Are You Ready? 6 – 7 Million More Foreclosures. Politicians criticize Fannie Mae & Freddie Mac out of one side of their mouths. Read: Who got the most money from FNMA. (by Joe /vera)
Scott Simon, a managing director and head of global asset-giant Pimco’s mortgage- and asset-backed securities teams, helped his firm avoid losses that hit Wall Street. is credited with foreseeing the housing crash and helping his firm dodge losses that plagued Wall Street.
He was recently asked if more foreclosures are expected to hit the market? He responded that over the next three years it could be as many as 6 -7 million more foreclosures.
Pulled the following from an old report. It was called shot in the Fannie Mae.
1997
Fannie Mae is a GSE (Govt. Sponsored Entity) regulated by Congress.
Fannie Mae buys mortgages from other companies.
It is backed by the taxpayers for all losses, but keeps all profits.
1998
Banks begin making thousands of bad loans,0 down, no documentation, for 120%! (1998 – 2008).
Executives at Fannie receive huge bonuses if loan targets are met.
Franklin Raines and Jamie Garelick from the Clinton Administration are appointed to run Fannie Mae.
2003
President Bush proposes a new oversight committee to clean up Fannie Mae, but Democrats derail the effort.
1999-2004
Raines earns $100 million in bonuses.
Garelick earns $75 million in bonuses.
In 2004, Enron collapses, congress investigates, Executives Skilling & Lay go to jail, for fraudulent bookkeeping.
Congress responds with the Sorbanes-Oxley Act, more heavy regulation of corporations.
2004
An OMB investigation finds massive fraudulent bookkeeping at Fannie Mae.
False numbers triggered executive bonuses every year.
Congress holds no hearings, no one goes to jail, or is punished.
WHY NOT?
1999-2005
Fannie Mae gives millions to Democratic causes, examples: Jesse Jackson & ACORN.
Fannie Mae pays millions to 354 congressmen and senators, from both parties.
Who got the most money?
#1 Sen. Christopher Dodd , (D-CT) Chairman of the Banking, Housing, & Urban Affairs Committee
#2 Sen. Barack Obama , (D-IL) Federal Financial Management Committee
#3 Sen. Chuck Schumer, (D-NY) Chairman of the Finance Committee
#4 Rep. Barney Frank, (D-MA) Chairman of the House Financial Services Committe
2005
Franklin Raines & top execs are forced to resign from Fannie Mae.
They do not go to jail.
There is no media “perp. walk.”
They keeps all of their bonuses
They finally pay $31.4 million in civil fines.
2005
The Federal Housing Enterprise Regulatory Reform Act is sponsored by: Sen. John McCain, (R-AZ) Armed Services, & Commerce, Science, & Transportation, “If Congress does not act, American taxpayers will continue to be exposed to the enormous risk that Fannie Mae and Freddie Mac pose to the housing market, the overall financial system, and the economy as a whole.”
None of the top 4 recipients support the legislation.
The reform act is blocked by Democrats, never even making it out of committee.
None of the politicians return any of the money, tainted by fraud.
2008
Fannie Mae & Freddie Mac go bankrupt and the govt. takes them over completely.
Lehman Brothers, goes bankrupt from investing in bad mortgages.
AIG get $85 million in loan guarantees, after insuring bad loans & projects.
Taxpayers will ultimately pay BILLIONS.
2008
Franklin Raines is now an advisor to the Obama Campaign which wants the govt. to take over more of the economy.
Did government involvement in the mortgage market work out?
How will even MORE government involvement make it better? Do you want to be Sweden?
McCain favors revising regulations & loan standards, selling off Fannie & Freddie.
Sources
Congressional Record, 5/25/06
“Hannity & Colmes,” Fox News, 9/16-9/17/08
Herald Tribune, 4/18/08
New York Times, 9/13/03
www. govtrack.com, 9/17/08
This was produced as a Power Point presentation by an Adjunct Instructor a Dennis Jantz in 2008.
Showing posts with label banks. Show all posts
Showing posts with label banks. Show all posts
Saturday, July 2, 2011
Friday, July 1, 2011
75% of Massachusetts County Mortgage Assignments in are Invalid
http://thelogosproject.com/?p=417
75% of Massachusetts County mortgage assignments in are invalid. This is a crime. Attorneys General need to investigate a crime not negotiate with criminals.
Three-quarters of mortgage assignments issued to and from JPMorgan Chase (JPM: 40.21 +1.69%), Wells Fargo (WFC: 27.72 +0.84%) and Bank of America (BAC: 11.05 +2.13%) during 2010 in the Southern Essex Registry of Deeds in Massachusetts are invalid, according to an independent review of documents.
