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How Banks Are Worsening the Foreclosure Crisis
- Text size
Brian Grow, Keith Epstein and Robert Berner
Yahoo News
February 13, 2009
The bad mortgages that got the current financial crisis started have produced a terrifying wave of home foreclosures. Unless the foreclosure surge eases, even the most extravagant federal stimulus spending won’t spur an economic recovery.
- A d v e r t i s e m e n t
The Obama Administration is expected within the next few weeks to announce an initiative of $50 billion or more to help strapped homeowners. But with 1 million residences having fallen into foreclosure since 2006, and an additional 5.9 million expected over the next four years, the Obama plan — whatever its details — can’t possibly do the job by itself. Lenders and investors will have to acknowledge huge losses and figure out how to keep recession-wracked borrowers making at least some monthly payments.
So far the industry hasn’t shown that kind of foresight. One reason foreclosures are so rampant is that banks and their advocates in Washington have delayed, diluted, and obstructed attempts to address the problem. Industry lobbyists are still at it today, working overtime to whittle down legislation backed by President Obama that would give bankruptcy courts the authority to shrink mortgage debt. Lobbyists say they will fight to restrict the types of loans the bankruptcy proposal covers and new powers granted to judges.
The industry strategy all along has been to buy time and thwart regulation, financial-services lobbyists tell BusinessWeek . “We were like the Dutch boy with his finger in the dike,” says one business advocate who, like several colleagues, insists on anonymity, fearing career damage. Some admit that, in retrospect, their clients, which include Bank of America (NYSE:BAC – News), Citigroup (NYSE:C – News), and JPMorgan Chase (NYSE:JPM – News), would have been better off had they agreed two years ago to address foreclosures systematically rather than pin their hopes on an unlikely housing rebound.
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February 13th, 2009 at 10:14 am
No one will be sorry when the Senators and Congress end up in the FEMA camps with a few honourable exceptions.
mrmakymkay Reply:
February 13th, 2009 at 12:42 pm
fuk em all invest in lead!!!!!
February 13th, 2009 at 10:16 am
What is congress doing to stop foreclosure? Nothing! Bow down to the Israeli banks. Jefferson said the people of America would wake up homeless in their own land if the Fed was privatised and he was right because Congress is too goddam stupid to understand the scam and too corrupt to stop it.
THIS IS NOT THE FREEMARKET: THIS IS THE SCAM JEFFERSON PREDICTED: READ YOUR ECONOMICS!
Jabberwocky Reply:
February 13th, 2009 at 2:56 pm
shit, you dont even have to read your economics, just look at a graph of the nations debt since the Fed took power and you can tell that something is wrong.
John Henke Reply:
February 14th, 2009 at 10:29 am
It’s the failure of Fascism!
Ozcee Reply:
February 15th, 2009 at 4:03 am
You’re a smart boy, that’s for sure!
February 13th, 2009 at 11:23 am
The Democrats seem to want to be able to spend a quadrillion dollars on the STIMULUS package. They say that the gargantuan bill is too small. How can they regain the trust of the people? Didn’t they have a procedural vote on Tuesday to wait forty eight hours after the final draft of the wasteful spending bill nonsense? Do they now want to vote today, less than twenty four hours after the final bill is drafted? Our government has been gambling away all our money.
I didn’t vote for Obama or McCain in November. Both parties have lost their way.
Is it a gamble to wonder if our creditors may call in our debt this year? What’s to stop them?
AJ says the whole thing is engineered. Do you doubt him? The economy will eventually fall. We can bank on it.
February 13th, 2009 at 11:28 am
The Occultist Signature in the Parliament of the World’s Religions
http://mankindlastchance.wordp.....religions/
jdogg92056 Reply:
February 13th, 2009 at 12:19 pm
Seriously dude, don’t you have anything better to do?
February 13th, 2009 at 11:56 am
Umm, Mankind’s Last Chance…..I think my father said it best…..”Coo-Coo, Quack-Quack”! I mean, really. People like you are hurting the rest of us by being so crazy. We’re all in dire trouble and I do believe satanic forces are involved but you take it too la-la land.
February 13th, 2009 at 11:56 am
Off topic, but here’s an opinion on another [better?] way to spend the 827 Billion Dollar Stimulus money: http://www.youtube.com/watch?v=jrJBJxKvHFc .
I found it quite interesting, you might too.
