Window Dressing: File a Lawsuit — Maybe It will Improve the View


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EDITOR’S COMMENT: YAWN! The government keeps filing lawsuits that COULD be big and COULD cause make corrections in the marketplace to reflect reality. But then they go nowhere, with discovery stymied by the Banks and then a settlement on the table that sells out everyone except the half dozen big banks that we allow to control the market, courtesy of our taxpayer money and our refusal to apply the same rules to them we do to the 7,000 other community banks and credit unions who could do the same or better job at handling the country’s finance sector.

Don’t get fooled. When someone comes out and says that securitization was an illusion, a ruse to defraud as many people in world population as possible, TEN we will have addressed the problem. When that special someone is willing to consider the idea that the banks never actually lost money and never needed a bailout, but that the top management diverted pornographic profits to off-shore havens then we will be on track to recapture the nation’s wealth, which currently is held hostage by Wall Street banks and the great majority of those in government who depend upon the mega banks for their political campaign expenses.

In the meanwhile, the lawsuits should be watched because deep inside each suit are some additional allegations, indicating the results of administrative investigations that you can use. When we get serious, the lawsuits will come fast and furious and aggressively pursued. Until then, all thee actions amount to little more than window dressing.

U.S. Is Set to Sue a Dozen Big Banks Over Mortgages


The federal agency that oversees the mortgage giants Fannie Mae and Freddie Mac is set to file suits against more than a dozen big banks, accusing them of misrepresenting the quality of mortgage securities they assembled and sold at the height of the housing bubble, and seeking billions of dollars in compensation.

The Federal Housing Finance Agency suits, which are expected to be filed in the coming days in federal court, are aimed at Bank of America, JPMorgan Chase, Goldman Sachs and Deutsche Bank, among others, according to three individuals briefed on the matter.

The suits stem from subpoenas the finance agency issued to banks a year ago. If the case is not filed Friday, they said, it will come Tuesday, shortly before a deadline expires for the housing agency to file claims.

The suits will argue the banks, which assembled the mortgages and marketed them as securities to investors, failed to perform the due diligence required under securities law and missed evidence that borrowers’ incomes were inflated or falsified. When many borrowers were unable to pay their mortgages, the securities backed by the mortgages quickly lost value.

Fannie and Freddie lost more than $30 billion, in part as a result of the deals, losses that were borne mostly by taxpayers.

In July, the agency filed suit against UBS, another major mortgage securitizer, seeking to recover at least $900 million, and the individuals with knowledge of the case said the new litigation would be similar in scope.

Private holders of mortgage securities are already trying to force the big banks to buy back tens of billions in soured mortgage-backed bonds, but this federal effort is a new chapter in a huge legal fight that has alarmed investors in bank shares. In this case, rather than demanding that the banks buy back the original loans, the finance agency is seeking reimbursement for losses on the securities held by Fannie and Freddie.

The impending litigation underscores how almost exactly three years after the collapse of Lehman Brothers and the beginning of a financial crisis caused in large part by subprime lending, the legal fallout is mounting.

Besides the angry investors, 50 state attorneys general are in the final stages of negotiating a settlement to address abuses by the largest mortgage servicers, including Bank of America, JPMorgan and Citigroup. The attorneys general, as well as federal officials, are pressing the banks to pay at least $20 billion in that case, with much of the money earmarked to reduce mortgages of homeowners facing foreclosure.

And last month, the insurance giant American International Group filed a $10 billion suit against Bank of America, accusing the bank and its Countrywide Financial and Merrill Lynch units of misrepresenting the quality of mortgages that backed the securities A.I.G. bought.

Bank of America, Goldman Sachs and JPMorgan all declined to comment. Frank Kelly, a spokesman for Deutsche Bank, said, “We can’t comment on a suit that we haven’t seen and hasn’t been filed yet.”

But privately, financial service industry executives argue that the losses on the mortgage-backed securities were caused by a broader downturn in the economy and the housing market, not by how the mortgages were originated or packaged into securities. In addition, they contend that investors like A.I.G. as well as Fannie and Freddie were sophisticated and knew the securities were not without risk.

Investors fear that if banks are forced to pay out billions of dollars for mortgages that later defaulted, it could sap earnings for years and contribute to further losses across the financial services industry, which has only recently regained its footing.

Bank officials also counter that further legal attacks on them will only delay the recovery in the housing market, which remains moribund, hurting the broader economy. Other experts warned that a series of adverse settlements costing the banks billions raises other risks, even if suits have legal merit.

The housing finance agency was created in 2008 and assigned to oversee the hemorrhaging government-backed mortgage companies, a process known as conservatorship.

“While I believe that F.H.F.A. is acting responsibly in its role as conservator, I am afraid that we risk pushing these guys off of a cliff and we’re going to have to bail out the banks again,” said Tim Rood, who worked at Fannie Mae until 2006 and is now a partner at the Collingwood Group, which advises banks and servicers on housing-related issues.

The suits are being filed now because regulators are concerned that it will be much harder to make claims after a three-year statute of limitations expires on Wednesday, the third anniversary of the federal takeover of Fannie Mae and Freddie Mac.

While the banks put together tens of billions of dollars in mortgage securities backed by risky loans, the Federal Housing Finance Agency is not seeking the total amount in compensation because some of the mortgages are still good and the investments still carry some value. In the UBS suit, the agency said it owned $4.5 billion worth of mortgages, with losses totaling $900 million. Negotiations between the agency and UBS have yielded little progress.

The two mortgage giants acquired the securities in the years before the housing market collapsed as they expanded rapidly and looked for new investments that were seemingly safe. At issue in this case are so-called private-label securities that were backed by subprime and other risky loans but were rated as safe AAA investments by the ratings agencies.

In the years before 2007, “the market was so frothy then it was hard to find good quality loans to securitize and hold in your portfolio,” said David Felt, a lawyer who served as deputy general counsel of the finance agency until January 2010. “Fannie and Freddie thought they were taking AAA tranches, and like so many investors, they were surprised when they didn’t turn out to be such quality investments.”

