taken back by the bank in foreclosure.
The memo, first reported by Bloomberg news service, comes at the same time the Tampa-based Florida Default Law Group has been withdrawing legal affidavits in its GMAC foreclosure cases under “candor to the court” rules acknowledging previously submitted information may have been inaccurate.
St. Petersburg defense attorney Matt Weidner, who is handling a case in which a GMAC affidavit was withdrawn last week, called the freeze “staggering.”
“I suspect they are recognizing they have a really big problem,” Weidner said. “I think they are afraid the foreclosure judgments may be voidable.”
If that’s the case, Weidner said it won’t be just GMAC redoing their foreclosure procedures.
“We’re not just talking about isolated incidents of problems with foreclosures, we’re talking systemic,” he said.
rktbrkr Says:
September 23rd, 2010 at 11:21 am
It sounds like these courts are malfunctioning and need to call a “time out”
ashpelham2 Says:
September 23rd, 2010 at 11:25 am
Look, I work at a fairly large regional bank in the Southern US. What happened with this guy started out as someone just blindly pushing buttons and paper, and then morphed into a complete failure of all possible safeguards to make sure something like this couldn’t happen. So, there is a lot of blame to go around, and yeah, this guy is probably owed some kind of restitution for the hassle and crap he’s been through. Should he, or any lawyer, be made wealthy because of it? No, but the courts failed to protect this guy in the original foreclosure process. Why should we expect the courts to get it right when he sues the hell out of B of A?
Banking has been dumbed down to the lowest common denominator at this level. All the brains are making huge bucks in the stuff that got us in the toilet to begin with.
Darkness Says:
September 23rd, 2010 at 11:29 am
I didn’t get what the title company was doing in all this. I can see the courts processing the foreclosures out of order, there is a long tradition of courts barely glancing at foreclosure orders and really, no one expects them to do otherwise, but the title company really screwed up here royally. All of these parties are getting paid their cut to provide a double check on the process and are doing squat. Parasites, the lot of them.
WFTA Says:
September 23rd, 2010 at 11:37 am
BR,
There you go encouraging those pesky plaintiffs’ attorneys again when I’ve been told for the last twenty years that’s why healthcare is unaffordable. Think what this will do for foreclosure inflation!
Matt SF Says:
September 23rd, 2010 at 12:10 pm
One word: Pillory.
Sentence any and all of these corrupt morons to 1 year of mandatory public shame. Only way this nonsense is going to stop is if the anger of the masses is correctly harnessed and directed at those who are propagating the crimes. Letting them pay a fine and *not* admit wrongdoing will only perpetuate the cycle.
Oh, and the afflicted home owner(s) should be given the option of flinging rotten eggs and tomatoes if he or she chooses.
louis Says:
September 23rd, 2010 at 12:36 pm
This just shows what you are dealing with and why none of the programs for housing are working.
jjay Says:
September 23rd, 2010 at 12:40 pm
“Suck it up, Grodensky!’
All my love,
Charlie Munger
bergsten Says:
September 23rd, 2010 at 12:43 pm
That’s it. I’m starting my own bank. It isn’t all that hard, you just have to fill out some state form or another.
Brendan Says:
September 23rd, 2010 at 12:57 pm
I love the irony that we have comments on this blog by people who are screaming about how it’s just unacceptable that the banking industry isn’t doing its due diligence before foreclosing… and then making completely false statements because they haven’t done their own due diligence.
ACORN’s “flunkies” were acquitted of “cooperating with a prostitution scheme” as the videos were shown to be “severely edited” by investigators (for lack of a better resource I’ll use Wikipedia):
http://en.wikipedia.org/wiki/ACORN_2009_undercover_videos_controversy
And also healthcare is not unaffordable due to litigation costs, as has been shown time and time again. Here’s a very recent study pegging the cost at 2.4% of total costs; see:
http://www.medicalnewstoday.com/articles/200462.php
I don’t think you can reasonably say that is to blame for the high cost of healthcare.
Pot meet kettle! You’re entitled to your own opinion, but not your own facts!
contrabandista13 Says:
September 23rd, 2010 at 1:01 pm
Sounds to me like… “ALL BETS ARE OFF….”
I have a good friend that got even for all of you, with BoA to the tune of 3 million….
He legally scammed them for over 3 million…. He told me that it was like shooting fish in a barrel and they cooperated all the way to the gallows…. Two of their VPs got their asses canned for it….
Bravo to my friend Tim B…..
Best regards,
Econolicious
Brendan Says:
September 23rd, 2010 at 1:01 pm
P.S. I recognize that the health-care comment may have been tongue-in-cheek, but it wasn’t really made very clear…
poppysmic Says:
September 23rd, 2010 at 1:45 pm
That’s brilliant by the Bank. They made/ will make money on the deal. Have you ever had a bank error in YOUR favor? Of course not. All credit card fraud can be stopped in almost an instant but they make money on the float. The vendor eats the loss, you make payment on the error until it clears, then they pass on the cost to Ins. or consumer. It sucks for honest citizens, but it’s the bottom line that matters….What’s the line? ” Greed is God’?
Space_Cowboy_NW Says:
September 23rd, 2010 at 1:45 pm
TX Capitial Punishment is to ____________ as FL Foreclosure Mills are to ______________
SOP in the Legal environment: ”Win some, lose some, bill ‘em early & often”
Only guilty people go to prison so remember:” Admit Nothing, Deny Everything, and promptly call your counsel.”
Your mileage may vary…..
APBERUSDISVET Says:
September 23rd, 2010 at 1:50 pm
Where was the title company in this mess? Or were they the corrupt instigator?
WFTA Says:
September 23rd, 2010 at 1:57 pm
Brendan, buddy. Lighten up. I’m on your side.
We need a sense of humor, cause I’m afeared it a hard rain gonna fall.
willid3 Says:
September 23rd, 2010 at 2:07 pm
and i thought many were big on property rights. oh i forgot, its property rights for corporations, TBTF and others. just not for the people
MinnItMan Says:
September 23rd, 2010 at 2:53 pm
A title company should have closed the cash purchase. If the buyer (Grodensky) didn’t use one, his bad. Penny-wise, pound-foolishness.
It’s worth pointing out that cash purchasers usually mean prospective slum-lords, but I don’t know that here. Alsos, his credit should not be affected. The loan was in the name of the former owner.
Not excusing anything, but I suspect the facts would show some strange bedfellows in this story in a fuller reporting.
bergsten Says:
September 23rd, 2010 at 2:58 pm
This box just popped up, asking if I wanted to participate in a TBP survey.
I like Barry, so I figured, “why not”?
The first question asked for my age. Fine. The second asked for (something along the lines of) my interests.
The first choice was “pet care.”
Sorry, but that’s when I bailed on the survey.
Is this legitimate or another ad that’s taken over the site?
formerlawyer Says:
September 23rd, 2010 at 3:58 pm
In my former jurisdiction and others, fraudsters would often take out a mortgage using forged identity. The process involved looking for (preferably vacant) properties without mortgages which was easily done from public records.
From that, forged identity for the owner would be obtained and a mortgage placed on the land with the fraudsters seeing a lawyer to finalize the documents. The fraudsters would set up a bank account from which payments could be withdrawn and place just enough money (ie. 6 months mortgage payments) to fund the mortgage. Often they would then move the address for service of record to a fictional address so that notification of the true owner would be forestalled. Thereafter, the mortgage proceeds would be laundered – usually by way of casinos on Indian lands or other mechanisms.
While personal service would be preferred, substitutional service on the lands or in a newspaper was commonly allowed in foreclosures. Voila – foreclosure once the money ran out.
While that is not the case here from my understanding this is not unknown.
willid3 Says:
September 23rd, 2010 at 4:05 pm
and foreclosure is controlled by the states. Fed have nothing to do with it (short of bankruptcy being involved).
