“If you can’t beat’em, join’em,” the old saying goes. These days, however, borrowers are opting for a variation on the axiom, choosing to at least “slow’em down” if they can’t actually beat their foreclosures. While most lenders cease foreclosure evictions around the holidays, all evidence points to a looming increase in foreclosure volumes over the coming year. However, the actual foreclosure process is likely to take nearly twice what it did in 2008, largely thanks to savvy delinquent borrowers using banks’ own shortcomings against them and demanding original paperwork, proof of note ownership and a variety of other evidence before bowing to the inevitable and forking over their keys and leaving their homes[1].
Homeowners have many options when it comes to stalling a foreclosure, and a stalwart delinquent borrower may be able to drag out the process for more than three years in some states. Not only can a homeowner demand proof of ownership of the note, production of original loan documents and a variety of related paperwork, but they can also declare bankruptcy, thereby stalling the process indefinitely. They’re not arguing whether or not they’ve been paying, says one lawyer who represents banks in foreclosure cases, but rather choosing to stay in the home “based on a technicality”[2]. He further notes that most homeowners in default have not made a payment in at least two years.
But is this stalling really bad for neighborhoods? Opinions differ. Some argue that homeowners who know that they are going to lose their homes to foreclosure eventually do not care for their properties. They may allow maintenance issues to linger or opt not to repair cosmetic damages. They may even trash the property in an attempt to “get back” at the banks. But if those properties are swiftly and efficiently foreclosed, then sit empty for months or years, is that really any better? And some of these homeowners do actually end up being allowed to remain in their homes, technicality or not. For example, on Staten Island man owed $300,000 on his mortgage, hadn’t made a payment in years and successfully got his foreclosure dismissed thanks to robo-signing issues associated with the case. So sometimes, the homeowners actually “win.”
Do you think that this stalling is a serious issue? If banks get homeowners out fast, then should they have additional responsibilities related to their new property?
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[1] http://realtormag.realtor.org/daily-news/2011/12/28/home-owners-try-delay-tactics-stall-foreclosures
[2]http://money.cnn.com/2011/12/28/real_estate/foreclosure/index.htm?section=money_realestate
Banks acted as thiefs from the very beginning, so they have no moral arguments.
So yeah, a lot of homeowners are acting in bad faith at the moment. This is what you get in a system where greed has become the highest virtue. We live in a country where Saint Dollar is the patron
The banks are not the banks. The “holders” of the notes are often investore who bought #100 shares of the income generated by 1-2 billion dollar bundles of notes. The banks are really just servicers. They are like crooked will administrators who are intent on billing the estate for as much as possible before their “cash cow” goes dry. If the house gets foreclosed on and the bank becomes the owner, the servicer just gets to keep on billing. The investors may never see a dime.
The banks have their reasons I’m sure, but you’re right, if they had common sense they could end this issue quickly. The banks will spend approx. $50K on a foreclosure, plus all the months/years of no payments…then take the property back, re-adjust the price, probably spend some money on small repairs to market it, plus pay a realtor commission. In the end, they simply get FMV anyways. Instead of modifying loans to simply adjust the payment, if they modified the principal amount owed, more people would make good on their mortgages. All the strategic foreclosures would go away, the banks would end up with a loan that has the same balance as if they sold it on short sale or foreclosure, and they would save all the fees and lost monthly payments. Once the loan is paid well for a period of time they could sell the note.
More people need to do this, anything against the “pretend lenders” is good. Since all the Government agencies and Courts like to look the other way instead of prosecuting these thieves, Stay in your House as long as possible. My foreclosure was done in secret (meaning I never saw any of the documents they used until I went to the Court case and asked for my case file). Even the File Room Clerks were making up excuses for the Attorneys. Colorado is the only state using Public Trustees, and letting them get away with foreclosing without ANY PROOF, while lining their pockets right along with the pretend lenders and the fraudclosure mill attorneys.
If a homeowner were to forge or falsify a publicly recorded document involving a single home loan we all know it is fraud and would expect prosecution if uncovered and proven. When a TBTF Bank gets caught doing it a hundred thousand times it is no longer fraud but a “technicality” according to the OCC and the banks. Folks are so concerned that their neighbor might get the mythical, numerically impossible, “free house” they are willing to overlook wholesale criminal fraud by the banks while the value of their own home and property records/chain of title all deteriorate right in front of their eyes. I prefer the rule of law. Lacking it moral hazard runs rampant. No one should be above the rule of law whether they have lobbyists in all 50 states and D.C. or not.
“Responsible” people point to the “irresponsible” people not paying their mortgage as the the reason future home loan costs will go up. They never stop and ask themselves how a bank with unlimited resources has trouble evicting a single homeowner.A single homeowner that often has had personal or financial issues and can no longer afford to continue to pay the overinflated, artificial price run up created by securitization and the easy money, no real underwriting scam.
The simplest answer is that the TBTF Banks are knowingly using fraudulent documents signed by surrogates for the banks (never by officers of the bank) so they can avoid taking civil and criminal liability for their crimes. It is much safer to outsource the “hit” if you are Organized Crime (“O.C.”). Instead of outsourcers named Fast Finger Freddy they are known by more friendly sounding names like, LPS, DocX, Wolters Kluwer, ReconTrust, AHMSI, Joe’s Honest Law Firm (All firms mentioned are innocent until proven guilty in a court of law). I know, it almost sounds like the banks are the irresponsible ones. Meanwhile O.C. is donating to local charities and has a great reputation in the community as their dirty deeds are done with others hands.
