State Attorneys Taking Stance Against Mortgage Rot
The fallout of the mortgage sector will continue to impede the growth of the national economy causing more people to lose their jobs. The personal financial situation of millions of Americans will continue to worsen unless the housing downfall is stopped.
But in the opinion of Mitt Romney, Republican Presidential aspirant, the housing crisis can only be stopped when the huge dark cloud of foreclosure hanging high above the nation is cleared. Unfortunately, it has been estimated that the foreclosure problem in the US will hang around for quite sometime to come.
Foreclosure simply comes about when a homeowner is unable to pay his or her mortgage, resulting in several months of defaulted mortgage payments. If this reason holds, then it stands to think that foreclosure is the result of the homeowner’s own personal financial crisis. However, some people believe that more than half of the foreclosures carried out by mortgage providers were done illegally. The Attorney General for Massachusetts, Martha Coakley, is wasting no time in seeking justice for homeowners who have been wrongfully foreclosed. She is dragging the Mortgage Electronic Registration System and the country’s major mortgage financial institutions to court.
According to the Attorney General for Massachusetts, the action of these institutions against distress homeowners amounted to mortgage fraud. But why would the Attorney General blame these bodies for the inability of a homeowner to pay his or her mortgage? Well, the answer lies in the fact that just as mortgage providers had turned to robosigning as a means of quickly processing borrowers for home loans, these same mortgage providers adopted a similar measure to foreclose on distress homeowners.
According to Ms Coakley, in order to justify their intentions of foreclosing on a property, some mortgage providers falsified documents relating to the loans. The legal war against mortgage providers continues throughout the country with State Attorneys leading the fight to ensure that distressed homeowners who have been foreclosed receive justice. Lenders and distress homeowners have been in discussion to find an amicable settlement to bad mortgage practices administered by Countrywide Financial Services before it was taken over by Bank of America.However, the deal was stopped at the last minute by the Attorney General for New York, Eric Schneiderman, because the Attorney General felt the compensation package arrived at through the discussions did not fully make up for the level of damage that had been caused by the company. In Nevada, a Lender Processing Service has had two of its employees indicted by the Attorney General, Catherine C. Masto on charges of felony. The list can go on and on.
According to the Attorney Generals, mortgage providers are having it difficult to follow the right procedure for foreclosing homeowners this is due to the fact that the whole mortgage sector before the housing sector bubble burst was built on the foundation of improper documentation and fraudulent schemes.
The housing downfall only came to reveal the extent of rot that existed in the mortgage industry. Mortgage providers counted on getting a lot of profit by dealing with borrowers in such a way as to offer borrowers home loans, reap the profits associated with the loans and then stand by and watch as the borrower defaults causing them (mortgage providers) to earn more on default charges.