Bankrupt Mortgage Companies Bouncing Property Tax Checks

Elaine Meinel Supkis

More and more homeowners are in trouble because bankrupt mortgage dealers and holders are going bankrupt and not paying property taxes or are using bad checks to pay this! And the poor homeowners have to fix this or lose their homes only they have no control over who is doing this! And they still have to pay the people bouncing checks. The world banking crisis gets worse as the US system collapses. Time to revisit the vile fraud, Greenspan. And talk about international banking rules yet again.

From the NYT:

Banks financing the purchase of the First Data Corporation by the equity firm Kohlberg Kravis Roberts made several concessions on the debt sale yesterday as they tried to lure skittish investors.

The seven banks, led by Credit Suisse and Citigroup, plan to sell only $5 billion in loans at this point to finance the $26 billion deal, which includes $24 billion in debt. Much of the rest will be sold later to avoid flooding the market.

Funny, there isn't much a market of fools drooling with joy at the thought of parting with their money. The curious thought arises, why are these bankers so anxious to unload these loans, they are already willing to take a 5% hit? Who wants that? In my wayward youth, banks extended loans and then would fret about them day and night. They would haunt the premises to see if all was well. Did you keep the lawn clipped? Did the business hire more people and issue dividends on their stocks? The banker had to be someone responsible who was also a naturally suspicious person.

As Mr. Breemer of the SEC back in 1990 said to the Japanese, the stock market/savings and loan crash meant bankers needed to detatch themselves from the money they lend so they won't crash when businesses or homeowners declare bankruptcy! How simple is that? By no longer holding these papers they generated, the banks could sail off merrily while any sinking ships would sink...and someone else would drown. Cool solution! The flaw in this new way of doing things is simple: the drowning people are investors!

Banks have to attract savers and we see a world now where they are not attracting savers at all. They are attracting people seeking loans, they are attracting debtors like moths to the flame. And the way they attracted investors was to tack on a higher interest rate...in the future....onto various loans. The kicker here is, someone has to not be bankrupt when the higher rates suddenly kick them in the ass.

So here we are: the biggest bankers on earth happily handed over insane sums of money, many billions, to a bunch of hot shots shuffling existing businesses around. And the plan was to then resell these warmed over left overs and sell them to mutal funds, retirement funds and others chumps. All these many billions of deals produced exactly....NOTHING BUT DEBTS! This is very astonishing. This wasn't so these many corporate entities being hammered together could expand and hire more people: they all, universally, FIRED people and SHRANK.

So these damn bankers gave money to vultures who went out and fired people and made industries and businesses smaller and weaker and under a huge burden of new debts. The pay-off was big bucks for the financiers and Fagins peddling these ridiculous deals. Now, they are weeping and wailing because this whole shameful business is now dead in the water. They need more liquidity! And the Central Banks are anxious to pour on more red ink to continue this destruction.

Note that the take-over mania skipped Japan! Indeed, every attempt at doing it there was squashed by the Japanese government and courts. Um, hey! We can learn from them, you know! They had the right idea in this regard.

From the NYT:

Both the Allison and First Data offerings included what amounts to a buyer’s protection plan against further price cuts on the loans. Under what is known as a most-favored-nations clause, if the banks sell a second slice of loans at a greater discount this year, they will refund the difference to buyers of the first round of loans.

Ohhhhhh......far from making me feel good, this news is hair raising. Apple made the mistake of discounting their phones too quickly and ran into the honest ire of earlier purchasers! Their profit margin has been hammered by the need to refund a lot of money. In this case, the urge to drive down prices so they can get further discounts is irresistible. A dire temptation. And as usual, since this is a dog-eat-hell hound world, financiers will force this issue and collect some pretty massive profits if they drive down the value!

This is the weakness of all systems set up to save people who are Ayn Randian 'Me First' types: they are always seeking advantage and an angle to exploit so they will happily exploit any errors, weaknesses and opportunities. And this is why the present push to save all these moral hazards are increasing the danger, increasing the possibility of a total meltdown. It is the nature of this beast and the cave wherein it lives.

