Securitization Fraud Task Force Responds to Criticism With PR

By: Tuesday May 22, 2012 7:05 am

Darren Samuelsohn takes a look at the much-maligned securitization fraud task force, which has come under criticism for, well, not doing much of anything since coming into existence. Let’s see how the leaders of the effort have responded to all that criticism.

 

As Predicted, Ally Bankruptcy Will Delay Loan Modifications, Settlement Actions for Borrowers

By: Monday May 21, 2012 9:40 am

When Ally Financial’s mortgage unit Residential Capital filed for bankruptcy last week, I had an inkling it would spell trouble for the foreclosure fraud settlement the parent company signed with state and federal regulators. How would individuals get loan modifications in the midst of a bankruptcy proceeding? Now it looks like they won’t.

Bankruptcy of Ally Mortgage Unit Raises Questions About Foreclosure Fraud Settlement

By: Monday May 14, 2012 2:10 pm

Ally Bank, formerly known as GMAC Mortgage, the nation’s fifth-largest mortgage servicer, put its mortgage subsidiary Residential Capital into bankruptcy. This is part of a continuing effort on the part of Ally, which is still majority-owned by the US government, to escape its mortgage liabilities. But what does it mean for the foreclosure fraud settlement, to which Ally is a signatory?

Analysts Missing the Point on DeMarco and Principal Reduction

By: Wednesday April 11, 2012 10:10 am

Coverage of Ed DeMarco’s speech on principal reductions has sometimes missed the point he’s talking about applying reductions to only a small subset of the underwater mortgates held by the GSEs, so the benefits of the policy are also seen as relatively small. It seems he and the Administration are focused more on interest refinancing than principal reductions.

Treasury’s Ridiculous Defense of their Second Lien Policies

By: Monday April 2, 2012 12:40 pm

Gretchen Morgenson’s story about banks being enriched by Fannie and Freddie principal reductions if their second liens aren’t wiped out is simply an expression of reality. If the seconds are allowed to stand, the banks make money on the increased ability to pay on the seconds as a result of reducing principal on the firsts. Now the Treasury Department has issued a tepid defense of this result.

Housing Recovery Bubble Popped Again by New Case-Shiller Data

By: Wednesday March 28, 2012 7:16 pm

The deep investment in the notion of a housing recovery took another hit today, as home prices fell to a 10-year low. And real home prices and price-to-rent ratios are down to late 1990s levels.

DeMarco Confirms Second Lien Issue in Principal Reductions

By: Monday March 26, 2012 11:15 am

One of the big arguments against Gretchen Morgenson’s quasi-defense of Ed DeMarco and the implications of principal reductions on Fannie and Freddie loans was that surely nobody is suggesting that the GSEs write down their primary loans while the second liens are kept intact. But in fact that is the argument, DeMarco makes, while ignoring cases in which there is no second lien.

Foreclosure Fraud Settlement Docs (IV): Association of Mortgage Investors Planning to Challenge in Court

By: Tuesday March 13, 2012 6:30 pm

One of the things I looked at in an earlier installment of the foreclosure fraud settlement documents is how banks can satisfy their obligations by modifying mortgages they don’t own. HUD again tried to push back on this with a blog post about “myths v. facts” in the mortgage settlement. But it seems they’ve confused the issue, and investors who could be hurt by paying for the banks settlement credits don’t agree either.

Foreclosure Fraud Settlement Docs (II): Giving Homes to Charity as a Penalty

By: Tuesday March 13, 2012 9:15 am

Part II in this series discusses credits the banks get towards meeting their multi-billion dollar settlement obligations. The federal government and state AGs want you to assume that means a set amount of principal reductions that the banks will grant. But in reality, the banks can employ a variety of non-modification strategies to receive credit toward the settlement, including a number of routine actions they would probably undertake whether or not there was a settlement in place.

Illinois HAMP Lawsuit Can Go Forward, Could Set Mandatory Modification Precedent

By: Monday March 12, 2012 7:50 am

Throughout the life of HAMP, the banks have had discretion to string along borrowers, to deny permanent modifications for obscure reasons after granting trial mods, and to trap homeowners and threaten foreclosure after the fact. The 7th Circuit just revived a case against this practice, allowing it to go forward, which means that similar plaintiffs may now go after the banks for unlawfully denying loan modifications.

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