Independent Foreclosure Review Part 1
Well let’s start with a little history. We know back in the hey days of 2005, 2006 and 2007 banks were writing loans with reckless abandon, then they tried selling these loans to other buyers, investors, etc. Then, they realized that someone had to collect these loans.
Mortgage servicers stepped in to take up the slack. The mortgage servicers act as agents for their principals (owners of the note), and they take a slice of the pie for themselves. Eventually, we found out that the servicers had such a slim margin (little profit) servicing the loans legitimately, but the real upside (amazing profits) was in default servicing (when the homeowner defaulted).
The servicers also referred cases to the foreclosure process and handled the processing of documents. Well it all went down the tubes then.
So here is what we know:
1. The banks treated profits as more important than their loan origination standards and processed loans like Lucille Ball at the Chocolate Factory.
2. We also know that banks not only can’t originate loans, but also can’t service them without committing fraud.
3. We later learned that they could not foreclose property either without cheating the system.
4. Now we are having an outside company/ individual determine what they did wrong, if anything. Why?
Well, once the banks/servicers were caught with their hands in the cookie jar, the FEDS decided to do something about it. Eventually a consent order was entered into between the servicers, the Federal Reserve, the Office of Thrift Supervision (OTS) and the Office of the Comptroller of the Currency (OCC).
Again this only applies to the banks/ servicers who were foreclosing on properties from Jan. 1, 2009 to Dec. 31, 2010.
This post was submitted by Carmen Dellutri, Esq., founder of The Dellutri Law Group, P.A. Currently, the firm has offices in Port Charlotte, Fort Myers, Naples. Mr. Dellutri also sits on the Board of American Board of Certification. Mr. Dellutri is also one of the founders of the Bankruptcy Law Network, Debt Law Network, Credit Law Network, and Mortgage Law Network. Mr. Dellutri also writes for the firm's personal injury litigation blog, www.faircreditreportingactblog.com and www.fairdebtcollectionpracticesactblog.com, and the firm's mortgage modification blog.
