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If people hadn't taken out mortgages they couldn't afford, then they wouldn't have been abused by the foreclosure process. Stop buying houses unless you have a 20% down payment and enough money in the bank to cover 6 months of expenses.
This shows how wrong is the attitude expressed by those who rail against controls on the financial industry. 400,000 families abused by these institutions, losing the roof over their heads in many cases! Glad the settlement is supposed to be paid to the homeowners, but even this will not repay the upheaval in their lives.
"This shows how wrong is the attitude expressed by those who rail against controls on the financial industry. 400,000 families abused by these institutions, losing the roof over their heads in many cases! Glad the settlement is supposed to be paid to the homeowners, but even this will not repay the upheaval in their lives"
I'm still waiting to meet one of those familes that were abused, every case I have seen personally so far was in way above their head with the mortgage they took out, thus why they lost their home. Are their some exceptions, most likely however most were self-inflected. You can't earn $50K a year and buy a $150K home, New car, boat, camper, etc.all at the same time, the math just does not add up.
Unfairly foreclosures? I have yet to hear of a single person who paid their mortgage on time that was foreclosed upon....
Once again the Government awards people gaming the system. It's hard to keep your integrity when our so called leaders reward this.
This is what we spent hundreds of billions of dollars of taxpayer money to save. How many lives did these banks ruin? @mnpikey, by all means google for people who were foreclosed upon who were current on their payments. I assure you many such cases made the news, regionally if not nationally. Bank of America in particular foreclosed on some houses where they didn't even hold the mortgage! One guy in Florida came home to find his doors chained shut and his household items sold at auction. Turns out the paperwork was wrong and the correct address was down the street. OOPS.
Also, having a 20% down payment and 6 months of expenses in the bank doesn't make any difference whatsoever when you're unemployed for 7 months.
Old Bernanke had a bank E I E I O. And to his banks he gave some bucks E I E I O. A bill bill here, a bill bill there, a bill here, bill there, everywhere a bill bill...
Several folks have suggested that this problem is not a bank problem but a consumer problem. I have two experiences that demonstrate that this is simply not the case. We had a mortgage with a company that was eventually bought by Bank of America during the merger/buyout frenzy in early 2009. We had paid on the mortgage for years with extra payments and had over 60% equity in our home. We received notification that we were going to be charged a check processing fee if we continued to pay by check so we went to automatic payment. That was fine for 6 months. Then one month our bank called to tell us that our mortgage draw had been made twice--on the first and the fifth. I called to correct the problem and was assured that it was an error that would be immediately fixed. The next month the same thing happened and when I checked our account the two extra mortgage payments were not credited to the mortgage. I called again and was given the run around. They couldn't credit the amount because it was in dispute with the other bank (we had asked our credit union to pursue the problem) and it would take 180 days for them to simply cut us a check. 180 Days! So we cancelled the automatic payment. They had 4 months of mortgage payments all withdrawn within 34 days. When we didn't send the next check they sent notification that we were delinquent. So I sent a check and they charged us both a check processing fee and the late fee. All while they were holding two extra mortgage payments. Three days later our insurance agent called to tell us our homeowners insurance had lapsed. The bank had not paid the insurance out of our escrow and as it turns out hadn't paid the taxes either (we paid the insurance out of pocket). 300 hours of phone calls (we saved every cell phone record) $3,000 in legal fees and we finally had it straightened out and refinanced the house through our credit union. That was two years ago. This last week they finally managed to complete the paperwork related to the payoff--the whole time they sent threatening letters even though the mortgage had been paid in full. We had the financial means to survive this both in terms of cash reserves and legal fees, but many families would have been thrown in to crisis. As it turns out a few months ago we ran into another couple with an almost identical story only they almost lost their house over it (young couple without the financial reserves to float a big bank what was essentially a loan for 9 months).
We put 30% down on our mortgage. We have combined incomes that exceed our mortgage. We also have liquid assets that exceed our mortgage. We sleep well at night because we live well within our means. To all the people blaming the banks and others, you need to do some self reflection.
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