Faces Of Foreclosure

October 31, 2009: 18.8 Million Vacant Homes in Last Quarter.

We need to dig to get the full story, but there are early indications that some lenders are “donating” money to communities where houses sit after foreclosure so that a new wave of low-income families can purchase them. Many of these homes are the very same houses they threw into foreclosure rather than help the existing homeowners in the first place.

Do you feel crazy yet? No. Well keep reading . . .

Abandoned and vacant foreclosed homes are piling up around the country . . . Repairing the damage from foreclosures is a difficult challenge, because cities, states, community development groups, and even willing banks and servicers have no experience working together on the complicated process of disposing of or reclaiming unwanted properties, said Joseph Schilling, a Virginia Tech urban affairs professor and co-founder of the National Vacant Properties Campaign . . . “We do a pretty good job in this country of recycling cans and plastic bottles,” Schilling said. “But we do an awful job of recycling and reusing vacant properties.”

In some states, even the banks are walking away from homes they threw into foreclosure.

A particular lender — one with a dreadful track record insofar as loan modifications are concerned — is reportedly putting $1 million into Marin County California to help people buy homes, some of which will be the very homes they seized through foreclosure in the past year or two. This is the very same lender that 20-25% of us working with Marin Family Action’s Home Save group have been asking for modifications.

Banks will end up making less from the new loan at the current property value than they would if they modified with the original owners. But they have insurance, don’t they . . . and taxpayers dollars.

What is the guarantee that the new homeowner will be able to keep their jobs and afford the payments down the road? None. Nada.

The San Francisco Chronicle reported on a “shadow inventory” of foreclosed houses—possibly 600,000 nationwide—that have not been placed on the market: “Lenders nationwide are sitting on hundreds of thousands of foreclosed homes that they have not resold or listed for sale, according to numerous data sources. And foreclosures, which banks unload at fire-sale prices, are a major factor driving home values down.”

Does this strike anyone else as insane? Or quite brutal?

This kind of “business” is what has made me feel quite stupid through the years; I keep thinking I’m missing something. There’s something I don’t understand. Obviously. Someone has a few screws lose and I no longer think it is me.

WHAT IF each of the major crime dramas, i.e. “Lie to Me,” ” Criminal Minds,” “Without A Trace,” various “CSI” programs, “Burn Notice,” “Numbers,” “The Closer,” “Leverage,” the new “White Collar Crime” (which is excellent — check out the “young blue eyes” lead), etc. presents their spin on our current mortgage nightmares/foreclosures during a season, all on separate evenings so they don’t touch each other’s ratings.

In 20+ years of building Web sites, I’ve never had one grow as fast as FacesOfForeclosure.com. The site is four months old and its traffic rank in the U.S. is 806,032 (as of December 8, it hit 795,732); that is amazing given that estimates are 43 million sites and Google is reporting 43 billion indexed pages (which would be the true competition figure as each page is searchable). Struck a nerve, obviously.

 

Since this is again war on our own soil, what about staging a national fundraiser through crime television programs, each of whom present their own take on the story of an individual or family (a real family) who has lost their home through foreclosure? And what about photographing just one day in every state; every state has dozens of foreclosures per day.

Include “real” mortgage brokers (especially anyone who received a bonus), a few politicans, a smattering of the real estate people cashing in on people’s distress, a few attorneys who charge massive fees to help and can’t. I’m working on the story of one family who spent $30,000 on fees and still lost their home. Use real people to get across just what a nightmare this is. (Perhaps the people appearing in the episodes get their home back totally paid for by the lending institution in question, of course.)

WHY? ‘Cause SOMEONE has to do something effective! And because many denizens of Hollywood care deeply about their craft and country. Movies and television dramas do bring truth to light and light to truth.

These are the images you see on the news. You seldom see the men, women, children, dogs, cats, birds, etc. that have had to move. Some of these people have been out of work for awhile and have no money to move and/or can’t find rentals that will accept their pets. Where do they go? What happens to the uprooted children?

Have you done the math for the millions of homes that have been lost to foreclosure? It’s a shocking revelation. Surely lending institutions are not thinking of their future. Two million foreclosures (this year alone) translates to an average of 2.6 people per home (5.2 million people), times a 50% expected population growth by 2050 (41 years). More than 10 million people, all passing down the stories of how they lost their home because Wells Fargo or Bank of America or Chase would not assist even though they received billions in taxpayer dollars to help families keep their homes.

If the lenders think this is going to go away, it isn’t. People in the Southern United States are STILL upset over the Civil War which ended in 1865.

Think about the goodwill of such a project. And, again, that audience. Many of these shows have audiences exceeding 2 million anyway; this could add a few million more viewers to each show.

Depending on your position in our home foreclosure saga, you will be damned or you will be praised.

Of note recently is that Wells Fargo has sold a number of loans to HSBC after those loans have fallen in some type of default. HSBC is based in China. I can’t help but wonder if this is some type of money laundering/offshore banking on a high level; is HSBC subject any banking rules/regulations of the U.S.?

I pulled up their web site and read the rules they subject themselves to. (I did the same with Wells Fargo . . . if you are having trouble with loan modifications through Wells Fargo, you may want to read their code of ethics — it will amuse you, I’m sure.)

Both of these entities purport to act fairly and honestly at all times and insist that their employees do also. My apologies to them, but that is not what we are seeing and many of the employees are in the dark; I have heard repeatedly that they do not know what is going on.

HSBC USA Inc. – Statement of Business Principles and Code of Ethics

The Fundamental Principle

In all its endeavors, it is the policy of HSBC North America Holdings Inc. and each of its subsidiaries (collectively referred to herein as the “Corporation”) to act honestly and fairly at all times. It is the Corporation’s policy to comply with the spirit as well as the letter of all applicable laws and regulations in all that it does. Each employee of the Corporation is expected to do the same.

Violations of this policy and failures to report known violations will subject the employee to disciplinary procedures, including termination of employment. In addition, employees who should have, through the exercise of due diligence, discovered violations of this policy, but who fail to do so, may be subject to discipline, including termination of employment.