From the Wall Street Journal:

Thousands of homeowners face an "imminent risk" of losing their homes because of clashes between American Home Mortgage Investment Corp. and its former financial backers, according to Freddie Mac, a government-chartered housing financier.

In documents filed with the U.S. Bankruptcy Court in Wilmington, Del., Freddie Mac said it seized $7 million that homeowners sent to American Home to cover principal and interest payments, property taxes and insurance just before the company's Aug. 6 collapse. American Home quit making payments to tax authorities and insurance companies Aug. 24.

Freddie Mac said 4,547 loans valued at nearly $797 million are at stake. It said it doesn't have the loan files necessary to pay insurance premiums and property taxes on them, however. "Therefore, there is the imminent risk that borrowers' insurance policies may lapse for nonpayment, subjecting the borrowers to a risk of loss of their mortgaged properties," Freddie Mac said.

I wrote about this before at the behest of one of my readers who was shocked one day to discover his mortgage had been sold off and then the buyer didn't pay the taxes and the sheriff came to the door and scared him nearly to death! I was outraged. I always specified I would pay my own taxes in the past but this is hard to do. Only if you pay more than 60% of the value of the property, can you demand this boon.

So here we are: a crisis is developing and totally innocent people sending their money in all due honor and care to a bunch of criminals and cads are now going to be in severe financial straits because the mortgage companies that are not bankers but brokers, are breaking the law and bouncing checks and in all sorts of ways, making it nearly impossible to unravel who owes what, where.

Many, many homeowners are tearing their hair out, trying to track down who is responsible for their taxes, their insurance and their mortgage payments. If the holder has messed up records, they simply declare the owners in arrears and initiate foreclosure! There is no penalty for doing this for spurious reasons. If the homeowner had cancelled checks proving they paid, this still means they can't get some satisfaction for the hassle of dealing with a messed up mortgage system!

My own children, to pay their own mortgages, have their bank handle everything so any problems is dealt with at their local bank which tracks the money and its status at all times. This means my children can sleep at night, secure. This news today is very bad for anyone caught in the gears of this massive breakdown in our banking system.

Via Carlos, a reader, comes this Baltimore Sun story:

Checks sent out by the troubled American Home Mortgage Investment Corp. to pay the property taxes of more than 70 homeowners in the Baltimore metropolitan area have bounced, local officials said yesterday.

Baltimore City received bad checks for 53 properties - a total of about $63,500. Baltimore County said American Home Mortgage checks bounced for 21 properties, totaling $41,000. Taxes are due at the end of the month.

Finance officials in the rest of the region - Anne Arundel, Carroll, Harford and Howard counties - reported no similar problems.

"This is just another chapter in what is a very difficult time for the mortgage industry," said Donald I. Mohler III, a spokesman for Baltimore County, which no longer accepts checks from American Home Mortgage.

When American Home Mortgage went under, the government assured everyone, no one need fear this, all would be transfered securely. Of course, total incompetence was the actual result. These bounced checks will not see any punishment. Unlike credit card companies or banks, homeowners can't fine the people passing bad checks on their taxes. The penalties will fall on the homeowners! Who trusted authorities to protect them while they faithfully fulfilled their own duties!

People have asked me why I should go through a lot of pain and suffering (and it was very hard work!) to eliminate my mortgage by my 60th birthday and I point to the uncertainty of mortgages when things do wrong. They are not panaceas with no downsides! This should be painfully obvious now!

The thought of losing my home because some jerk in a bank or mortgage outfit bounced checks! Holy hell! All systems have downsides. This is why the homeowning/mortgage system had so many rules and regulations, all seemingly onorous except all of them sprang from previous messes and were set up as protections! And this is also why one should try to slip out of the obligation of paying mortgages by the time they retire!

From Bloomberg:

European finance ministers and central bankers said they would resist overreacting to turbulence in financial markets by rushing to impose unwieldy regulations.

At their first talks since international credit costs soared in reaction to the collapse of the market for U.S. subprime mortgages, the officials yesterday commissioned a review of whether they need to rewrite rules for lenders and credit-rating companies, while stopping short of pledging to take action.

