EDITOR’S COMMENT: Thousands of homes are involved. Tens of thousands of lives disrupted or destroyed by the process of foreclosure that was at minimum, questionable. And what did the banks do with their ill-gotten gains? They either abandoned the homes because they were done with it and didn’t want to pay maintenance, insurance and taxes, or they are donated the homes to charities, which is just another way of abandoning the homes.
These events corroborate the premise of this blog: that the Banks are mere intermediaries who have no skin in the game, are claiming fictitious losses on behalf of fictitious creditors. This information should be used, along with as much other information as you can get from title and securitization chains. It would be particularly helpful in mediation and modification attempts.
On a statistical basis, it highly probable that a large percentage of these homes were the subject of a modification proposal by the homeowner. Under HAMP, the servicer is required to consider the proposal. The assumption was that the servicer would act in a reasonable manner — i.e., if it made more money on the modification than the foreclosure, it would accept the modification. That is the way real estate work-outs have gone for hundreds of years. Here we can assume that all such attempts at modifications were denied without consideration — and without telling the investors about it either. It is the final slap in the face of Americans whose tax dollars were used to bailout these monstrosities.
Forget collecting coins in a red kettle — charities are increasingly netting donated homes as a result of the foreclosure crisis.
And the trend is likely to to continue. USA Today reports that Bank of America donated 150 homes in 2011 and plans to donate more than 1,200 next year. Wells Fargo donated almost four times as many homes this year compared to last. And Habitat for Humanity almost doubled the number of donated homes that it’s rehabbed in the year ending last June.
“It’s a win, win, win” Rebecca Mairone, head of Bank of America’s donation program, told USA Today. Those three “wins” include one for the neighborhood where the house is located, one for the bank, and one for the investor.
By donating homes — typically of low value — owners rid themselves of a mortgage and the expenses that go with upkeep, as well as earn tax breaks for their donation. Depending on who the home is donated to, it might be torn down, refurbished or rebuilt completely.
In some places home donations are becoming too popular. CrainsDetroit.com reports that in Detroit, nearly 98 percent of homes offered are declined, as many are too rundown. And as home donation inquiries increase, some charities are still figuring out what they can and cannot accept.
“We had to kind of look at our policy on accepting house donations,” William Brazier, executive director of the Society of St. Vincent de Paul Detroit, told CrainsDetroit.com.
But saying “no” to that many home donations still puts most nonprofit organizations and banks ahead of the game. Nonprofit News reports that Real Estate Donations, a division of the West Dundee, Ill.-based nonprofit Restoration America, is still taking advantage of the upward shift in donations.
Filed under: bubble, CDO, CORRUPTION, currency, Eviction, foreclosure, GTC | Honor, Investor, Mortgage, securities fraud Tagged: | bankruptcy, borrower, countrywide, disclosure, foreclosure, foreclosure defense, foreclosure offense, foreclosures, fraud, LOAN MODIFICATION, modification, quiet title, rescission, RESPA, securitization, TILA audit, trustee, WEISBAND