Casual Onlooker Says:
September 23rd, 2010 at 5:10 pm
I find the arguments that mistakes like BofA are just simple oversight, and one off errors that did little harm. From a lot of the various stories out there, from banks that “lose paperwork” to people getting lost in voice mail hell just trying to find a real person, much less a person a person that is not reading a script off his computer, speaks volumes as to the increasing chaos in the system.
To add to GMAC story, NPR yesterday aired a segment on this, and some of the details are rather troubling. http://www.npr.org/templates/transcript/transcript.php?storyId=130052495
From the story…
————
Chris Immel is an attorney at Ice Legal, a foreclosure defense firm in West Palm Beach, Florida. He conducted a deposition with a GMAC employee named Jeffrey Stephan. Immel says his job was to sign foreclosure documents.
Mr. CHRISTOPHER IMMEL (Attorney, Ice Legal): We took his deposition. And in taking it, he pretty much admitted to signing, you know, he said approximately 10,000 documents a month.
KEITH: Attorneys like Immel have taken to calling these employees at loan servicing firms robo-signers.
———
I mean really, 10,000 documents a month by a single person… where is the due diligence in that? How does this not rise to the level of a endemic problem that needs addressing? That’s 62.5 documents signed an hour, or one a minute.
Brady Dennis Says:
September 23rd, 2010 at 5:47 pm
Robo-signer’ played quiet role in huge number of foreclosures
The robo-signer lives on a quiet street in this small town an hour’s drive northwest of Philadelphia.
His modest two-story house, for which he paid $118,000, sits on a corner lot just down the street from the local Moose Lodge and an all-night diner. A weathered Chrysler Concorde is parked in the driveway, and a Toyota Camry sits by the curb.
Many large mortgage lenders have come to rely on a relative handful of so-called robo-signers such as Jeffrey Stephan, 41, to attest to the accuracy of thousands of home foreclosure documents across the country. These workers are not the Wall Street masterminds who created ever more complex mortgage-backed securities and fueled the subprime mortgage boom, but rather “affidavit slaves” with modest incomes and mountainous workloads.
Their actions are leading lawyers representing foreclosed homeowners to claim that lenders have no legal standing if the filings weren’t reviewed and verified, and to argue that the cases should be thrown out.
Herb2 Says:
September 23rd, 2010 at 7:42 pm
In the Philippines when Marcos declared martial law, I noticed that much more attention and money flowed into elections of judges than into elections of senators, which was contrary to my experience in the US. Subsequently I learned that judges decided which phony paperwork was authentic when title to a property was contested.
The particulars are different, but we drift in a similar direction.
Home buying on a Saturday « Tim Hedden's Blog Says:
September 25th, 2010 at 7:01 pm
other day I read a fairly enthusiastic Barry Ritholtz post entitled Man without Mortgage Loses Home in Foreclosure. Basically, the Florida court system is so in the groove of foreclosing on properties, they are
doloresflynn Says:
September 26th, 2010 at 3:45 pm
Please set a standard here !
As soon as you uthrow out the f-bomb, everyone thinks it is their cue to trash the place.
Morality belongs to the financial sector as well as personal, and if you are educated, you can get your point across very well without vulgar puctuations.
Florida’s Foreclosures Nightmare | The Big Picture Says:
September 29th, 2010 at 2:53 pm
Man without Mortgage Loses Home in Foreclosure (September 23rd,
BofA’s unfunny foreclosure tricks | Anne-Marie Wurzel, P.A., Real Estate Agent - Winter Springs, FL Real Estate Office Says:
September 30th, 2010 at 11:05 am
seems. Barry Ritholtz says at his blog that the only way the banks will ever learn is if they lose big judgments in court – a notion that seems to be borne out by another aspect of the Schroit
stopGOVTwaste Says:
October 2nd, 2010 at 1:16 am
So if they come once with fake documents, do they have free reign to come back and try again with NEW fake docs? The mortgage MUST remain together with the note but MERS prevents that from happening. Bifurcation =’s off book securities transactions.
What they don’t want to tell you is that the insurance taken out on the loan pool at 30x value of pool (conservatively) has paid off – EXTINGUISHED – the loans in the underlying pool, many times over (AIG, AMBAC, MGIC, TARP, ETC). But wait a second, weren’t these the same loans that were supposed to be “recorded” in public land records per the terms of the Pooling & Servicing Agreement (PSA) and the Mortgage “contract” (see section 20 of the standard Fannie/Freddie instrument).
So if the chain of custody was never recorded, then the trusts set up to hold the loan pools actually held “nothing but air” – if they even existed at all.
You can’t collect on a debt that has been paid off, that is fraud. Plus, the controlling aspects of the PSA void the sale of the asset under FAS 140, in addition the REMIC will lose it’s tax deferred status under IRS Code. You cannot commit securities fraud, tax fraud, violate a plethora of federal and state lending and consumers laws and get away with it scott free… can you? The crime is mortgage backed securities and the crime scene is our public land records.
Enjoy the video (below) and have a great weekend!
Slowing the Runaway Foreclosure Train | The Big Picture Says:
October 4th, 2010 at 7:26 am
we have seen, homeowners without mortgages have lost their home to foreclosure. That this legal impossibility actually occurred reveals the
Boston Real Estate Blog : Blog Archive : Slowing down the foreclosure assembly line Says:
October 4th, 2010 at 9:53 am
we have seen, homeowners without mortgages have lost their home to foreclosure. That this legal impossibility actually occurred reveals the
Are WSJ OpEd Writers Clueless or Liars? | The Big Picture Says:
October 11th, 2010 at 11:10 am
has been widely circulated and discussed in the media, Man’s home sold out from under him in foreclosure mistake. The
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This was probably inevitable: the minute that Dodd-Frank cracked down on the fees charged by credit cards aimed at students, some other bright financial innovation would crop up. This time, a debit card aimed at students. Which carries lots of fees. Ylan Mui reports that a company called Higher One has started signing up colleges around the country, taking on the burden of providing cash to students. In return, it gets lots of fees:
Students say several of the fees associated with Higher One’s card are particularly irksome, including the $19 inactivity fee, a 50-cent charge for using a PIN to make a purchase rather than a signature, and a $2.50 fee for using other banks’ ATMs…
Higher One said that only 1 percent of customers have been charged an inactivity fee and that more than half are charged the 50-cent fee only once. All fees are listed on Higher One’s Web site, along with tips on avoiding them.
“We have a big effort with educating students on how to use the account,” Smith said. “We’re very passionate about financial literacy.”
If the fees are listed on Higher One’s website, they’re not exactly prominent. I did find this page, eventually, via this blog entry, but it just says that “when you swipe & sign, you won’t be charged the PIN-based transaction fee”. I haven’t been able to find a page showing a 50-cent transaction fee anywhere*, although I did manage to find this page, showing a $25 fee for domestic wire transfers and a $50 fee for international wire transfers. “Higher One offers less costly alternatives for transferring funds”, it says, without giving any indication what they might be; I suspect that what they’re talking about is transfers to or from people who have already registered somehow with Higher One.
It should go without saying that any firm which is “very passionate about financial literacy” would encourage, rather than penalize, simple, cheap and safe PIN-debit transactions. It would not give students a debit card and then tell them that if they want to avoid fees they should select the “credit” option rather than the “debit” option when they come to pay.
And I can’t think of any good reason to charge a $19 inactivity fee to people who haven’t used their cards in 9 months.
The fact is that students are often very naive when it comes to money, and it’s easy to gouge them once or twice before they learn that banks are not necessarily on their side. If you can get your card accepted by a majority of freshmen every year, and then come up with all manner of weird fees to hit them with, that’s a great way of making money out of ignorance.
Meanwhile, all students should have a bank account: giving them a debit card instead only serves to maximize the number of unbanked students. So while I’m sure cards like this are attractive to colleges, it would be great if either the colleges or else the Consumer Financial Protection Bureau started being a lot more critical of them. Prepaid cards only ever make sense if the alternative is being completely unbanked; that should not ever be the case for students.
