HARRISBURG, PA FILES FOR BANKRUPTCY

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$2.9 TRILLION MUNICIPAL BOND MARKET WEAKENS

Wall Street’s economic death grip continues to have consequences and repercussions — both politically and economically. The Banks’ push on mortgage bonds, derivative securities, and hedge products has resulted in loss of of money, loss of revenue and loss of prospects. The biggest contributor is the housing and mortgage market, with jobs taking up second place. Revenues are shrinking as money needed to restore the economy to a firm foundation is withheld by the megabanks, some of whom (Goldman) are crying poverty.

According to a Wall Street Journal report written by Michael Corkery and Kris Maher, the capital city of Pennsylvania filed for bankruptcy protection in a case that follows other cities, but its sheer size makes it a case to watch.

Harrisburg rejected selling or leasing assets to pay down debt. In Arizona, the government sold the capital buildings in Phoenix and leased them back in what some are calling a sweetheart deal that benefits the buys more than the state or the taxpayers.

It’s the politics that is even more interesting than the economics. The split city council was taken over by members who were tired by being “pushed around,” an echo of the Occupy Wall Street movement. Last month Jefferson County, Alabama used the threat of bankruptcy to squeeze concessions from creditors.

Since 1980 there have been 48 official bankruptcy filings for cities, counties and other governmental units. But that is the tip of the iceberg. Hundreds more have been negotiating, like Jefferson County in Alabama to get relief from creditors. But what they should be doing is prosecuting claims for impact costs and lost revenues from the Banks, who used a variety of means to evade payment of taxes, fees and expenses relating to the false run-up of prices and housing activity over the last 10 years.

Local government, taking their information from the Banks’ were led to believe that their area was growing and that more services and infrastructure was needed, thus committing themselves to huge debt and expenses that could have been paid if the representations and analysis from Wall Street was true. Like the ratings on the “mortgage backed” bonds, the analysis from Wall Street was false and the ratings firms should have known that, just as they should have known that the mortgage bonds were a scam.

So-called experts are being rolled out by the dozen to say that the Harrisburg bankruptcy does not foreshadow more local government bankruptcies. But a quick look at the finances around the country shows clearly that many, if not most cities and counties, are on the verge of a collapse of their financial system. The money they are missing is sitting on Wall Street the titans of which won’t give it back.

Local government is like small and medium sized businesses. It needs the revenue from ordinary consumers to function, provide fire, police and other social services. It needs that revenue to pay off bonds and other debt to pay for new roads or repairing roads, bridges and tunnels.

The consumer class has run out of money and run out of equity. Ordinary people have virtually no equity equity left in their homes or a steep reduction, their 401k is less, and their pension benefits are being eroded by losses from mortgage bond chicanery and creeping inflation as the Federal Reserve engages in its third round of quantitative easing — i.e., printing money — to cover up the $16 Trillion “bailout” of the Banks.

If the federal government and federal reserve spent 1/4 of what turned out to be the Great Bailout of Banks for Nonexistent Losses, this problem would not exist. As taxpayers, we gave Wall Street $16 Trillion. We have nothing to show for it except worthless paper transactions involving worthless securities that were fraudulently issued and fraudulently represented as backed by mortgage loans. None of it was true.

At some point, we are either going to get that money back and put it into a hungry economy or we will give up and simply accept the fact that the Banks run the country, that the government of the people, by the people, for the people no longer exists.

20 Responses

  1. […] […] well something better happen soon everyday that go by ticking of the clock toward my foreclosure. i had paid the 5 th paymeyment of a mod thats was higher then te original. I called wells fargot and asked about a hamp i was underemployed. They told me i had to be in eminent default before i could apply???. Me to wells fargo but i am current and do not want to lose my home i put 20% down so does this mean i have to stop paying??? I asked for it in writing 9/14 and 9/15 and the refused. i need help here need a defense please help i do not want tose my home. We were told not to pay while my loan was being reviewed my file was moved the when i complained they sent me another hamp application from 2 different computers. I sent my package by fed ex and the lost just like in 2009 my paper work was lost thats when i google mortgage and mod fraud and found all these web sites. But its people like me and husband who need help we have 3 children we do not want to be homeless please! HelpSource: wordpress.com […]Source: wordpress.com […]

