Peak Housing

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The Mortgage Fraud Scandal Biggest in Human History

L. Randall Wray, Benzinga

We have long known that lender fraud was rampant during the real estate boom. The FBI began warning of an “epidemic” of mortgage fraud as early as 2004. We know that mortgage originators invented “low doc” and “no doc” loans, encouraged borrowers to take out “liar loans”, and promoted “NINJA loans” (no income, no job, no assets, no problem!). All of these schemes were fraudulent from the get-go

Read more:http://www.businessinsider.com/mortgage-fraud-scandal-2010-10

Banks Commit Mortgage Fraud

let's take a look. / more a the link

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In a letter to Attorney General Eric Holder, Federal Reserve Board Chairman Ben Bernanke and U.S. Comptroller John Dugan, the lawmakers said recent reports that Bank of America,J.P. Morgan Chase and Ally Financial may have improperly approved thousands of foreclosures "amplify our concerns that systemic problems exist."

Banks "have repeatedly misled and obstructed homeowners from receiving the help Congress and the Administration have sought to provide," they wrote. "The excuses we have heard from financial institutions are simply not credible three years into the crisis."

http://www.washingtonpost.com/wp-dyn/content/article/2010/10/05/AR2010100503969.html?hpid=topnews

Mortgage Fraud by Originators

4ClosureFraud Posts Lender Processing Services Mortgage Document Fabrication Price Sheet

We’ve said for some time that document fabrication is widespread in foreclosures. The reason is that the note, which is the borrower IOU, is the critical instrument to establishing the right to foreclose in 45 states (in those states, the mortgage, which is the lien on the property, is a mere “accessory” to the note)..................

................Evidence is mounting that for cost reasons, starting in the 2004-2005 time frame, originators like Countrywide simply quit conveying the note. We are told this practice was widespread, probably endemic. The notes are apparently are still in originator warehouses. That means the trust does not have them (the legalese is it is not the real party of interest), therefore it is not in a position to foreclose on behalf of the RMBS investors. So various ruses have been used to finesse this rather large problem.

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