An audit revealed 75% of mortgage assignments are invalid, 16% of mortgage assignments in the Southern Essex Registry are valid and 9% of assignments are questionable. About 27% of invalid assignments are fraudulent while 35% are robo-signed and 10% violate the Massachusetts Mortgage Fraud Statue.
“What this means is that the degradation in standards of commerce by which the banks originated, sold and securitized these mortgages are so fatally flawed that the institutions, including many pension funds, that purchased these mortgages don’t actually own them,” “The assignments of mortgage were never prepared, executed and delivered to them in the normal course of business at the time of the transaction.” according to the analysts.
What could make anyone think that the results would be any different in other counties? Why are state and federal governments and policing agencies negotiating with Banks for a miserable settlement?
75% of Massachusetts County mortgage assignments in are invalid. This is a crime. Attorneys General need to investigate a crime not negotiate with criminals.
Three-quarters of mortgage assignments issued to and from JPMorgan Chase (JPM: 40.21 +1.69%), Wells Fargo (WFC: 27.72 +0.84%) and Bank of America (BAC: 11.05 +2.13%) during 2010 in the Southern Essex Registry of Deeds in Massachusetts are invalid, according to an independent review of documents.
An audit revealed 75% of mortgage assignments are invalid, 16% of mortgage assignments in the Southern Essex Registry are valid and 9% of assignments are questionable. About 27% of invalid assignments are fraudulent while 35% are robo-signed and 10% violate the Massachusetts Mortgage Fraud Statue.
“What this means is that the degradation in standards of commerce by which the banks originated, sold and securitized these mortgages are so fatally flawed that the institutions, including many pension funds, that purchased these mortgages don’t actually own them,” “The assignments of mortgage were never prepared, executed and delivered to them in the normal course of business at the time of the transaction.” according to the analysts.
What could make anyone think that the results would be any different in other counties? Why are state and federal governments and policing agencies negotiating with Banks for a miserable settlement?
Wednesday, June 15, 2011
Viewpoint: Five Key Tasks to Make FDIC Loss-Sharing Work
Why? Every day a court in the USA stops a bank from wrongfully foreclosing. Failed Bank executives walk away keeping bonuses based on bad loans. Then …
Why? Every day a court in the USA stops a bank from wrongfully foreclosing. Failed Bank executives walk away keeping bonuses based on bad loans. “After all, there is a reason why these banks failed. Oftentimes, financial statements are old,
appraisals are out of date, and file memos chronicling the loan’s current status are missing.” Then the government insures the buyer of a failed Bank against losses. The thinking seems to be if the government keeps hiding theft and charging it to our children and their children, maybe they (the bankers and the politicians that received “contributions) can continue to get away with skimming.
This article is written by an expert recommending that expert investors who intend to acquire a failed bank with an guarantee against loss should get more experts to counsel on the loss sharing agreement.
So, if the experts have to get experts, how are decent Americans, whether a cook, fireman, truck driver, doctor, or Ph.D. going to understand what is taking place behind closed doors. Yes, closed doors.
A county recorder in Utah said of MERS, “… if looked like a scam from hell.” You will be hearing more about Loss Sharing Agreements. What you won’t hear or read is how by starting a new bank, it might be possible to actually end up with profit by foreclosure on a American. This looks like another “scam from hell” to me.
Viewpoint: Five Key Tasks to Make FDIC Loss-Sharing Work
American Banker | Tuesday, January 12, 2010
By Charles B. Wendel
Entering into shared-loss transactions appears to be the Federal Deposit Insurance Corp.’s preferred approach for
dealing with failed banks. More than 60% of last year’s 140 bank failures were resolved using this approach.
Shared-loss transactions let banks build market share or move into new markets with minimal risk. They also let
private-equity players (led by a team of bankers) take advantage of current industry discontinuities.
Much of the attractiveness of these transactions centers on the “guarantee” the FDIC offers buyers. Typically, the
agency remits 80% of “dollar one” loan losses to buyers and increases its payments to 95% for losses beyond an
agreed upon threshold. In turn, the FDIC benefits from recoveries during the 10-year life of these deals.
Though these deals are attractive strategically and economically, they are also complex.
My company’s work with banks and private-equity players points to five key elements that should be addressed in
order to structure and manage a transaction appropriately.
Conducting a focused due diligence process and negotiating the FDIC shared-loss deal. Though many players
are experienced in due diligence, the FDIC window is short, with no more than two weeks between reviewing an offer
package to bidding. Time with the target is also limited (two to three days), requiring a focused approach. Buyers
should assemble a team of internal and external resources and set clear priorities for their review process.
As for negotiating an agreement, the FDIC has standardized the general structure of its purchase-and-assumption
and shared-loss agreements. However, no two agreements are alike, given evolving requirements by the FDIC (for
example, a “true-up” provision added in the fourth quarter) and buyer-negotiated amendments. Management should
view these agreements as a bible that will be revisited many times. Bank buyers should consult the handful of legal,
valuation and related advisers with expertise in the shared-loss world, leveraging their knowledge rather than relying
solely on internal controllers, general counsels or other internal resources.
