I was writing about the housing bubble on this blog a-way back in 2007 (though all those posts refer to the ill-fated Pabst Farms Money Hole), but I was following it via a couple of blogs back to 2005 when I was living in a wildly overpriced townhome on the SOUTH SIDE~! of San Jose, CA.
I had always said that, irrespective of my living situation (married or not), I would not think about looking to buy a home again until around 2011-2012. I wanted to see what would happen when the tidal wave of ARM resets came due in a flagging economy.
Well, about the last thing I thought would happen is that banks packaged and sold the same mortgage several times over to different servicers. In doing so, two things have started to happen:
- If the homeowner is delinquent, the banks have started to sue each like crazy to be the one who gets to foreclose on the property. The homeowner is screwed either way since they couldn’t pay- that sucks for them but now it’s mostly a battle to the death between multi-national corporations to get yet another empty house to flood the market with after sitting on it for months or years.
- If the homeowner can easily pay each month… the banks will still sue each other like crazy to foreclose on the property. Why? Because the homeowner is sending their payment to one servicer, but two or more servicers expect payment. Bank A is happy with the money it’s getting, but Banks B and C haven’t been paid, so the mortgage will be foreclosed. At this point everyone starts suing everyone as in the above scenario. But the key thing here is that the homeowner did nothing wrong.
It’s because of this nightmare scenario that Atrios rhetorically asked this morning why any sane person would get any sort of mortgage at this stage of the game. And I must agree- the banks have gotten so greedy that a foreclosed home is worth more to them than someone paying the mortgage each month; along with the fact that the colossally assholish mortgage bundlers fucking greedily resold a mortgage to multiple clients. And the government protects these shitheels- doing nothing to protect people who legally bought their house, and who correctly paid the agreed-upon amount every fucking month. That someone’s home could be taken from them by a multinational shitpile (and subsequently fought over by several multinational shitpiles) makes me incandescent with rage.
I’m certainly not buying a house in this climate. How about this, you asshole fucking bank? I get a mortgage, and then I pay you for 30 years. You fuck.
Via Atrios again, there’s this:
CLEVELAND, Ohio — Michael and Pamella Negrea have never been late on a mortgage payment in the 15 years they’ve owned their home in Eastlake. But they’ve been foreclosed on three times.
Martin and Kirsten Davis, meanwhile, lost their home in Cleveland to foreclosure two years ago. The reason: a mess that started when they accidentally paid 14 cents too little on their monthly payment.
And Michael Rendes of Berea had his mortgage sold last year to Bank of America. The bank foreclosed on him in November, after insisting for months that it didn’t hold his loan and wouldn’t accept his payments.