Woah: Merscorp Lacks Right to Transfer Mortgages, Judge Says

[G27]

Merscorp Lacks Right to Transfer Mortgages, Judge Says - Bloomberg

If this stands, watch the banks fall like never before...

[Chucktshoes]

That is some seriously bad news for a lot of banks that played fast and loose in the real estate and mortgage markets.

[Guest 6.8 AR]

Yep, and TARP, Obamacare, Stimulus and everything else this last couple years could make

for trouble the 30's never dreamed of. I don't doubt for a minute this current Dow high is nothing

but prop up by the FED. This is exactly what that man-child in the White House wanted.

It's not that those mortgage companies played fast and loose, they were forced into it by bills

passed years ago. Those chickens are coming home to roost.

[mikegideon]

I gotta get my girlfriend to read this and tell me what it really means. I know very little about it... on purpose. She does it for a living

[G27]

That is some seriously bad news for a lot of banks that played fast and loose in the real estate and mortgage markets.

Seriously, if this stands, there will be TONS of folks who will purposely default on their loans, and when foreclosure starts, simply ask the mortgage holder for the note, which they will not be able to produce a legal copy of...

I'm telling you, this will make the bank collapse of 2008 look like a walk in the park.

Also, notice how the mainstream media isn't touching this one...

[MacGyver]

There have been a couple of precedents for this when judges in foreclosure cases have asked to see the original loan documents and the loan holder wasn't able to produce them. Many mortgages transferred hands so many times, that it's questionable if the original document the loan holder signed still exists - even though it's supposed to legally.

I think there are two ramificaitons of this. One, like was said above, it will cause many banks to fail. I'm not sure that getting some of them out of the pool is such a bad thing. The potentially bigger effect in my mind is that it continues to weigh the economy down due to "mortgage owners" who are unable to get non-paying mortgages and the underlying assets off of their books and back onto the market.

Mind you, this may all really be moot, as it's all smoke and mirrors anyway. Try and name three things that are different in the underlying fundamentals of the economy today than were present in September 2008. There's been a lot of money moved and changing hands, but nothing has really changed.

[G27]

Mind you, this may all really be moot, as it's all smoke and mirrors anyway. Try and name three things that are different in the underlying fundamentals of the economy today than were present in September 2008. There's been a lot of money moved and changing hands, but nothing has really changed.

Well, TARP def kept quite a few banks above water, though it didn't do anything to fix the underlying issues. Problem is, even with the TARP cash in their coffers, they weren't liquid enough to move money around like the Fed had hoped. If this stands, which I'm cynical enough to doubt it will, some BIG banks are going to fail without another TARP, which is likely political suicide at this point.

interesting times, indeed...

[Chucktshoes]

This thread is reminding me that I need to go buy more ammo. /not joking

[Guest 6.8 AR]

Yes, you should.

[MacGyver]

I've said before, and still believe that the Dow will see 5,000 before it sees 15,000.

Don't forget that as lending rules got looser and looser, significantly more 3/1 ARMS were written in 2008 than in the previous years. It's now 2011, and it's time for them to convert. Oh, but wait...it's harder to get a mortgage now.

From my chair, I see multiple single point events that could precipitate a crash that would make 2008 seem mild. The Feds have used all their ammo paying off their friends. We've got very little left to fight another round. Of course, we could just let the market sort it out. However you look at it, we're going to collectively pay the consequences of these decisions.

[G27]

rom my chair, I see multiple single point events that could precipitate a crash that would make 2008 seem mild. The Feds have used all their ammo paying off their friends. We've got very little left to fight another round. Of course, we could just let the market sort it out. However you look at it, we're going to collectively pay the consequences of these decisions.

Yep.

At this point, any number of things can push us over the edge, but really, with our national debt now equaling GDP, we're likely to see our credit rating drop from AAA soon, which means all the FedGov's continued borrowing of money will come at higher interest rates.

All it takes it is one or two relatively small thing to make the deck of cards come crashing down, but this MERS decision is a HUGE one.

Like I said, we do live in interesting times. If you recall what the world was like just 25 years ago, who would have ever dreamt we would be where we are today?

[creeky]

All it takes it is one or two relatively small thing to make the deck of cards come crashing down...

Not to sound like a complete idiot... just a functioning one ... the "Crashing Down" scenario. Would an example of that be close to... say... what Argentina went through? Hyper-inflation, riots, sudden extreme jump in crime, shortages of food and basic necessities, etc.

Sort of a 30's type depression... on steroids?

[G27]

Not to sound like a complete idiot... just a functioning one ... the "Crashing Down" scenario. Would an example of that be close to... say... what Argentina went through? Hyper-inflation, riots, sudden extreme jump in crime, shortages of food and basic necessities, etc.

Sort of a 30's type depression... on steroids?

I don't think there's any way to predict what it would look like. I suspect we'd be a lot closer to the Argentinian collapse of earlier this decade, though we're in uncharted waters - never has any entity as large as the US collapsed. That in and of itself adds tons of complexity - on the surface it could be MUCH worse, as both the numbers are far more dramatic but also as the people of the US are far less acclimated to any real discomfort. Then again, are we too big for the world to let us fail? A collapse of the US economy would surely resonate dramatically throughout the economies of the first world every where, even greater than it did during the great Depression of the early 20th century...

No way anyone can tell you what would happen in that sort of scenario, but I fear we're close to finding out. Sure hope not.

[mikegideon]

Frankly, I don't they will let the decision of one judge unravel the economy. If the US economy fails, it will be a global unravelling.

[creeky]

...on the surface it could be MUCH worse, as both the numbers are far more dramatic but also as the people of the US are far less acclimated to any real discomfort.

I would venture to guess then any large cities (LA, NY, Chicago, Atlanta, Memphis, etc.) down to certain areas of mid to small cities would become very unfriendly places. Just guessing. I've read FerFal's blog some about what happened in Argentina... it's it's not real rosy.

If things go south I just hopes it's two years from now. Too close to paying my house off!!!

[Guest KimberChick]

My mortgage was transferred in May via MERS from First Horizon to IBM Business Process Lending Services. I can no longer pay ahead, I can no longer pay my own mortgage for free by any other method but USPS, I cannot pay the next month before the 15th of the current month, and no one there seems to know anything OR be able to give me concrete yes or no answers when I call in with questions. If this gives me legal ammo to snatch this loan away from these morons, I may try it. If the transfer could be deemed essentially invalid, maybe I can go back to First Horizon...I dunno.