Addressing key accounting-related priorities. Accounting regulations to be addressed include FAS 141R, SOP
03-3 and IRC Section 593. Many tax and accounting issues stem from the need to determine the tax basis of assets
subject to the shared-loss agreement and the rules related to deferred tax gains. A bank’s auditor is conflicted out
from offering these services, since it would be reviewing and passing judgment on its own work. This requires bank
buyers to obtain the services of an independent firm with appropriate accounting and valuation capabilities.
Ensuring strong portfolio support. The FDIC expects buyers to make regular claim submissions related to loan
losses, usually monthly for residential loans and quarterly for commercial and consumer loans.
Residential submissions are relatively straightforward because of the objective loss criteria outlined by the FDIC,
namely, “actual losses incurred due to modifications, foreclosures, short sales, deeds-in-lieu or bulk sales.” However,
commercial submissions are more subjective and require greater evaluation.
The state of commercial loan files in failed banks is often inadequate for portfolio management or for making “audit-
proof” submissions. (After all, there is a reason why these banks failed.) Oftentimes, financial statements are old,
appraisals are out of date, and file memos chronicling the loan’s current status are missing.
Owners should select a team of internal and/or external resources to triage, in effect, the portfolio, uncovering the
low-hanging fruit that can be submitted earliest while establishing a process to assess the entire portfolio. Every loan
in the portfolio must be reviewed against the acquirer’s risk rating system and managed within policy guidelines.
Commercial bankers at the acquired bank should undergo a sea change in how they look at their loans. Before
failure, many banks avoided taking losses because their reserves could not support a realistic view of a borrower’s
position. Under shared-loss agreements, management wants bankers to accurately assess transaction risk as quickly
as possible in order to identify loans subject to FDIC claims.
Making accurate and complete certificate submissions. The FDIC has developed a three-page certificate that
requires buyers to tap multiple internal databases and in some cases provide manual inputs as well. Systematizing
this process is crucial to increased accuracy and productivity.
Using technology to track and monitor loan submissions and recoveries during the life of the FDIC agreement.
While residential mortgage loans usually involve one submission, both CRE and C&I loans may require multiple
submissions based upon declining values and continuing expenses related to asset preservation, legal and appraisal
costs.
In addition, recoveries occur across the portfolio. Buyers need to develop an inclusive information management
system or “portal” to track these ins-and-outs. Tying the portal to the bank’s core systems allows for the “automatic”
generation of certificates, eliminating much of the manual activity that dominates bank staffers’ time in the early
stages of integrating an acquisition.
Shared-loss transactions can be very attractive and beneficial to all stakeholders, including the customer and the
FDIC. However, making them work requires senior management focus, clear priorities, and a bankwide
understanding of the unique opportunity these transactions offer.
Charles B. Wendel is the president of Financial Institutions Consulting Inc.
Why? Every day a court in the USA stops a bank from wrongfully foreclosing. Failed Bank executives walk away keeping bonuses based on bad loans. “After all, there is a reason why these banks failed. Oftentimes, financial statements are old,
appraisals are out of date, and file memos chronicling the loan’s current status are missing.” Then the government insures the buyer of a failed Bank against losses. The thinking seems to be if the government keeps hiding theft and charging it to our children and their children, maybe they (the bankers and the politicians that received “contributions) can continue to get away with skimming.
This article is written by an expert recommending that expert investors who intend to acquire a failed bank with an guarantee against loss should get more experts to counsel on the loss sharing agreement.
So, if the experts have to get experts, how are decent Americans, whether a cook, fireman, truck driver, doctor, or Ph.D. going to understand what is taking place behind closed doors. Yes, closed doors.
A county recorder in Utah said of MERS, “… if looked like a scam from hell.” You will be hearing more about Loss Sharing Agreements. What you won’t hear or read is how by starting a new bank, it might be possible to actually end up with profit by foreclosure on a American. This looks like another “scam from hell” to me.
Viewpoint: Five Key Tasks to Make FDIC Loss-Sharing Work
American Banker | Tuesday, January 12, 2010
By Charles B. Wendel
Entering into shared-loss transactions appears to be the Federal Deposit Insurance Corp.’s preferred approach for
dealing with failed banks. More than 60% of last year’s 140 bank failures were resolved using this approach.
Shared-loss transactions let banks build market share or move into new markets with minimal risk. They also let
private-equity players (led by a team of bankers) take advantage of current industry discontinuities.
Much of the attractiveness of these transactions centers on the “guarantee” the FDIC offers buyers. Typically, the
agency remits 80% of “dollar one” loan losses to buyers and increases its payments to 95% for losses beyond an
agreed upon threshold. In turn, the FDIC benefits from recoveries during the 10-year life of these deals.