Fannie and Freddie had other reasons to buy the securities, Mr. Rood added. For starters, they carried higher yields at a time when the two mortgage giants could buy them using money borrowed at rock-bottom rates, thanks to the implicit federal guarantee they enjoyed.

In addition, by law Fannie and Freddie were required to back loans to low-to-moderate income and minority borrowers, and the private-label securities were counted toward those goals.

“Competitive pressures and onerous housing goals compelled them to operate more like hedge funds than government-sponsored guarantors, ” Mr. Rood said.

In fact, Freddie was warned by regulators in 2006 that its purchases of subprime securities had outpaced its risk management abilities, but the company continued to load up on debt that ultimately soured.

As of June 30, Freddie Mac holds more than $80 billion in mortgage securities backed by more shaky home loans like subprime mortgages, Option ARM and Alt-A loans. Freddie estimates its total gross losses stand at roughly $19 billion. Fannie Mae holds $38 billion of securities backed by Alt-A and subprime loans, with losses standing at nearly $14 billion.

23 Responses

  1. […] Like this: Like Be the first to like this post. Filed under: bubble, CDO, CORRUPTION, currency, Eviction, foreclosure, GTC | Honor, Investor,Mortgage, securities fraud Tagged: | amicus, ARIZONA, assignment, attorney general,bankruptcy, borrower, countrywide, Deutsch, disclosure, foreclosure, foreclosure defense,foreclosure offense, foreclosures, fraud, horne, LOAN MODIFICATION, modification, quiet title,recordation, rescission, RESPA, Saxon, securitization, TILA audit, trustee, Vasquez, WEISBAND « Window Dressing: File a Lawsuit — Maybe It will Improve the View […]

  2. […] Window Dressing: File a Lawsuit — Maybe It will Improve the View Posted on September 2, 2011 by Neil Garfield […]

  3. How can you get the Federal Government to help people with bad loans and the company aren’t big banks. They have done things wrong, just as bad as the big ones.The little people need help too ! If anyone can help my email is

  4. I’ve been saying this for how long?

    And you’re barely catching up to speed Neil?

    We could be getting somewhere if we ALL organized, pooled our resources together and worked on one or two things at a time. But as we are, we get to nowhere just as fast as we have been.

  5. Frankly I tend to agree with Garfield on this. it seems timed to coincide with the Obamination speachifying about what nice things his administration will do for everybody that can vote–if only they ignore those pesky tea party folks that are skeptacle that hes just buying votes. as with the mods—–great expectations pumped up pre-election, then turned out to be another device to entice homeowners to fall into default–and waive rights. Once burned?

    I as those who are tea Party folks am simply suspicious that the motives are to maintain power at whatever cost —–and that corruption is the end game. What else should we ever have expected from a Chicago machine politician. Ask Blagonovich or whatever the ex gov name was. I like the run of the mill Tea Partier–if there is such a thing—simply do not want my money nor yours diverted to useless progras, corruption and waste. We all want effective and efficient government–that is aimed at delivering reasonable protections of law to the general citizenry.

    The HAMP failed—MISERABLY. Did not appear to be intended to work–sort of a bunch of soundbites–then get away fast. Count on the people to have short memories. That is the homeowners who are under the gun–an ever larger number.

    Then there are the investors—real investors–like teachers’ pension funds, not the vulture bottom feeders that bought the discounted stuff after the teachers had to unload the triple C- bad paper by the investment rules. These people now have a good idea they were duped too–lots of Tea Partiers in these groups–people that saved in pensions for decades only to see every rule twisted around to seize their retirement funds. Lets face it–tea Partiers are not day trading millionaires–just folks that think they have savings and a lot of equiry in their homes. By now, staring into a double dip, with people saying the dip may last the rest of their lives—they are now maybe remembering the adage “There but for the Grace of God go I”

    These folks invested in the stock market –usually through IRAs.
    Now they are wondering where their money went, why they MUST have their stocks held in the names of these banks–wondering if all they really own is an electronic account that can evaporate in a “flash crash”. BTW where does the money go in one of those? Who sells high and buys back in low?

    Then the real smart ones–the real conservative ones—bought what they think are interests in gold and silver. They aren’t sure exactly what an ETF is—or exactly what the form of the supposed”investment” in the SAFE gold and silver. Can they touch it? Can they get physical delivery of it? Not on your life.

    It is interesting to note that immediately after Hugo Chavez demanded the banks hand over the gold supposedly held for Venezuela–the markets went wild for just as long as it took to gather the gold to send back to Venezuela. Why would that be if the gold was actually held in storage in venezueal’s name? Makes no sense if it was really there. It makes a lot of sense if the gold had been sold by the banks to 3rd parties and the banks were scrambling to buy enough to cover–probably had to go to the fed Reserve –to Ft Knox to make up the shortfall. So lets just posit–maybe there is about 5 times as much ETF gold and “gold” held in electronic accounts than there is actual physical gold in existence.

    If that turned out to be the case, what would it do to markets?

    The value of “electronic” gold would plummet while the value of real gold in hand would skyrocket—it is my opinion–based on what we saw when Chavez called the banks’ bluffs, that this is really the case–who is the global gold counter–nobody.

    so if they sold the same gold 5 times–why not shares of General Electric? now those of you that have really followed this post and the facts that it addresses KNOW that there were double sales of MBS or CDO or whatever you want to call them. We know that there were multiple recoveries on the same assets–notes—so one might as an investor think that the note had sort of belonged to me if i paid out for it—CDS etc. But we know that is not true–several parties paid out. severalparties think they have some claim there–and so this suit should get to the bottom –or paint a false bottom by giving investors settlements so they quit looking for the missing assets. The ones sold twice or three times.

    A good cover-up requires that people quit asking questions–and that can only happen when there are settlements. pennies on the dollar.

  6. neidermeyer wrote:

    “I have property outside the USA that is in a country that was overrun by the Japanese in WW2 , the land title system there is still a huge mess and it has created an almost feudal society , trust me when I say it would be better for the US to go through a “Shays Rebellion” period than to have that fate befall us.”