*At Southern Oregon University, Higher One agreed to waive the 50-cent PIN-debit charge, but only if there was a simultaneous “swipe-and-sign” campaign. If the campaign is unsuccessful and students do the sensible thing by using PIN debit, then the university can be charged $2 per student for “PIN fee elimination”.
Update: Higher One’s Donald Smith responds:
Higher One was founded 10 years ago by three college students (undergraduates at the time) who were looking for streamlining the way financial aid refunds were distributed to students. Today we work with more than 675 campuses across the country, have a 97% client retention rating, and an A+ rating with the BBB.
The OneAccount is Higher One’s optional, no minimum balance, no monthly fee, FDIC-Insured checking account created by students for students. We do not offer a stored value card. We are very open with our fee schedule. We post it on every program website for all to access, explain each fee, discuss how to avoid each fee, and provide students with a web page that tells them how to use the account for free (which you’ve already found). Because of this, we believe that our customers pay less than half the amount in fees that the average bank checking account customer pays per year.
Two of the fees you referenced in your blog are the PIN fee and the Abandoned Account Fee. The PIN fee is easily avoided by choosing a signature based transaction at the checkout. The majority of students uses it in this manner and is in turn protected by MasterCard’s Zero Liability Policy against fraudulent charges (a safer way of purchasing than a PIN based transaction). We do not have an inactivity fee on our fee schedule – we don’t penalize students who do not use their accounts. We do have an Abandoned Account Fee of up to $19, for those who have abandoned their accounts, but this has been charged to less than 1% of all OneAccount holders in our company’s history because of our proactive outreach plan.
Higher One offers no instruments of credit. As a matter of fact, we’re generally in favor of initiatives restricting students’ access to credit cards and promoting financial literacy. This is why we offer a full range of financial literacy resources along with the services we provide.
I particularly dislike the implication, here, that PIN-based transactions are unsafe. They’re not; they’re just less lucrative, in terms of interchange fees, than signature-based transactions.
eric seiger
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eric seiger
some things need to be re-read..
Mark E Hoffer Says:
September 23rd, 2010 at 11:04 am
QOTD:
The difficulty lies, not in the new ideas, but in escaping from the old ones, which ramify, for those brought up as most of us have been, into every corner of our minds. —John Maynard Keynes, The General Theory of Employment, Interest and Money (13 December 1935)
Robespierre Says:
September 23rd, 2010 at 11:11 am
@constantnormal Says:
September 23rd, 2010 at 10:36 am
“This is where we are heading, in our journey to reshape the US into the world’s largest banana republic.”
I think it is becoming more like a feudal system than a banana republic.
Arequipa01 Says:
September 23rd, 2010 at 11:14 am
The De Soto interview is interesting and embedded in it is an interesting tidbit:
“Fink: This is how the de Soto model works. Property ownership allows poor people to obtain credit, amass capital, and climb out of poverty. Legal reforms make all of that possible. Right now in most developing countries, a morass of laws and bureaucracy keeps the poor from being able to gain title to their property, register their businesses and secure loans.
But de Soto’s ideas have run up against some hard realities. Governments have tended to implement only some of the reforms he champions. And few Peruvian shanty dwellers have been able or willing to borrow against their homes. Most banks don’t extend credit to owners of straw huts and rickety wooden shacks. And taking out a loan is risky for the poor. The owners of the garment factory de Soto and I visited have taken on considerable debt.
De Soto: “About $114,000.”
Fink: They’re paying a high interest rate.
De Soto: “Their interest rates are 2% per month.”
Fink: And they’re worried about keeping up with the payments. Less than a year ago, the factory operated at full capacity. Now it’s at just a quarter of that. As we drive away from the factory, de Soto questions what the future holds for these entrepreneurs.
De Soto: “They may have gone in over their heads. We don’t know.”
The other side of that coin is indebtedness. “obtain credit, amass capital” It’s just that easy! why didn’t I think of that.
You see, while I am very much in favor of improving the titling of property in Peru*, but the assumption that there is a liquid market for properties in an area like Huaycán is unwarranted. There is not. So, you secure a loan with a bank and pledge your property in an illiquid market. Hmmm, would any of you all be interested in that?
* This is a fascinating reality to study and some bright United Statesian kid in CRE should be figuring out how his/her organization can participate in the CRE boom in Lima.
rktbrkr Says:
September 23rd, 2010 at 11:19 am
Real systemic risk!
“We’re not just talking about isolated incidents of problems with foreclosures, we’re talking systemic,”
GMAC suspends foreclosure evictions and sales of seized property
By KIMBERLY MILLER
Palm Beach Post Staff Writer
Foreclosure evictions and homeowner lockouts have been halted by Ally Financial Inc.’s GMAC Mortgage in 23 states including Florida as the nation’s fifth-largest home loan servicer addresses legal challenges to its foreclosure procedures.
A two-page memo dated Sept. 17 and marked “urgent” told brokers to immediately stop evictions, cash-for-key transactions, lockouts and to suspend sales of properties already taken back by the bank in foreclosure.
The memo, first reported by Bloomberg news service, comes at the same time the Tampa-based Florida Default Law Group has been withdrawing legal affidavits in its GMAC foreclosure cases under “candor to the court” rules acknowledging previously submitted information may have been inaccurate.
St. Petersburg defense attorney Matt Weidner, who is handling a case in which a GMAC affidavit was withdrawn last week, called the freeze “staggering.”
“I suspect they are recognizing they have a really big problem,” Weidner said. “I think they are afraid the foreclosure judgments may be voidable.”
If that’s the case, Weidner said it won’t be just GMAC redoing their foreclosure procedures.
“We’re not just talking about isolated incidents of problems with foreclosures, we’re talking systemic,” he said.
rktbrkr Says:
September 23rd, 2010 at 11:21 am
It sounds like these courts are malfunctioning and need to call a “time out”
ashpelham2 Says:
September 23rd, 2010 at 11:25 am
Look, I work at a fairly large regional bank in the Southern US. What happened with this guy started out as someone just blindly pushing buttons and paper, and then morphed into a complete failure of all possible safeguards to make sure something like this couldn’t happen. So, there is a lot of blame to go around, and yeah, this guy is probably owed some kind of restitution for the hassle and crap he’s been through. Should he, or any lawyer, be made wealthy because of it? No, but the courts failed to protect this guy in the original foreclosure process. Why should we expect the courts to get it right when he sues the hell out of B of A?
Banking has been dumbed down to the lowest common denominator at this level. All the brains are making huge bucks in the stuff that got us in the toilet to begin with.
Darkness Says:
September 23rd, 2010 at 11:29 am
I didn’t get what the title company was doing in all this. I can see the courts processing the foreclosures out of order, there is a long tradition of courts barely glancing at foreclosure orders and really, no one expects them to do otherwise, but the title company really screwed up here royally. All of these parties are getting paid their cut to provide a double check on the process and are doing squat. Parasites, the lot of them.
WFTA Says:
September 23rd, 2010 at 11:37 am
BR,
There you go encouraging those pesky plaintiffs’ attorneys again when I’ve been told for the last twenty years that’s why healthcare is unaffordable. Think what this will do for foreclosure inflation!
Matt SF Says:
September 23rd, 2010 at 12:10 pm
One word: Pillory.
Sentence any and all of these corrupt morons to 1 year of mandatory public shame. Only way this nonsense is going to stop is if the anger of the masses is correctly harnessed and directed at those who are propagating the crimes. Letting them pay a fine and *not* admit wrongdoing will only perpetuate the cycle.
Oh, and the afflicted home owner(s) should be given the option of flinging rotten eggs and tomatoes if he or she chooses.
louis Says:
September 23rd, 2010 at 12:36 pm
This just shows what you are dealing with and why none of the programs for housing are working.
jjay Says:
September 23rd, 2010 at 12:40 pm
“Suck it up, Grodensky!’