In dealing with employees, customers and suppliers, the Corporation makes decisions without regard to race, ancestry, color, religion, national origin, citizenship, marital status, veteran’s status, gender, gender identity, sexual orientation, age or disability that can be reasonably accommodated. All employees are responsible for ensuring that the working environment is free of any form of harassment, discrimination or inappropriate behavior . . .

In dealing with customers, the Corporation is dedicated to offering top quality products and services and to supplying only honest information about them. The Corporation will offer products and services on a competitive basis and will not tolerate the use or attempted use of improper incentives to obtain business. With regard to suppliers, the selection of products and services by employees with purchasing duties for the Corporation is based solely on quality, price and service.

Compliance with Laws and Regulations
Numerous laws and regulations, both domestic and foreign, specifically govern various aspects of the Corporation’s business: the Foreign Corrupt Practices Act, the Financial Institutions Regulatory and Interest Rate Control Act (FIRA), the Community Reinvestment Act, the Truth-in-Lending Act, the Fair Credit Reporting Act, the Bank Secrecy Act, and various federal and state usury laws, to name just a few. In addition, laws and regulations of general applicability, such as the securities, equal employment, wage and hour and antitrust laws, affect us. Failure to comply with these laws and regulations can have serious consequences, including legal liability for damages and other penalties. You have a responsibility to learn and understand the laws and regulations applicable to the activities of your department and your particular responsibilities within your department. If you identify unresolved legal questions you should bring them promptly to the attention of your supervisor or department head. The General Counsel’s office is always available to provide further help.

The banking industry has concerns that money laundering schemes will increase and, if successful, will lead to the erosion of public confidence in the banking system. Bank personnel therefore must comply aggressively with the provisions of the Bank Secrecy Act — particularly the reporting of unusual cash transactions. Compliance will not only help the Corporation avoid stringent penalties, but also will assist us in fulfilling our obligations to our fellow workers, our parent company and our communities.

Corporate Sustainability
Our goal is to be one of the world’s leading brands in corporate sustainability. This is not solely an environmental or social agenda, nor is it confined to governance and ethics. Sustainability is about bringing all of these issues together into our business model, and about maintaining the long-term growth of a successful business for the benefit of our stakeholders. For HSBC, sustainability is about making decisions that maintain the right balance between the environment, society and the economy to ensure long-term business success.

We believe that it is our duty to our customers, investors and employees to foster an ethical, responsible and sustainable corporate philosophy.

While our biggest contribution to society is the responsible provision of financial services, we have also long sought to strengthen our ties with local communities through philanthropic partnerships. Education continues to be the primary focus for our corporate giving. The second philanthropic area we support is the environment.

Conflict of Interest
As part of your employment responsibilities we expect you to act in a way that contributes to the financial success of the Corporation, enhances its reputation and fosters our customer relationships. This requires you to look after your own private financial interests in such a way that you do not profit improperly from your position with the Corporation.

A “conflict of interest” arises when your personal interest in a transaction, or an obligation you owe to someone else, comes into conflict with your obligation to the Corporation and its customers. This includes using your position to advance your own personal gain or advantage on the basis of sensitive information gained during your employment, whether or not you obtained this gain or advantage at our expense or at the expense of any entity of the Corporation or its customers.

Conflict of interest rules apply to all transactions, directly or indirectly, for your own account or for the account of family members or any person who shares the same residence.

General Policy
While staff members have personal lives and private interests outside their work, as an employee of a financial institution you must manage your personal financial and business affairs to avoid conflicts of interest, or even the appearance of any conflict of interest.

When a conflict of interest does confront you in the performance of your job, you must disclose its existence promptly to your immediate supervisor or divisional compliance officer, fully describing the facts giving rise to the conflict, and excuse yourself from participation in any aspect of the transaction.

While it is impossible to set out all the situations where conflicts may arise, the following examples outline situations that are either impermissible, or are permitted only with prior disclosure or approval.

Please direct questions concerning the existence of a possible conflict of interest to the General Counsel’s Office.

Self Dealing, Fiduciary Appointments and Powers of Attorney
You may never participate in the consideration or approval of any extension of credit, any waiver of fees or any other transaction between the Corporation and yourself or anyone in your immediate family, or with other people, corporations, partnerships, trusts or other organizations in which you or any member of your immediate family have a significant financial interest.

You may not accept a personal fiduciary appointment for anyone who is a customer or vendor of the Corporation (for example, as an executor or trustee), whether alone or with any other person, bank or other institution, except in close family relationships or unless you have the prior written approval of the General Counsel’s office. You may not accept such an appointment, even in a close family relationship, where an actual or potential conflict with your obligations to the Corporation would arise . . .

Entering into relationships for ordinary banking, trust or investment services with the Corporation on standard terms and conditions (such as a safe deposit box, a regular checking or savings account, a certificate of deposit or a discount brokerage, trust or investment relationship on the same terms and conditions available to other customers or generally available to employees) does not violate the foregoing prohibition.

We ask you to direct questions concerning such situations to the General Counsel’s Office.

Gifts from Suppliers or Customers
The Bank Bribery Act and other applicable laws prohibit you from seeking or accepting for yourself or any other person anything of value (including services, discounts or entertainment) from customers, suppliers or anyone else in return for any business, service or confidential information of the Corporation. The laws expressly prohibit you from accepting cash, checks or gift certificates convertible to cash. There are certain exceptions to the general prohibition against seeking or accepting anything of value as follows:

(i) Lunches, dinners and other customary entertainment (e.g., sports events, golf, etc.) provided in the ordinary course of a supplier’s or customer’s business and in situations where we would normally reimburse the cost as a proper business expense;
(ii) Services or discounts customarily afforded by suppliers or customers in the ordinary course of their business;
(iii) Promotional gifts such as lighters, pencils, calendars and the like, routinely distributed by the donor; and
(iv) Gifts in connection with customarily recognized events (e.g., holidays, job promotions, etc.) not exceeding a $100 value.