  2. […] well something better happen soon everyday that go by ticking of the clock toward my foreclosure. i had paid the 5 th paymeyment of a mod thats was higher then te original. I called wells fargot and asked about a hamp i was underemployed. They told me i had to be in eminent default before i could apply???. Me to wells fargo but i am current and do not want to lose my home i put 20% down so does this mean i have to stop paying??? I asked for it in writing 9/14 and 9/15 and the refused. i need help here need a defense please help i do not want tose my home. We were told not to pay while my loan was being reviewed my file was moved the when i complained they sent me another hamp application from 2 different computers. I sent my package by fed ex and the lost just like in 2009 my paper work was lost thats when i google mortgage and mod fraud and found all these web sites. But its people like me and husband who need help we have 3 children we do not want to be homeless please! HelpSource: wordpress.com […]

  3. E.Toile,

    I was absolutely pissed when my servicer gave me the song and dance about mod documents being lost, my not having “missed” payments and, therefore, not being at risk of foreclosure and the rest of the horror stories everyone tells. I went beserk when i got turned down and went on my fight, not quite sure I was right to go on the attack.

    After reading your answer and seeing all the posts of all the people who got modified upwards, I thank God I wasn’t allowed to modify: I might have ended up much, much worse off!!!

    Thank you for clarifying this point for me.

    Sheesh…!

  4. marco barazza- GREAT IDEA! You could probably start with the 2 or 3 county recorders’ records audited by Marie O’Donnell, she did the amicus brief for the Ibanez (Mass.) and has stellar credentials. Maybe she would share her findings. We all know that these “loans” were sold multiple times to multiple trusts, this would PROVE the enormity of the fraud. As long as you can locate the mortgage loan schedule. Some of the PSAs don’t list even the # of loans, let alone the individual loans themselves. But it would be a great start.

  5. Carrie we need to track down foreclosed homes documents create a database that shows which home was foreclosed by the name of each trust the psa says that 2200 mortgage were in this trust bet you can find 8000 homes foreclosed in that name of a trust and ask investors did you receive any funds and what account number were the funds sent to NEIL HAS HAD FIVE MILLION READERS a data base of like type of foreclosures sure would help other homowners real evidence. Same fraud a Lee Farkas did with colonial bank. The least politically connected went down. Lee is actually in jail Taylor Bean whitaker has done the same as countrywide with angelo mozillo.

  6. […] Filed under: bubble, CDO, CORRUPTION, currency, Eviction, foreclosure, GTC | Honor, Investor, Mortgage, securities fraud Tagged: bankruptcy, borrower, countrywide, disclosure, foreclosure, foreclosure defense, foreclosure offense, foreclosures, fraud, LOAN MODIFICATION, modification, quiet title, rescission, RESPA, securitization, TILA audit, trustee, WEISBAND Livinglies’s Weblog […]

  7. Enraged, upped mod payments are, or were, very common, albeit almost never discussed by the government or anybody mainstream. My mod, which BTW took 9 months of tussling back and forth in 2009, the final 3 months with the aid of limp-threats from my AG aimed at Countrywide with absolutely no fear from CW’s legal department, was raised significantly on a monthly payment schedule, along with fees for the hassle. This was pre-HAMP.

    I don’t have the figures in front of me, but I distinctly recall that in November 2009, 65% of modifications had in fact raised the monthly amount to the hapless “client”. Doomed to fail? You betcha’. Just as sinister is the fact that when the banks tout their completion rates for mods achieved and receive our government monies for the same, this little known fact is conveniently swept under the rug and out of sight.

    You ask why anyone would go along with this travesty? What’s the choice? There isn’t the variety of modification offer #3 or #9, or what have you. It’s very much a take it or find one’s self meeting the curb deal. Even with all of the perceived resources of the attorney general’s department threatening with all their might, in my case CW just smirked, as if they knew that no harm would befall them, as we all know is the reality. They do in fact own our government. Nothing short of a dismantlement will correct this situation.

    Only when this same arrogance has pushed more and more individuals to the brink or over the edge will the problem be resolved, and it won’t be by our elected representatives seeing the light and deciding to do the right thing. Their masters grease palms and guarantee campaign resources way too effectively. See OWS and taking it to the streets for the remedy, even if it is nasty medicine.

    This parasite can only be starved to death, by the masses working together to withdraw any and all funding, not just individually, but by consensus collectively as well. When we refuse to allow our government, from local townships through federal, to play with the big boys, a.k.a. GS, Chase, Citi, B of A, Wells, refuse to allow these entities to usurp what we do on a daily basis, only then will we cutoff their access to our free money. When we force our reps to stop Bank of America from being the unemployment payment czar….when we force our reps into disallowing Chase from being the financial portal for the EBT system instead of our own freakin’ government….when we refuse to allow municipalities to finance short term stop gap school funding through Wells Fargo….when we say no to municipal refinances to Sachs…the list goes on. Only then will they wither and die. And it really is us or them, make no mistake about it.

