American Gasoline on the Brain Fire
March 23, 2012 Leave a comment
This is the kind of thing that while reading it you get this feeling inside your skull like someone’s tossing half-spent cans of WD-40 from the garage onto the bonfire. I have to also confess, that I was reading this article in one sitting, in it’s entirety, on my 30 minute lunch break from working almost exclusively with Bank of America foreclosures.
Yes, that means working with bad mortages sold to people the bank had no real expectation of ever recuperating their investment from.
An SEC investigation later found out, for instance, that Countrywide essentially had no standards for whom to lend to. As a federal judge put it, “Countrywide routinely ignored its official underwriting guidelines to such an extent that Countrywide would underwrite any loan it could sell.” Translation: Countrywide gave home loans to anything with a pulse, provided they had a sucker lined up to buy the loan.
That means cleaning up the shit storm of sloppy paperwork filed by a bank that has the mentality of an institution not actually interested in getting paid back for the loans it issues*.
Case in point: With all those hundreds of thousands of mortgages the bank bought, it simply stopped filing basic paperwork – even the stuff required by law, like keeping chains of title. A blizzard of subsequent lawsuits from pissed-off localities reveals that the bank used this systematic scam to avoid paying local fees. Last year, a single county – Dallas County in Texas – sued Bank of America for ducking fees since 1997. “Our research shows it could be more than $100 million,” Craig Watkins, the county’s district attorney, told reporters. Think of that next time your county leaves a road unpaved, or is forced to raise property taxes to keep the schools open.
But the lack of paperwork also presented a problem for the bank: When it needed to foreclose on someone, it had no evidence to take to court.
That means dealing with a corporation that lies to the face of the federal government’s good faith efforts to help out homeowners by intentionally misplacing paperwork for alternatives to the foreclosure process:
In classic con-artist behavior, Bank of America even tried to rip off homeowners a second time by gaming President Obama’s HAMP program, which was designed to aid families who had already been victimized by the banks. In a lawsuit filed last year, homeowners claim they were asked to submit a mountain of paperwork before receiving a modified loan – only to have the bank misplace the documents when it was time to pay up.
…it even instituted a policy punishing any bank employee who spent more than 10 minutes helping a victim get a loan modification.
Needless to say, I packed up this article and shipped it off to my father. In doing this, I felt like I was shooting a rail gun over his house. A warning shot to say, hey Dad, let’s have a chat about where you think the family should store it’s savings.**
*Because the real money wasn’t in a 40-year ARM to a black family. It was in bundling hundreds of any type of mortgage (and there just aren’t enough stable income families to do this correctly) and passing them off as AAA pure gold investment material.
**Man that’s a cheesedick ending. I’m not editing it. It’s terrible though. Guh.