Occupy Wall Street Targets the Banks – Who Wins?

By December 6, 2011Housing Market

Today Occupy Wall Street (OWS) is having its National Day of Action to Stop and Reverse Foreclosures. The idea being that they can hurt the banks by forcing them to stop foreclosing. Only problem with this plan is that foreclosure delays help the banks as we introduced with our Foreclosure Roulette blog post, and demonstrated with our further analysis of foreclosure delays. In reality attacking foreclosures will result in little more than leaving homeowners stuck in their prisons of debt – unable to sell and unable to move on with their lives.

ZeroHedge, a popular finance blog, misinterpreted a Bank of America email, which is clearly just simply trying to keep their agents and employees safe, property secure, and press relations intact (is that possible at this point), as indicating that Occupy Wall Street is getting Bank of America (BofA) where it hurts them most.

Not a chance – I’d actually venture that it is more likely a bank operative infiltrated OWS to come up with this boneheaded plan – after all the banks are running out of excuses to delay foreclosure at this point with the robo-signing crisis now a year old. Perfect timing, yet another reason for the banks to extend and pretend while continuing to leave non-performing assets marked-to-model allowing them to remain solvent and pay bonuses. If Occupy Wall Street really wanted to hurt banks they’d have a national don’t make a payment month. More realistically they should lobby congress to end mark-to-model accounting and foreclosure delays… if banks were forced to take losses now, I guarantee they’d suddenly become a lot more interested in principal balance reductions. Certainly there is no reason for banks to lower principal balances when they can leave them on their books at inflated valuations.

Who is OWS really helping today? We’d love to hear what you think.

10 Comments

  • CJ Johnson says:

    Attention Occupy Idiots, if I find you in one of my REO properties that has been rekeyed and posted as vacant no trespassing, which I video log with a time date stamp and a witness, I will have you arrested under a citizens arrest for unlawfully breaking and entering into our property, and criminal trespass. You will not squat for free, you are not a bonafide tenant, and if you place utilities in your name illegally you are committing fraud. You will be prosecuted to the fullest. How ever gave you that bad legal advice should go to law school and learn how to read. The police MUST honor a citizens arrest when and where a law is being violated. Many of my peers do not understand the law and think that you are correct and must go through eviction and this simply is NOT TRUE. Don’t get caught in one of my houses unless you want to spend some time in jail.

    • Tom says:

      By law the bank has to provide the original promissory note with the home owners wet signature before they can take the property, but the home owner has to request it. Fact is the bank will NEVER be able to provide that note because once it’s signed they stamp the back and deposit it. This document is the only proof they have that they are a party of interest. Since they can’t provide that document, they are illegally taking people’s homes. If they still take the home, you can notify the FBI that their is a conspiracy to take your home and the bank, Judge and attorney WILL be investigated and found guilty of conspiracy to commit fraud. Although you’ll never have to contact the FBI, because the Judge knows the law.

      • Sean O'Toole says:

        Tom – can you back up your claim by pointing to the specific law, or to a single case where a judge was found guilty? Also, what about a lost note affidavit? Has been standard practice for years.
        Hypothetically – if a fire burned all the notes, do you really believe those loans simply go away? And if so, do you really think that would be fair?
        I think you’ll find that in the real world, judges are required to look at all the facts… and if the borrower can’t prove they had the money to buy the house, they aren’t going get a free pass on the loan over these issues.

  • Tom says:

    Sean,

    You’re making it seem as if it’s the owner that has to prove something, they don’t, a Mortgage company that is trying to take your home has to show proof that the are in deed the holder in due course. The only way to do that is to show the original contract with wet signature. Yes of course they will come to court and claim they misplaced it or lost it. That’s not anyone’s fault but their own. They can’t show they are a party of interest, therefore they don’t have a leg to stand on.

    Examples:

    Indymac Bank v. Boyd, 880 N.Y.S2d 224 (2009). To establish a prima facie case in an action to foreclose a mortgage, the plaintiff must establish the existence of the mortgage and the mortgage note…

    Wells Fargo Bank, v. Bryd, 178 Ohio App.3d 285, 2008-Ohio-4603, 897 N.E.2d 722 (2008) “If Plaintiff has offered no evidence that it owned the note and mortgage when the complaint was filed, it would not be entitled to judgment as a matter of law.”

    And yes I do think its fair, because they lie to the homeowner. They tell them they are lending them money, which they are not. Do your research. Start with Modern Money Mechanics put out by the Federal Reserve Bank of Chicago. There’s many other violations in their closing documents as well. Here’s an example of a case dealing with that:

    Deutsche Bank v. Peabody, 866 N.Y.S.2d 97 (2008) EquiFirst, when making the loan, violated Regulation Z of the Federal Truth in Lending Act 15 USC 1601 and the Fair Debt Collections Practices Act 15 USC 1692: Intentionally created fraud in the factum and withheld vital information concerning said debt and all the matrix involved in making the loan.

    Personally I find it disturbing that a million homes a year are being foreclosed on by banks that the public bailed out. While I can’t say that the OWS movement is doing a whole lot to hurt the banks. I will say they are making a great statement against corrupt capitalism.