``Not everything can be dealt with through regulation -- it's not a magic wand,'' Portuguese Finance Minister Fernando Teixeira Dos Santos told reporters after chairing the talks on the first day of a two-day meeting in Oporto, Portugal. European Central Bank President Jean-Claude Trichet said ``it is too early to draw definitive conclusions.''

HAHAHA. Their magic wands quivver with power when they create money and do other nifty tricks but the minute these little wizards must control themselves and not wreck everything when their magic tricks go awry, suddenly, their wands droop and shrink like a kick in the balls. Risky money making: the wands work. Protection: the wands break.

Usually, after obvious collapses, rules are made so things won't get worse or happen all over again. The wand wavers hate this. They will cheerfully inflate bubbles, pop them, and then repeat. They forget the entire point of having National Banks and all the accords between nations: to prevent bubbles/busts! I expect no regulations or changes until the whole system collapses.

From the NYT:

The book is “Atlas Shrugged,” Ayn Rand’s glorification of the right of individuals to live entirely for their own interest.

For years, Rand’s message was attacked by intellectuals whom her circle labeled “do-gooders,” who argued that individuals should also work in the service of others. Her book was dismissed as an homage to greed. Gore Vidal described its philosophy as “nearly perfect in its immorality.”

In Atlas Shrugged, the hero didn't suddenly find himself in hock to guys in Asia demanding he balance his books or get a bullet to the back of his head and his organs sold on the open market. We can be thankful these go-getters don't cite that ultra-commie, Jesus as their guiding star. The book by Rand didn't charm me mostly because I was already very cynical when young. It also annoyed me that the hero wasn't blown up or shot dead. It is easy to be superman if you don't have any real opposition. This is probably why so many wheeler-dealers are so naive.

And here is a book review from Forbes:

In Supercapitalism, Reich turns the standard liberal critique of corporations on its head. Corporations aren't powerful, he says. They're constrained by global competition. They owe society nothing because society doesn't want anything from them except low-priced goods and high-flying stocks. In Reich's view, Americans and people around the world have demanded that companies serve only consumers and investors. Democracy and citizenship are not corporate concerns.

"Condemning Wal-Mart for not giving its employees better pay and health benefits may be emotionally gratifying, but has little to do with the forces that have impelled Wal-Mart to keep wages and benefits low and bestow good deals on Wal-Mart's customers and investors," Reich argues. He goes on to say that "we should make the rules--rules that reflect our values as citizens as well as our values as consumers and investors."

Whatever consumers or businesses want, the government is supposed to transcend all this. For example, the government must be aware of and very angry about trade deficits. These are the very devil and have to be dealt with, sharply. Instead, the government encourages these deficits! On every level, where the government should step in and stop some trend, they make it worse because it brings in some temporary benefit that is really bad in the long run.

The focus is not on the future but barely on tomorrow. This is the spendthrift's view of the world. Not all nations are run this way. In Asia, this is certainly the not the case: they all have long range goals and governments willing to impose them.

Another book review from Bloomberg:

Former Federal Reserve Chairman Alan Greenspan criticized President George W. Bush for following an economic agenda driven by politics instead of sound policy, with little concern for future consequences.

Soon after Bush took office, Greenspan wrote in a new book, it became evident that the Treasury secretary and White House economists would play secondary roles in decisions on taxes and other issues. In addition, officials with whom he had worked in the administration of President Gerald Ford changed after Bush brought them back to Washington, he said he found.

``The Bush administration turned out to be very different from the reincarnation of the Ford administration that I had imagined. Now, the political operation was far more dominant,'' Greenspan, 81, wrote in ``The Age of Turbulence: Adventures in a New World.''

What a slimeball. I tracked this clown all my life. He is Atlas Shrinks. He pretends he was this innocent person who was dragged along??? HAHAHA. Right! The minute Bush stole the election, Greenspan dropped interest rates! They were already halfway to 1% when 9/11 happened. When Bush and the GOP cut taxes, Greenspan dropped interest rates! I recall him NEVER saying a PEEP about inflation! Quite the contrary.

From Bloomberg:

Greenspan saved his harshest analysis for the current president. Soon after Bush took office in 2001, the president set about implementing a campaign promise to cut taxes, a policy Greenspan said he believed at the time wasn't well conceived.

