Foreclosure Fraud: How MERS blurred the ownership of homes

[seafan]

Link




Tyler Durden at ZeroHedge:

MERS Enters Self-Preservation Mode, Issues Press Release To "Clarify" Its Role In Foreclosure Fraud October 10, 2010

As more people realize that the fake title transfer aspect of foreclosure fraud is just the tip of the iceberg which runs, via MERS (Mortgage Electronic Registration Systems) conduits all the way to the core of the securitization system, and thus $10 trillion in first level debt (and who knows how much in 3rd and 4th level layering of debt on top of this: think CDO-squared and cubed), we expect an increasing number of denials from the enablers in the explosion of securitization over the past ten years.

Such as MERS.

Which is why it is not surprising that late last night, it was precisely MERS who not only acknowledged for the first time its involvement in this whole fiasco (by a press release and a "fact and rebuttal" session), but has made it all too clear just how deep the problem truly runs.

We would like to highlight just how very alike is the defense prepared by the High Frequency Signing Lobby to that by the High Frequency Traders out there: it is all just technological advancement, and if you want to blame it on someone, blame it on Intel and their fast fast chips: "What we're seeing now is that the foreclosure process itself was not designed to withstand the extraordinary volume of foreclosures that the mortgage industry and local governments must now handle."

Obviously the volume only exploded once failed systems such as MERS appeared on the scene: it is precisely in this aspect that MERS served as an enabling catalyst to let loose the wave of exponential re-re-securitization. It continues: "The MERS process of tracking mortgages and holding title provides clarity, transparency and efficiency to the housing finance system." And here is where MERS basically puts the ball back in the corrupt legal system's court: "We are committed to continually ensuring that everyone who has responsibilities in the mortgage and foreclosure process follows local and state laws, as well as our own training and rules."

Because why not blame the entire judicial system, when one could just acknowledge the burden of having failed at doing their own job properly... One thing is certain: someone is going down for this biggest snafu in the history of mortgages/securitization.

Follows the full MERS press release:

.....

*Oh, NO, it's not OUR fault!*


Take a look at who owns MERS.




The MERS story has been cooking since last fall.



But our media were too happy skipping after celebrities heading to the Big House.




Alan Grayson explains the Foreclosure Factories.





Where all of this will take us is beyond our imagination.

[catzies]

1. Bookmarked. Recommended. Must look up links when I get home

*whispers* I work for a mortgage banker ...shhhh.... :hide:

[Gin]

2. I went to the MERS site...found my loan....its serviced by BOA

with Fannie Mae as an investor....what does that mean to me?

BOA got the loan from countrywide so that's correct and they service it also.. but the investor part is what I don't understand.....I am not in foreclosure.

[catzies]

3. Well, I cannot speak to your personal situation but I would say as a start

the Planet Money podcasts on NPR have some info for you on how investors got into mortgages courtesy of Wall Street.

Their toxic asset Toxie was once a performing mortgage, IIRC.

http://www.npr.org/blogs/money/

[seafan]

4. 'Please, let's not do *anything* to upset the banks.' We've seen this movie before.

Paul Krugman hashes up the whole enchilada.


October 17, 2010

.....

The story so far: An epic housing bust and sustained high unemployment have led to an epidemic of default, with millions of homeowners falling behind on mortgage payments. So servicers — the companies that collect payments on behalf of mortgage owners — have been foreclosing on many mortgages, seizing many homes.

But do they actually have the right to seize these homes? Horror stories have been proliferating, like the case of the Florida man whose home was taken even though he had no mortgage. More significantly, certain players have been ignoring the law. Courts have been approving foreclosures without requiring that mortgage servicers produce appropriate documentation; instead, they have relied on affidavits asserting that the papers are in order. And these affidavits were often produced by “robo-signers,” or low-level employees who had no idea whether their assertions were true.

Now an awful truth is becoming apparent: In many cases, the documentation doesn’t exist. In the frenzy of the bubble, much home lending was undertaken by fly-by-night companies trying to generate as much volume as possible. These loans were sold off to mortgage “trusts,” which, in turn, sliced and diced them into mortgage-backed securities. The trusts were legally required to obtain and hold the mortgage notes that specified the borrowers’ obligations. But it’s now apparent that such niceties were frequently neglected. And this means that many of the foreclosures now taking place are, in fact, illegal.

This is very, very bad. For one thing, it’s a near certainty that significant numbers of borrowers are being defrauded — charged fees they don’t actually owe, declared in default when, by the terms of their loan agreements, they aren’t.

Beyond that, if trusts can’t produce proof that they actually own the mortgages against which they have been selling claims, the sponsors of these trusts will face lawsuits from investors who bought these claims — claims that are now, in many cases, worth only a small fraction of their face value.

And who are these sponsors? Major financial institutions — the same institutions supposedly rescued by government programs last year. So the mortgage mess threatens to produce another financial crisis.

.....

It will be very interesting to see what happens to HR 3808 after the election.


CNBC already predicts that Congress will retroactively legalize foreclosure fraud during the lame duck session.


At this point, it seems like it's already in the bag.




Once again, the burning rhetorical question: Is it time?

[sabrina 1]

5. MERS was invented by the Banking Industry in order to be ready

to quickly process the land grab, regardless of laws, which they circumvented to get their plans on track of making as much money as possible. They could not depend on honest people to push through foreclosures without due process, so they invented their own entity to do the job.

This was known and pointed out by people like Marcy Kaptur two years ago when she tried to warn people about it. She advised people NOT to leave their homes because she said then that people were being railroaded, without proper representation and that the paperwork likely didn't exist for many foreclosures.

Great post, bookmarking the MERS link.

Congress is going to get them off the hook the same way they got the War Criminals off the hook.

Our government, both parties, is no longer functional as far as the American People are concerned. They work for the Banks. The Banks are panicking and when that happens, they run to Congress. See Henry Paulson and the bailouts.

Now they are back as their criminal scheme unfolds before the public in court cases across the country. And last week, Congress dutifully tried to help them by unanamously passing a bill that would have gotten them off the hook for some of the fraud they have perpetrated against the American people. They nearly got away with it.

But I think in the end, no one will be held accountable. Congress will bail them out by passing some kind of legislation that makes a deal with them, and we will be told to 'move on'. Our only recourse are the courts. So there is no doubt that Congress will address that by capping the amount people can ask for, and maybe even decriminalizing their crimes, as they did with the TeleComs.

We are screwn!! There really has been a coup, as Marcy Kaptur said in 'Capitalism A Love Story'.