Untangling the Foreclosure Mystery - Part 1

As run in Key West the Newspaper May 6, 2011
How is it that so often I am reading a news article and find myself pleading with the reporter to ask the next question?

So often it seems reporters will just leave the story with one major disconnect that could put all the pieces of the puzzle together. That was the case again recently with an article regarding foreclosure in the Sunday Citizen. The worst part about it is that the story was just starting to scrape the surface of what very few journalists have been able to expound upon.

Granted, the reporter may have been limited by the confines of column inches, or the directive of editors telling him to be concise, but why can’t reporters just dig a smidgen deeper versus regurgitating the same old rhetoric about foreclosures that’s passed around the AP wire?

Fortunately, it’s why everyone should, and I do, love Key West the Newspaper. They are concerned about the truth, and making sure you know it. To that end they have provided me the opportunity, in a forthcoming series of articles, to provide an explanation of how it all ties together. In the next few weeks I hope to enlighten you on how bank fraud, your property values, everyone’s due process, our tax base, robosigning, court budgets, banks, Pam Bondi, the Florida Bar, real estate agents, overwhelmed judges, and market confidence all twist together like one large screw applied firmly to a certain part of your posterior anatomy— regardless of whether you are a homeowner, a pensioner, a taxpayer, or just someone who breaths oxygen—trust me you’re feeling it. Here’s the same old tired story from the main stream media:

A bunch of deadbeat homeowners stop paying their mortgage, thereby overburdening the banks that have to process the foreclosures, and ultimately overburden our court system. In the haste to process all the paperwork, the poor old banks have to “create” documents to gain standing to foreclose.

Hence the robo-signing and document problems. Our court system is now burdened with all these extra civil cases, and they have a tough time budgeting with the fluctuations. All the foreclosures are a drag on property values, decreasing the tax base, and destroying equity. All levels of government must subsequently reduce their budgets accordingly. Blah, blah, blah. Copy and Paste.

OK, so what is the question that desperately needs to be addressed? The Citizen article stated “the nationwide drop (in foreclosures) is largely the result of foreclosure delays implemented by banks last fall in response to allegations of forgery and other irregularities in paperwork processing.”

I’ll save the flippant use of the words “allegations” and “irregularities” for another day, but here’s my question: Why the need to create documents that might even be considered forgeries??

The answer to that question is the holy grail of almost every ailment that our governments are faced with right now…and I have the answer.

Now if at this point you are more interested in a Royal wedding, or Dancing With the Stars please feel free to tune out, put this paper down and pick up some bird cage wrapper with pretty colorful pictures that make you feel good. But if you care one bit about truth, and all that we know in our hearts is going wrong with our world, then bear with me and take the chance that a few minutes of your time might provide for you some critical insight. The answer to the question I pose is: Fraud. Not just fraud, but control fraud. Widespread, intentional fraud the scale of which has never been seen in the history of our nation.

Fraud committed by the BANKS. Now, I’m not talking about our small local banks like Keys Federal Credit Union; I’m talking the Big Boys. The Too Big To Fail boys. You know, the banks that get massive amounts of our tax dollars to bail them out so we don’t experience Economic Armageddon so that they can pay themselves bonuses. Those banks.

I can hear some of you saying,”Yes Matt, we know the evil old rich bankers are crooks, but that doesn’t affect me. That doesn’t affect those of us buying a house, or paying our mortgage and taxes, that doesn’t affect those of us who want to sell a house, or have to pay more for essential government services.”

Well, you might be right. You might be right if your perception is gleaned from soundbite journalists, “Now’s the time to buy!!!” Real Estate agents, or from colorful newspapers with self portraits of giddy editors.

But here is the truth. Those TBTF banks that committed widespread fraud are 100% directly responsible for the foreclosures, decreasing property values, an overburdened court system, increasing tax burden, and government budget constraints. AKA – the aforementioned screw.

Why would banks have to produce documents to gain standing to foreclose? Why couldn’t they simply use the documents that are historically on file with the Clerk’s Office to gain standing in cases so that foreclosures are cut and dry? Because the banks intentionally destroyed the original documents. Because the banks failed to file any subsequent assignments and evaded billions in filing fees.

Oops, that might inspire a journalist to ask another question, or at least leave the reader pounding his or her head into their breakfast wondering: Why would the banks do that?

Tune in next week when our hero unties the damsel in distress from the railroad tracks.

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