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Oh yes, if there is no record of fraud then who goes to jail??
"When Congress comes back into session next week, it may consider measures intended to bolster the legal status of a controversial bank owned electronic mortgage registration system that contains three out of every five mortgages in the country.
The system is known as MERS, the acronym for a private company called Mortgage Electronic Registry Systems. Set up by banks in the 1997, MERS is a system for tracking ownership of home loans as they move from mortgage originator through the financial pipeline to the trusts set up when mortgage securities are sold.
The system has come under scrutiny by critics who charge MERS with facilitating slipshod practices. Recently, lawyers have filed lawsuits claiming that banks owe states billions of dollars for mortgage recording fees they avoided by using MERS."
"Besides the obvious seediness of this maneuver, it runs roughshod over state property laws, and the rights of investors, homeowners and borrowers. It amounts to a permanent installation of a Federal system that supersedes the county records for recording property rights. Off-record comments I’ve heard from people in power are outraged at this assault on states’ rights. But these people are not legislators, who are getting promises larger than anything in your imagination, if they will support such a bill. It might be couched as a uniform law to be adopted by the states to get around the states rights issues, but it will permanently remove some of the power over property that lies solely within the jurisdiction of the states and place it preemptively within federal jurisdiction."
If there were legitimate gripes about MERS then I'd have sympathy, but all I see are people who freely admit they haven't paid a mortgage in many moons and then they want to tell the banks to go to hell when they foreclose because a single document can't be presented. This current situation is a dream for shady lawyers to make a fortune off of.
Just imagine if that was the standard what an insane mess would become of the US economy. Neighbors would be pissed off at other neighbors who don't pay a mortgage because their lender can't find the note. Banks would collapse one after another. It would be utter disaster.
Yeah I agree rule of law is important, but I think this is a case where if its pretty clear you agreed to a note at some point other proof could come up to prove there was a loan on the property. If someone made mortgage payments on a property and then suddenly stopped paying it saying they didn't think a note existed, that would be pretty hard to say under oath now wouldn't it? Or if filings were made showing a bank was owned money on a property when the sale was filed, how could you ignore that?
If there is true fraud then let there be action against it, but to rail against fraud because a document was lost int he process is pretty sketchy in my book and not worth taking down our economy for.
The government will do what ever is needed to immunize the banks from prosecution for their crimes, and financial losses. That is what the banks pay them to do. End of story. Welcome to the real world.
Or if filings were made showing a bank was owned money on a property when the sale was filed, how could you ignore that?
Problem is, in most all mortgages taken out in the past decade or more, there is NO BANK involved. As soon as the loan is "originated", it is sold off to an investment banker (a la Lehman Brothers, which is no more, because of this) who then "securitizes" it, by selling off little portions of it to a bunch of bond investors.
So the original "originator" has been paid back, totally. They then used that money to make another loan, and on and on. Nobody is out any money, except the investors, who really aren't because these securities change hands daily, like all securities do.
The "bank" that these folks make their payments to is just the "servicer" of the so-called debt. The servicer is not entitled to any of the funds that are made to them in payment, but they just take the money anyway.
The rule of law is, you need to prove that you own/hold the originalpromissary note that was given to the "lender" in exchange for theproperty. Funny how these things just disappeared...and now any old "bank" can just step forward and forclose???
I don't think so. Congress can do a lot, but there are some laws that it can't change (thankfully). This is one of them!
Assuming the lender is the original promissary note holder and they cannot foreclose....
Wouldn't they still have the records of non-payment and be able to sue taking the house as an asset and then evicting the people?
In short, it just seems to be a loophole stab at not being foreclosed on but that the proof of debt and non-payment still exist.
So, it's going to redistribute wealth from banks to lawyers and the people will still wind up out on the street in the end....possibly with a non-dischargeable debt from the lawsuit including legal fees?
I think the foreclosure process has some legal protections for the person being foreclosed upon but a good old fashioned breach of contract suit would follow different rules.
Might wind up in worse shape a la good old Wesley Snipes taking a loophole and winding up with a slipknot instead.
Curious to hear peoples thoughts on this possible scenario.
Assuming the lender is the original promissary note holder and they cannot foreclose....
Wouldn't they still have the records of non-payment and be able to sue taking the house as an asset and then evicting the people?
In short, it just seems to be a loophole stab at not being foreclosed on but that the proof of debt and non-payment still exist.
So, it's going to redistribute wealth from banks to lawyers and the people will still wind up out on the street in the end....possibly with a non-dischargeable debt from the lawsuit including legal fees?
I think the foreclosure process has some legal protections for the person being foreclosed upon but a good old fashioned breach of contract suit would follow different rules.
Might wind up in worse shape a la good old Wesley Snipes taking a loophole and winding up with a slipknot instead.
Curious to hear peoples thoughts on this possible scenario.
From what I understand of this..the note and mortgage have to stay together. And when it went through MERS and transferred hands, MERS did not submit paperwork to effect that change against the property.
The wheeling and dealing went on via computer bits.
Legal papers were not filed with county courthouses.
At some point the note separated from the mortgage in ownership.
That's about how I understand it from various articles I've read.
That's how 2-3 banks were able to try to foreclose on the same house..they had computer work showing they owned it but no recorded documents from the county.
In any circumstance though..the people paying the mortgage should be evicted for non-payment.
The question is who gets the house and mortgage loss.
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