The Mortgage Crisis Blog

People who took out bad mortgages or bought houses they couldn’t afford once interest rates reset shouldn’t be helped. “I acted responsibly,” they said. “Why should someone who acted less responsibly than I did be rewarded by a better deal then I got?” Others say that the collective impact of these mortgages going into foreclosure and people filing bankruptcy have such a negative effect on the economy that something needs to be done to staunch the hemorrhaging.

The problem is that all of the solutions discussed thus far seem to carry a high price tag. Buying the bad mortgages would cost hundreds of billions, as would giving government benefits directly to people with bad mortgages.

Also when it comes to mortgages, there are many people that have been scammed by a mortgage broker, promised one loan and given another. To the untrained eye, unless those flaws are obvious in the loan documents, the future holder of the loan is not liable for that claim. If proper assignments were not completed until just in time for court, the consumer may have plenty of rights to offset the claims made by the servicer. But consumers will never know the option is there if the lender can hide the chain of assignments behind smoke and mirrors. Bankruptcy courts are federal courts. Federal courts are constitutionally limited to addressing only a case or controversy between parties who have a true stake, something to win or lose in the outcome. Someone claiming such a stake has to be able to prove it.

Recently decisions have been made requiring the lending industry to disclose what it has been doing with loans. It’s a small thing but very important. Homeowners rarely understand how their loan ended up where it is. Sometimes they have conflicting information about who is entitled to the payments. Servicers don’t always talk to each other coherently when they pass paper between themselves, so how can a consumer not trained in mortgages be expected to understand it? Consumers may discover they have rights and claims which should be vindicated. Consumers don’t know when their rights are violated, in fact, they often are outraged by things which are lawful while only confounded by the unlawful. A lot of these consumers never find out any of this until they file for bankruptcy and are being foreclosed on.

Bankruptcy filing is or can be the most powerful foreclosure tool if used properly. In fact bankruptcy is probably the most powerful financial tool one can use in this country. And in these tough economic times, it’s not so it’s a question of whether a bankruptcy filing can stop foreclosure, but more of a question of what else cans bankruptcy due in addition to stopping the foreclosure. For instance, it may be possible to attach the mortgage itself and entirely strip off the property if there is an enforceability issue. Likewise, if new legislation is passed, arrears may no longer be an issue since the home loans will be entirely restructured into one mortgage reduced to a fair market value, with a lower interest rate, a lower payment, and spread over 40 years.

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Article Source:http://www.articlesbase.com/mortgage-articles/the-mortgage-crisis-and-bankruptcy-filing-1005901.html

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Gary Barnett is a real estate guru who is offering his advice on how to get out of this financial crisis. He suggests the government blocks big businesses from firing employees, extends mortgages, and spends over $10 billion to subsidize mortgages. Will the government take his advice or is it too extreme?

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In this time of economic crisis, help for troubled homeowners often arrives late, when it arrives at all. All too frequently, families are going into default on their mortgages, facing foreclosures and evictions that may have traumatic consequences.

The Mortgage Crisis Blog Mortgage Crisis

You think folks are pissed now? I wouldn’t be surprised if hedgies have to add Force Protection to all the other risks of their biz.As we saw in last Monday’s “Creditanstalt Redux?: Failure to save East Europe will lead to worldwide meltdown”, the place where international money flows are impacting the common volk of eastern Europe is currently in their mortgages. If your UBS mortgage is priced in Swiss francs and your wages are paid in a local currency, say the zloty, which has fallen 50% vs C

The Mortgage Crisis Blog Mortgage Crisis

One of the reasons why so many people around the world are not eligible for traditional credit and financial services is because they don’t have any collateral to offer to the lender. However, ironically, collateral alone is often not enough anyway. If you look at traditional borrowers in the U.S., who take out mortgages while putting their house down as a collateral or other loans, the default rates are still quite high (even before the crisis). So is physical collateral a necessity? Or can c

The Mortgage Crisis Blog Mortgage Crisis