    Let’s go! I’m game….I’ve had just about enough of the lies and deceipt rampant in this hemisphere. Lead the way.

    Besides, it sounds like your other property is at least halfway through their title problems. As to the feudal society, I see no way whatsoever we can escape that fate.

    The bad news….I read one analysis that said the total dollar cost of the fraud perped by Wall Street is around a quarter quadrillion….the good news? No one has a calculator that goes that high.

  7. neidermeyer, well said. Sixty years for Japan. How many decades will it take for us. Our recording system has been destroyed and the only good thing is that we figured it out. We have to fix this but it will be one home at a time..decades it will take to unravel. No ‘agreement’ is going to fix this and these faux lawsuits by the ptb for public consumption are blatently telling in thier lanquage. The lies go on but the Truth is out now. Every time a lawsuit is filed they perjure themselves and we the people that know must keep calling them out.

  8. neidermeyer, absolutely, agree. The truth will set us free. One big bad private bank does not destory a nation. Ignorance destroys a nation. Hitler like tactics of fear. You are not beholding to the FEDERAL RESERVE private wealth owners, a private bank. Stop the madness.

  9. ian sorry for the repost but the flow of information relative to the ‘suit’ and research important.

  10. tnharry absolutely for the State University of Pennsylvania is a very important think tank whose experts helped tank the economy all dba Mortgage Servicers affiliates.

    MERS in 2003, first commercial National Registry Version 1.0 March 2003, published all notes could be destoryed of MERS Members.

    Predatory Lending investigation by the participants with vested interest to not reveal how ‘No’ during a mortgage application for a loan was critical to predatory lending. Had the ‘no’ come back what % would have not taken a loan.

    The fox is in the henhouse and nothing has changed except the spin, they are better at the spin consumers the majorityremain uneducated and that includes how many members of Congress they say no nothing about economics.

    We need a central bank run by the people of the US and get rid of the FEDERAL RESERVE today!


    #1037 —*+ Mortgage Electric Registration System, Inc. 2812542 Mc Lean VA, Data Processing Servicer

    Money flows to/from #1019

    #1019 —* Chase Bank of Texas, National Association Houston, TX a National Bank.

    Money flows to/from #108

    #108 -* Chase Equity Holdings, Inc (1832132) Wilmington DE Bank Holding Company

    Money flows to/from #1 Parent last day 5/03/1999

    Chase Manhattan Corporation – RSSD ID 1039502 New York a Bank Holding Company.

    Attention: Important

    All ‘MERS’ members THEREFORE PER OCC VISIORIAL POWERS REENFORCED UNDER SUPRAMACY CLAUSE 2002 – ALL MERS MEMBERS IN 1990’S are affiliates of national banks, federal savings banks, etc.

    OCC visitorial powers attach privilegs of national bank to all Mortgage Servicers affiliates’

    Visitorial Powers of OCC prevent enforcement of cosumer protection laws and have allowed money laundering of all cash attached to Mortgage Servicers affiliate sof national banks.

    How simple
    The ‘No’ bypassed on all ‘loan applications’ feed to Alt-A Loan Lenders. Consumer never told the property was placed with CREDITOR who sold mortgage backed note as collateral to third party and sold servicing of debt to another third party and the consumer signed promissory note with Mortgage Servicer’s affiliate who acted as Temporary Lender the commercial client of the ‘Seller’ of the loan.

    All Loan transactions c/o MERS c/o National Bank as described above significant.

    The seller a national bank and therefore all of the related transactions are Mortgage Servicers Affiliates include Purchaser of loan, and the RETAIL transaction c/o Temporary Lender and Institutional investors Alt-A Loan and Alternative investments ‘cash’ passed c/o Mortgage Servicers affiliates all exempted from FinCEN requirements that cash transactions be disclosed under Patriot Act.

  12. 1995, Chemical Bank, Investement Product Servicers, Pittsburgh PA ‘Plan Admin’ 1/1/1996

    Chemical Bank renamed to Chase Manhattan Corporation …

    F.N.B. Corporation

    1) First National Bank of Pennsylvania United States

    First National Building Corp. Pennsylvania

    2) Bucktail Bank and Trust Company Pennsylvania

    3) Reeves Bank Pennsylvania

    4) First County Bank Ohio

    5) The Metropolitan Savings Bank of Ohio Ohio

    6) Dollar Savings Association Pennsylvania

    DSA Serv Corp Pennsylvania

    Aloma Holdings, Inc. Florida

    7) Regency Finance Company Pennsylvania

    Citizens Financial Services of New York, Inc. New York

    Citizens Equity Corporation of New York, Inc. New York

    Citizens Financial Services, Inc. Ohio

    Regency Investment Company, Inc. Delaware

    8) Penn-Ohio Life Insurance Company Arizona

    9) Mortgage Service Corporation Pennsylvania

    10) F.N.B. Building Corporation Pennsylvania

    Regency Finance Company conducts business under four names

    Regency Finance Company conducts business under four names. Business is conducted at the fifteen offices in Butler, Clearfield, Crawford, Elk, Erie, Fayette, Lawrence, McKean, Mercer, Somerset and Warren counties in Pennsylvania

    and Chatauqua county in New York under the name of F.N.B. Consumer Discount Company.

    Business is conducted in the five offices in Columbiana, Mahoning, and Trumbull counties in Ohio under the name of Citizens Budget Company.

    Business is conducted in the twelve offices in Centre, Columbia, Lackawanna, Lehigh, Monroe, Montour, Northampton, Snyder, and Union counties in Pennsylvania under the name of
    Regency Consumer Discount Company.

    Business is conducted at the office in Hanover County, Pennsylvania under the name of
    Reliance Consumer Discount Company.