    So, why do they modify upwards? For the very same reason they short securities that they sell to investors. It’s the same game plan, and in their game, there can only be one winner, but multiple losers. Why do you think it is that until just now, Sachs has NEVER seen a down trading quarter? Ask anyone who’s ever traded for a living like Yours Truly how impossible that scenario is if in fact you play by the rules that everyone else is bound by.

    They modify their victims…uhm…. their clients…. mortgages upwards because they know they can, without fear of any regulators, because they want your house. It’s a free house, even if fraudulently acquired, and it’s helping in a small way, along with the free monies from the Fed and the Treasury to help fight off expensive investor lawsuits. So for them, adjusting modifications upwards is a very simple combination of gravity and math. When the borrower’s outgo exceeds their income, their upkeep is their downfall, and this downfall aids their bottom line, and they continually rise to the top. Make no mistake about this simple fact….to them, the true 1%, you and I are nothing more than magnetic ink on a ledger sheet.

  8. @ lies,

    I have another one of my dumb questions but it’s killing me: I’ve got to ask.

    You are not the first person whose post mentions a modification with a monthly payment higher than the one you previously had. Did you notice when you agreed to it that you would be paying more? Why did you sign, then? Why do people agree to terms that put them in a worst position then before? What did the bank tell you to make you swallow something like that?

    I don’t get it! And please don’t get me wrong: I am not implying anything about you as a person. I am just wondering why it seems to happen so much and why people went along with it. The idea of a mod was to help you, not put you in a worst place…

  9. @lies is all they tell:

    Tell your stinking servicer to tell you “WHO OWNS MY LOAN??”.

    Then tell them to PROVE it with a LEDGER and BALANCE SHEET showing ALL of your payments conveyed to an ACTUAL MORTGAGE…not just some “debt” attempting to be collected by a stinking DEBT COLLECTOR.

    Tell them you are on to their lies—that they have no right to foreclose on unsecured debt—tel them you demand PROOF of their CLAIM that you in fact owe ANYTHING AT ALL on a manufactured “debt” that they cannot prove is attached to an actual mortgage. THEY MUST SHOW THAT YOUR PAYMENTS ARE GOING TO AN ACTUAL MORTGAGE WITH A VERIFIABLE LEDGER AND BALANCE SHEET.

    Please fight back—you must get very aggressive—send a cease and desist dispute of debt certified letter to the servicer AND the “foreclosure mill” that sent the Notice Of Default (NOD),—did they send you one yet?

    If they try to get your house you must also fight them on “subject matter jurisdiction”! File to dismiss for lack of subject matter jurisdiction!!

    (I am not an attorney and this is not legal advice…)

  10. […] Livinglies’s Weblog Filed Under: Foreclosure Law News, Foreclosure News Tagged With: crisis, foreclosure, […]

  11. @lies……….

    forgot this one,,,,,,,,,,,you can always keep cash in the garage or whatever. Which is what I do. I pretty much trust no bank or financial institution but only keep money in it for bills. I also do not wish these financial institutions to use my cash on account for their benefit only with no return on my letting them have my deposits. I have no desire to let the rich get richer why I get nothing. There is no deposit or savings interest you get these days.

    Imagine,,,,,,,,,,,,,,

    you start a business like a insurance company or bank,,,,,,,,,,,,,and you get thousands, millions of people to deposit money with you, for an exchange of some insurance policy or deposit interest,,,,,,,,,,,,,,and only 5% of the deposits will you have to pay out on,,,,,,,,,,,,,,but you get to use all the 95% people’s money to play the markets…………you can figure it out,,,,,,,,,,,,yehaw, I can make lots of money…………it’s in all the numbers………….

    but what is the real exchange for products, that people have to work for a living………….something went wrong………….it is called leverage…………..it is called compound interest………….it is called allowing credit for a consumer of a product that degrades and becomes worthless over time but you still owe on it,,,,,,,,,,,,,of products that degrade in value once you use them, but still must pay for the credit used to get the product..

    Do not use credit for products, consumerables that have no value over time, but your debt has value over time until paid.

  12. @lies………….

