Is your home worth more than your mortgage? For many Americans that is not the case and they fall further and further behind in their payments.
Yet why did so many Americans obtain mortgages they should not have?
Have you wondered why you can’t pick up a paper today without reading about someone having their home foreclosed on and what caused that problem?
The number of Americans behind on their mortgage payments keeps increasing. For some- they obtained mortgages they could not keep up with. Many mortgages were given to people who could not repay. According to panelist: Richard Bitner,” the mortgage industry is essentially a food chain-
Borrowers on one end and investment banks, rating agencies and securitization on the other. Mortgages were bundled and sold off to investors world wide under the belief they would perform better than they did. There was a belief that mortgages were low risk, like bonds.”
Panelist: C.K. Lee adds “ People owning homes is a good thing. Everyone from the President to mortgage bankers have said so- BUT- But there was a flawed premise behind this . The problems started with investment banks and Fannie Mae and Freddie Mac- operating under the auspices of government.”…
In this program we’re going to examine, in simple language, all the mistakes and fraud that led us to where we are today and the many causes of the mortgage debacle.
Panelists include:
- C.K. Lee –Managing Director; Commerce Street Capital
- Richard Bitner- Author; Confessions of a Sub Prime Lender
***
1903 – 2.20.11
I recently caught part of your program on Easter Sunday. As one who has personally experienced foreclosure and loss of home, it was interesting to see how your mortgage and servicing guests avoided blame for this national problem.
I must laugh when hearing the line, “borrowers that took out loans they shouldn’t have” or something similar. Real estate agents, brokers, appraisers, loan officers, banks and securities professionals are all licensed by some governmental authority. How would a borrower take out a loan “they shouldn’t have” without fraud on the part of one of these licensed groups. As you know these Captains of the Industry have a fiduciary duty and are held to a higher degree of responsibility than John Q. Consumer. Like the Devil’s greatest trick, they led the consumer to believe in a value that was not there.
The successes of the mortgage rescue plans of Bush and Obama by any yardstick are failures, but the servicers keep harping them (follow the money). As is usual with these types of shows, you need to have Borrowers on the other side, telling the real story. These rescue plans, the bailouts, QE1/2, TARP etc. have all been for the benefit the banks and Wall Street, and those vested in them.
This bill was introduced by the Republicans, passed both houses but was never debated and was signed by the lame-duck president Bill Clinton. (10-27-08 04:27 AM http://en.wikipedia.org/wiki/Commod…ion_Act_of_2000 )
The “Commodity Futures Modernization Act of 2000” (H.R. 5660) was introduced in the House on Dec. 14, 2000 by Rep. Thomas W. Ewing (R-IL) and cosponsored by Rep. Thomas J. Bliley, Jr. (R-VA) Rep. Larry Combest (R-TX) Rep. John J. LaFalce (D-NY) Rep. Jim Leach (R-IA) and never debated in the House.[2]
The companion bill (S.3283) was introduced in the Senate on Dec. 15th, 2000 (The last day before Christmas holiday) by Sen. Richard Lugar (R-IN) and cosponsored by Sen. Peter Fitzgerald (R-IL) Sen. Phil Gramm (R-TX) Sen. Chuck Hagel (R-NE) Sen. Thomas Harkin (D-IA) Sen. Tim Johnson (D-SD) and never debated in the Senate.
Given the above-stated chronology, it would appear that the House and Senate versions of the bill were introduced just prior to the Christmas holiday in December of 2000, following George W Bush’s (first) election (in November of 2000), while then-President Clinton was serving out his final days as President. The bill was never debated by the House or Senate. The bill by-passed the substantive policy committees in both the House and the Senate so that there were neither hearings nor opportunities for recorded committee votes. In substance, it appears that the leadership of the Republican-controlled Senate and House incorporated the deregulation of credit default swaps into an omnibus budget bill (without hearings or recorded votes)at a time when the outgoing president was in no position to veto anything. The following article argues that Bill Clinton and Alan Greenspan endorsed this law : The Bet That Blew Up Wall Street.
Securitizations / Derivatives were necessary to increase the flow of new monies to bankers and Wall St. thieves. This was all a large scale theft scheme by elite and bankers against the American middle class, accelerated with the return of “bucket shops”, now aided by the FED.
The sooner the housing market is allowed to reset the sooner our country can start its recovery, rather than this slow asphyxiation. The second dip is just now starting, Texas is not exempt, and most don’t understand that prices will overshoot the mark on the way down.
Housing will never recover without jobs, and we cannot build “Ghost Cities” like the Chinese. We will need leaders who will fight for the recovery of jobs and America.
Love this article! I have intermittently researched (as I can…Too busy working just to pay bills and taxes–just how the Republicans want me).
Thank you for sharing your wisdom!
Lynn