    5625 Mills Civic Parkway
    West Des Moines IA 50266
    RSSD ID 1208568

    FIRST BANK (378549) WEST DES MOINES IA Non-member Bank


    FNB Holding Co (1208568) West Des Moines IA Bank-Holding Co
    currency Federal Reserve System Parent money flows to from
    FIRST Bank (378549) Non-Member Bank
    flows to from
    FNB Holding Company Capital Trust I 3187872 Domestic Other ENtity

    Event Date Historical Event
    1983-03-11 FNB HOLDING COMPANY located at WEST DES MOINES, IA was established as a Bank Holding Company.
    1984-12-31 FNB HOLDING COMPANY moved to 1630 22ND STREET WEST DES MOINES, IA.

    FNB Holding Company Does not look important in ‘predatory lending’ when you look at FFIEC.GOV and don’t look at SEC History






  13. Nancy Drewe , Alice ,

    Of course it’s a cover up ,, and it comes all the way from the top because their advisors all are Wall Street alumni and if it’s good for the “street” it’s good for the country… they successfully stashed all their pallets (of soon to be worthless) federal reserve notes in the Caymans and Bahamas. They are too blind to see that their actions will harm them also.

    They are of course destroying all confidence that this country can provide a fair chance to all who work hard and play by the rules … That’s who we are ,, we may be broke and beaten down but we are playing by the rules , we know how to actually do things , unlike the wall streeters that only know how to shave a bit off of every transaction WE conduct ; we are slowly winning converts who are seeing past the big lie… Soon the big lie will become apparent to all and the tide will change as the FedGov will feign surprise at the revelation and turn on their current accomplices,, we just need to hang in there , work together sharing important information and not give up or give in …

    I have property outside the USA that is in a country that was overrun by the Japanese in WW2 , the land title system there is still a huge mess and it has created an almost feudal society , trust me when I say it would be better for the US to go through a “Shays Rebellion” period than to have that fate befall us.

  14. Nancy, did you just cite something from ACORN? Their credibility is somewhere on the level of MERS and LPS isn’t it?

  15. Nancy Drewe- while I read the complaint against the 12 big banks last night on zerohedge, you and others posted it again for all to see. Please note that “…..Fannie and Freddie lost $30 billion of their investment.” To put things in perspective, the Florida Retirement System lost $62.4 billion, and they are just one investor. There were hundreds of thousands of investors around the world, and if you include RMBS/MBS held in mutual funds etc., there were millions and millions of investors. Also bear in mind that the NY BOA ‘settlement’ of $8.5 billion was to address losses of $424 billion in the 530 Countrywide trusts. These and similar numbers should be front and center so that readers don’t lose perspective, and also referred to when contacting legislators/regulators/AGs, while mentioning “Say, aren’t you up for re-election next year?”

  16. Nancy Drewe, I agree, this whole things reeks of coverup. Carefully worded indeed. False statements. Pretend the loans were securitizatied per the PSA. The lies continue and the unsuspecting public (those now starting to catch on) reads this and believes something is happening when it is not. What are the ramifications when the Truth comes out, when all those investors, all over the world reach the realization they have nothing and no faux lawsuit is going to get them something. But the headlines look good don’t they.

  17. Here’s a canned reply from rep Passidomo ,, it is long (sorry) I had written a polite but to the point e:mail to her regarding the proposed “Florida Fair Foreclosure” bill she is crafting ,, I do not know if it will format correctly as this site lacks a “preview” function but here goes…

    Thank you for your email. As you may know, SW Florida has been devastated by the huge numbers of foreclosures filed over the past several years. In 2008, as a response to the problem I formed the Collier County Foreclosure Task force with Jeffrey Ahrens who is the Executive Director of the Legal Aid Service of Collier County, Our task force has taken a holistic approach to the problem that has been of great benefit to people in our community who are facing foreclosure or who have been foreclosed upon. Our first goal was to help people stay in their homes by working with them and their lenders (through pro-bono attorneys and HUD certified credit counselors) and if that was not an option, giving them advice and counsel on (to quote my co-founder Jeff Ahrens) how to “depart with dignity” (particularly to avoid deficiencies and negative impacts on their neighborhoods from abandoned homes, etc. ). You may want to look at the website we created. ( (It’s a bit out of date since we haven’t been meeting this summer as I have been involved in the redistricting meetings around the state).

    The bill that I intend to file is one that was originally generated in the Foreclosure Task Force last session but it needed a lot of work so I didn’t pursue it at that time. Part of the problem is that the statutory provisions pertaining to foreclosures are spread out throughout the statutes without an apparent connection. After session ended this year I began meeting with a small committee of attorneys in the Real Property Section of the Florida Bar to come up with a bill that we feel is fair, practical and workable. We have worked all summer on the bill, drafting our own language. This is not a bill drafted by lobbyists or any special interest group. Once we had a rough draft created we provided copies to pretty much anyone who was interested in reviewing the proposed language (including attorneys for borrowers, HOA’s, lenders, transactional attorneys, etc) and have received hundreds of emails with constructive comments which we are in the process of working our way through to come up with a product that we think will work. (We have also received a number of not-so-constructive emails who it appears didn’t take the time to review the draft bill). Contrary to what the blogs say, it is NOT a non-judicial foreclosure bill.

    We expect to come up with a final draft in the next few weeks and I intend to file it shortly thereafter. I hope you will continue to follow the issue. Thank you for your interest.

    Representative Kathleen Passidomo
    District 76-Naples, FL

    District Office:
    3299 Tamiami Trail East, Suite 304
    Naples, FL 34112
    Phone: 239-417-6200
    Fax: 239-417-6204

    Capital Office:
    1003 The Capital
    402 South Monroe Street
    Tallahassee, FL 32399
    Phone: 850-488-4487

    Legislative Assistant: Jacob Pewitt
    Director of District Affairs: Kevin Comerer

  18. Breaking News:
    FNMA v. LEBO #856-Civil-2010 Wayne County Pennsylvania

    ‘LEBO’ is a realtor group affiliates of national banks Mortgage Services.