All my love,
Charlie Munger
bergsten Says:
September 23rd, 2010 at 12:43 pm
That’s it. I’m starting my own bank. It isn’t all that hard, you just have to fill out some state form or another.
Brendan Says:
September 23rd, 2010 at 12:57 pm
I love the irony that we have comments on this blog by people who are screaming about how it’s just unacceptable that the banking industry isn’t doing its due diligence before foreclosing… and then making completely false statements because they haven’t done their own due diligence.
ACORN’s “flunkies” were acquitted of “cooperating with a prostitution scheme” as the videos were shown to be “severely edited” by investigators (for lack of a better resource I’ll use Wikipedia):
http://en.wikipedia.org/wiki/ACORN_2009_undercover_videos_controversy
And also healthcare is not unaffordable due to litigation costs, as has been shown time and time again. Here’s a very recent study pegging the cost at 2.4% of total costs; see:
http://www.medicalnewstoday.com/articles/200462.php
I don’t think you can reasonably say that is to blame for the high cost of healthcare.
Pot meet kettle! You’re entitled to your own opinion, but not your own facts!
contrabandista13 Says:
September 23rd, 2010 at 1:01 pm
Sounds to me like… “ALL BETS ARE OFF….”
I have a good friend that got even for all of you, with BoA to the tune of 3 million….
He legally scammed them for over 3 million…. He told me that it was like shooting fish in a barrel and they cooperated all the way to the gallows…. Two of their VPs got their asses canned for it….
Bravo to my friend Tim B…..
Best regards,
Econolicious
Brendan Says:
September 23rd, 2010 at 1:01 pm
P.S. I recognize that the health-care comment may have been tongue-in-cheek, but it wasn’t really made very clear…
poppysmic Says:
September 23rd, 2010 at 1:45 pm
That’s brilliant by the Bank. They made/ will make money on the deal. Have you ever had a bank error in YOUR favor? Of course not. All credit card fraud can be stopped in almost an instant but they make money on the float. The vendor eats the loss, you make payment on the error until it clears, then they pass on the cost to Ins. or consumer. It sucks for honest citizens, but it’s the bottom line that matters….What’s the line? ” Greed is God’?
Space_Cowboy_NW Says:
September 23rd, 2010 at 1:45 pm
TX Capitial Punishment is to ____________ as FL Foreclosure Mills are to ______________
SOP in the Legal environment: ”Win some, lose some, bill ‘em early & often”
Only guilty people go to prison so remember:” Admit Nothing, Deny Everything, and promptly call your counsel.”
Your mileage may vary…..
APBERUSDISVET Says:
September 23rd, 2010 at 1:50 pm
Where was the title company in this mess? Or were they the corrupt instigator?
WFTA Says:
September 23rd, 2010 at 1:57 pm
Brendan, buddy. Lighten up. I’m on your side.
We need a sense of humor, cause I’m afeared it a hard rain gonna fall.
willid3 Says:
September 23rd, 2010 at 2:07 pm
and i thought many were big on property rights. oh i forgot, its property rights for corporations, TBTF and others. just not for the people
MinnItMan Says:
September 23rd, 2010 at 2:53 pm
A title company should have closed the cash purchase. If the buyer (Grodensky) didn’t use one, his bad. Penny-wise, pound-foolishness.
It’s worth pointing out that cash purchasers usually mean prospective slum-lords, but I don’t know that here. Alsos, his credit should not be affected. The loan was in the name of the former owner.
Not excusing anything, but I suspect the facts would show some strange bedfellows in this story in a fuller reporting.
bergsten Says:
September 23rd, 2010 at 2:58 pm
This box just popped up, asking if I wanted to participate in a TBP survey.
I like Barry, so I figured, “why not”?
The first question asked for my age. Fine. The second asked for (something along the lines of) my interests.
The first choice was “pet care.”
Sorry, but that’s when I bailed on the survey.
Is this legitimate or another ad that’s taken over the site?
formerlawyer Says:
September 23rd, 2010 at 3:58 pm
In my former jurisdiction and others, fraudsters would often take out a mortgage using forged identity. The process involved looking for (preferably vacant) properties without mortgages which was easily done from public records.
From that, forged identity for the owner would be obtained and a mortgage placed on the land with the fraudsters seeing a lawyer to finalize the documents. The fraudsters would set up a bank account from which payments could be withdrawn and place just enough money (ie. 6 months mortgage payments) to fund the mortgage. Often they would then move the address for service of record to a fictional address so that notification of the true owner would be forestalled. Thereafter, the mortgage proceeds would be laundered – usually by way of casinos on Indian lands or other mechanisms.
While personal service would be preferred, substitutional service on the lands or in a newspaper was commonly allowed in foreclosures. Voila – foreclosure once the money ran out.
While that is not the case here from my understanding this is not unknown.
willid3 Says:
September 23rd, 2010 at 4:05 pm
and foreclosure is controlled by the states. Fed have nothing to do with it (short of bankruptcy being involved).
Casual Onlooker Says:
September 23rd, 2010 at 5:10 pm
I find the arguments that mistakes like BofA are just simple oversight, and one off errors that did little harm. From a lot of the various stories out there, from banks that “lose paperwork” to people getting lost in voice mail hell just trying to find a real person, much less a person a person that is not reading a script off his computer, speaks volumes as to the increasing chaos in the system.
To add to GMAC story, NPR yesterday aired a segment on this, and some of the details are rather troubling. http://www.npr.org/templates/transcript/transcript.php?storyId=130052495
From the story…
————
Chris Immel is an attorney at Ice Legal, a foreclosure defense firm in West Palm Beach, Florida. He conducted a deposition with a GMAC employee named Jeffrey Stephan. Immel says his job was to sign foreclosure documents.
Mr. CHRISTOPHER IMMEL (Attorney, Ice Legal): We took his deposition. And in taking it, he pretty much admitted to signing, you know, he said approximately 10,000 documents a month.
KEITH: Attorneys like Immel have taken to calling these employees at loan servicing firms robo-signers.
———
I mean really, 10,000 documents a month by a single person… where is the due diligence in that? How does this not rise to the level of a endemic problem that needs addressing? That’s 62.5 documents signed an hour, or one a minute.
Brady Dennis Says:
September 23rd, 2010 at 5:47 pm
Robo-signer’ played quiet role in huge number of foreclosures
The robo-signer lives on a quiet street in this small town an hour’s drive northwest of Philadelphia.
His modest two-story house, for which he paid $118,000, sits on a corner lot just down the street from the local Moose Lodge and an all-night diner. A weathered Chrysler Concorde is parked in the driveway, and a Toyota Camry sits by the curb.
Many large mortgage lenders have come to rely on a relative handful of so-called robo-signers such as Jeffrey Stephan, 41, to attest to the accuracy of thousands of home foreclosure documents across the country. These workers are not the Wall Street masterminds who created ever more complex mortgage-backed securities and fueled the subprime mortgage boom, but rather “affidavit slaves” with modest incomes and mountainous workloads.
Their actions are leading lawyers representing foreclosed homeowners to claim that lenders have no legal standing if the filings weren’t reviewed and verified, and to argue that the cases should be thrown out.
Herb2 Says:
September 23rd, 2010 at 7:42 pm
In the Philippines when Marcos declared martial law, I noticed that much more attention and money flowed into elections of judges than into elections of senators, which was contrary to my experience in the US. Subsequently I learned that judges decided which phony paperwork was authentic when title to a property was contested.
The particulars are different, but we drift in a similar direction.
Home buying on a Saturday « Tim Hedden's Blog Says:
September 25th, 2010 at 7:01 pm
other day I read a fairly enthusiastic Barry Ritholtz post entitled Man without Mortgage Loses Home in Foreclosure. Basically, the Florida court system is so in the groove of foreclosing on properties, they are
doloresflynn Says:
September 26th, 2010 at 3:45 pm
Please set a standard here !