Home mortgages are contracts. I am very comfortable having the contract enforced. The banks don’t want to abide by the contracts they basically wrote. The rule of law is the only equitable and efficient way to sort this crisis out. It just so happens it also serves up a close approximation of justice when evenly applied.
Banks are acting like illegal debt collectors the people should not have to do any legal battles the Govenors of thier states should be stepping in and saying you acted illegally and people do not have to fight you get off the pot of moffia style ,money laundrying ,corruptions stop bothoring the good folks from my state and make them pay back all the money they have defrauded from the people illegally ! Just the fact that they are allowing them to continue should be a high crime. First the banks take mone illegally then they have to pay lawyers to fight to keep thier homes from the thieves so more theft by deceptions for money to attorneys. and deceptions just are being allowed to continue and continue. this is how so much trouble has been pushed on this Country! By the higher ups allowing the illegal crap to get started to begin with then to allow it to continue . so when the missed payments even when it is false information hurts the little guys credit the crap just continues to help make more misory. Just like Washingtom Mutual Mortgage stealing from people checking accounts stating that these late payment fees when they themselves changed dates of the original payments to make them late Then selling when they knew they were going down ! Tell me this is not a form of conspiracy ! Sorry the banks should have to let go and reimburse fraudulently gained moneys all of it !
Apparently, many people here do not know that the banks make A TON OF MONEY from hedging their bets with insurance money, FDIC money, TARP bailouts, other bailouts, and even more agreements where they get paid if you supposedly default on your mortgage. ( Don’t forget PMI–Private Mortgage Insurance–for the banks, not you.) Incidentally, most homeowners own their Note and Mortgage outright as the debt has already been retired. The servicers that belong to the TBTF banks are stealing the houses. The banking system in the US must go, or we will have the same S&*t all over again.
In Florida, even a judical foreclosure is a simple process.
Simply prove that you have the right to foreclose, usually you need the original note and mortgage and necessary assignments, made to the Plaintiff. If John Q Public wants to collect on a promissory note in small claims its the same process.
Somehow, the banks/lenders/servicers that file the foreclosure law suits simply can’t, with legitimate documents, do that. To allow the foreclosure to proceed wold be to allow someone not entitled to foreclose the mortgage to do so without proof.
Why should the lenders be held to a lesser standaed than someone in small claims?
YES! Awesome comments people! You guys really seem to get it now. I am glad to be in your company, and pray that God will evict the banksters from our land. Be sure and vote out the big government as soon as we are able!
This is almost great news. The only thing better would be for the homeowners to file Broken Chain of Title and keep their home – and not ruin their credit on the way.
It’s interesting how our government bailed out the banks and the banks continue to get as much money for their distress property as possible putting our economy in shambles. It would have save us billions of dollars if the government would have helped the people refi at market value or paid the shortage of a underwater seller so they could sell their homes without recourse or damaging their credit. They could then move on with moving to another job in a different location and buy or rent a new home. Housing is the base of our economy. All the short sales and foreclosures due to walking away effect have killed the economy. People have no choice as the banks wear them down and many times will not do a loan mod or short sale without recourse. Our government made a huge mistake helping banks not the American People.
I have been fighting with GMAC for almost 4 year’s, I got a law office to help me and I paid them $4600.00 and they didn’t help me at all and this law office was telling us all the time that our loan was fraudulent and that they where going to take GMAC to court, but every time we got our hopes up every time and was let down….So I sent a complaint over to the Attorney General’s office and then I got a letter to my United States Senate and I have got letter’s from our Senator,he has let me know that they are making this there highest priorities….GMAC has sent me letter’s saying that 8 should not be coming for them they have dune nothing wrong……in almost 4 year’s I have been though 3 or 4 modification’s and this is a mobile home and land and they want me to pay them a $189000.00 + on the mortgage right now. this is a 30 year fix note and the payment have been from 1200.00 up to 1800.00 and with the modification the note never go’s down. But I have put up a fight but with God has been with me and I’m steel here at my home. I have sent pics of my home to GMAC so they could see this is not a house house it’s a mobile home. GMAC told me that they don’t keep pics they do away with them. The mortgage Co. Should be put out on the road like they have dune to every one all over the world….. This thing they call HOPE it don’t work at all I told them to kiss it because they told me they could not help me with my home because our law office had hurt us so bad they was nothing going to help us with any thing. So if there is any one out there that is in need of help ……. Attorney General office and your United States Senate office.
It sure seems to me that we have forgotten the one thing that used to be a common theme in American society, and that was that we all generally had the integrity to pay our debts. If we borrowed from one of the bad guys (a loan shark) then we could expect to pay the dire consequences if we didn’t pay him back. It also seems to me that we are trying to make loan sharks out of the banks. Yes, they participated heavily in the kiting of real estate values, but everybody fed the frenzy…Realtors, builders, buyers, banks and investors. This convoluted mess we have made is everyone’s fault, and rationalizing the obligation to pay back what you owe is not going to solve it. Blaming a bank for not doing the paperwork properly, or making a loan without a deed or any of these other glorified excuses is your priority, but it doesn’t absolve one of the obligation. We can thank the legal establishment for setting up this entitlement attitude..and of course our wonderful Congress.