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« And A Child Shall Lead Them... | Main | Currency: The Year of 'Printing Money' »
Wednesday
Dec222010

Check Out The Little House In Maine That Started The Nationwide Foreclosure Freeze (PHOTO, NYT Story)

This is the house where it all started.  It was in a deposition for the foreclosure case that news of GMAC using a robo-signer was first revealed almost 3 months ago.  Very interesting story from the NYT.

--

DENMARK, Me. — The house that set off the national furor over faulty foreclosures is blue-gray and weathered. The porch is piled with furniture and knickknacks awaiting the next yard sale.  In the driveway is a busted pickup truck. No one who lives there is going anywhere anytime soon.

Nicolle Bradbury bought this house seven years ago for $75,000, a major step up from the trailer she had been living in with her family.  But she lost her job and the $474 monthly mortgage payment became difficult, then impossible.

It should have been a routine foreclosure, with Mrs. Bradbury joining the anonymous millions quietly dispossessed since the recession began. But she was savvy enough to contact a nonprofit group, Pine Tree Legal Assistance, where for once in her 38 years, she caught a break.

Her file was pulled, more or less at random, by Thomas A. Cox, a retired lawyer who volunteers at Pine Tree. He happened to know something about foreclosures because when he worked for a bank he did them all the time. Twenty years later, he had switched sides and, he says, was trying to make amends.

Suddenly, there is a frenzy over foreclosures. Every attorney general in the country is participating in an investigation into the flawed paperwork and questionable methods behind many of them. A Senate hearing is scheduled, and federal inquiries have begun. The housing market, which runs on foreclosure sales, is in turmoil. Bank stocks fell on Thursday as analysts tried to gauge the impact on lenders’ bottom lines.

All of this is largely because Mr. Cox realized almost immediately that Mrs. Bradbury’s foreclosure file did not look right. The documents from the lender, GMAC Mortgage, were approved by an employee whose title was “limited signing officer,” an indication to the lawyer that his knowledge of the case was effectively nonexistent.

Mr. Cox eventually won the right to depose the employee, who casually acknowledged that he had prepared 400 foreclosures a day for GMAC and that contrary to his sworn statements, they had not been reviewed by him or anyone else.

GMAC, the country’s fourth-largest mortgage lender, called this omission a technicality but was forced last month to halt foreclosures in the 23 states, including Maine, where they must be approved by a court. Bank of America, JPMorgan Chase and other lenders that used robo-signers — the term caught on instantly — have enacted their own freezes.

The tragedy of foreclosure is that some homeowners may be able to stay where they are if their lenders are more interested in modification than eviction. Without a job, Mrs. Bradbury is not one of them. Her family, including her 14-year-old daughter and 16-year-old son, lives on welfare and food stamps.

“A lot of people say we just want a free ride,” Mrs. Bradbury said. “That’s not it. I’ve worked since I was 14. I’m not lazy. I’m just trying to keep us together. If we lost the house, my family would have to break up.”

It has been two years since she last paid the mortgage, which surprises even her lawyers.

“Had GMAC followed the legal requirements, she would have lost her home a long time ago,” acknowledged Geoffrey S. Lewis, another lawyer handling her case.

---

 

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Reader Comments (17)

Sorry Folks, The Put-Back Apocalypse Ain't Gonna Happen

http://www.cnbc.com/id/39686897

John Carney...cheyenne has already pointed out the weakness to Carney's argument...
Oct 15, 2010 at 6:55 PM | Registered CommenterDailyBail
Foreclosure Crisis Finally Hitting Banks Where it Hurts: Their Stock Prices

http://www.nakedcapitalism.com/2010/10/foreclosure-crisis-finally-hitting-banks-where-it-hurts-their-stock-prices.html

Must read summary from yves...forget the headline...this story ties it all together...
Oct 15, 2010 at 6:56 PM | Registered CommenterDailyBail
Oct 15, 2010 at 6:58 PM | Registered CommenterDailyBail
The mortgage servicers (who we introduced here), the group of financial workers who have been involved with the wave of fraud and the reason foreclosures have shut down, aren’t really regulated. I want to continue to emphasize this, and I want to quote from Andy Kroll’s January 2010 Mother Jones piece Can Anyone Stop the Predatory Lenders?

http://rortybomb.wordpress.com/2010/10/13/a-look-at-how-unregulated-servicers-are-and-the-consequences-for-leaving-this-crisis/
Oct 15, 2010 at 7:01 PM | Registered CommenterDailyBail
Oct 15, 2010 at 7:01 PM | Registered CommenterDailyBail
Oct 15, 2010 at 7:02 PM | Registered CommenterDailyBail
Oct 15, 2010 at 7:03 PM | Registered CommenterDailyBail
Oct 15, 2010 at 7:05 PM | Registered CommenterDailyBail
Oct 15, 2010 at 7:06 PM | Registered CommenterDailyBail
Bank of America Announces That It Has Discovered Some Trivial Technical Problems With a Small Number of its Mortgages

http://www.ritholtz.com/blog/2010/10/bank-of-america-announces-that-it-has-discovered-some-trivial-technical-problems-with-a-small-number-of-its-mortgages/

this is funny...
Oct 15, 2010 at 7:09 PM | Registered CommenterDailyBail
Oct 15, 2010 at 7:11 PM | Registered CommenterDailyBail
The growing scandal over the improper, and perhaps fraudulent, foreclosures on homes by US banks is becoming both a financial and a political hot potato. Wall Street is being forced to admit to yet more unsavoury practices linked to mortgage bonds and President Barack Obama has been dragged into the affair.

http://www.ft.com/cms/s/0/0688d26a-d7cb-11df-b478-00144feabdc0.html?ftcamp=rss
Oct 15, 2010 at 7:12 PM | Registered CommenterDailyBail
Oct 15, 2010 at 7:15 PM | Registered CommenterDailyBail
The Maine motto is "Dirigo". Here is your chance starting in a few days.
Dec 22, 2010 at 3:51 PM | Unregistered Commenterjohn
Maine's highest court rules in favor of bank

The court agreed GMAC Mortgage should not be held in contempt despite its 'reprehensible’ handling of foreclosure documents.


http://www.pressherald.com/news/Maines-high-court-denies-appeal-of-robo-signing-ruling.html

excerpt:

In what has become a high-profile case, Maine’s highest court refused Tuesday to find a mortgage company in contempt for signing a sworn document in support of foreclosing on a woman’s home without reviewing pertinent records.

The case gained national attention when the woman’s attorney found that GMAC Mortgage and other banks had engaged in a pattern of “robo-signing” such documents – processing them quickly for use in foreclosures without reviewing records to verify the information. The revelation led to a freeze on home foreclosures across the nation, congressional hearings and investigations by attorneys general in several states, although not Maine.

By a 5-1 margin Tuesday, the Maine Supreme Judicial Court upheld a lower court’s decision against imposing sanctions on GMAC or the Federal National Mortgage Association – Fannie Mae – or finding either in contempt.
Dec 7, 2011 at 10:42 AM | Unregistered Commenterjohn

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