As soon as you uthrow out the f-bomb, everyone thinks it is their cue to trash the place.
Morality belongs to the financial sector as well as personal, and if you are educated, you can get your point across very well without vulgar puctuations.
Florida’s Foreclosures Nightmare | The Big Picture Says:
September 29th, 2010 at 2:53 pm
Man without Mortgage Loses Home in Foreclosure (September 23rd,
BofA’s unfunny foreclosure tricks | Anne-Marie Wurzel, P.A., Real Estate Agent - Winter Springs, FL Real Estate Office Says:
September 30th, 2010 at 11:05 am
seems. Barry Ritholtz says at his blog that the only way the banks will ever learn is if they lose big judgments in court – a notion that seems to be borne out by another aspect of the Schroit
stopGOVTwaste Says:
October 2nd, 2010 at 1:16 am
So if they come once with fake documents, do they have free reign to come back and try again with NEW fake docs? The mortgage MUST remain together with the note but MERS prevents that from happening. Bifurcation =’s off book securities transactions.
What they don’t want to tell you is that the insurance taken out on the loan pool at 30x value of pool (conservatively) has paid off – EXTINGUISHED – the loans in the underlying pool, many times over (AIG, AMBAC, MGIC, TARP, ETC). But wait a second, weren’t these the same loans that were supposed to be “recorded” in public land records per the terms of the Pooling & Servicing Agreement (PSA) and the Mortgage “contract” (see section 20 of the standard Fannie/Freddie instrument).
So if the chain of custody was never recorded, then the trusts set up to hold the loan pools actually held “nothing but air” – if they even existed at all.
You can’t collect on a debt that has been paid off, that is fraud. Plus, the controlling aspects of the PSA void the sale of the asset under FAS 140, in addition the REMIC will lose it’s tax deferred status under IRS Code. You cannot commit securities fraud, tax fraud, violate a plethora of federal and state lending and consumers laws and get away with it scott free… can you? The crime is mortgage backed securities and the crime scene is our public land records.
Enjoy the video (below) and have a great weekend!
Slowing the Runaway Foreclosure Train | The Big Picture Says:
October 4th, 2010 at 7:26 am
we have seen, homeowners without mortgages have lost their home to foreclosure. That this legal impossibility actually occurred reveals the
Boston Real Estate Blog : Blog Archive : Slowing down the foreclosure assembly line Says:
October 4th, 2010 at 9:53 am
we have seen, homeowners without mortgages have lost their home to foreclosure. That this legal impossibility actually occurred reveals the
Are WSJ OpEd Writers Clueless or Liars? | The Big Picture Says:
October 11th, 2010 at 11:10 am
has been widely circulated and discussed in the media, Man’s home sold out from under him in foreclosure mistake. The
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This was probably inevitable: the minute that Dodd-Frank cracked down on the fees charged by credit cards aimed at students, some other bright financial innovation would crop up. This time, a debit card aimed at students. Which carries lots of fees. Ylan Mui reports that a company called Higher One has started signing up colleges around the country, taking on the burden of providing cash to students. In return, it gets lots of fees:
Students say several of the fees associated with Higher One’s card are particularly irksome, including the $19 inactivity fee, a 50-cent charge for using a PIN to make a purchase rather than a signature, and a $2.50 fee for using other banks’ ATMs…
Higher One said that only 1 percent of customers have been charged an inactivity fee and that more than half are charged the 50-cent fee only once. All fees are listed on Higher One’s Web site, along with tips on avoiding them.
“We have a big effort with educating students on how to use the account,” Smith said. “We’re very passionate about financial literacy.”
If the fees are listed on Higher One’s website, they’re not exactly prominent. I did find this page, eventually, via this blog entry, but it just says that “when you swipe & sign, you won’t be charged the PIN-based transaction fee”. I haven’t been able to find a page showing a 50-cent transaction fee anywhere*, although I did manage to find this page, showing a $25 fee for domestic wire transfers and a $50 fee for international wire transfers. “Higher One offers less costly alternatives for transferring funds”, it says, without giving any indication what they might be; I suspect that what they’re talking about is transfers to or from people who have already registered somehow with Higher One.
It should go without saying that any firm which is “very passionate about financial literacy” would encourage, rather than penalize, simple, cheap and safe PIN-debit transactions. It would not give students a debit card and then tell them that if they want to avoid fees they should select the “credit” option rather than the “debit” option when they come to pay.
And I can’t think of any good reason to charge a $19 inactivity fee to people who haven’t used their cards in 9 months.
The fact is that students are often very naive when it comes to money, and it’s easy to gouge them once or twice before they learn that banks are not necessarily on their side. If you can get your card accepted by a majority of freshmen every year, and then come up with all manner of weird fees to hit them with, that’s a great way of making money out of ignorance.
Meanwhile, all students should have a bank account: giving them a debit card instead only serves to maximize the number of unbanked students. So while I’m sure cards like this are attractive to colleges, it would be great if either the colleges or else the Consumer Financial Protection Bureau started being a lot more critical of them. Prepaid cards only ever make sense if the alternative is being completely unbanked; that should not ever be the case for students.
*At Southern Oregon University, Higher One agreed to waive the 50-cent PIN-debit charge, but only if there was a simultaneous “swipe-and-sign” campaign. If the campaign is unsuccessful and students do the sensible thing by using PIN debit, then the university can be charged $2 per student for “PIN fee elimination”.
Update: Higher One’s Donald Smith responds:
Higher One was founded 10 years ago by three college students (undergraduates at the time) who were looking for streamlining the way financial aid refunds were distributed to students. Today we work with more than 675 campuses across the country, have a 97% client retention rating, and an A+ rating with the BBB.
The OneAccount is Higher One’s optional, no minimum balance, no monthly fee, FDIC-Insured checking account created by students for students. We do not offer a stored value card. We are very open with our fee schedule. We post it on every program website for all to access, explain each fee, discuss how to avoid each fee, and provide students with a web page that tells them how to use the account for free (which you’ve already found). Because of this, we believe that our customers pay less than half the amount in fees that the average bank checking account customer pays per year.
Two of the fees you referenced in your blog are the PIN fee and the Abandoned Account Fee. The PIN fee is easily avoided by choosing a signature based transaction at the checkout. The majority of students uses it in this manner and is in turn protected by MasterCard’s Zero Liability Policy against fraudulent charges (a safer way of purchasing than a PIN based transaction). We do not have an inactivity fee on our fee schedule – we don’t penalize students who do not use their accounts. We do have an Abandoned Account Fee of up to $19, for those who have abandoned their accounts, but this has been charged to less than 1% of all OneAccount holders in our company’s history because of our proactive outreach plan.
Higher One offers no instruments of credit. As a matter of fact, we’re generally in favor of initiatives restricting students’ access to credit cards and promoting financial literacy. This is why we offer a full range of financial literacy resources along with the services we provide.
I particularly dislike the implication, here, that PIN-based transactions are unsafe. They’re not; they’re just less lucrative, in terms of interchange fees, than signature-based transactions.
eric seiger
Verizon iPhone 4 | Adan <b>News</b>
Verizon iPhone 4 | Adan News | New iPhone Info Says: October 10th, 2010 at 10:03 pm. Verizon iPhone 4. It's coming soon…or is it? I remember back in March, right before the end of the first quarter the WSJ said that the Verizon ...
Fox <b>News</b> - Fox Business | New Ad | Two Networks - Solve | Mediaite
Back in June, a Fox Business Network promo featured only Fox News stars, touting the new financial channel. Now there's a new marketing strategy out, in ads playing on News Corp. cable news networks but also across the dial, ...