    Lebo Real Estate on Realtor Com

    Predatory Lending in South Central Pennsylvania:

    A Review of Rising Foreclosure Filings and the Relationship to Predatory Lending

    By ACORN Fair Housing
    For the South Central Assembly for Effective Governance

    December 3, 2003

    Association of Community Organizations for Reform Now (ACORN)

    In 2002, the Task Force set out to document the problem of predatory lending in the mortgage industry by a thorough analysis of foreclosures caused by predatory activity. The Task Force secured financial support from area lenders, county
    and municipal CDBG programs, area nonprofits, USDA Rural Development, Fannie Mae, Freddie Mac, and other organizations.
    This study stands as critical evidence that predatory lending in the mortgage industry is a serious issue


    First Bank ome Loan Bank, Pittsburgh

    Predatory Lending is a very real and growing problem throughout our region. It exists in urban, rural, and suburban communities.
    􀀹 It hits those individuals hardest with the least means of protection and the fewest resources – the poor, minorities, and the elderly.
    􀀹 The federal, state and local governments’ role in combating predatory lending must be increased, in part, because it has adverse impacts on homeownership rates, tax revenue, and neighborhood stability.
    􀀹 Predatory lending is a very human problem that impacts (not only the immediate victims) but also the neighborhood, extended families, communities, and ultimately the entire region.
    􀀹 New specific resources need to be directed to the families that have been victimized as well as to those organizations and individuals who are directly working to combat the problem and assist victims.
    􀀹 The Assembly intends to continue its efforts to prevent further predatory lending by:
    o Making the public aware of this problem,
    o Conducting further research as needed,
    o Broadening its Task Force to include more parties and agencies interested in the effort,
    o Advocating for progressive anti-predatory lending legislation at all levels,
    o Helping housing counseling agencies, legal services and other
    organizations in their anti-predatory lending efforts,
    o And by assisting victims of this unscrupulous lending.

    Respectfully submitted,
    W. Craig Zumbrun
    Executive Director
    South Central Assembly for Effective Governance
    777 West Harrisburg Pike
    Middletown, PA 17057
    WCZ2 @ PSU . EDU


    The Honorable Stephen R. Reed, Chair
    Commissioner Nancy Besch, Vice-chair
    Commissioner Anthony Petrucci, Second Vice-chair
    Commissioner Harry Stokes, Secretary
    Ed Calvert, Treasurer
    Commissioner Rose Marie Swanger, Assistant Treasurer
    We acknowledge the members of the Board of Directors of the South Central Assembly for Effective Governance (as
    of the date of this report):
    Mayor Robert Anspach, City of Lebanon Representative John Payne, HD 106
    Vladimir Beaufils, SC Workforce Investment Board Dr. Steven Peterson, PSU, School of Public Affairs
    Mayor Jim Becraft, Borough of Carroll Valley Doug Pfautz, Elizabethtown
    Harrison Bink, Bink Partnership, Inc. Commissioner Cheryl Plummer, Franklin County
    Mayor John Brenner, City of York Stephen Powell, Powell Steel
    Keith Chase, Gannett Fleming Commissioner Christopher Reilly, York County
    Susan Connell, Newport George Rettew, Jr., Rettew Associates
    Commissioner G. Warren Elliott, Franklin County Robert Shaffer, Sr., Engineer, Gannett Fleming
    Harriet Faren, Leb. Valley Chamber of Commerce Rep. Michael Sturla, PA House of Reps, HD 96
    Michael Fesen, Norfolk Southern James Turner, Esq., Turner & O’Connell
    Barbara Groce, Vice-President, ENVISION Mayor William Troxell, Borough of Gettysburg
    Christopher Gulotta, Cumberland Co. Redev.
    Margaret Weaver, Gettysburg-Adams Co. Chamber
    of Commerce
    Francis B. Haas, Jr., McNees, Wallace & Nurrick Boyd Wolff, Former PA Secretary of Agriculture
    Prof. Irving Hand, Delta Development Merrill Yohe, Retired, AMP, Inc.
    William Hawkins, Triad Strategies
    Roger T. Karsnitz, Sr. Myerstown Ex Officios
    Commissioner Mark Keller, Perry County George Klaus, USDA
    Dr. Raymond Klein, Mechanicsburg Mike Krempasky, DCNR
    Jo Ellen Litz, Commissioner-elect, Lebanon Co. Dennis Lebo, PADOT
    Walter Lyon, Capital Region Water Board Dave McCarraher, HUD
    Dr. Joseph McCarthy, Susquehanna Conference Susan Parry, RC&D
    Senator Harold Mowery, Jr. Senate of PA, SD 31
    Penny Myers, Waypoint Bank
    Staff Members
    W. Craig Zumbrun Daniel Marcucci, PhD, MLA Kari A. Reagan
    We acknowledge the members of the Predatory Lending Task Force of the South Central Assembly for Effective
    Governance (as of the date of this report):
    Chair, Penny Myers, Waypoint Bank
    Vice-Chair, Dan Betancourt, Community First Fund Steve Masters, City of Philadelphia
    David W. Buches, FHLB – Pittsburgh Leila McAdoo, Dauphin Co. EDC
    Betsy Buckingham, Realtors Assoc. of York &
    Adams Counties
    Willonda McCloud, Lancaster Co. Human Relations
    Gerald Burke, Community Action Commission Derrick McDonald, Borough of Steelton
    Phyllis Campbell Patricia McMorrow, Freddie Mac
    Ed Carlin, Fannie Mae Pat Mrkobrad, Cumberland Co. Redev. Authority
    Ray Cartwright, PA Human Relations Commission Chad Myers, Housing Initiatives Corp.
    Ken Connor, PA Human Relations Commission Randy Patterson, Lancaster Co. Redev. Authority
    Sam Cooper, Dauphin Co. Bar Association Kay Pickering, Harrisburg Ctr. for Peace & Justice
    Cindy Daley, Regional Housing Legal Services Mary Rios, TABOR Community Services
    Sherrie Davis, Housing Council of York County Kevin Ritchey, Atty.
    Gladys Delgado, TABOR Community Services Craig Roda, Fulton Bank
    Lisa Fishburn, Schuylkill Community Action Byron Ross, USDA Rural Development
    Hellen Gemmill, McNees Wallace & Nurrick Nancy Roth, Housing Council of York
    John Goryl, PA Housing Finance Agency Roberta Ryan, PA Housing Finance Agency
    Gwendolyn Hailey, Esq. Beth Schalk, Lanc. Housing Opp. Partnership
    Olaf Hasse, F&M Trust Dganit Shefet, Dauphin Co. Area Agency on Aging
    Marilyn Hedge, Wachovia Ray Spencer, Citizens Bank
    Randall Heilman, Lancaster Co. Planning Comm. Mark Stone, City of Harrisburg Dept. of Housing
    Alan Jennings, Community Action Committee Joseph Terrana, Fannie Mae
    John Kilduff, PA Credit Union League Renee Thomas-Glover, SACA
    George Klaus, USDA Aimee Tyson, Lancaster Co. Redev. Authority
    Tucker Landon, Esq. Don Williams, M&T Bank
    Karl Ledford, Adams Co. Housing Authority Jeremy Wilson, USDA Rural Development
    Glenda Machia, Community First Fund David Wise, Summit Terrace Neighborhood
    Traxsene Martinez, PA Human Relations Council
    Funding support to combat predatory lending was received from the following in 2003:
    Allfirst Bank First Union Bank / Wachovia
    Citizens bank Freddie Mac Foundation
    City of Harrisburg Community Dev. Block Grant Fulton Bank
    Commerce Bank Lancaster Co. Housing & Redevelopment Authority
    Community First Fund Lancaster Co. Human Relations Commission
    Community Action Program of Lancaster County Lancaster Housing Opportunity Partnership
    Cumberland Co. Housing & Redevelopment
    Authority Affordable Housing Trust Fund
    M&T Bank
    Dauphin County Affordable Housing Trust Fund TABOR Community Services
    Dauphin County Community Dev. Block Grant USDA Rural Development
    Fannie Mae Corporation, Wilkes Barre Waypoint Bank
    Farmer’s First Bank
    Federal Home Loan Bank, Pittsburgh

