Huge Foreclosure Deal Reached

Thursday, February 09, 2012

housing, house, foreclosure, foreclosing House in foreclosure. (Respres/flickr)

A massive settlement has been reached between the government and five of the nation's biggest banks over foreclosure abuses and relief. Our partner The New York Times says the $ 26 billion deal will be doled out to 2 million homeowners. It's part of a broad national settlement aimed at halting the housing market's downward slide and holding banks accountable. Joining the program is Nelson Schwartz, business reporter with our partner, The Times.

Comments [3]

Charles

I need to self-correct one of my statements below. While the settlement process may have been driven by mostly-Democrat attorneys general, I'd be remiss and totally unfair if I didn't mention that 49 states through their attorneys general joined in the federal suit that was led for the most part by the Obama-directed HUD and the Eric Holder-derected DoJ. There was a core group of (Democrat) AG's from NY and CA who were the lead aggressors, and Oklahoma's AG declined to participate.

Feb. 09 2012 06:40 PM
Charles

I heard this story covered today in about ten different ways on public radio; regular NPR News as well as The Takeaway and others. Then at the end of the day I heard the triumphal comments of President Obama, talking about how this is a first step toward solving the mortgage crisis.

Not once did I hear a sensible recitation of what this settlement was all about. Indeed, listening to Obama and The Takeaway (there was little difference) I felt less informed than I would have been if my radio had been turned off.

This settlement has nothing at all to do with what any ordinary person would understand to have been a "wrongful foreclosure," and everything to do with laywers would call "wrongful foreclosures."

Virtually no one that I know of was kicked out of a home while they were making payments and keeping current with their mortgage. What happened was that with the massive glut of valid foreclosures, the banks used robo-signed documents instead of having the correct officers do the notarized signing.

And so, while John Hockenberry was wondering about the "pittance" amounts of $2000 or so being paid out to persons who were foreclosed, let's remember who these people were; they were people who had indeed defaulted on their mortgage payments. They got the proper foreclosure documents in due course, but the signatures on those documents were not by the officer who had actually reviewed the paperwork but instead someone else.

The banks, together, are paying more than a billion dollars for that acknowledged processing error. But let's not for a moment think that this is about the banks doing much more wrong than that. To me, it is not astonishing that individuals are collecting so little -- it is much more incredible that the banks are paying so much.

And I must say; that while public radio prides itself on detailed and in-depth reporting, this is such a remarkable instance of almost deliberately superficial reporting, such that the real story is virtually lost. I'll just bet that 80 or 90 percent of public radio listeners come away from this story thinking that this was a case of banks forcing out homeowners who deserved to stay, and getting only a slap on the wrist. When in fact it is a case of a media witch-hunt, driven by mostly Democratic state attorneys general, trying to score purely political points. A media witch hunt in which public radio played its role rather well.

Feb. 09 2012 06:24 PM
listener

When will "progressives" government officials investigate themselves and their role in this crisis?
As soon as the "progressive" media stop pursuing a political agenda and report the factual history of this crisis.

Feb. 09 2012 09:27 AM

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