'American Idol's Crystal Bowersox Gets Married | Fancast <b>News</b>
'American Idol's Crystal Bowersox married musician Brian Walker on Sunday, October 10, 2010, in Chicago, and will celebrate their anniversary on 10/10/10 along with the other approximated 40000 lovebirds who said 'I Do'
eric seiger
eric seiger
eric seiger
Verizon iPhone 4 | Adan <b>News</b>
Verizon iPhone 4 | Adan News | New iPhone Info Says: October 10th, 2010 at 10:03 pm. Verizon iPhone 4. It's coming soon…or is it? I remember back in March, right before the end of the first quarter the WSJ said that the Verizon ...
Fox <b>News</b> - Fox Business | New Ad | Two Networks - Solve | Mediaite
Back in June, a Fox Business Network promo featured only Fox News stars, touting the new financial channel. Now there's a new marketing strategy out, in ads playing on News Corp. cable news networks but also across the dial, ...
'American Idol's Crystal Bowersox Gets Married | Fancast <b>News</b>
'American Idol's Crystal Bowersox married musician Brian Walker on Sunday, October 10, 2010, in Chicago, and will celebrate their anniversary on 10/10/10 along with the other approximated 40000 lovebirds who said 'I Do'
eric seiger
some things need to be re-read..
Mark E Hoffer Says:
September 23rd, 2010 at 11:04 am
QOTD:
The difficulty lies, not in the new ideas, but in escaping from the old ones, which ramify, for those brought up as most of us have been, into every corner of our minds. —John Maynard Keynes, The General Theory of Employment, Interest and Money (13 December 1935)
Robespierre Says:
September 23rd, 2010 at 11:11 am
@constantnormal Says:
September 23rd, 2010 at 10:36 am
“This is where we are heading, in our journey to reshape the US into the world’s largest banana republic.”
I think it is becoming more like a feudal system than a banana republic.
Arequipa01 Says:
September 23rd, 2010 at 11:14 am
The De Soto interview is interesting and embedded in it is an interesting tidbit:
“Fink: This is how the de Soto model works. Property ownership allows poor people to obtain credit, amass capital, and climb out of poverty. Legal reforms make all of that possible. Right now in most developing countries, a morass of laws and bureaucracy keeps the poor from being able to gain title to their property, register their businesses and secure loans.
But de Soto’s ideas have run up against some hard realities. Governments have tended to implement only some of the reforms he champions. And few Peruvian shanty dwellers have been able or willing to borrow against their homes. Most banks don’t extend credit to owners of straw huts and rickety wooden shacks. And taking out a loan is risky for the poor. The owners of the garment factory de Soto and I visited have taken on considerable debt.
De Soto: “About $114,000.”
Fink: They’re paying a high interest rate.
De Soto: “Their interest rates are 2% per month.”
Fink: And they’re worried about keeping up with the payments. Less than a year ago, the factory operated at full capacity. Now it’s at just a quarter of that. As we drive away from the factory, de Soto questions what the future holds for these entrepreneurs.
De Soto: “They may have gone in over their heads. We don’t know.”
The other side of that coin is indebtedness. “obtain credit, amass capital” It’s just that easy! why didn’t I think of that.
You see, while I am very much in favor of improving the titling of property in Peru*, but the assumption that there is a liquid market for properties in an area like Huaycán is unwarranted. There is not. So, you secure a loan with a bank and pledge your property in an illiquid market. Hmmm, would any of you all be interested in that?
* This is a fascinating reality to study and some bright United Statesian kid in CRE should be figuring out how his/her organization can participate in the CRE boom in Lima.
rktbrkr Says:
September 23rd, 2010 at 11:19 am
Real systemic risk!
“We’re not just talking about isolated incidents of problems with foreclosures, we’re talking systemic,”
GMAC suspends foreclosure evictions and sales of seized property
By KIMBERLY MILLER
Palm Beach Post Staff Writer
Foreclosure evictions and homeowner lockouts have been halted by Ally Financial Inc.’s GMAC Mortgage in 23 states including Florida as the nation’s fifth-largest home loan servicer addresses legal challenges to its foreclosure procedures.
A two-page memo dated Sept. 17 and marked “urgent” told brokers to immediately stop evictions, cash-for-key transactions, lockouts and to suspend sales of properties already taken back by the bank in foreclosure.
The memo, first reported by Bloomberg news service, comes at the same time the Tampa-based Florida Default Law Group has been withdrawing legal affidavits in its GMAC foreclosure cases under “candor to the court” rules acknowledging previously submitted information may have been inaccurate.
St. Petersburg defense attorney Matt Weidner, who is handling a case in which a GMAC affidavit was withdrawn last week, called the freeze “staggering.”
“I suspect they are recognizing they have a really big problem,” Weidner said. “I think they are afraid the foreclosure judgments may be voidable.”
If that’s the case, Weidner said it won’t be just GMAC redoing their foreclosure procedures.
“We’re not just talking about isolated incidents of problems with foreclosures, we’re talking systemic,” he said.
rktbrkr Says:
September 23rd, 2010 at 11:21 am
It sounds like these courts are malfunctioning and need to call a “time out”
ashpelham2 Says:
September 23rd, 2010 at 11:25 am
Look, I work at a fairly large regional bank in the Southern US. What happened with this guy started out as someone just blindly pushing buttons and paper, and then morphed into a complete failure of all possible safeguards to make sure something like this couldn’t happen. So, there is a lot of blame to go around, and yeah, this guy is probably owed some kind of restitution for the hassle and crap he’s been through. Should he, or any lawyer, be made wealthy because of it? No, but the courts failed to protect this guy in the original foreclosure process. Why should we expect the courts to get it right when he sues the hell out of B of A?
Banking has been dumbed down to the lowest common denominator at this level. All the brains are making huge bucks in the stuff that got us in the toilet to begin with.
Darkness Says:
September 23rd, 2010 at 11:29 am
I didn’t get what the title company was doing in all this. I can see the courts processing the foreclosures out of order, there is a long tradition of courts barely glancing at foreclosure orders and really, no one expects them to do otherwise, but the title company really screwed up here royally. All of these parties are getting paid their cut to provide a double check on the process and are doing squat. Parasites, the lot of them.
WFTA Says:
September 23rd, 2010 at 11:37 am
BR,
There you go encouraging those pesky plaintiffs’ attorneys again when I’ve been told for the last twenty years that’s why healthcare is unaffordable. Think what this will do for foreclosure inflation!
Matt SF Says:
September 23rd, 2010 at 12:10 pm
One word: Pillory.
Sentence any and all of these corrupt morons to 1 year of mandatory public shame. Only way this nonsense is going to stop is if the anger of the masses is correctly harnessed and directed at those who are propagating the crimes. Letting them pay a fine and *not* admit wrongdoing will only perpetuate the cycle.
Oh, and the afflicted home owner(s) should be given the option of flinging rotten eggs and tomatoes if he or she chooses.
louis Says:
September 23rd, 2010 at 12:36 pm
This just shows what you are dealing with and why none of the programs for housing are working.
jjay Says:
September 23rd, 2010 at 12:40 pm
“Suck it up, Grodensky!’
All my love,
Charlie Munger
bergsten Says:
September 23rd, 2010 at 12:43 pm
That’s it. I’m starting my own bank. It isn’t all that hard, you just have to fill out some state form or another.
Brendan Says:
September 23rd, 2010 at 12:57 pm
I love the irony that we have comments on this blog by people who are screaming about how it’s just unacceptable that the banking industry isn’t doing its due diligence before foreclosing… and then making completely false statements because they haven’t done their own due diligence.
ACORN’s “flunkies” were acquitted of “cooperating with a prostitution scheme” as the videos were shown to be “severely edited” by investigators (for lack of a better resource I’ll use Wikipedia):
http://en.wikipedia.org/wiki/ACORN_2009_undercover_videos_controversy
And also healthcare is not unaffordable due to litigation costs, as has been shown time and time again. Here’s a very recent study pegging the cost at 2.4% of total costs; see:
http://www.medicalnewstoday.com/articles/200462.php
I don’t think you can reasonably say that is to blame for the high cost of healthcare.