``Little value was placed on rigorous economic policy debate or the weighing of long-term consequences,'' he wrote.

In 2001 testimony before Congress, Greenspan was widely interpreted to have endorsed Bush's proposal to cut taxes by $1.6 trillion over 10 years. In the book, he characterized his testimony as politically careless and said his words were misinterpreted.

Greenspan also expressed disappointment in Bush's reluctance to antagonize then-House Speaker Dennis Hastert and other congressional Republicans by vetoing spending bills.

``There is a remedy for legislative excess,'' wrote Greenspan, ``it's called a presidential veto.''

To this day, this criminal, this stupid man, this lying bastard, has refused to weigh even short term consequences! When Bush and Congress began adding another $5 trillion....gasp....more than doubling our entire national debt from the last 200 years, I recall Greenspan saying virtually nothing! Did he begin to raise rates as they did this? The price of oil began its long climb from $12 a barrel to now over $80 a barrel, did Greenspan raise rates?

HE DROPPED THEM TO 1%, an unheard of level! This was utterly absurd and irresponsible. He claims today, he had no idea this would launch the world's biggest equity/asset bubble and crash! Either he is very stupid or a child unable to see cause and effect. Either way, his performance this week is self-serving in a classic Ayn Randian way.

From Bloomberg:

``I was soon to see my old friends veer off in unexpected directions,'' wrote Greenspan, who had been encouraged by the budget surpluses of the Clinton administration. ``Then with George Bush came the tax cuts, unmatched by decreased spending, and, in the wake of September 11, still more open-handed spending.''

Either put this man in a mental hospital or arrest him and charge him with treason. Who opened the vaults to America's future wealth? Who handed us over to debtor's prison? Who lured us to take on endless loans at super-low rates? Who destroyed savings so utterly, we are now negative savers and our debt loads have quadrupled? Worse, we set a very bad example and this infected the entire planet's financial systems.

From Bloomberg:

Axel Weber, president of Germany's central bank, said growing risks of an economic downturn in Europe's biggest economy as a result of the collapse of the U.S. subprime mortgage market have yet to change official forecasts.

``What's changing is the risk perception, but not the main scenario'' for economic growth, Weber told reporters today after a two-day meeting of European central bank governors and finance ministers in Oporto, Portugal. ``We continue to expect economic growth of around 2.5 percent for Germany and I think this figure can be reached this year.''

He is waving his wand so hard, his hands are sweaty and sweat is flying off his brow. The world's economy will grow and grow nice and hard with all this wonderous chanting of spells! Why, Germany and China, Japan and Canada, all the nations, and this is virtually all at this point, who have trade surpluses with the US willl not see a contraction! Why, they will sell to each other!

But then, this is the dilemma: the world's money and commerce must circulate. And the system has been one way for many years: all goods flow into the US and trillions of dollars pour out. And every dollar is loaded with debt here at home in the US. And only if our partners hold these indebted dollars, can this continue. And it is collapsing which is why the dollars lose value the longer our trade partners hold them. Only Japan is content with this for their own yen had, until July, weakened even faster so the dollar's value GREW in Japan!

But this ended abruptly when the yen began to climb as China, I suspect, began to force it upwards. The only way the dollar can have any worth is if the US consumer pays their bills and pays interest on their bills. They cannot declare bankruptcy enmass. This is the problem! Rising oil prices are hammering the US hard. Thanks to our addiction to consuming oil recklessly.

And which our government should have stopped via higher energy taxes. The one thing no one dared do.

Culture of Life News Main Page

Comments

[sin]

Greenspan is attempting to cover his ass. The following article proves he is full of shit:
http://tinyurl.com/27saql

Here is a confidence preview:

http://preview.tinyurl.com/27saql

[apostle]

Greenspan seems to be already trying to get out in front of a Jewish banker backlash. Headlines should read: "Jewish Banker Throws Bush Administration Under The Bus"

[DeVaul]

Yeah, I am quite surprised at how fast Greenspan is moving to protect himself and his "image". I strongly suspect that the internet is responsible for this.