You must promptly report to the General Counsel’s office anything of value beyond those items listed above if offered to you, received by you, or if you anticipate receiving such an item.

NOTE: Employees may never accept gifts of cash, checks or gift certificates convertible to cash, regardless of amount.

Borrowing Money from Suppliers or Customers
Employees are not permitted to borrow from any of the Corporation’s suppliers or customers.
You may receive credit on customary terms in connection with the purchase of goods and services from a commercial establishment within the foregoing prohibition. We allow loans made to staff members by other financial institutions, including bank correspondents of the Corporation, in the ordinary course of their business.

Note: Because the Corporation is engaged in the business of lending, the Corporation’s employees must set an example. Failure to timely repay loans from the Corporation may place the employee in a conflict of interest situation. Therefore, the Corporation believes it appropriate to disclose an employee’s delinquent debt to the employee’s business unit manager.

Outside Employment and Business Activities
Other potential sources of conflict of interest include holding any outside employment position or conducting personal business which may interfere with the employee devoting full attention and loyalty to the Corporation during working hours; holding a direct or indirect financial interest in a competitor company or in any firm or entity with which the Corporation does business (excepting normal investments in publicly owned companies); holding a direct or indirect financial interest in any firm or entity that is a supplier of or vendor for the Corporation (excepting normal investments in publicly owned companies); holding or acquiring an interest in any property or business in which the Corporation has or proposes to acquire an interest; serving as a director or officer of any firm that is a competitor, customer or supplier of the Corporation; or conducting business on behalf of the Corporation with an individual related by blood, marriage or adoption. Accordingly, you should disclose and obtain approval for any outside employment from your manager or Human Resources.

You may accept a position as a director, officer, partner or consultant of any business organized for profit only if you receive the written consent of both your Executive Vice President or Business Unit head, and the General Counsel’s Office.

You should know that certain types of outside employment, such as with other financial institutions or securities dealers, are prohibited by law. Refer questions relating to the appropriateness of such outside employment to the General Counsel’s Office.

Soliciting or Accepting Legacies or Other Favors
We do not allow you to solicit any legacy or other favor granted by an individual or organization where your relationship to the individual or organization arose primarily during the course of your employment.

Confidential Information

Information About Our Customers and Employees

We expect you to treat information entrusted to us by our customers and employees as you perform your duties for the Corporation as confidential and privileged. This includes information relating to deposit and loan balances, information concerning the management, financial condition and future plans of our customers’ businesses, employee/salary information and information obtained in the course of fiduciary relationships. You must not disclose confidential information to anyone either inside or outside the Corporation except in compliance with the Corporation’s information protection policies. Your obligation to maintain the confidentiality of the information continues even after you leave the Corporation . . .

Use of the Corporation’s Computer Systems
Use of the Corporation’s computer systems provides employees access to confidential customer information based on the business/support function(s) being performed. Employees are granted access to the Corporation’s various computer systems to perform their job duties. Each employee is expected to protect the access granted to him or her and to keep any associated passwords confidential at all times. Usage will be monitored to ensure compliance with the Corporation’s Information Technology Policies.

Limited Use of Confidential Information
While recognizing the need for a constant flow of information for the smooth operation of the Corporation, we expect you will not disclose confidential information pertaining to our customers’ affairs to your fellow employees unless they have a clear business need to know the information for the performance of their duties. You must exercise particular care in communicating confidential information to persons in other departments or in other corporate subsidiaries and affiliates who may have different responsibilities and possibly conflicting obligations. Without prior approval of the General Counsel’s Office, you cannot communicate nonpublic information concerning our customers to staff members in the trust or investment departments of HSBC, HSBC Asset Management Americas, Inc., or any other HSBC subsidiary or affiliate engaged in investment advisory or management activities. Employees in these departments and affiliates should not request such information.

Disclosure of Information to Outsiders
Apart from routine credit inquiries, you cannot release information concerning our customers’ affairs to outsiders, including law enforcement authorities, except in response to a valid subpoena or similar legal process within strict compliance of the Corporation’s established internal operating procedures. Treat information concerning the Corporation, its affiliates, or any of their customers as confidential. You may not disclose this information to anyone outside of the Corporation, except as otherwise provided in the Corporation’s information protection policies, without the written authorization of our General Counsel. Your obligation to maintain customer information as confidential remains in effect even after you are no longer employed by the Corporation.

Information About HSBC North America Holdings Inc., its Subsidiaries or Affiliates:
Because of your position, you may obtain information about your business unit or HSBC North America Holdings Inc. or other HSBC subsidiaries or affiliates not otherwise available to the public. You cannot disclose confidential financial or other proprietary information concerning any of these entities to outsiders until it has been published in reports to security holders or otherwise made generally available to the public. HSBC policy requires the coordinated communication of sensitive information about HSBC or its affiliates to investors, security analysts and the press through properly designated representatives in our Investor Relations and Public Affairs areas. Your obligation to maintain information about HSBC and its affiliates as confidential remains in effect even after you are no longer employed by the Corporation. In addition, you may have legal liability if someone inside or outside your immediate family obtains a personal gain or advantage on the basis of confidential information obtained directly or indirectly from you.

External Communications:
You must refer all media inquiries directly without further comment to Public Affairs. Likewise, Public Affairs must coordinate all ongoing media contact. This ensures the preparation of official statements is consistent with corporate policy, monitored contacts and anticipated news coverage.

In addition, your immediate supervisor and Public Affairs must approve any articles, speeches or other materials that you may wish to submit to the media for publication, and must approve in advance any external speeches or appearances you make as an employee of the Corporation.

Personal Gain:
You must not use confidential information about the Corporation or any of its affiliates, customers, or suppliers entrusted to you in the course of your employment for your personal gain or the personal gain of your family, friends, or others.