    I do not have the answers nor do I think anybody here on this site will have the answer that you can just follow. And it truely sucks. How do you like that for our nation of laws. And the name of the game is survival so you best have a plan B or C. Cuz they will take your joint. I am just being totally honest, I am not a lawyer, just a person like you. So, I will repeat, you need plans to move or just don’t care. Somehow save money that is for sure and keep it outside of a bank and I recommend moving your savings and checking accounts to a local credit union now!. And maybe even opening a few accounts in different credit unions. Remember to research that the credit union is a non profit credit union or banking institution.

  13. well something better happen soon everyday that go by ticking of the clock toward my foreclosure. i had paid the 5 th paymeyment of a mod thats was higher then te original. I called wells fargot and asked about a hamp i was underemployed. They told me i had to be in eminent default before i could apply???. Me to wells fargo but i am current and do not want to lose my home i put 20% down so does this mean i have to stop paying??? I asked for it in writing 9/14 and 9/15 and the refused. i need help here need a defense please help i do not want tose my home. We were told not to pay while my loan was being reviewed my file was moved the when i complained they sent me another hamp application from 2 different computers. I sent my package by fed ex and the lost just like in 2009 my paper work was lost thats when i google mortgage and mod fraud and found all these web sites. But its people like me and husband who need help we have 3 children we do not want to be homeless please! Help

  14. Garnishing Wages – The Concern About Deficiency Judgments

    Posted on October 13, 2011 by Mark Stopa

    Many homeowners may not realize it, but in states like Florida, banks can collect additional money from you after a foreclosure lawsuit, even after the foreclosure is over and long after you’ve been evicted. By way of example, suppose you owe $400,000 on your home and you stop paying your mortgage. By the time the bank gets a Final Judgment of Foreclosure, to include interest, attorneys’ fees, and costs, that number will likely be more like $500,000. (Everyone always under-estimates the impact of default interest on the total amount owed.) Suppose the home is worth $200,000. When the bank forecloses, it will have collected just $200,000 of the $500,000 you owe. The remaining $300,000 is called a deficiency. Even after being evicted, you still owe that money. Even after the foreclosure, the bank can chase you down to collect that $300,000.

    If you’re not sure what I mean, go look at a Final Judgment of Foreclosure in any (closed) court case. Chances are, it says the court “reserves jurisdiction” to award a deficiency. This means, in layman’s terms, the bank can come back to the court in the future and ask the court to enter a deficiency judgment against that homeowner.

    Don’t get me wrong – nobody wants to be foreclosed. But for many homeowners, avoiding a deficiency is the primary goal. Many homeowners can accept getting foreclosed so long as they don’t owe the bank more money after the foreclosure is over.

    I’m convinced most homeowners don’t realize the magnitude of the problem vis a vis a deficiency judgments. Many clients have told me “I don’t have anything the bank can take.” In many cases, that’s true – you can’t get blood from a stone.

    However, it’s not that simple. Once a foreclosure case i over, all the bank has to do is obtain the deficiency judgment and record it in the public records. This is like any other judgment in any lawsuit – it’s the court’s way of saying “homeowner owes this money to bank.” And here’s the problem – that judgment doesn’t just go away. Money judgments are valid in Florida for up to 20 years. 20 years! And they accrue interest at a statutory rate (currently 6%, but often as high as 10% or more). After 10 years, that $300,000 judgment can be $450,000 or more, easily.

    Some homeowners still scoff, saying “the bank can never collect from me.” My response to this is simple – ”are you sure?”

    By way of example, the Second District Court of Appeal just issued an opinion, hot off the presses, which should scare the daylights out of all Florida homeowners. It hasn’t made headlines among foreclosure defense advocates because it’s not a foreclosure case, but take a closer look.
    http://www.2dca.org/opinions/Opinion_Pages/Opinion_Page_2011/October/October%2012,%202011/2D11-256.pdf

    In the opinion, the Second District explained that USAMERICABANK was entitled to garnish the wages of Richard Nelson Klepal, Jr. even though he was the head of household because the promissory note he signed with the bank expressly authorized it to do so.

    The “head of household” exception is an often-cited reason why homeowners think a bank won’t be able to collect a deficiency judgment against them. “I have children, and I’m the head of household, so the bank can’t garnish my wages.” Yes, that’s the layman’s explanation, but, regrettably, it’s not that simple. As the Second District just yesterday, if you consented to the bank garnishing your wages in your note/mortgage, then the bank can garnish your wages even if you’re the head of household.

    With that, I ask – how many homeowners reading this know whether their note/mortgage allows the bank to garnish wages? I suspect the number, if it’s not zero, is darn close. Scary, eh? And remember – even if you are currently the head of household, and even if your note/mortgage doesn’t allow the bank to garnish your wages, what is going to happen when your children grow up and/or you aren’t head of household any longer? Remember, deficiency judgments are valid for twenty years, accruing interest each year.

