Think The Bank Deal on Mortgages is a Good One?
Posted on | February 10, 2012 | No Comments
Whether you think the deal made with the banks is good or bad, the following is worth reading. It came by email this morning from a debt advocate.
The following are highlights of the settlement followed by the advocates comments in bold:
” . . . roughly one million expected to have their mortgage debt reduced by lenders or be able to refinance their homes at lower rates. (This is less than two percent of the 73 million homeowners. If you would have had a choice, as an American taxpayer, would you have voted to spend $26 billion to help less than two percent of homeowners?)
” . . . mortgages owned by the government’s housing finance agencies, Fannie Mae and Freddie Mac, will not be covered under the deal, excluding about half the nation’s mortgages.” (It is not surprising that the vast majority of distressed mortgage loans are owned by Fannie or Freddie?)
“Another 750,000 people who lost their homes to foreclosure from January 2008 to the end of 2011 will receive checks for about $2,000. The aid is to be distributed over three years. The deal grew out of an investigation into mortgage servicing by all 50 state attorneys general that was introduced in the fall of 2010 amid an uproar over revelations that banks evicted people with false or incomplete documentation.” (If I had lost my home to foreclosure, an offer of $2,000 in restitution would be a slap in the face!)
“On average, these homeowners are underwater by $50,000 each. A recent estimate from the settlement negotiations put the average aid for homeowners at $20,000.” (The few homeowner’s who will benefit from the settlement, will not receive sufficient benefit to get their heads above water)
“Bank of America, Citigroup, JPMorgan Chase and Wells Fargo also agreed to pay a penalty of $394 million as part of a settlement over foreclosure abuses, the Office of the Comptroller of the Currency said.” (How long do they have to pay the $394 million and who are they to pay it to? To my knowledge, banks involved in the mortgage crises have not paid one penny of penalty money to date)
“The five mortgage servicers in the settlement — Bank of America, JPMorgan Chase, Wells Fargo, Citigroup and Ally Financial — have largely set aside reserves for the expected cost of the accord and investors are likely to cheer its announcement because it removes one more legal worry for the industry, analysts said.” . . . “More than the dollar figures, the settlement had been held up amid concern by New York’s attorney general, Eric T. Schneiderman, that it provided too broad of a release for banks for past misdeeds, making future investigations much more difficult.” (Did you get that America? The banks participating in this settlement are released of “past misdeeds” and “legal worry”)“More than just an attempt to aid consumers and stabilize the housing market, administration officials cast the settlement as an effort to finally hold banks accountable for their misdeeds, more than three years after the mortgage meltdown brought on a full-scale financial crisis.” (We hold the banks accountable for their misdeeds by giving them billions of dollars of taxpayer’s money? Would you and I have received money if we would have violated the law by committing fraud, therefore causing four million Americans to lose their homes?)
For more information, watch this video: http://www.youtube.com/watch?featur%20e=player_embedded&v=-5Tw3Q3wQbs#!
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