Securities Law Penalties:
The improper or personal use of confidential information concerning the Corporation or its affiliates, customers or suppliers is a violation of the Corporation’s policies, and may subject both you and the Corporation to penalties under various securities laws and regulations.
The federal securities laws prohibit you from taking advantage of nonpublic material information about the Corporation or its affiliates, customers or suppliers, or communicating such information to others. If you violate these laws, you may be subject to penalties, including fines and imprisonment. Information about a company that may affect the market price or a person’s decision to invest in its stock is considered “Material Information.” Only a small group within the Corporation generally knows this type of information and may divulge it only in a manner that assures equal access to the entire investing public.

Competition
The Corporation believes in the free enterprise system and is dedicated to the maintenance of fair competition in an open market. Employees are to avoid any circumstances that will, or would appear to, violate antitrust or competition laws.

Employees shall refrain from discussing or entering into any arrangements or understandings with competitors concerning prices, production limits, allocation of customers, products or territories, boycotting certain customers or suppliers or in any way engaging in other anti-competitive practices. Normal business activities occasionally require contacts with competitors, but on such occasions discussion of any of the above-mentioned subjects must be avoided. Any violation of these conditions should be reported immediately to the General Counsel’s office.

Whenever any doubt exists as to the legality of a particular action, advice from the General Counsel’s office should be sought before engaging in this activity. In this same spirit, employees should refrain from making disparaging comments about the products or services of the Corporation’s competitors.

Employees are prohibited from making, offering or soliciting any payment that is in the nature of a bribe, kickback or other illegal payment to any customer or supplier of the Corporation or to any other person. If any customer, supplier or any other person solicits or requests such a payment, that solicitation or request should be reported immediately to the General Counsel’s office.

Corporation Records
The Corporation’s books and records and other essential data are to be maintained with accuracy and honesty in strict compliance with applicable laws, accounting principles and management’s general authorization. When preparing such records, employees are not to make false or misleading entries in records nor permit to exist any fund or asset or liability which is not fully and properly recorded on the Corporation’s books. No transactions, agreements, programs, plans, obligations or payments shall be entered into, made or recorded with the understanding that their use is for other than the stated purpose.

Employees shall not make any false or misleading statements about such records or conceal information from management or the Corporation’s auditors. We expect you to fully cooperate with our internal and independent auditors and counsel. This means providing them with complete and accurate information. Any omissions or inaccuracies in the Corporation’s records should be reported immediately to the General Counsel’s office.

Government and Public Affairs
The Corporation advocates the democratic system and is committed to upholding the political, legal and governmental processes of the local, state and federal systems of the United States and other countries where the Corporation operates.

Further the Corporation recognizes that participation by citizens in civic and political activities is necessary for this system to function properly. The Corporation encourages employees to exercise their right to vote, to participate actively in the political process, to be informed on public issues and on the positions and qualifications of public officials and candidates for public office and to support issues, candidates and parties of their choice, as individual citizens.

Employees should not use the Corporation’s name or the name of HSBC Holdings plc or any of their affiliated entities, either directly or indirectly, to endorse any public issue, political candidate, political party or business interest, product or service, unless otherwise authorized by the General Counsel’s office.

Political Activities and Contributions:
Federal and state laws and regulations restrict, and in some cases prohibit, corporations from making payments or using their property to support candidates for political office or political parties or committees. As a matter of policy, HSBC and its subsidiaries do not use corporate funds to make contributions to federal, state or local candidates or committees. We prohibit the use of the Corporation’s employees or property, including office supplies, printing facilities, postage and equipment, to promote political candidates or parties. We prohibit you from making any expenditures for such purposes through travel and expense accounts and we do not allow recovery of any such expenditure.

Both state and federal laws, however, permit voluntary personal contributions to segregated funds established for political purposes, such as H-PAC, the political action committee (PAC) for employees of the Corporation. The Corporation may legally pay for the PAC’s administrative expenses, but the employees voluntarily provide the funds the PAC uses to financially support candidate campaigns.

The solicitation of the Corporation’s employees for political contributions on the Corporation’s premises is limited to H-PAC.

Holding of Public Office:
Under the laws of the State of New York and most other states in which the Corporation does business, the holding of public office, elective or otherwise, may give rise to an illegal conflict of interest or could prevent us from having normal business relationships with the governmental body involved, including depository relationships and the purchase of its debt obligations. Whether or not the public official receives any salary or participates in the actual deliberations leading up to any contract or transaction does not affect this rule.

To avoid such violations and possible criticism and embarrassment, any officer or employee must obtain approval from the General Counsel’s Office before seeking a public office or accepting an appointment to one. We generally grant such approval if the position does not prevent the Corporation from doing business with the public body.

A public office means any position in the state, county, city, town, village or federal governments and includes school districts, public authorities, renewal agencies and other comparable governmental subdivisions or agencies.

Improper Payments:
The Corporation prohibits the use of corporate funds for bribes or for making improper payments of any kind to any persons or organizations in order to obtain their business or to influence their policies or decisions, or for any other reason. This prohibition includes any payment to any foreign or domestic government official, employee or agent not required by law. We also prohibit the making of any “kickback” or the sharing of fees with those who represent customers or suppliers of the Corporation.

We remind you that the Corporation and its affiliated companies conduct business throughout the world and that the Corporation will strictly comply with the applicable laws and regulations of the countries in which we do business. However, you must remember that laws and business customs vary from one foreign country to another and from the laws and customs of the United States. We forbid foreign practices that violate a U.S. law or regulation even when acceptable locally.

If you have questions concerning the legality of any payment, or any suspicion of a kickback, bribe or other illegal arrangement, you should report it immediately to the General Counsel’s office.

Personal Investments
Subject to any more restrictive divisional policies and procedures, you and the members of your immediate family may invest at your discretion in stocks, bonds and other corporate securities, as well as foreign currency, interest rate and commodity forwards, futures and options. However, because of your position with a financial institution, you should avoid excessive speculation or risk in your personal financial activities. You may easily measure excessive risk by determining if the loss of a particular investment would significantly affect your standard of living or cause you to encounter extreme financial hardship.

