U.S. Attorneys General Announce Multi-State Probe into Mortgage Foreclosure Practice

[Hissyspit]

Source: Reuters

By Elinor Comlay and Joe Rauch

NEW YORK/CHARLOTTE | Wed Oct 13, 2010 10:58am EDT

NEW YORK/CHARLOTTE (Reuters) - JPMorgan Chase has identified some issues in its ongoing review of foreclosure affidavits, but said it was "pretty comfortable" that its decisions to foreclose had been proper.

The company, which also posted a higher-than-expected profit on Wednesday, is among three of the big mortgage servicers to announce that it has halted some of its foreclosures while it reviews its processes.

JPMorgan has been talking to attorneys general, but does not know what the ultimate outcome of the states-driven probe will be, Chief Executive Jamie Dimon said during a conference call with reporters.

Later on Wednesday about 40 state attorneys general, many facing re-election, are expected to announce a joint investigation into the allegations that some banks used shoddy paperwork to kick struggling borrowers out of their homes.


Read more: http://www.reuters.com/article/idUSTRE69B4UY20101013

[Bragi]

1. I fear this is a huge and nasty development

I've been reading about this latest melt-down of the housing-mortgage-foreclosure market, and man, this looks like it may be bad beyond words.

About the only good thing that could come from this would be if Obama used the opportunity to put in place a bailout for home owners rather than bankers.

But that won't likely happen, will it. More likely he'll wait until the midterms are over, and then come in with another bank bailout, all the while saying how sorry he is that this has to be done.

[Ozymanithrax]

2. Obama can not legislate...

What can be done will depend on the cooperation of Repubicans, and in the best case scenario there will be more of them in Washington next year. If they do well, Republicans in the Senate will lock it up tight.

It is Congress that must act, not the President.

[Bragi]

3. Noted. Thanks.

[DirkGently]

9. If they violated federal laws, DOJ could get involved and negotiate something.

Don't know that it's clear that occurred.

[dkf]

4. All it does is slow things down.

The mortgages were recorded after all.

Irony is struggling homeowners who stopped paying their mortgage and are in danger of foreclosure don't have any housing payments so they have more disposable income than someone in the same economic boat who is renting or is paying their mortgage.

[Bragi]

6. I do hope you're right, however...

Beyond the bad paperwork and robo-signing issues, I gather it isn't clear at this point that the parties doing the foreclosings actually had title to the underlying properties being foreclosed upon.

In particular, the link between specific mortgages and specific properties may have become legally muddled, or even lost, when these mortgages were inappropriately bundled and traded as securitized derivatives.

Yes or no?

[dkf]

8. It just has to be recreated.

The data exists.

[JDPriestly]

7. That's the problem as I understand it.

Mortgages were not always properly recorded -- at least not in recent years.

[lunatica]

11. Many of those may not have jobs which is why they stopped paying

[dkf]

12. So Mortgage modifications won't do much.

These folk are lucky they have a roof over their heads at no cost for over a year. They wouldn't be able to do that as renters.

[DirkGently]

10. I'd love to see homeowner bailouts negotiated on this basis, but it's unlikely.

The state AGs will huff and puff, and maybe squeeze some cash "fines" out of the lenders. Then the foreclosure train will get right back on track.

[txlibdem]

5. Attorney General could arrest and try all the greedy banksters

Why aren't any of the crooks in jail? Why are they not even under arrest?

How many minorities have been tossed into jail for possession of tiny amounts since all their crimes came to light? What is wrong with this picture!

All drugs should be legalized, funding for addiction treatment should be paid for by taxing the drugs. (Hey, some people are addicted to video games but we're not outlawing them now are we.)

Being rich should be a crime, subject to immediate arrest, conviction and life sentence with no possibility of parole.