    • Sean O'Toole says:

      Tom, we primarily serve non-judicial states, and with the very recent exception of Nevada, lenders don’t have to prove anything in court, they simply have to file notices and hold an auction.
      Also note, that these lower court rulings you cite are largely being overturned, and there has yet to be a state or federal supreme court ruling that supports your point to my knowledge. More typically we see results like the following on MERS which hold up a lenders right to foreclose once it reaches that level: http://www.foreclosuretruth.com/blog/sean/big-news-on-robo-signing-and-mers-today/.
      I’m no fan of the Fed or “reserve” banking systems, but the argument that borrowers shouldn’t have to pay back the money because of the way the banking system works doesn’t hold water as being fair to me. How’s it fair for the guy who refinanced his house to buy cars, boats and motorhomes to get his house for free when the next door neighbor made payments for 30 years to pay theirs off? How’s it fair to the retiree whose pension fund may not be able to pay retirement benefits due to massive losses on mortgages? How’s it fair that our kids will get stuck paying the debt if the mortgages are truly deemed invalid. You are awfully naive if you think no one would get left holding the bag.
      Don’t get me wrong, I think the banks should be the ones left with that bag, but that isn’t going to happen. Thanks to the politicians we elected they weren’t required to hold sufficient assets to cover the losses – and due to legislation like the Commodities Futures Modernization Act they were even allowed to amplify those losses further.
      It does NOT disturb me at all that folks that haven’t made a payment for on average 2 years, are finally asked to leave such that the property can be resold to someone who will pay. That said, I have preached since 2007 that loan mods which include principal balance reductions are likely the best way to address this crisis, and are certainly better than foreclosure (which leads to higher losses for all parties). Free houses? No way.

  • Tom says:

    Let me get this straight. So banks create loans, put people in debt, then they take their money out of the market, in doing so they create a recession and businesses go out of business, people lose their jobs and some how it’s the people’s fault for not being able to pay their debt.

    I agree with you 100% that it’s not fair in all of those situations. But the banks are the crooks. They are to blame, not the people trying to save their homes. That’s not even mentioning the loan officers tricking old couples into refinancing their homes and putting them on 2 year ARMs. Or even putting anyone on an ARM. I worked for a banker in NJ and they were selling simple interest loans. People were paying their mortgage for 10+ years and not one payment went towards their principle. I mean there’s more and more corruption in banking, too much to go on about here.

    To blame people for saving their homes is such a defeatist attitude, if the banks are to blame, then they are to blame, period. Fight them, that’s the right of the American people. But that’s not what we want to do, we rather look down on the middle class or poor people and blame them, because it’s the easy route. Fight the good fight, not the one with the least resistance.

    Anyway, Supreme court:

    Durante Bros. & Sons, Inc. v. Flushing National Bank, 755 F .2d 239. Supreme Court found a “pattern of racketeering activity.”

    Maybe the majority of these lower court and supreme court cases don’t work out for the homeowner, but maybe the majority do. I doubt you researched all these court cases, therefore I would have to assume you’re going off of someone else’s word or an assumption.

    I’m for loan modification in certain instances, but what good is a loan modification to someone that doesn’t have a job? Or someone that was getting paid 60k a year and now has to work for 35k or 40k.

    I’m just saying, do we really think putting a family out on the street is the best thing to do? It definitely isn’t the moral thing to do. Not that anyone cares about that.

  • CJ Johnson says:

    I know a lot of loan officers and not one of them carries a GUN. Ask all those poor people who took the big windfall cash outs where all the money is now. These folks already sold their house in my eyes and now they want a get out of jail free card. When I go to offer up Cash for Keys on a foreclosed property for the lender I pass the new gas guzzling SUV towing a 5th wheel or boat into a house full of Big Screen TV’s tripping over piles of toys and video games (at $50 a pop) talking to folks who’s 9 year olds are texting on their smart phones or parents new tablet, only to be told by those who have not made a house payment in almost 2 years that they have no money to move and need another $7500 from the bank from the “relocation fund” that all their friends told them about. Sure I feel bad when someone looses their house because of a true distress but sorry to say I am out there in the field each and every day and this is just not the case. Their toys and goodies dropped 50% the day after they bought them but they do not give them up. Nope. Where is their personal responsibility in all this? I just had a neighbor two houses away who told her Pastor and others at her Church that she was walking away from her house and letting it go into a strategic default foreclosure and that they could go take all they wanted including the AC Condensor, electrical fixtures, etc all of which were on the house when she bought it. This is the kind of broken moral code I see on a regular basis as well. Sorry to say these God fearing friends of hers went right on over and began to strip the house. The police said they could not do anything about it because she told them it was OK and the Pastor confirmed. No one is a winner here. Every homeowner paying their mortgage is now effected when the house sells at a 30% discount for being in poor condition. I think our entier Moral Compass in this Country is broken and until we all buck up and admit that we can live in a smaller older house, drive a used car, and give back to our neighborhoods to build strong communites all this blame game is just more foolishness.

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