    My point isn’t to scare anyone. Rather, I’m trying to educate homeowners so they don’t find themselves in the predicament in which Mr. Klepal found himself. Quite simply, don’t ignore a possible deficiency judgment against you. And don’t assume the bank won’t be able to collect on its judgment. Even if you’re the head of household now, even if you’re unemployed or earning very little income now, twenty years is a long time. Chances are, your circumstances will improve at some point in the next twenty years, especially if you’re currently 65 or younger. (As I’ve said before, deficiency judgments are less of a concern for the elderly. But anyone still in the work force should try their darndest to avoid one.)

    So what should you do? Simple. As part of fighting your foreclosure case, strive to avoid a deficiency judgment in one of three ways:

    1. Settlement. Every case is different, but it’s certainly possible to get the bank to agree to waive the right to collect a deficiency as part of a settlement of the foreclosure case … if you fight. If you make it easy for the bank, you won’t get this sort of agreement. But if you fight, and make it difficult for the bank to foreclose, it stands to reason you have a better chance at convincing the bank to waive a deficiency. In doing so, you may get foreclosed, but at least you won’t owe the bank more money after the foreclosure is over.

    2. Bankruptcy. Yes, it’s a dirty word for some, but bankruptcy is a totally lawful way to eliminate debt. If the bank won’t agree to waive a deficiency, a Chapter 7 or Chapter 13 bankruptcy is a far better option than letting a bank garnish your wages or collect a six-figure judgment against you for the next twenty years.

    3. What happens if you can’t get a settlement with the bank and aren’t a candidate for bankruptcy? Simple – asset protection. This is complicated, and beyond the scope of this blog. But I talk with homeowners about this regularly. If you have assets, and are facing a potential deficiency judgment, make sure you talk to a lawyer who can counsel you on asset protection strategies. This may sound shady, but rest assured – there are perfectly lawful things you can do to protect your assets from creditors.

    Fighting to avoid a deficiency isn’t as fun or sexy as talking about “foreclosure fraud” or “robo-signing.” But it’s a very practical approach for many homeowners, allowing them to move on with their lives without a bad investment haunting them for years to come. Please don’t under-estimate the importance of this aspect of your foreclosure case.
    Mark Stopa

    http://www.stayinmyhome.com

  15. ——————————————————————————–

    Anh,

    BREAKING NEWS: The New York Times reports that Mayor Michael Bloomberg may force protesters from Zuccotti Park — effectively evicting Occupy Wall Street.

    We have less than 24 hours to stop it — please sign this emergency petition:

    “Mayor Bloomberg: Respect First Amendment rights. Don’t try to evict Occupy Wall Street.” Sign here.

    Bloomberg is claiming the eviction is “temporary” for “cleaning” the park — the exact excuse used to permanently end prior protests.

    Even if the protesters return, they may have to follow ridiculous new rules like “No sleeping bags” — completely undercutting the permanent occupation that is raising the nation’s awareness of corporate greed.

    We need a national groundswell immediately. This petition will be delivered by our friends at MoveOn to Mayor Bloomberg at City Hall tonight.

    Over 100,000 people signed this emergency petition in the last couple hours. It will be delivered to Bloomberg tonight — please sign here and spread the word.
    http://act.boldprogressives.org/sign/petition_defend_ows/?akid=5492.1109578.yjJQ1F&rd=1&source=e1-boa&t=3

    Thanks for being a bold progressive.

    — Neil Sroka, Kristiane Skolmen, Adam Green, Stephanie Taylor, Forrest Brown, and the PCCC team

  16. tn—you there?

  17. tnharry—what say ye to this from ANON.?

    “…The only way to prove not owned by any trust — is by production of the cash ledgers maintained by servicers and trustees. If servicer did not advance payments to trustees on behalf of “default” loan borrower, trust and trustee is entitled to nothing. Ledgers are the key. Unilaterally, servicers cease advancing payments before 180 days. At that time — swap out of “collection rights” occurs. No security transferred — the security is dead…”

  18. Enraged, actually the very least they can do is exactly what they’ve been doing….nothing. It’s time for all of these individuals to awaken and kick butt.

  19. That’s the very least they can do. Then, I hope they also go after the banks and brokers who sold them fabulous investments opportunities for their employees retirement plans!

  20. I hope that the Recording Clerks in all citys and towns will wake up and go after MERS, for all past due recording fee’s.

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