February 13th, 2009 at 12:18 pm
Well, of course the banks don’t want the mortgages modified. Would you kill your own pet goose that lays golden eggs? When the bank “lends” to finance a mortgage, all they do is type in the amount of the “loan” into their accounting system. It’s not like they go into the vault and actually haul out money which would represent the result of their past profitable business transactions and then loan that to you, which by the way, it would only be correct to pay interest on. Oh no, they let you pay your real interest that you have to earn by the sweat of your brow, on imaginary money. Money that doesn’t physically exist. So every time they pull this fraud, they imagine that they have created an additional revenue stream for themselves for the next 30 to 40 years. Modify the mortgages? Hell no, not while they’re breathing, there won’t be any mortgage modifications.
February 13th, 2009 at 12:46 pm
Yep, they just keep on taking and taking… Ever look at your mortgage? The banks are making 150% of the value of your home over the life of the mortgage and for what? They created the money out of THIN AIR!! They get $350,000 on my $250,000 mortgage for servicing it?!?!? And they STILL need to be BAILED OUT?!?! WAKE UP PEOPLE!! This is HIGHWAY ROBBERY and This system HAS TO STOP!!!
I’ve done my part. Will you do yours? The enemy uses BILLIONS of YOUR HARD-EARNED MONEY every year in the agenda to keep us enslaved. Yes, HALF of your income and even MORE in the future will go to these CRIMINALS running the show in DC and the BANKS. How much more are we going to take before we join together and push back? I know there are at least 2 million Infowarriors out there who can contribute 5 bucks to the cause. That’s a $10 million injection into the Infowar which will help get the word out to more people!! It’s ONLY awareness by the masses that will stop this in it’s tracks! This is a war, people, and as we all know from Iraq, wars need funding–except I’m not lying to justify my case!!! The only difference is we’re not able to steal from the citizens to fund our war. It has to come from US! Please donate today! Thanks for your support…
http://www.youtube.com/watch?v=Uns4n_Rd1do
What’s 5 bucks today for a chance at freedom the rest of your lives…?
February 13th, 2009 at 2:26 pm
OK, so now it’s time for the government to get involved with mortgages? That is an issue between lenders and borrowers to negotiate, NOT for stimulus packages to interfere with. The only FIX for the housing crisis is for enough foreclosures and seller markdowns to occur so that homes are sold at TRUE market value instead of the still current inflated prices.
It was Greenspan and CO.’s failed Keynesian policies that allowed for the post 9/11 run-up in housing prices, and it will take Austrian economic policy to fix the market, not more tinkering.
February 13th, 2009 at 2:33 pm
Obama-cadabra!!!
MAGIC!?
http://911truth-sherbrooke.org.....-ceremony/
February 13th, 2009 at 3:27 pm
This is just the beginning for ALL home owner. SOME of the homeowner defaulting on load payment, because of JOB lose,They will lose they home. SO your house is payed in full?….LOL. The other half of that some will be. Your property tax will start increasing, if you are on a fixed income (MOST & elders) you are out the door. The goal is to remove all American from they homes. I wounder for what?.
John Henke Reply:
February 14th, 2009 at 10:36 am
Property tax is the rent we pay to the government to stay in what we think is our property.
There in lies the joke. Property ownership in America is an illusion. There was more private property in the Soviet Union than there is here.
We will never own property until this despicable property tax has been forever abolished.
Todd Reply:
February 15th, 2009 at 3:44 pm
Does a wage-earner have “property” in the fruits of his labor?
If so, then how are wage taxes any less a violation of property rights than property taxes?
http://www.progress.org/2003/fold315.htm
February 13th, 2009 at 6:57 pm
IN A FREE MARKET ECONOMY THE BANKS WOULD BE EATING CROW….BUT IN AMERICA, THEY PROFIT.
February 13th, 2009 at 7:01 pm
this foreclosure shit can be explained, but only by being honest and taking everything into account. It all has to to with racism, bank scams, profiteering, making the rich richer and poor poorer. It has nothing to do with fucking the economy. The economy is not weak. You have just been brainwashed. People are still buying the really expensive cars, tv’s, and everything else they want. The only folks that have been affected are the struggling, low wage paid folks and those who work in jobs that sit and shuffle papers all day long. 30,000 people will lose jobs from the uncessary closure of circuit city, but they are mostly high school and college students.
