Will Homeowners Benefit from Mortgage Mess Settlement?

Will Homeowners Benefit from Mortgage Mess Settlement?

By Catherine New Posted 6:45AM 04/15/11 Economy, Real Estate, Credit

Will Homeowners Get Relief from Big Banks in Mortgage Mess Settlement ?Will homeowners see a penny of the reimbursements that the government has ordered 16 mortgage lenders to pay? Not likely, foreclosure victims and housing activists say.

Under a settlement between regulators and banks announced on Wednesday, an independent review will be conducted of all foreclosures that took place in 2009 and 2010 to determine whether fees were improperly charged or homes were wrongfully foreclosed upon.

Kathleen Keest at the Center for Responsible Lending says whether or not homeowners see any money from the banks is contingent on the outcome of the review.

“It all depends on what the independent consultant looks for, how well it does its job, what standards it uses to evaluate those questions, and what it finds,” Keest says. The investigators are to be named by the banks, subject to approval from the Office of the Comptroller of the Currency.

Lisa Epstein, a homeowner-rights activist and founder of ForeclosureHamlet.org, a social network of more than 3,000 distressed homeowners, is skeptical that the review will be substantial or truly independent.

“They came out with weak, conciliatory try-to-do-it-better consent agreement that offers no hardcore investigation,” Epstein says. “It’s trying to sweep up the confetti while the parade is still happening.”

She says a thorough investigation needs to examine both the borrowers’ records and the servicers’ records. “There can be two different stories,” she says. “A lot of people may look delinquent for the servicer, but they have records of payment.”

‘How Many Times Can You Be Outraged?’

One such borrower is Nicole West, a homeowner in Jensen Beach, Fla., who has been fighting a foreclosure on the home where she has lived with her husband and two children since the early 2000s. Their four-year-long saga has been highlighted by Rep. Alan Grayson (D-Fla.).

She says she has Western Union records of more than $43,000 made in wire payments to her mortgage servicer in 2007 in an effort to get current on her loan. West claims that the money was never applied to her debt. She concurrently tried for a loan modification, but her property was placed under threat of foreclosure, she says. That practice is called dual-tracking. West is currently working with a lawyer to fight the foreclosure proceedings on her home and expose the fraudulent procedures.

West called Wednesday’s settlement a poor excuse of a solution and a slap on the wrist for the banks. “There is a phrase called ‘outrage fatigue,’ because how many times can you be outraged before you are done?”

Alys Cohen of the National Consumer Law Center is concerned that the settlement is step backwards with regard to dual-track problems like those West has experienced. Cohen says the settlement ruling stops short, and prevents only the sale of the property as a foreclosure, but it doesn’t stop the loan servicing company from starting the foreclosure process. For homeowners awaiting loan modification approval, she says, that’s confusing, and leaves the door open for potential wrongful sales.

What About the Land Records?

Included in the settlement was a cease-and-desist order against Mortgage Electronic Record Systems or MERS, a privately held company that operates an electronic registry system designed to track mortgage ownership and rights of mortgaged properties.

John O’Brien, who has served as the register of deeds for Essex County, Mass., since 1977, is vocal about the flaws with MERS. He says the settlement action is a step in the right direction, but doesn’t address the millions of dollars in lost revenue for counties and states and the ongoing confusion over titles for millions of properties.

“I was encouraged that they ordered a cease and desist for MERS, but I am also cautious and want to also make sure that this isn’t swept under rug,” O’Brien says. “We have been recording property titles since the 1700s. We know what we are doing. Meanwhile, they have sold people’s mortgages time and time again.”

In Guilford County, N.C., the sentiment was echoed by country Register of Deed Jeff Thigpen, who has also been outspoken about problems with MERS. He says Wednesday’s settlement is only a drop in the bucket to get things back in order for homeowners.

“I am little skeptical that this is a strong message. The banks sounded like, ‘Oh you hit me on the arm. I’m hurting now.’ It’s just play-acting,” he says. “This is not really getting at the gravity at the billions and trillions of dollars lost and the pain and suffering of not knowing who owns what.”

Catherine New is a personal and consumer finance reporter for DailyFinance.com and Aol Huffington Post.

