The Mortgage Morass......Krugman

[northernlights]

http://www.nytimes.com/2010/10/15/opinion/15krugman.html?_r=2&hp

....This is very, very bad. For one thing, it’s a near certainty that significant numbers of borrowers are being defrauded — charged fees they don’t actually owe, declared in default when, by the terms of their loan agreements, they aren’t....

....if trusts can’t produce proof that they actually own the mortgages against which they have been selling claims, the sponsors of these trusts will face lawsuits from investors who bought these claims — claims that are now, in many cases, worth only a small fraction of their face value....

...So the mortgage mess threatens to produce another financial crisis....


...conservative commentators like those at The Wall Street Journal’s editorial page have come out dismissing the lack of proper documents as a triviality. In effect, they’re saying that if a bank says it owns your house, we should just take its word. To me, this evokes the days when noblemen felt free to take whatever they wanted, knowing that peasants had no standing in the courts...

[xchrom]

1. ...

'...conservative commentators like those at The Wall Street Journal’s editorial page have come out dismissing the lack of proper documents as a triviality. In effect, they’re saying that if a bank says it owns your house, we should just take its word.'

[HereSince1628]

2. The mortgage crisis was emBAREASSing now there's even MOREASS

Just sayin.

[Kolesar]

3. Credit counselers like CCA could arbitrate &adjudicate the mess

(CCA is funded by grants, and is not one of those opportunistic, profit making credit management services)

"That won’t be easy, but there are good ideas out there. For example, the Center for American Progress has proposed giving mortgage counselors and other public entities the power to modify troubled loans directly, with their judgment standing unless appealed by the mortgage servicer. This would do a lot to clarify matters and help extract us from the morass.

"