You pick and choose what you want to believe, but all of the above is involved, not just some shit interest rate.
February 13th, 2009 at 7:12 pm
We need to run the banks. If everyone would just go to their bank and withdraw the cash that isn’t there we would have the upper hand. Nothing is going to change until people stop playing the fake electronic cash game. After that a new currency is needed and it should be based in something that has intrinsic value so that counterfeiting it is in essence creating value. We can’t use IOUs or paper promises that represent the actual underlying medium. The medium of exchange has to be transfered at the point of the transaction so that there are no degrees of freedom to be taken advantage of by fraudster. Let’s face it Trust simply doesn’t work so we need to have a system/medium that doesn’t rely on trust. And one other thing Alex’s reference to “International Bankers” is just a thinly veiled allusion to the International Jews. I guess he is limited to what he can say because of possible legal repercussions from inciting ethnic this or that.
Henry Ford wrote books about this topic in 1920. You all should check then out Amazon or Barnes and Noble. He explained the exact same things that are happening now way back then which is very potent evidence for the validity of the theory.
Maybe I should tell Alex about Henry Fords writings.
February 13th, 2009 at 9:37 pm
Is anyone here familiar with the books by Henry Ford That I mentioned?
February 13th, 2009 at 9:42 pm
I know how to make them modify a mortgage. Here’s what you do if you’re in over your head in your own house: 1) move out into as small of an apartment as you can, sell all extraneous items. 2) rent out the house for prevailing market rate. Sign renter to 6 month lease, then month to month after that. 3) Stop making payments on house. 4) after about 4 months contact bank explaining financial difficulty (make sure you’re not making too much money, the less the better). 5) offer the bank a short sale. if they will look at offers, contact realtor who will do it. This should get you through about 6 months of rent collecting and no mortgage. Then tell your renters that the house is for sale. Offer to sell them the house at the new “short sale” price. If no, have realtor put on market. Offer renters discounted rent if they need to save money to move out if house is bought and taken over. It should take about another 6 months to sell the house after it hits the market (includes offer plus approval time). When offer is accepted by bank, new owners take over and either move in or continue renting to current renters. Presto! you’re off the hook and the house is now valued at the new market rate. Mortgage now modified.
Ozcee Reply:
February 15th, 2009 at 4:09 am
Thanks. Saved as a text file aginst the day I might need it.
February 14th, 2009 at 11:49 am
I am a realtor..and I am telling you ..the banks are committing so much fraud it is SCARY!!!!
This whole foreclosure thing could have been resolved and it was ignored…I am convinced it was fraud by design.
Veritas Aperio Reply:
February 14th, 2009 at 2:03 pm
Susie,
Very interesting input.
Please expand on your “fraud by design” comment. How systemic was/is it? All banks? Most banks? A few banks? This endemic fraud continues unabated? Any other info relevant to this comment?
Many thanks!
February 16th, 2009 at 8:11 am
FINANCIAL CRIMES ENFORCEMENT NETWORK
UNITED STATES DEPARTMENT OF TREASURY
FinCEN’s mission is to enhance U.S. national security, deter and detect criminal activity, and safeguard financial systems from abuse by promoting transparency in the U.S. and international financial systems.
So my question to FinCEN is, how and why did you allow this economic fiasco to occur? Why do we even have this agency and waste $$Billions of dollars on a bunch of government losers, that failed to see the corruption and the greed, by politicians and CEOs, which in turn caused our economic collapse.
February 16th, 2009 at 12:39 pm
Take direct action against the banks – credit card rebellion:
http://bringthemtotheirknees.com
February 16th, 2009 at 6:01 pm
The realtors and underwriters along with blacks, stupid ass mexicans and white trash caused this problem. Illegal aliens built all the homes during the boom, thus another level of corrupion by the builders and their suppliers. Nobody gets nuffin fo free and it’s a hard pill to swallow for the supposed “disfranchised foke”. Well FU and shut up yer f’ing whinging. Go back to yer f’ing teepees or projects or wherever the hell you came from. And those banksters are now unemployed too…good. There’s also a question of the loansters who have yet to be dealt with.
Take some personal accountabilty and stop blaming everyone else for you being a f’in retard!
February 16th, 2009 at 6:04 pm
Yo man. My aunt jus loss her crib coss she kaint pay. Whaasssup wit dat?