Pot meet kettle! You’re entitled to your own opinion, but not your own facts!
contrabandista13 Says:
September 23rd, 2010 at 1:01 pm
Sounds to me like… “ALL BETS ARE OFF….”
I have a good friend that got even for all of you, with BoA to the tune of 3 million….
He legally scammed them for over 3 million…. He told me that it was like shooting fish in a barrel and they cooperated all the way to the gallows…. Two of their VPs got their asses canned for it….
Bravo to my friend Tim B…..
Best regards,
Econolicious
Brendan Says:
September 23rd, 2010 at 1:01 pm
P.S. I recognize that the health-care comment may have been tongue-in-cheek, but it wasn’t really made very clear…
poppysmic Says:
September 23rd, 2010 at 1:45 pm
That’s brilliant by the Bank. They made/ will make money on the deal. Have you ever had a bank error in YOUR favor? Of course not. All credit card fraud can be stopped in almost an instant but they make money on the float. The vendor eats the loss, you make payment on the error until it clears, then they pass on the cost to Ins. or consumer. It sucks for honest citizens, but it’s the bottom line that matters….What’s the line? ” Greed is God’?
Space_Cowboy_NW Says:
September 23rd, 2010 at 1:45 pm
TX Capitial Punishment is to ____________ as FL Foreclosure Mills are to ______________
SOP in the Legal environment: ”Win some, lose some, bill ‘em early & often”
Only guilty people go to prison so remember:” Admit Nothing, Deny Everything, and promptly call your counsel.”
Your mileage may vary…..
APBERUSDISVET Says:
September 23rd, 2010 at 1:50 pm
Where was the title company in this mess? Or were they the corrupt instigator?
WFTA Says:
September 23rd, 2010 at 1:57 pm
Brendan, buddy. Lighten up. I’m on your side.
We need a sense of humor, cause I’m afeared it a hard rain gonna fall.
willid3 Says:
September 23rd, 2010 at 2:07 pm
and i thought many were big on property rights. oh i forgot, its property rights for corporations, TBTF and others. just not for the people
MinnItMan Says:
September 23rd, 2010 at 2:53 pm
A title company should have closed the cash purchase. If the buyer (Grodensky) didn’t use one, his bad. Penny-wise, pound-foolishness.
It’s worth pointing out that cash purchasers usually mean prospective slum-lords, but I don’t know that here. Alsos, his credit should not be affected. The loan was in the name of the former owner.
Not excusing anything, but I suspect the facts would show some strange bedfellows in this story in a fuller reporting.
bergsten Says:
September 23rd, 2010 at 2:58 pm
This box just popped up, asking if I wanted to participate in a TBP survey.
I like Barry, so I figured, “why not”?
The first question asked for my age. Fine. The second asked for (something along the lines of) my interests.
The first choice was “pet care.”
Sorry, but that’s when I bailed on the survey.
Is this legitimate or another ad that’s taken over the site?
formerlawyer Says:
September 23rd, 2010 at 3:58 pm
In my former jurisdiction and others, fraudsters would often take out a mortgage using forged identity. The process involved looking for (preferably vacant) properties without mortgages which was easily done from public records.
From that, forged identity for the owner would be obtained and a mortgage placed on the land with the fraudsters seeing a lawyer to finalize the documents. The fraudsters would set up a bank account from which payments could be withdrawn and place just enough money (ie. 6 months mortgage payments) to fund the mortgage. Often they would then move the address for service of record to a fictional address so that notification of the true owner would be forestalled. Thereafter, the mortgage proceeds would be laundered – usually by way of casinos on Indian lands or other mechanisms.
While personal service would be preferred, substitutional service on the lands or in a newspaper was commonly allowed in foreclosures. Voila – foreclosure once the money ran out.
While that is not the case here from my understanding this is not unknown.
willid3 Says:
September 23rd, 2010 at 4:05 pm
and foreclosure is controlled by the states. Fed have nothing to do with it (short of bankruptcy being involved).
Casual Onlooker Says:
September 23rd, 2010 at 5:10 pm
I find the arguments that mistakes like BofA are just simple oversight, and one off errors that did little harm. From a lot of the various stories out there, from banks that “lose paperwork” to people getting lost in voice mail hell just trying to find a real person, much less a person a person that is not reading a script off his computer, speaks volumes as to the increasing chaos in the system.
To add to GMAC story, NPR yesterday aired a segment on this, and some of the details are rather troubling. http://www.npr.org/templates/transcript/transcript.php?storyId=130052495
From the story…
————
Chris Immel is an attorney at Ice Legal, a foreclosure defense firm in West Palm Beach, Florida. He conducted a deposition with a GMAC employee named Jeffrey Stephan. Immel says his job was to sign foreclosure documents.
Mr. CHRISTOPHER IMMEL (Attorney, Ice Legal): We took his deposition. And in taking it, he pretty much admitted to signing, you know, he said approximately 10,000 documents a month.
KEITH: Attorneys like Immel have taken to calling these employees at loan servicing firms robo-signers.
———
I mean really, 10,000 documents a month by a single person… where is the due diligence in that? How does this not rise to the level of a endemic problem that needs addressing? That’s 62.5 documents signed an hour, or one a minute.
Brady Dennis Says:
September 23rd, 2010 at 5:47 pm
Robo-signer’ played quiet role in huge number of foreclosures
The robo-signer lives on a quiet street in this small town an hour’s drive northwest of Philadelphia.
His modest two-story house, for which he paid $118,000, sits on a corner lot just down the street from the local Moose Lodge and an all-night diner. A weathered Chrysler Concorde is parked in the driveway, and a Toyota Camry sits by the curb.
Many large mortgage lenders have come to rely on a relative handful of so-called robo-signers such as Jeffrey Stephan, 41, to attest to the accuracy of thousands of home foreclosure documents across the country. These workers are not the Wall Street masterminds who created ever more complex mortgage-backed securities and fueled the subprime mortgage boom, but rather “affidavit slaves” with modest incomes and mountainous workloads.
Their actions are leading lawyers representing foreclosed homeowners to claim that lenders have no legal standing if the filings weren’t reviewed and verified, and to argue that the cases should be thrown out.
Herb2 Says:
September 23rd, 2010 at 7:42 pm
In the Philippines when Marcos declared martial law, I noticed that much more attention and money flowed into elections of judges than into elections of senators, which was contrary to my experience in the US. Subsequently I learned that judges decided which phony paperwork was authentic when title to a property was contested.
The particulars are different, but we drift in a similar direction.
Home buying on a Saturday « Tim Hedden's Blog Says:
September 25th, 2010 at 7:01 pm
other day I read a fairly enthusiastic Barry Ritholtz post entitled Man without Mortgage Loses Home in Foreclosure. Basically, the Florida court system is so in the groove of foreclosing on properties, they are
doloresflynn Says:
September 26th, 2010 at 3:45 pm
Please set a standard here !
As soon as you uthrow out the f-bomb, everyone thinks it is their cue to trash the place.
Morality belongs to the financial sector as well as personal, and if you are educated, you can get your point across very well without vulgar puctuations.
Florida’s Foreclosures Nightmare | The Big Picture Says:
September 29th, 2010 at 2:53 pm
Man without Mortgage Loses Home in Foreclosure (September 23rd,
BofA’s unfunny foreclosure tricks | Anne-Marie Wurzel, P.A., Real Estate Agent - Winter Springs, FL Real Estate Office Says:
September 30th, 2010 at 11:05 am
seems. Barry Ritholtz says at his blog that the only way the banks will ever learn is if they lose big judgments in court – a notion that seems to be borne out by another aspect of the Schroit
stopGOVTwaste Says:
October 2nd, 2010 at 1:16 am
So if they come once with fake documents, do they have free reign to come back and try again with NEW fake docs? The mortgage MUST remain together with the note but MERS prevents that from happening. Bifurcation =’s off book securities transactions.