Though these deals are attractive strategically and economically, they are also complex.
My company’s work with banks and private-equity players points to five key elements that should be addressed in
order to structure and manage a transaction appropriately.
Conducting a focused due diligence process and negotiating the FDIC shared-loss deal. Though many players
are experienced in due diligence, the FDIC window is short, with no more than two weeks between reviewing an offer
package to bidding. Time with the target is also limited (two to three days), requiring a focused approach. Buyers
should assemble a team of internal and external resources and set clear priorities for their review process.
As for negotiating an agreement, the FDIC has standardized the general structure of its purchase-and-assumption
and shared-loss agreements. However, no two agreements are alike, given evolving requirements by the FDIC (for
example, a “true-up” provision added in the fourth quarter) and buyer-negotiated amendments. Management should
view these agreements as a bible that will be revisited many times. Bank buyers should consult the handful of legal,
valuation and related advisers with expertise in the shared-loss world, leveraging their knowledge rather than relying
solely on internal controllers, general counsels or other internal resources.
Addressing key accounting-related priorities. Accounting regulations to be addressed include FAS 141R, SOP
03-3 and IRC Section 593. Many tax and accounting issues stem from the need to determine the tax basis of assets
subject to the shared-loss agreement and the rules related to deferred tax gains. A bank’s auditor is conflicted out
from offering these services, since it would be reviewing and passing judgment on its own work. This requires bank
buyers to obtain the services of an independent firm with appropriate accounting and valuation capabilities.
Ensuring strong portfolio support. The FDIC expects buyers to make regular claim submissions related to loan
losses, usually monthly for residential loans and quarterly for commercial and consumer loans.
Residential submissions are relatively straightforward because of the objective loss criteria outlined by the FDIC,
namely, “actual losses incurred due to modifications, foreclosures, short sales, deeds-in-lieu or bulk sales.” However,
commercial submissions are more subjective and require greater evaluation.
The state of commercial loan files in failed banks is often inadequate for portfolio management or for making “audit-
proof” submissions. (After all, there is a reason why these banks failed.) Oftentimes, financial statements are old,
appraisals are out of date, and file memos chronicling the loan’s current status are missing.
Owners should select a team of internal and/or external resources to triage, in effect, the portfolio, uncovering the
low-hanging fruit that can be submitted earliest while establishing a process to assess the entire portfolio. Every loan
in the portfolio must be reviewed against the acquirer’s risk rating system and managed within policy guidelines.
Commercial bankers at the acquired bank should undergo a sea change in how they look at their loans. Before
failure, many banks avoided taking losses because their reserves could not support a realistic view of a borrower’s
position. Under shared-loss agreements, management wants bankers to accurately assess transaction risk as quickly
as possible in order to identify loans subject to FDIC claims.
Making accurate and complete certificate submissions. The FDIC has developed a three-page certificate that
requires buyers to tap multiple internal databases and in some cases provide manual inputs as well. Systematizing
this process is crucial to increased accuracy and productivity.
Using technology to track and monitor loan submissions and recoveries during the life of the FDIC agreement.
While residential mortgage loans usually involve one submission, both CRE and C&I loans may require multiple
submissions based upon declining values and continuing expenses related to asset preservation, legal and appraisal
costs.
In addition, recoveries occur across the portfolio. Buyers need to develop an inclusive information management
system or “portal” to track these ins-and-outs. Tying the portal to the bank’s core systems allows for the “automatic”
generation of certificates, eliminating much of the manual activity that dominates bank staffers’ time in the early
stages of integrating an acquisition.
Shared-loss transactions can be very attractive and beneficial to all stakeholders, including the customer and the
FDIC. However, making them work requires senior management focus, clear priorities, and a bankwide
understanding of the unique opportunity these transactions offer.
Charles B. Wendel is the president of Financial Institutions Consulting Inc.
Friday, May 6, 2011
Illegal Lock Changing
Lock-Changing Some banks send representatives to change the locks on properties that have not yet been foreclosure. In California, deeds of trusts provide that banks can protect collateral if it being wasted or if it is abandoned. They also have changed locks when property owners are delinquent and still occupying the property. In some instances, lock-changing has taken place against property owners who were not delinquent nor in foreclosure.
Such property owners are being exposed to theft of property and personal harm. At what point does such activity cross the line from civil to criminal? If you know of and can document a lock-changing event before a foreclosure or when there was no foreclosure, please let us know. We would like to speak with some of these property owners.
Such property owners are being exposed to theft of property and personal harm. At what point does such activity cross the line from civil to criminal? If you know of and can document a lock-changing event before a foreclosure or when there was no foreclosure, please let us know. We would like to speak with some of these property owners.
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