Tuesday, July 05, 2011

Banks Playing Mortgage Games

Ticker notes a very significant item.

Two of the nation’s biggest lenders, JPMorgan Chase and Bank of America, are quietly modifying loans for tens of thousands of borrowers who have not asked for help but whom the banks deem to be at special risk. --Ticker quoting NYT

Well, now. What is the meaning of this?

It is NOT the generosity and self-sacrifice of bankers.

Recall that the Banks are ........ahhh........having *problems*........ with clear title to the mortgages and notes for many, many loans. These notes were assigned to MBS packagers who then sold the packages to large-scale investors. Along the way, the "t"'s were not crossed, and the "i"'s lacked dots, and in many States, this simply voided the Banks' claims to the note.

In other words, the Banks cannot foreclose; they do not have the legal right to do so.

UNLESS the party who owes the money signs a brand-new mortgage and note!

This is "half-a-loaf" in real life. The Banks took it, rather than nothing.

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