Although overshadowed by other recent news stories, the foreclosure/robo-signing mortgage settlement has generated a fair amount of discussion since it came out about two weeks ago. The “investigation” into the foreclosure practices of large banks by all 50 state attorneys general was supposed to get down to the bottom of the foreclosure-fraud/robo-signing debacle. Lead by Attorney General Tom Miller of Iowa (who at one point promised to “put people in jail“), the investigation and proposed settlement has drawn widespread criticism.
The settlement has been ripped by critics on both sides of the issue, some saying it doesn’t go far enough, while others say it goes way too far. Large and small banks criticize it as “stealth cramdown legislation“. Yves Smith of Nakedcapitalism.com has termed it a “bailout as reward for institutionalized fraud“. I for one am very skeptical of the efficacy of any sort large fund that is meant to provide restitution to those hurt by the allegedly fraudulent action of large banks. Ultimately, the numbers bandied about in the settlement seem to pale in comparison to the damage done (additionally a similar type of fund isn’t working so well in the BP settlement).
This morning a Housingwire.com article by Jon Prior and Christine Ricciardi says that not even all the attorneys general are on the same page about the settlement. According to the article, Utah Attorney General Mark Shurtleff hasn’t even seen a copy of it. The AGs of both Oklahoma and Virginia oppose the settlement, and as many as a dozen states total are not on board.
The proposed settlement is by no means final, and AG Tom Miller has said it will take several more months to hammer out a finalized agreement. I am very skeptical that we will see any sort of agreement that is able to appease those on the left and right, as well as the various attorneys general, the banks, and aggrieved homeowners. Do you think we will every actually see some sort of settlement here? Let me know in the comments section below.
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saving my home in floridah
May 8, 2011 @ 11:20 pm
pam bondi better do something for floridah. they are not helping the people that have already have gone through the ringer with their lender. they are comitting mortgage modification fraud. no one seems to get it they do now want to modify these loans. we need a mortitorium on all foreclosures. and a reversal of these mortgae values to 80 % property value. give us back out equity. everyone forgets that money was in an “account” called our mortgage…any person whom put that 20% down should have that money returned. these appraisals were all fraudulent. this is worse then the depressio why are we being hung out to dry yet the banks get off the hook for the fraud???/
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sick in lousiana
July 11, 2011 @ 10:05 pm
The banks need to cease foreclosures on all of the securitized loans that were fraudulently transferred; as retribution they then need to forgive the indebtness and be required to payback the certificate holders. Then and only then will this situation be made right. In doing so, the markets would stabilize and the economy would have half a chance of recovering. Will some people benefit? Of course but in the current situation, lenders have garnered huge profits in both write offs, government subsidies and in my case, walked off with between $20K and $30K in equity from my home after a liberal bankruptcy judge refused to even hear my case.
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