You also must avoid particular investments affecting your judgment with respect to making decisions for the Corporation or giving rise to the appearance of a conflict of interest if reported on the front page of The New York Times.

You must limit investments in the obligations of customers, suppliers and other parties doing business with the Corporation to securities publicly traded on a national securities exchange or in the over-the-counter market, unless you obtain the prior written approval of the General Counsel’s office. Investments in such publicly traded securities in excess of 1% of the company’s issued and outstanding shares require prior approval of the General Counsel’s Office.

In making your personal investment decisions, you must carefully avoid the use of any confidential information you have obtained through your employment. In order to avoid potential conflicts in this area, you should avoid investments in the securities of any corporate customer for which you currently have or anticipate having direct or indirect account responsibilities.

Trading and Margin Accounts:
Subject to compliance with divisional policies and procedures applied because of your position with the Corporation, officers and employees may maintain accounts, including margin accounts, for their own personal trading and investment activities and those of members of their families and others. You are permitted to maintain these accounts with HSBC affiliates, such as HSBC Brokerage (USA) Inc., or with independent securities, foreign exchange or commodities firms.

The Rules of Fair Practice of the National Association of Securities Dealers restrict NASD registered broker dealers, including HSBC Brokerage (USA) Inc., from selling securities distributed in a public offering (i) to senior officers of commercial banks, investment companies and registered investment advisers, or (ii) to any employees of such entities engaged in buying or selling securities for such entities or their customers. These restrictions also apply to family members sharing the same household.

In addition, rules of the New York Stock Exchange provide that member firms may open margin accounts for bank employees if they first obtain the employer’s consent. Your supervisor or divisional compliance officer can provide such a consent, if requested to do so. Of course, officers and employees should not engage in trading or investment activities conflicting with their employment duties or considered imprudent under their own personal circumstances.

Reporting and Inquiries
The basic principles presented in this statement are intended as general guidelines rather than rules and regulations for all situations. Should any question arise as to the interpretation of a particular principle or situation, the employee shall refer the question to the General Counsel’s office.

Inquiries and information reported under this policy will be kept in confidence except as may otherwise be required to protect the Corporation’s interests. There shall be no reprisals for reporting information pursuant to this policy.

Violations of this policy and failures to report known violations will subject the employee to disciplinary procedures, including termination of employment. In addition, employees who should have, through the exercise of due diligence, discovered violations of this policy, but who failed to do so, may be subject to discipline, including termination of employment.

Reporting Violations:
If asked or ordered to participate in, or you otherwise become aware of, any event violating the Corporation’s policies, applicable laws and government regulations, or both, you should report the information to the General Counsel’s office and/or contact the Employee Integrity Tip Line at 888-560-1777. The Employee Integrity Tip Line Unit will notify Corporate Security, if appropriate. Corporate Security conducts such investigations as are required under the circumstances and has responsibility for coordinating the related involvement of the Corporate Security Department, Human Resources Division and related division management.

Inquiries:
You should refer questions concerning this Statement of Business Principles and Code of Ethics to the Employee Integrity Tip Line (888-560-1777) or the General Counsel’s office.

Last Revised: July 23, 2008

A last-ditch loan-mod effort . . .

Borrowers place hopes on forensic loan reviews
Steve Bergsman
Inman News

. . . The forensic loan review is expensive (pricing is usually $2,000 to $5,000) and even if it is successful in discovering problems in your underlying mortgage documents, that’s usually not enough to make a difference with your bank.

The forensic loan review is an in-depth scrutinization and subsequent report on all documentation, transactional data and associated aspects of the residential loan origination process. The review often focuses on the closing documents to see if they contain violations of the Truth in Lending Act (TILA) and the Real Estate Settlement Procedures Act (RESPA), or if there was any kind of fraud or misrepresentation.

This type of review is only successful if you, as a consumer, go the next step, which is to bring a lawsuit against your lender.

“An audit by itself is not some magical way to make everything go away — it is just a beginning,” notes Dean Mostofi, the founder of National Loan Audits in Rockville, Md. “Borrowers who contact lenders with an audit don’t get too far. It’s in their best interest to go in with an attorney.”

Editor’s note: It is our experience that lenders will NOT modify unless you go in with an attorney in any case; so we have been working with a group named Marin Family Action in Marin that has been raising funds to hire attorneys to represent us in court. It works!

The good news is most lawsuits based on the findings of a forensic loan review are generally successful in attaining for the borrower a loan modification. The bad news: hiring a law firm is just another big expense at a time when you are so hurting financially you are in danger of losing your home.

More than 50 percent of the loans our company reviewed have material misrepresentations, says Jeffrey Taylor, managing director and chief business development officer for Digital Risk LLC in Dallas, which does work for large banks and government agencies, not individual consumers.

One of the first companies to do forensic loan reviews for consumers was You Walk Away LLC in Carlsbad, Calif. “We found about 80 percent of the loans we looked at had some type of violation in them. Clearly, a lot of adjustable-rate mortgages had violations,” says Jon Maddux, CEO . . . lenders were, and still are, so overwhelmed with foreclosures that even if you walked into an office and handed them proof that there were problems in the original loan documentation, they still put you in the queue along with everyone else. Meanwhile, the clock continued to click down on the foreclosure process.

Maddux realized even with a forensic review no progress would be made with your lender unless you actually sued.

“The borrowers are struggling to get the attention of overworked loan servicers, who are scrambling with as many modifications, workouts and deals as they can come up with,” says James Thompson, an attorney in the Chicago office of Jenner & Block LLP. “You can get to the head of the line sometimes if you show up with an attorney and a forensic loan examination saying there is a TILA violation.”

In researching the short history of consumer forensic loan reviews I hadn’t come across even one situation in which a homeowner lawsuit had actually gone to the end of the court process, mostly because if there is an actual, verifiable violation it would be difficult for lenders to win a case. So why should they bother to fight?