  19. Consumers how did you wind up here interested in learning how you and your family, friends, neighbors, town, municipality, county, state, nation was harmed? Who took away the choice on the loan application for a ‘mortgage’ and home equity loan the type of lender and type of loan disclosures? Who bypassed the ‘NO’ for GSE type of loans and passed the loan application without disclosure to third party lenders who only sell Alt-A loans? to affiliates of Alternative Investmenets?

    All started when you followed the instructions: Applying For A Loan

    Under the good faith of the US Federal Government Regulators who controlled the ‘simple english’ fifth grade level disclosures of who would be your ‘mortgage servicers’ c/o Temporary Lender who was taking possession of property’s Collateral c/o third party Tempoary Lenders will evaluate the value of the property, a source of protection for the money they lend. The lenders want a guaranty that they will get back the money they lend. Is the property worth the risk? What are the chances that the property will decrease in value?

    Your ‘Path to Homeownership”
    Applying For A Loan & Having an approved loan application means you can begin the closing process c/o Bank Closing Agent & Tempoary Lender and Institutional Investors Bank.

    Once you have negotiated a final purchase offer with the seller, you are ready to finalize the loan application process. Under RESPA (Real Estate Settlement Procedures Act), lenders are legally required to provide you with a good faith estimate within three days after receiving your application. The information gives you an estimate of your closing costs and monthly payments. This good faith estimate does not require lenders to provide a detailed breakdown of the closing cost items or to identify the persons responsible for the payments. Therefore, it is important for you to work with your real estate agent or attorney to understand all the closing cost fees. This will ensure that there are no unexpected expenses related to your final closing costs.

    Required Paperwork

    To apply for a loan, you will have to provide the lender with detailed documentation of your financial history. The lender will request a credit report from a credit agency and will verify the information provided in your loan application

    Investors attracted to “Ginnie Mae securities” which are among the most secure investments in the global capital market. Smart Investment in nation’s housing market.

    I learned Cendant Title & Settlement Services morphed into 4 IPO’s in which Realogy IPO parallels this offer above in which the Mortgage Servicer’s affiliates, agents, dealers, brokers, distributors did morph over 2006, 2007 into 2008 through which consumers and institutional investors benefitted from owning real estate as Realogy put it in their IPO prospectus promo materials – you can own real estate carefree hands-off not having to take care of the individual propertys.

    2003: U.S. HUD’s Ginnie Mae plans two new bond programs

    Ginne Mae: A Unique Safe have for investmenets
    Guaranteed Safety of Timely Payment of Principal and Interest
    Our strength lies in our guaranty: Ginnie Mae is the only agency to offer mortgage-backed securities backed by the full faith and credit of the United States government.

    In addition to traditional mortgage-backed pass-through securities, Ginnie Mae also administers the multiclass securities program, under which Real Estate Mortgage Investment Conduits (REMICs) and Ginnie Mae Platinum Securities are issued.

    Ginnie Mae Multiclass Programs

    Real Estate Mortgage Investment Conduits (REMICs)

    Ginnie Mae Platinum Securities

    Individual commercial institutional investors, banks and their commercial clients benefactors
    1. Borrowers Ability to Meet Financial Obligations
    2. Insured by and/or Guaranteed by FHA and/or VA
    3. Issuer’s Financial Strength and Obligations

    (This is the ‘Issuing Entity’ as fictitious name c/o Registrant over SEC Norwest Asset Securities Corp ‘Seller’ as Depositor dba Wells Fargo Asset Securities Corp Originator and purchaser c/o Structured Asset Securities Corp c/o Lehman Securities LLC, for example). There are ‘multiple’ sound alike names of SASCO’s for other Institutional Investors/banks too. But only one “NASCOR”. dba Wells Fargo Bank NA c/o Wells Fargo & Co/MN, Norwest Corporation partner with WFC.

    An agency within the U.S. Department of Housing and Urban Development (HUD) plans to introduce two new types of bonds it expects to sell next year that may cut borrowing costs for home buyers.

    One of the bonds planned by the U.S. Government National Mortgage Association (Ginnie Mae), the HUD agency, has a complex structure created from other securities that pool home loans, while the other bond will bundle income from the servicing of home loans.