See full article from DailyFinance: http://srph.it/gx6d7V

6 Responses

  1. Something is better than nothing and even though so many of you are fighting hard to win it, only a very small percentage are doing so and the banks love it.

    What is the answer: – Where is our plan that I talked about submitting almost a year ago that represented a reasonable settlement to all and while in the process, sufficiently compensated those that had been wrongfully foreclosed. No, now it has gone on for so long – the trickle down effect has taken a horrific toll on the rule of law, the banksters responsibility to the people and particularly those persons that have been so arrogantly wronged by the banks and their counter parts. Now is the best time for the people to do something – we know pretty much the facts, maybe not all, but most – Put it down on paper and get it in to some of the real experts on this cite – I thought Neil was heading up something along these lines, but don’t know what happened.

    Let’s get going – before the final ink is laid on the settlement. Just coming to an agreement among those victimized with be monumental and again, that is what the banks are counting on – so again, let’s get going.

    Keep in mind – that we only have certain factors that we can utilize and not go out on a limb asking for outrageous compensation. WE don’t want to be copy cat bankers do we?

  2. Again, I see no reference to a cease and desist order against MERS. They have to “committee” this thing like everyone else that agreed to this Consent Order and Stipulation agreement. Where are the actual words that say “CEASE AND DESIST” on this Order?

    I will be on The Power Hour this morning at 9 a.m. CDT discussing this with attorney Mike Wasylik out of Tampa, Florida. http://www.cloudedtitles.com

  3. This is a step in the WRONG direction. Basically that will open up a free for all. I guess its just fine to steal peoples homes using fraud right? Everyone can do it then right?! Let’s all file satisfactions then if its okay with the AG and everyone over them. (Sarcasms everyone) When there is no punishment for willful and wrongful fraud within our civil procedures – when is that not criminal? Recording false or fake documents into the county records is serious and needs to be treated as the felony it is. Wire fraud, accounting fraud, racketeering, lying under oath used to be perjury. What is going on? MERs gets a Cease and Desist and that’s it? They defrauded America for Gods Sake. This is deplorable. Doesn’t anyone have any guts any more. If u need some ill loan u some of mine – using a MERS/DocX or LPS assignment of course. Maybe we can have smith hiatt and diaz or stern draft it for us too. That’s 12.95 plus third party fees too of course. Debi. 561-389-9339

  4. If the homeowners do not benefit, who in the F**** does? Keep fighting people. Eventually they will pay the right full owners of the fraudulent ponzi schemes across this country. Deed of trust is a funny thing. Guess they forgot about all that. Fight them every one!!!! This is INSANE. The homeowners were fuked in every sense of the word and the investor, banks or who ever else, gets it? Its really time to fight. Dig deep everyone. They need to pay the right full victims!!! So sick of this insanity and brutality from our very own government. The corruption so deep. I’m gonna fight til I have no more life. This is sick, wrong and needs to stop. How much F-ing over can the same people take? Not much more I would imagine. This country is wicked, corrupt, greedy and appalling. I have choicer words but really trying to control my anger and animosity right now. Hatred is trying to surface how sickening is it to be an American right now. Our predecessors are rollin in their graves too. Debi 561389-9339

  5. New York Dept of Finance records are all messed up. Fidelity National Title and their corrupt attorney Thomas Malone and corrupt attorney David K Fiveson who says he represents a title company called Coronet title have fraudulently recorded forged deeds they bought and transfered owner ship of my two nyc condos to their clients.
    A FORGED DEED CONVEYS NO TITLE.
    As i have said on previous posts, the corrupt title attorney from Fidelity National Title and corrupt David K Fiveson have infiltrated the county land records with their fraud. These are the same attorneys that paid NY Supreme Court Judge Alice Schlesinger a bribe. Why aren’t these three racketeers getting indicted?

  6. Strip the loans from 2003-2008 from the banks and hand them over to the respective states to reconstruct with the borrowers (2% for 30 years). The states are the ones getting stung from the wasps’ net – and don’t even realize what its costing them in welfare, lost tax revenues, lost service fees… not to mention how many of these states lost their retirement and pension funds with these banksters. Its time to STOP the madness. Take over the loans and take back America!

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