. . . Here’s the way it has usually worked out: The homeowner’s attorney goes to the lender with this message, “If this goes to litigation it is going to cost you $200,000 in penalties plus the cost of legal work when all the borrower really wants is an affordable mortgage and affordable interest rate to stay in the home.”

“I don’t see very many of these litigating,” says August Blass, CEO and president of National Loan Auditors in Walnut Creek, Calif. “Most of these settle. This brings the settlement offer to the table a little bit faster. It’s not to say a lender would have not been brought to the table without the audit, it just seems to fast-track it a little bit as the lender knows you are being handled by an attorney and there are illegalities being claimed on the loan.”

So, what do you get for your dollars and efforts?

If the object of the forensic loan review and, perhaps, lawsuit, is a loan modification, then this is a very attainable goal. If you instead believe the mortgage should be totally rescinded, then you need to consider what that means.

What it absolutely does NOT mean is that you that simply wash your hands of the loan and walk away as if it never happened. What it does mean is that the consumer gets to buy back the loan. In short, the borrower has to be able to repay the amount that was borrowed . . .

As Blass observes, most homeowners want a loan modification that will let them remain in the house where they currently live — “they don’t actually want the loan rescinded.”

From Steve Bergsman, a freelance writer in Arizona and author of several books, including “After the Fall: Opportunities and Strategies for Real Estate Investing in the Coming Decade.”

***

Copyright 2010 Inman News

http://www.showyourhome.com/Homes/News/Article.aspx?id=inmannews112528

Just read a comment on a blog from Tina, who wrote “Loan modification for them is a game . . . They not going to help anyone . . . ”

Tina hit the nail on the head. Playing with money on the levels of Goldman Sachs, Wells Fargo, Chase, etc. IS a game . . . a game of money with high stakes.

A Vanity Fair article on Goldman Sachs notes that these gentlemen look with scorn on anyone with a tan, as though they are slackers, and pride themselves on “how hard they work.” Jerks. No working mothers have tans . . . they don’t have time. No one in high-tech has a tan. The only people with tans are lifeguards and low-paid farm workers ’cause they actually have to be in the sun. (Oh, and one of the senior executives of Wells Fargo, but that’s cause he lives in California and HAS to have a tan . . . his tan, of course, is fake ’cause he doesn’t actually take time to be in the sun — he could, if he played tennis or golfed with banker buddies. Oh, and his fake tan is a dreadful orange color, but at least it takes attention away from his gel-styled, probably dyed hair.)

Goldman Sachs’ measurements for hard work are just plain old boys’ school silly. They ARE just playing. The average middle-income family works as hard as any of them, yet these non-tan (or the aforementioned fake tan)bankers assume they are impressing someone with these stupid games. They think they deserve bonuses for their tanless incompetency.

I’ve spent more than a year seeking modification. I have a 3-month forbearance with no agreement beyond that to do anything. They eMailed me that they do NOT know who holds the note . . .

What DO these bankers do with their $500,000+ salaries? Drink a lot to forget how much they screw people all day long? I SO would love to talk with their wives to see what life is like in that crooked lane? What do they tell themselves about their husbands cheap views of everyone else on this planet.

I said it before and I’ll say it again, dealing with cancer treatments in 2008 was easier than dealing with Wells Fargo in 2009. I knew what to expect with cancer. The doctors were quite clear. Wells on the other hand . . . Well who knows!

Treasury Department announces permanent mod plan
November 30, 2009

The Treasury Department and Department of Housing and Urban Development has announced a plan to help borrowers convert to permanent loan modifications. As expected, the announcement emphasized the importance of ushering borrowers currently in trial modifications into permanent modifications.

Phyllis Caldwell, chief of the Treasury Department’s Homeownership Preservation Office, said in a press release that with the success of the trial modification program, agency officials will aim to augment the permanent modification plans. “We now must refocus our efforts on the conversion phase to ensure that borrowers and servicers know what their responsibilities are in converting trial modifications to permanent ones,” Caldwell said.

The plan would involve applying more pressure on banks to convert trial modifications into permanent ones. It’s a task that has proved tricky — while over 650,000 borrowers have qualified for trial modifications under the Treasury’s program Making Home Affordable only 375,000 of those are expected to transition to permanent modifications by the end of 2009.

The Treasury plans to disclose how many permanent modifications each bank implements, according to Michael Barr, assistant secretary for financial institutions, a move intended to call out those banks that aren’t performing adequately. “We’re going to be quite focused and direct on particular institutions that are not doing a good job,” Barr said. “Some firms ought to be embarrassed, and they will be.”

A comment from one of the readers of this article:

It is my hope that Ms. Caldwell takes her role seriously, takes no prisoners with regard to enforcement of mortgage servicer slackers, and facilitates IMMEDIATE REMEDIES and SOLUTIONS for homeowners. This problem is an embarrassment to our country! It doesn’t make sense how banks/mortgage servicers are dragging their feet when slated to receive “incentives of several thousand dollars for each mortgage they agree to modify with lower payments. Those payments aren’t made until the modification is permanent.” In fact, it seems more evident that banks/mortgage servicers are benefitting from foreclosures . . . from what? Insurance and government backing for losses?

In a recent meeting with a local real estate agent, she named Chase as the worst bank in all of the mess, followed closely by Wells Fargo. And I just found this re Chase . . . this is shocking. Can’t charters be pulled from banks? Why are they unregulated and out of control?

I’ve been in an on-going nightmare with Chase since mid-2003, involving them forcing me into bankruptcy then to save my home, and the last year and a half of misfeasance, malfeasance, simple incompetence and outright greed. My “three-month modification trial period” has now stretched to eight months, with no end in sight, and no guarantee of anything resembling an equitable mortgage from this. At one point, Chase attempted to have us falsify our incomes to get a better deal. And reporting this occurance, which is a felony, to several federal agencies got us nowhere. Nothing has been done, and it looks like my only remedy is going to be to sue Chase in federal court to see if I can get a mortgage out of them for something less than the 11 3/4% I’m paying now.

