EDITOR’S COMMENT: OK think about it. BOA is going to pay hundreds of millions to those minorities who were steered into either high interest rate loans or sub prime loans that were loaded with exotic features, including high interest rates. ” High Interest” means an interest rate that was significantly higher than the one the borrower was qualified to receive. Countrywide targeted the least sophisticated Borrowers in order to get away with these shenanigans. The higher the interest, the higher the payments. The higher the payments, the more likely the loan would fail. And by definition these were loans that SHOULD have been given to these people at more affordable rates and terms.WHY WOULD A TRUE LENDER PRESS UNSOPHISTICATED BORROWERS INTO LOANS THAT WERE MORE LIKELY TO FAIL THAN THE LOAN TERMS THOSE SAME BORROWERS WERE QUALIFIED TO RECEIVE?Now when some minority homeowner is in court, the Bank will say that the matter has been settled or at least partially paid through the settlement. The answer from the homeowner should be that they did receive some money from the DOJ action but that didn’t cover their damages or their case. In fact, it goes to corroborate their argument that the amount demanded is wrong and that the lien very likely never attached to their real property, leaving the “creditor” with nothing more than an unsecured loan that could be discharged in bankruptcy. Such litigants should hope and prey that the Bank makes that argument.If the Bank argues payment in a collateral case from a collateral source (remember that the forecloser is mostly the so-called trusts, not the Banks) the homeowner’s response should be that the Bank has now admitted that third party and collateral source payments should be counted, to wit: such payments are (a) subject to an accounting and (b) do set off the amount due to the extent paid.THAT MEANS PAYMENTS RECEIVED FROM INSURANCE, CDS, AND CREDIT ENHANCEMENTS MUST OFFSET THE AMOUNT DUE FROM BORROWER TO THE EXTENT THAT SUCH MONEY WAS RECEIVED BY THE CREDITOR OR ON BEHALF OF THE CREDITOR. THIS ASSUMES THAT THAT THERE IS EVEN A CREDITOR IN EXISTENCE BECAUSE REPORTS RECEIVED BY LIVINGLIES INDICATES THAT THE SPVS (trusts) HAVE BEEN DISSOLVED LEAVING HALF, AT BEST, OF THE TRUSTS STILL IN EXISTENCE, WHICH MEANS THE INVESTORS HAVE SETTLED OUT.THE CREDITOR HAS BEEN PAID BUT THE BANKS KEEP ASSERTING A CLAIM AGAINST THE BORROWER FOR THE FULL AMOUNT WITHOUT SET OFF FOR PAYMENTS RECEIVED FROM BAILOUT, INSURANCE, CREDIT DEFAULT SWAPS ETC.BUT WHY DID THEY WANT TO MAKE LOANS THAT WERE TOXIC TO ANYONE, LET ALONE MINORITIES? Because that is where they made their money, the really big money, that is hiding off shore now, siphoned off from the the U.S. Economy, from consumers, homeowners and borrowers without any accounting because the government decided that ” balance sheet” transactions were both legal and did not need to be disclosed.They took a loan that was nominally valued at $200,000 and sold it to the investor pools for $300,000 and called it ” trading profits.” In truth it was pure theft. It’s like allowing them to sell your own car to you, take a profit, and then tell you that you have a loss, now, which is their profit.They took the investor’s money, bought crap, slapped a value on it that was inconceivably wrong, and then sold it back to the investor for 100 cents on the dollar that the investors gave them. Their cost for the crap (a bad $200,000 loan that over valued, and used an overvalued appraisal to establish a false value of the collateral) they funded (from investor money) was $200,000, and it was only worth $100,000, so the investor put up $300,000 and got at best a $100,000 asset. After that it went down from there diminished by falling markets, fees from the intermediaries etc.The investment Bank took the difference between the amount the investor paid for the bogus mortgage bonds and the amount actually used for funding mortgages and booked the transactions as trading profits and fees.
Maybe someday the government experts will understand what we already know —- we were all lied to and screwed —- taxpayers, insurance companies, investors, and homeowners. But because the learning curve is so steep and the path so convoluted, by the time government actually publishes how we were screwed and why the foreclosures were totally wrong, the tsunami of foreclosures divesting at least 12 million families of their homes, their lifestyles and even their lives, the economy will be down the drain. Stop the foreclosures, and we stop the drain. Allow these illegal, improper and foolish foreclosures and you are sealing the fate of America and all it’s citizens.
NAACP, NCLR laud Bank of America for Countrywide settlement
by Kerri Panchuk, HousingWire
Bank of America’s (BAC: 5.3893 +3.05%) $335 million fair-lending settlement with the Justice Department drew praise from two groups who applaud the banking giant for resolving inherited issues from Countrywide Financial Corp.
The bank agreed to pay millions in restitution to compensate Hispanic and black borrowers who were steered into subprime mortgages and home loans with higher fees during the origination process.
“To its credit, Bank of America — which was not named in the investigation — immediately shut down Countrywide’s harmful practices when it acquired the company in 2008,” said the National Council of La Raza in a statement.
The National Association for the Advancement of Colored People also released a statement saying Bank of America “takes one more important step toward creating a fairer lending environment for consumers.”
The NAACP went on to say that BofA’s acquisition of Countrywide allowed it to rectify what the organization considers Countrywide’s “most egregious practices.”
“These included ending: no documentation loans, pay option adjustable-rate mortgages and exploding adjustable rate mortgages,” the NAACP said. “Additionally, in March 2011, Bank of America became one of the first financial institutions to endorse the NAACP’s responsible mortgage lending principles, which deal directly with the issues in the lawsuit by setting standards of non-discrimination, fairness and transparency in ways that help ensure our nation and all our communities will continue to move forward towards a day of greater shared economic strength and stability.”
The lawsuit resolved by Wednesday’s settlement is the result of Countrywide lending practices that occurred between 2004 and 2008, impacting more than 200,000 black and Hispanic borrowers.
Write to: Kerri Panchuk.
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