Sunday, October 10, 2010

Foreclosures, Judgments, and Congresses Betrayal

It's hard not to feel a bit irritated right now at the United States political system.

When the healthcare debate raged, Single Payer (where everybody in the United States would be signed up for Medicare) was off the table - couldn't even be brought up for debate. The same thing was true with the Public Option (which would have created a government run not-for-profit company). Or even stronger regulations on Wal-Street, or any number of things that "well, we can't get that past the Republicans or the Blue Dog democrats - bummer!"

Now, let's go into recent events. Those with memories lasting longer than a goldfish may remember there was a near financial meltdown of the financial industries, one caused by banks giving far too many mortgages to people who shouldn't have had them so they could sell the mortgages to investment firms on Wall Street. When this bubble finally popped, these financial institutions - which were also tied into people's retirement and pension funds - basically said "give us money or else the whole United States economy will collapse!"

So the American public did. And in return - well, the economy doesn't fall apart, but when it came time to help small business with loans, the response from the major banks was "Well, we're going to hold onto our money so we can buy out other places when *they* go under."

And then in the process, housing foreclosures started in. Attempts made by the Obama administration to curtail this were admittedly weak - but let's face it: the banks weren't interested in playing ball. Story after story of banks being unwilling to work with homeowners who are underwater or facing changing interest rates from mortgage.

Just when the foreclosures were rising - we find out that the courts have started paying attention and making banks prove that they actually own the homes they're foreclosing on. We're finding banks evicting people from houses they don't own.

In order to foreclose on a home, the bank has to prove:

1. That they actually own the home (remember - the homeowner is paying a loan on the house, and until it's paid off, the bank is supposed to own the home).
2. That the person they have the mortgage with is actually the person who signed the paperwork.

So imagine the shock and horror in the financial system when courts are actually making them prove they own the house in question - this after the years of trading houses back and forth like Monopoly cards. And to make matters worse, it turns out that the people working in the banks to review and sign the paperwork were signing the documents as complete without even looking at them. Literally thousands of foreclosure submissions to the courts were sent without the banks actually making sure they actually had the title to the home let along the proof they owned it.

Banks like Bank of America brought a halt to foreclosures at the realization that they courts could toss out their foreclosures. Attorney generals start launching investigations to see if there was fraud involved in claims to the courts that the paperwork is complete.

And then - along comes Congress to the rescue. Oh, they couldn't do Single Payer. They couldn't get a vote for weeks on giving the 9-11 first responders health care or voting on the budget increasing Bush tax cuts because the Democrats didn't have a spine.

Then along comes a bill that would say that courts have to accept the paperwork from banks as being properly checked as long as it has a signature of a notary. Oh, I know - the literal language just says:

Each Federal court shall recognize any lawful notarization made by a notary public licensed or commissioned under the laws of a State other than the State where the Federal court is located if--
(1) such notarization occurs in or affects interstate commerce; and
(2)(A) a seal of office, as symbol of the notary public’s authority, is used in the notarization; or
(B) in the case of an electronic record, the seal information is securely attached to, or logically associated with, the electronic record so as to render the record tamper-resistant.

Oh - sounds innocent. It just says that if a notary has signed it, then it shall be "recognized". The courts would have to accept it. All of the sudden, all of those problems with foreclosures would just go away - banks could submit their paperwork and the courts would have to accept it - and if there are any problems, well, how were we the banks supposed to know that the notaries didn't do their job?

That's not what bothers me. The major banks are crooked and out to make a buck for themselves and screw anybody else. But Congress passed this law in the Senate by Unanimous Consent - in other words, they didn't debate it. Just as the banks needed some help - along comes the Senate to pass a law that helps them.

No questions. No "hey, what's up with this?" Just "Oh, hey, sure - both Democrats and Republicans can get behind a bill that just happens to save the bacon of the major banks who don't want to hire the manpower to actually review their paperwork or verify they own the homes."

Heaven forbid the major banks that wrecked the economy, then got loans to save themselves, then refused to help out anybody but themselves now that they're faced with spending more money in verifying the paperwork they're submitting is correct, in verifying that the people they're throwing out of houses are actually the right people - instead, they can just get Congress to push through a bill that helps them.

It would be nice if Congress were on our side. It would be nice if I can believe it. But after years of Congress being unable to pass anything because "It's just so hard in the current climate" then turning around and passing something that helps out the richest and most powerful - well, I guess we know who's side Congress is really on.

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