A favorite:

The banks are not honoring the agreement they made with the government. They should be fined $1 millions a day until they start modifying loans. Banks want the program to fail. Our government needs to step it up and make the banks accountable.

And then there is Wells Fargo . . .This from Alex Strobel on December 14, 2009:

Wells Fargo has been participating in the Making Home Affordable Program since April 13, 2009 by providing homeowners with home loan mortgage modifications. The numbers:

Wells Fargo has potentially 334,949 homeowners who qualify for a home loan mortgage modification through the Making Home Affordable Program. There are currently 96,137 homeowners in a home loan modification trail period and Wells Fargo has made 3,537 home loan mortgage modifications permanent.

Responses to this included:

We met all the requirements and applied for the HAMP program with Wells Fargo and were told that our “investor” is not participating in the HAMP program only to find out that Wells Fargo is actually our investor. They approved us for their “in-house” modification program, and put us on a 3 month forbearance. We made our final payment on Dec. 1st. We then received a notice saying we need to come up with $14,000 by January 5, 2010 or risk foreclosure proceedings. I have called and emailed Wells Fargo and am waiting for a call back. They are they are putting homeowners through a vicious obstacle course, many won’t find their way, and their lives will be horribly effected in the process. (Coming from a homeowner that had 800+ credit score, now low 600’s, and still no relief from Wells Fargo, just more panic attacks.) Good luck economy!

A gentleman named “Larry” notes that Wells are “bastards” and “good for nothing scum bags.”

So much for Forbearance Agreements:

January 4, 2010: A Realtor/friend said today: “Be careful. Wells Fargo just foreclosed without notice on a home that was in the middle of the three month forbearance agreement.” Apparently Wells (and other lenders) do not have the ability to modify any loans it has sold (and my loan has been sold repeatedly). I was pleased in 2006 when Wells Fargo took on my mortgage; I had no idea that lenders were then bundling and selling them willy nilly. This has been a painful lesson.

January 5, 2010: A couple knocked on my door around 4 p.m. wanting to know if the open house was over. Surprised, I told them they must mean Point San Pedro Road. They said they were new to the area and weren’t sure. (I subsequently checked — there is NO address similar to mine on Point San Pedro Road — it is my house they came to view, but I see nothing on the Internet to indicate that it is up for sale — this strikes me as insider information. The woman was about 45, blonde, 5’7”, trim. The man was around 60, about 5’8”, quite portly, somewhat seedy and smoking cigarettes. She spoke. He said nothing.)

I was delighted when on December 23, 2009 (after one year of “negotiations”) I received a Forbearance Agreement from Wells Fargo with a modification within my income structure. A polite Wells Fargo rep explained that the language on those “Agreements” is “boilerplate.” That doesn’t seem to be true: Basically, you do give away your rights, the lender “in its sole discretion and without further notice to you (me), may terminate this Agreement . . . and may foreclose . . .

January 5, 2010: eMail to Wachovia and Wells Fargo: Do you have any idea what is going on? Does Wells Fargo have the power to save anyone’s home?

I have written to Wells Fargo’s CEO and CFO for an explanation of the Agreement and requested a copy of the note as it is now held so I know with whom I am dealing. No response as yet. I CAN afford the restructured agreement as noted in the forebearance — without undue problems.

My negoiator said it might go up a couple of hundred dollars when it is finalized — that is affordable also. However, if lenders really do not want to help anyone with anything, or actually cannot help, what are we all doing? Will you kindly assist me in getting a copy of the note asap or tell me who to contact?

I speak for millions of Americans when I say this is really sad; this absolutely should not be happening in America.

A Selection of Books on Robber Barons The Robber Barons: Great American Capitalists 1861-1901 Dark Genius of Wall Street: Jay Gould, King of the Robber Barons In Their Own Words: Robber Barons and Radicals Andrew Carnegia: Robber Baron as American Hero The Age of the Moguls: Robber Barons and Great Tycoons House of Morgan The Man Who Robbed the Robber Barons “The Myth of the Robber Barons” by Folsom describes the role of key entrepreneurs in the economic growth of the United States from 1850 to 1910. The entrepreneurs studied in many “robber baron” books are Cornelius Vanderbilt, John D. Rockefeller, James J. Hill, Andrew Mellon, Charles Schwab, and the Scranton family. Most historians argue that these men, and others like them, were Robber Barons. The story, however, is more complicated. Burton Folsom, in his book, divides the entrepreneurs into two groups market entrepreneurs and political entrepreneurs. Market entrepreneurs, such as Hill, Vanderbilt, and Rockefeller, succeeded by producing a quality product at a competitive price. Political entrepreneurs such as Edward Collins in steamships and in railroads the leaders of the Union Pacific Railroad were men who used government to succeed. They tried to gain subsidies, or in some way use government to stop competitors. The market entrepreneurs helped lead to the rise of the U. S. as a major economic power. By 1910, the U. S. dominated the world in oil, steel, and railroads led by Rockefeller, Schwab (and Carnegie), and Hill.

Reading today’s news brings home the fact that few of us know much about the history of the world. Many of us are rightfully upset, but Robber Barons ARE the people who develop all countries while amassing fortunes at the expense of others under the guise of conquest, development, “you need this or that.” Think about all that you have in your home that you absolutely do NOT need at all for any reason. If you never saw this or that widget, it would not matter.

Think about all the foodstuffs that we consume that are actually harmful; food and drug industries are rife with Robber Barons . . . and with the help of government. Think about cigarettes; beyond a shadow of a doubt, they main and kill. Executives and shareholders of Philip Morris, R.J. Reynolds, etc., ARE robber barons. They are making fortunes while individuals die (or, perhaps worse, live and drain taxdollars to help them stay alive — while continuing to smoke).

Our friends, The Robber Barons (aka Super Thieves) have been with us since the dawn of time. As soon as someone decides they want something you have, and the second the desire outstrips their ethics, the game starts. During extensive historical research for a maritime site, I’ve repeatedly been appalled at the machinations of man as I read about who took over what nation and under what circumstances.

