Homeowners being robbed by big mortgage companies operating in collusion with the courts
Courtroom foreclosure proceedings now favor big mortgage companies over the homeowners who are systematically being robbed by them! Special courts have been created that have been nicknamed "rocket dockets." Their mandate is to "clear" 25 cases an hour, so judges are spending just a few minutes on each case. The problem here is that these cases are very complicated: In the beginning, when these mortgages were issued, no one knew that their future would turn out to be far different from that of the normal mortgages one would have had 20 or 30 years ago, when one bank gave one person a loan, and then they held the loan note until maturity. In the last 10 to 15 years, banks have been making loans to people and then essentially throwing the loan notes in big piles and essentially chopping them up into little bits, making securities out of them and then selling those securities to foreigners or pensions or others. Problem is, many of these transactions were essentially fraudulent. Why fraudulent? Because the seller was fraudulently presenting sub-prime mortgages as AAA-rated. And once they dumped these loans off on other people, in the form of mortgage-backed securities, the banks stopped doing the paperwork, saying to themselves, "Why bother doing this the right way, or why bother being principled or even legal about it now? It's out of our hands and no longer our worry. We sold it, we have the money they paid us, and now it's someone else's problem. Good riddance and good bye." In other words, they sold a product that they knew was crap, and that is of course the very definition of fraud.
Why again was the product crap?
Because it was a virtual certainty that many of the mortgages in the bundled group of securitized mortgages were going to go bad. Why would they go bad? Because as soon as home prices stopped rising, and people started losing their jobs (to continuing automation/computerization and to low-wage workers in China), they would be unable to make their mortgage payments, and their homes/mortgages would be forced into foreclosure.
However, the vast majority of these foreclosure cases had what is called "bad paperwork," which means, among other things, that the foreclosing entity is no longer in possession of the mortgage note. Therefore the bank or other foreclosing entity is unable to prove that they actually own this loan. And if there is actually a lawyer present in the courtroom that points this out, usually the homeowner can beat the rap. By this means some people are able to stay in their houses three and four years after making their last mortgage payment. Yet, up until now, 98% of the cases are still unopposed, and the courts usually just rubberstamp these foreclosures, even when the foreclosure is not legal and could easily be beaten by any decent lawyer.
Many class-action lawsuits in the pipeline
When the banksters were selling these mortgage-backed securities, they were typically selling them to groups of investors who were not well organized. One person owned one 1/1000th or one ten-thousandth of a pool of mortgages. It's only now that those investors are getting together, organizing and realizing that the big banks took them for a ride. So the banks are now getting sued from two sides: They're getting sued by the investors, and they're getting sued by groups of homeowners who are being foreclosed upon.
There's one suit in New Jersey against the Bank of America. It's a class-action suit that basically charges BofA with using predatory loan practices or getting people into houses that they couldn't afford or into risky loans when they could have had safe ones and then defrauding investors. There's another suit in Kentucky that is a racketeering or RICO suit. They're using racketeering laws to try to get at this. So it is coming; there's going to be a wave of lawsuits where people are going to try to recover their money from the banksters who continue to steal it from them by the billions.
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