    The plans, unveiled at a celebration of Ginnie Mae’s 35th anniversary in Washington D.C. Tuesday, were outlined by a Ginnie Mae official to Reuters Wednesday.

    Here’s how the new bond programs work.

    Many mortgage banks resell their home loans on Wall Street as bonds. The simplest of these securities are known as pass-throughs and they are repackaged into complex transactions known as collateralized mortgage obligations (CMOs).

    From these CMOs, Interest-Only securities (IOs) are created by stripping out interest payments made monthly by borrowers. Principal only securities (POs) are backed solely by principal payments. These slices of principal and interest payments are one of the new bond programs planned by Ginnie Mae.

    “If somebody does a large IO PO deal, that takes bonds out of the market. All else being equal, that will make the securities appreciate slightly and that would modestly lower borrowing costs to consumers,” said Art Frank, head of mortgage research at Nomura Securities International Inc.

    Investors such as hedge funds or mortgage banks like to buy IOs and POs to hedge, or protect, themselves against changes in interest rates.

    The two top sources of housing finance in the United States, Fannie Mae and Freddie Mac , have had such IO PO programs in place since the 1980s.

    Like Freddie Mac and Fannie Mae, Ginnie Mae sells guarantees of timely payment of principal and interest for loans to lenders. Lenders are then able to more readily resell the loans as bonds with a Ginnie Mae guarantee, attracting investors like banks, money managers, and central banks.

    “We looked at this concept for many years,” said Ted Foster, Vice President, Office of Mortgage-Backed Securities at Ginnie Mae.

    “What I imagine is we would create more investor interest. It would make it a more robust investor base for GNMAs. We want to make these securities more appealing and this will drive down borrower costs.”

    The IO and PO deals are expected to be structured in July 2004 and the other transaction, the sale of excess income from the servicing of home loans, will be sold in September 2004.

    Servicing involves the collection of principal and interest payments each month by companies which, often, are an arm of a lending company. Sometimes this collection generates excess income, and it is this expected extra income that Ginnie Mae plans to sell as a bond.

    By selling this excess income in a security, Foster said, “it will make more capital available for lending … You hope that as there is more capital available there would be improvement in rates for borrowers.”

    Copyright 2003, Reuters News Service

    F.H.F.A the housing finance agency created in 2008 assigned to oversee the hemorrhaging government-backed mortgage companies, through conservatorship … hmmm

    Power of the federal government and the private sector working together. Over the years, Ginnie Mae has guaranteed more than $2.8 trillion in mortgage-backed securities, providing home financing for more than 35 million Americans

    New Term: Government-backed mortgage companies (plural) who else but Ginne Mae offers government-backed mortgage companies guarantees

    Issuer responsibilities and requirements:
    If you are a current Ginnie Mae single-family issuer,
    Single Family Division:
    Ginnie Mae Office of Mortgage-Backed Securities
    Single-Family & Manufactured Housing Division
    451 7th Street, SW, Room B-133
    Washington, DC 20410-9000

    Physical Location:
    550 12th Street, SW, Third Floor
    Washington, DC 20024

    (202) 708-1535
    Fax (202) 485-0232

    Michael R. Drayne
    Single-Family Division

    If you are a current Ginnie Mae multi-family issuer,
    Multifamily Division

    Mailing Address:
    Office of Mortgage-Backed Securities
    Multifamily Programs Division
    451 7th Street, SW, Room B-133
    Washington, DC 20410

    (202) 708-2043
    Fax (202) 708-3019

    Physical Location:
    550 12th Street, SW, Third Floor
    Washington, DC 20024

    Philip H. Buckley, CMB
    Multifamily Programs Division
    (202) 708-2043, Ext. 4979

    Michelle Murphy
    Mortgage-Backed Securities Specialist
    Multifamily Programs Division
    (202) 475-7825
    Fax (202) 485-0233

    As the only mortgage-backed securities in the market to carry the full faith and credit guaranty of the United States government, Ginnie Mae securities are enjoying unprecedented demand and continue to perform well.

    Ginnie Mae issuers benefit from knowing that a liquid market is always available for loans originated through the Federal Housing Association (FHA), the Department of Veterans Affairs (VA), the Rural Housing Service (RHS) and Public and Indian Housing (PIH) — and investors benefit from the knowledge that an investment in Ginnie Mae securities is among the safest in the world. Office of Mortgage-Backed Securities is personally committed to the highest standards (can we sue them?)

    Government National Mortgage Association (Ginnie Mae )


    Ginnie Mae Platinum Securities provide investors with greater operating efficiency, allowing holders of multiple MBS to combine them into a single platinum certificate. Ginnie Mae Platinum Securities can be used in structured finance transactions, repurchased transactions as well as general trading.

    YES: Ginnie Mae securities are the only MBS to carry the full faith and credit guaranty of the United States government, which means that even in difficult times an investment in Ginnie Mae MBS is one of the safest an investor can make.


    The Office of Mortgage-Backed Securities.

    With approximately $576.8 billion of MBS outstanding and more than $2.8 trillion of cumulative issuance, Ginnie Mae’s MBS program has been a significant contributor to the growth of the secondary mortgage market in the United States.

    Ginnie Mae, we help make affordable housing a reality for millions of low- and moderate-income households across America by channeling global capital into the nation’s housing markets. Specifically, the Ginnie Mae guaranty allows mortgage lenders to obtain a better price for their mortgage loans in the secondary market. The lenders can then use the proceeds to make new mortgage loans available.

    Ginnie Mae does not buy or sell loans or issue mortgage-backed securities (MBS). Therefore, Ginnie Mae’s balance sheet doesn’t use derivatives to hedge or carry long term debt.

    What Ginnie Mae does is guarantee investors the timely payment of principal and interest on MBS backed by federally insured or guaranteed loans — mainly loans insured by the Federal Housing Administration (FHA) or guaranteed by the Department of Veterans Affairs (VA). Other guarantors or issuers of loans eligible as collateral for Ginnie Mae MBS include the Department of Agriculture’s Rural Housing Service (RHS) and the Department of Housing and Urban Development’s Office of Public and Indian Housing (PIH).

