From Reuters via CNBC:
Litigation arising from foreclosure paperwork problems could be “very damaging” to the housing market, a top U.S. banking regulator said Monday.
Federal Deposit Insurance Corp Chairman Sheila Bair said she did not believe legislation would be needed to address concerns over whether the paperwork was properly done so long as investigations show the issue was mostly “procedural.”…
Translation: “for goodness sake, if we make the banks actually do their job properly, our whole ‘extend and pretend’ game will crash and a score of big banks will go under. Don’t you hicks out there realize that only via government corruption are we keeping these banks afloat?”.
The problem here isn’t that people lost their homes unfairly – if you don’t pay your mortgage, you lose your house. People who have been foreclosed upon or who face it might be able to spin things out and live rent free for a while, but the plain fact of losing the house cannot be escaped. The problem here is that this mess will slow down foreclosures making banks keep the toxic loans on the books for longer than they can stand…and, even worse, sales of distressed houses will drop like a rock as title insurers back off any short or foreclosure sales because there are too many questions about who has title to the house. Ultimately, we could also see massive lawsuits from people who bought mortgage-backed securities and took a bath on them…
What the Banksters and Bureaucrats want is for this problem to go away – and go away very fast. The game they’re playing only works as long as everyone pretends there is no problem…as soon as someone notices the emperor has no clothes, the jig is up. We’ll see how successful they are…but I’m not counting on it as once lawyers get involved, easy resolution becomes impossible.
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