What they don’t want to tell you is that the insurance taken out on the loan pool at 30x value of pool (conservatively) has paid off – EXTINGUISHED – the loans in the underlying pool, many times over (AIG, AMBAC, MGIC, TARP, ETC). But wait a second, weren’t these the same loans that were supposed to be “recorded” in public land records per the terms of the Pooling & Servicing Agreement (PSA) and the Mortgage “contract” (see section 20 of the standard Fannie/Freddie instrument).
So if the chain of custody was never recorded, then the trusts set up to hold the loan pools actually held “nothing but air” – if they even existed at all.
You can’t collect on a debt that has been paid off, that is fraud. Plus, the controlling aspects of the PSA void the sale of the asset under FAS 140, in addition the REMIC will lose it’s tax deferred status under IRS Code. You cannot commit securities fraud, tax fraud, violate a plethora of federal and state lending and consumers laws and get away with it scott free… can you? The crime is mortgage backed securities and the crime scene is our public land records.
Enjoy the video (below) and have a great weekend!
Slowing the Runaway Foreclosure Train | The Big Picture Says:
October 4th, 2010 at 7:26 am
we have seen, homeowners without mortgages have lost their home to foreclosure. That this legal impossibility actually occurred reveals the
Boston Real Estate Blog : Blog Archive : Slowing down the foreclosure assembly line Says:
October 4th, 2010 at 9:53 am
we have seen, homeowners without mortgages have lost their home to foreclosure. That this legal impossibility actually occurred reveals the
Are WSJ OpEd Writers Clueless or Liars? | The Big Picture Says:
October 11th, 2010 at 11:10 am
has been widely circulated and discussed in the media, Man’s home sold out from under him in foreclosure mistake. The
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This was probably inevitable: the minute that Dodd-Frank cracked down on the fees charged by credit cards aimed at students, some other bright financial innovation would crop up. This time, a debit card aimed at students. Which carries lots of fees. Ylan Mui reports that a company called Higher One has started signing up colleges around the country, taking on the burden of providing cash to students. In return, it gets lots of fees:
Students say several of the fees associated with Higher One’s card are particularly irksome, including the $19 inactivity fee, a 50-cent charge for using a PIN to make a purchase rather than a signature, and a $2.50 fee for using other banks’ ATMs…
Higher One said that only 1 percent of customers have been charged an inactivity fee and that more than half are charged the 50-cent fee only once. All fees are listed on Higher One’s Web site, along with tips on avoiding them.
“We have a big effort with educating students on how to use the account,” Smith said. “We’re very passionate about financial literacy.”
If the fees are listed on Higher One’s website, they’re not exactly prominent. I did find this page, eventually, via this blog entry, but it just says that “when you swipe & sign, you won’t be charged the PIN-based transaction fee”. I haven’t been able to find a page showing a 50-cent transaction fee anywhere*, although I did manage to find this page, showing a $25 fee for domestic wire transfers and a $50 fee for international wire transfers. “Higher One offers less costly alternatives for transferring funds”, it says, without giving any indication what they might be; I suspect that what they’re talking about is transfers to or from people who have already registered somehow with Higher One.
It should go without saying that any firm which is “very passionate about financial literacy” would encourage, rather than penalize, simple, cheap and safe PIN-debit transactions. It would not give students a debit card and then tell them that if they want to avoid fees they should select the “credit” option rather than the “debit” option when they come to pay.
And I can’t think of any good reason to charge a $19 inactivity fee to people who haven’t used their cards in 9 months.
The fact is that students are often very naive when it comes to money, and it’s easy to gouge them once or twice before they learn that banks are not necessarily on their side. If you can get your card accepted by a majority of freshmen every year, and then come up with all manner of weird fees to hit them with, that’s a great way of making money out of ignorance.
Meanwhile, all students should have a bank account: giving them a debit card instead only serves to maximize the number of unbanked students. So while I’m sure cards like this are attractive to colleges, it would be great if either the colleges or else the Consumer Financial Protection Bureau started being a lot more critical of them. Prepaid cards only ever make sense if the alternative is being completely unbanked; that should not ever be the case for students.
*At Southern Oregon University, Higher One agreed to waive the 50-cent PIN-debit charge, but only if there was a simultaneous “swipe-and-sign” campaign. If the campaign is unsuccessful and students do the sensible thing by using PIN debit, then the university can be charged $2 per student for “PIN fee elimination”.
Update: Higher One’s Donald Smith responds:
Higher One was founded 10 years ago by three college students (undergraduates at the time) who were looking for streamlining the way financial aid refunds were distributed to students. Today we work with more than 675 campuses across the country, have a 97% client retention rating, and an A+ rating with the BBB.
The OneAccount is Higher One’s optional, no minimum balance, no monthly fee, FDIC-Insured checking account created by students for students. We do not offer a stored value card. We are very open with our fee schedule. We post it on every program website for all to access, explain each fee, discuss how to avoid each fee, and provide students with a web page that tells them how to use the account for free (which you’ve already found). Because of this, we believe that our customers pay less than half the amount in fees that the average bank checking account customer pays per year.
Two of the fees you referenced in your blog are the PIN fee and the Abandoned Account Fee. The PIN fee is easily avoided by choosing a signature based transaction at the checkout. The majority of students uses it in this manner and is in turn protected by MasterCard’s Zero Liability Policy against fraudulent charges (a safer way of purchasing than a PIN based transaction). We do not have an inactivity fee on our fee schedule – we don’t penalize students who do not use their accounts. We do have an Abandoned Account Fee of up to $19, for those who have abandoned their accounts, but this has been charged to less than 1% of all OneAccount holders in our company’s history because of our proactive outreach plan.
Higher One offers no instruments of credit. As a matter of fact, we’re generally in favor of initiatives restricting students’ access to credit cards and promoting financial literacy. This is why we offer a full range of financial literacy resources along with the services we provide.
I particularly dislike the implication, here, that PIN-based transactions are unsafe. They’re not; they’re just less lucrative, in terms of interchange fees, than signature-based transactions.
eric seiger
eric seiger
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www.sharedreviews.com is a site where you can write and get paid for your product reviews. Do you love your new camera, or perhaps you hate the new deodorant you bought recently and want to tell everyone about it? Shared Reviews gives you that chance and best of all pays you to do it. They pay ten dollars for every 5 reviews and to be honest each review only takes just a few moments to write, so they pay is great in that respect. They pay weekly by pay pal when you have earned at least 10 dollars. So next time you find that great new product, simply type it up and make some money.
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Verizon iPhone 4 | Adan <b>News</b>
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Back in June, a Fox Business Network promo featured only Fox News stars, touting the new financial channel. Now there's a new marketing strategy out, in ads playing on News Corp. cable news networks but also across the dial, ...
'American Idol's Crystal Bowersox Gets Married | Fancast <b>News</b>
'American Idol's Crystal Bowersox married musician Brian Walker on Sunday, October 10, 2010, in Chicago, and will celebrate their anniversary on 10/10/10 along with the other approximated 40000 lovebirds who said 'I Do'
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Verizon iPhone 4 | Adan <b>News</b>
Verizon iPhone 4 | Adan News | New iPhone Info Says: October 10th, 2010 at 10:03 pm. Verizon iPhone 4. It's coming soon…or is it? I remember back in March, right before the end of the first quarter the WSJ said that the Verizon ...
Fox <b>News</b> - Fox Business | New Ad | Two Networks - Solve | Mediaite
Back in June, a Fox Business Network promo featured only Fox News stars, touting the new financial channel. Now there's a new marketing strategy out, in ads playing on News Corp. cable news networks but also across the dial, ...
'American Idol's Crystal Bowersox Gets Married | Fancast <b>News</b>
'American Idol's Crystal Bowersox married musician Brian Walker on Sunday, October 10, 2010, in Chicago, and will celebrate their anniversary on 10/10/10 along with the other approximated 40000 lovebirds who said 'I Do'
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