    Ginnie Mae MBS are created when eligible mortgage loans (those insured or guaranteed by FHA, the VA, RHS or PIH) are pooled by approved issuers and securitized. Ginnie Mae MBS investors receive a pro rata share of the resulting cash flows (again, net of servicing and guaranty fees).


    Real Estate Mortgage Investment Conduits (REMICs) direct principal and interest payments from underlying mortgage-backed securities to classes with different principal balances, interest rates, average lives, prepayment characteristics and final maturities.

    Unlike traditional pass-throughs, the principal and interest payments in REMICs are not passed through to investors pro rata; instead, they are divided into varying payment streams to create classes with different expected maturities, different levels of seniority or subordination or other differing characteristics. The assets underlying REMIC securities can be either other MBS or whole mortgage loans.

    REMICs allow issuers to create securities with short, intermediate and long-term maturities — flexibility that allows issuers to expand the MBS market to fit the needs of a variety of investors.

    Ginnie Mae I MBS requires all mortgages in a pool to be the same type (e.g. single-family). Each mortgage must be, and must remain, insured or guaranteed by FHA, VA, RHS or PIH. In addition, the mortgage interest rates must all be the same and the mortgages must be issued by the same issuer. The minimum pool size is $1 million; payments on Ginnie Mae I MBS have a stated 14-day delay (payment is made on the 15th day of each month).

    Ginnie Mae II MBS allows multiple-issuer pools to be assembled, which in turn allows for larger and more geographically dispersed pools as well as the securitization of smaller portfolios. A wider range of coupons is permitted in a Ginnie Mae II MBS pool, and issuers are permitted to take greater servicing fees — ranging from 25 to 75 basis points. The minimum pool size is $250,000 for multi-lender pools and $1 million for single-lender pools. Ginnie Mae II MBS have an additional five-day payment delay because issuer payments are consolidated by a central paying agent (payment is made on the 20th day of each month).

    AND SO, the national banks are victims you say, ‘had to provide low-to-moderate income families with Alt-A loans which were undisclosed to be REO properties insured by GINNE MAE when placed inside of MBS pools of mortgages which Ginnie Mae MBS rolled into REMICS c/o national bank, and federal savings bank, Mortgage Servicers affiliates who are the ‘Tempoary Lenders’ who are the commercial clients of the ‘commercial banks’ who sold loans to consumers via portals over cloud who were pipeline of sub-prime lenders, alternative investors, non-conforming financial products and services.

    Important Pool Dates
    Calendar of Deadlines for ACH Payments, Pool Processing, and Data Reporting (PDF)

    Ginnie Mae I Paper Submission Due Dates (PDF)
    Ginnie Mae I Electronic Transmission Due Dates (PDF)
    Ginnie Mae II Custom Pool Due Dates (PDF)
    Ginnie Mae II Multiple Issuer Pools Securities Delivery Dates and Loan Package Transmission Due Dates (PDF)
    Adjustable Rate Mortgage (ARM) Pool Interest Adjustment Date – Date of Federal Reserve Board’s Statistical Release H15

    Investors trust Ginnie Maes, and as a result, the market is large and highly liquid. That means our issuers can roll over capital almost as soon as a qualifying pool of FHA, VA, RHS or PIH single-family mortgages, or FHA multi-family mortgages is settled.

    Ginnie Mae issuers also realize a steady income stream from mortgage servicing fees, and know exactly what their spread will be from the outset. Of course, issuers have to qualify and abide by certain rules. Ginnie Mae provides ample online training for new issuers (and for new employees of existing issuers). To learn more about how to become a Ginnie Mae issuer

    Issuers pool eligible mortgage loans and securitize these pools into Ginnie Mae I MBS or Ginnie Mae II MBS. Unlike others in the market, Ginnie Mae does not buy or sell these pools of loans or issue MBS.

    Instead, Ginnie Mae makes issuers’ mortgage-backed securities more attractive to investors by guaranteeing the timely payment of interest and principal on those securities. Our guaranty is the only one in the market to enjoy the full faith and credit of the United States government — and we are the only player in the business to guarantee the timely payment of interest and principal.

  20. Breaking News:
    FNMA v. LEBO #856-Civil-2010 Wayne County Pennsylvania
    Judge Grants Motion for Jury Trial on Counterclaim, deletes Foreclosure from Docket.

    Just like we’ve been telling you all along – Jury Trial on Compulsory Counterclaim prevents Summary Judgment from going forward. Consequence: Foreclosure Case in Equity is ripped out of Judges hands and placed in hands of local jurors. If affirmative defenses are same as counterclaim jury nod to any of your counts will deny foreclosure and possible award damages. Think angry under water homeowners and fraudulent banks will render their decision instead of a judge who wants to clear docket or says homeowner should owes someone.

  21. FREDDIE/Fannie – two mortgage giants acquired the securities in the years before the housing market collapsed –

    Pay attention ‘securities’

    And so the ‘purchaser order for loans’ in which Originator ‘Wells Fargo Bank NA c/o Wilminton Trust Company’ Seller of Loans acted as Depositor c/o Wells Fargo Asset Securities Corp aka Norwest Asset Securities Corp and all of the ‘TEMPORARY LENDERS’ are commecial clients of ‘Wells Fargo Bank NA’ national bank as ‘Mortgage Servicer’s affiliates.

  22. SUPRISE “Fannie and Freddie thought they were taking AAA tranches” as Institutional Investors ‘private wealth benefactors’ thought …


    “Fannie and Freddie were required to back loans to low-to-moderate income and minority borrowers”

    So the ‘excuse’ will be carefully worded

    Institutional Investors’ banks in order to ‘keep charters’ issued by FEDERAL RESERVE had to comply with OCC ‘CRA’

  23. I agree with you Neil , until we see criminal, not civil, charges are brought against these white collared criminals, it will only result in another negotiated fine that is a pittance of what these banks made from their ill-gotten gains. Criminal charges with jail time for the perpetrators, along with reinstating the Glass-Steagall Act is what is needed.

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