Greenspan knows that the mainstream media will protect him up until a certain point, and that point is when the roar on the internet about him becomes so loud that it cannot realistically be ignored any longer.

Greenspan knows this, being a political creature by nature, and he knows that if there is a recession or depression, he will be blamed instead of the "Great Decider". Bush and his minions will make sure of this.

I notice that the Wall Street Journal always draws his face as if he were a reptile, with a macabre smile thrown in just to make him even more creepy. He would make an excellent scapegoat as he has no real protectors (that I know of).

However, if he were blamed, it would not be unjustified.

[Mark]

"Germany lunged a second time at England and nearly took England down! The only thing that saved Enlgand was the US empire."

Nonsense Elaine. The only thing that saved England (The whole UK actually) was the RAF defeating the Luftwaffe during the Battle of Britain in summer 1940, a full 15 months before the USA even entered the war.And we have Pilots from all over the then British Empire to thank for that heroic deed.

Please get your facts right.

[Neuro Artist]

Those heroic pilots were certainly one important factor, but I doubt very much that the British would have been able to withstand Germany, without US military aid prior to Pearl Harbour, and the massive aids following after to booth Soviet Union and Great Britain, effectively making it a 2-front war for Germany. You wouldn't really be a heroic pilot if you don't have an aeroplane.

I am pretty certain that UK government would have agreed to a seize-fire and a peace-treaty with Nazi-Germany, if the US had remained truly neutral. And Germany would have crushed Russia. Didn't Hitler admire the English aristocracy and its controll of the masses? And they did attempt to negotiate peace with the UK. Why was the US fleet concentrated in Pearl Harbour? Almost an invitation to the Japanese...

[DeVaul]

Nonsense, Mark.

The only thing that saved England in both World Wars was US supplies and ships. German submarine warfare had broken Britain's back in both wars, and Britain relied on American ships to bring in food and supplies until the US entered the war officially. England's surface fleet was useless.

Read up on submarine warfare and how many weeks supplies England had left at one point before we entered the war.

I wish we had not entered either WWI or WWII. Then, we would not have lost half a million men and would not have to hear so much crowing by the French and English about how heroic their surrend... I mean "victory" was.

[Elaine Meinel Supkis]

The Germans cut England off from her entire empire. We supplied England AND the Soviet Union! And we did this by producing zillions of ships, vehicles, planes and everything else. And the heroic sailors the merchant marine, took lots of losses trying to supply the English and Russian empires.

Truly, heroism and little was asked in return at the tiime, very little. I admire the previous generation for doing this. I wish we learned some lessons from the failure of Britain.

[DeVaul]

True. No one ever talks about the heroism of the merchant marine or any other little guys. It's all about the glorious fighter pilot, who cannot even perform basic maintenance on his own plane.

At least the Vikings knew how to fix their own ships while they were out at sea.

Read about the reconstructed Viking ship that sailed from Denmark to Ireland recently. The sailers were amazed at how hard it was to achieve this on a longboat, and they had modern protective gear and a modern ship shadowing them. Very interesting.

[John]

You have two options before you when it comes to applying for payday cash advance. You can either go to a local payday store or apply online. The benefit of choosing online mode is that you can maintain your privacy, as there is no need to talk to anyone in person. This is particularly good for people, who are shy of asking someone in person to lend the money. http://advancemagnumcash.pixieinfo.com

[buy homes]

Under the latest plan, dubbed Project Lifeline, the lenders promise to seek contact with homeowners who are 90 or more days overdue on their mortgages. In some cases, homeowners will be given the chance to“ pause” their foreclosure for 30 days while lenders try to work out a way to make the loans affordable. Lenders could begin sending letters to these borrowers as soon as this week.

[companies going bankrupt]

hi,

thanks for sharing info with regard to companies going bankrupt, its really useful to readers..

[red bottom]

HHH Yes, the design of national policy is important, how our economic development plans for the next five years, how the implementation, how to make our economy even faster. Are designed to advance our focus to invest money in what ways it should be carefully arranged.

[red sole]

So cute! I already like you on FB and also get your posts on Google Reader. :)