Don’t you find it appalling that the British, French, Spanish, Dutch, et. al. sat around divving up countries willy nilly in order to secure spices for England or gold for Queen Isabella of Spain or diamonds for Holland? These countries were already inhabited and some quite developed when Europeans arrived, claimed to have “discovered the land,” and proceeded to invade, rape, pillage, rob, burn . . . They want what they want and they take it.

It seems the only reason so many more of us are aware of international wheeling and dealing is because of the Internet and cellphones; the people have a voice like never before. Little can be hidden.

While government representatives, for example, insist there is no strife in their country, a student or tourist with a cellphone snaps that telling shot . . . the one that shows a different story; one that shows the truth to the world. (Left is a robbery of a jewelry store captured on someone’s cell phone — this was found on the internet!)

This, while I agree, I find this article from the Sovereign Society newsletter quite narrow in scope:

Lies and irresponsibility have become the hallmark of both Wall Street and now Washington are threatening the life savings of individuals.

Noted author and economic analyst John Pugsley was quoted as saying, “Hard working Americans, trying to do everything right, are now at the mercy of the fallout from these lies. And there are three in particular that pose devastating threats. But investors today can protect themselves if they quickly take the appropriate steps…”

For all of us to decide, perhaps, is how much is enough? How much is too much? Do we need all of these developments at the cost of everything else on earth?

In the event you have note wrestled with that one (or have without a satisfactory answer), you might want to see the movie “Avatar,” which addresses some of these issues.

The upside and downside of being out of work for most of 2009 has been I’ve had time to look at our system of government and banking in a depth never before done by me. It’s depressing. The “powers that be” have gotten away with so much because families have had their heads down working hard to make a living. We have paid scant attention to the corruption stemming from Wall Street and Washington, D.C.

America IS a great country. Why has it come to this levels of abandonment of principles?

This was just sent to me. It IS time to take back our country and level the playing field.

For too long we have been too complacent about the workings of Congress. Many citizens had/have no idea that members of Congress can retire with the same pay after only one term, that they don’t pay into Social Security, that they specifically exempt themselves from many of the laws they pass (such as being exempt from any fear of prosecution for sexual harassment) while ordinary citizens must live under those laws.

The latest attempt in Congress is to exempt themselves from the Healthcare Reform that is being considered . . . in all of its forms.

Somehow, that doesn’t seem logical. We do not have an elite that is above the law. It does not matter if they are Democrat, Republican, Independent or whatever. The self-serving must stop. This is a good way to do that. It is an idea whose time has come.

Ask each person on your eMail list to contact a minimum of twenty people on their address list, in turn ask each of those to do likewise.

In three days, most people in The United States of America will have the message. This is one proposal that really should be passed around.

Proposed 28th Amendment to the United States Constitution:

“Congress shall make no law that applies to the citizens of the United States that does not apply equally to the Senators and/or Representatives; and, Congress shall make no law that applies to the Senators and/or Representatives that does not apply equally to the citizens of the United States.”

Dr. Seuss’ Did I Ever Tell You How Lucky You Are? (Classic Seuss)
A favorite economics lesson is from Dr. Seuss’ “Did I Ever Tell You How Lucky You Are?”

Oh, the jobs people work at! Out west, near Hawtch-Hawtch, there’s a Hawtch-Hawtcher Bee-Watcher. His job is to watch . . . to keep both his eyes on the lazy town bee. A bee that is watched will work harder, you see.

Well . . . he watched and he watched. But, in spite of his watch, that bee didn’t work any harder. Not mawtch.

So then somebody said, “Our old bee-watching man just isn’t bee-watching as hard as he can. He ought to be watched by another Hawtch-Hawtcher. The thing that we need is a Bee-Watcher-Watcher.”

WELL . . .The Bee-Watcher Watcher watched the Bee-Watcher. He didn’t watch well. So another Hawtch-Hawtcher had to come in as a Watch-Watcher-Watcher.

And today all the Hawtchers who live in Hawtch-Hawtch are watching on Watch-Watcher-Watchering-Watch, Watch-Watching the Watcher who’s watching that bee. You’re not a Hawtch-Hawtcher. You’re lucky you see.

Why are those at the heads of the investment banking businesses worldwide trying to convince us that this entire sink hole began only a year or so ago, when in fact the sink hole has been being positioned by those very actors, for decades. How and when did America become the “sloppy society?” The way our country is run is quite inelegant.

The following is from a variety of sources: “Treasury Inspector General for Tax Administration Recovery Act,” “Sovereign Society,” and a gentleman self-described as a “Disgruntled Republication.”

Federal workers owe more than $3B in back taxes
By STEPHEN OHLEMACHER (AP) – Dec 15, 2009

WASHINGTON — Federal workers owed the government more than $3 billion in back income taxes in 2008, just as federal tax revenues started to suffer from the recession.

More than 276,000 federal employees and retirees owed back income taxes as of Sept. 30, 2008, according to data from the Internal Revenue Service. The $3.04 billion owed was up from $2.7 billion owed by federal employees and retirees in 2007.

Among cabinet agencies, the Department of Housing and Urban Development had the highest delinquency rate, at just over 4 percent. The Treasury Department, which includes the IRS, had the lowest delinquency rate, at 0.98 percent.

Overall, the 9.7 million federal workers included in the data had a delinquency rate of about 2.9 percent.

“It’s not right for a few to shirk their obligations, and it’s especially offensive that these tax delinquencies come from federal employees and contractors,” said Sen. Chuck Grassley of Iowa, the top Republican on the Senate Finance Committee.

The IRS doesn’t provide a comparable delinquency rate for income taxes paid by the public. The nation’s overall compliance rate, which includes taxes paid by small businesses and corporations, has hovered around 85 percent for decades, according to IRS statistics.

Most residents who owe back income taxes file returns but cannot pay the full amount at tax time, said IRS spokesman Anthony Burke. Others have their tax bills increased through audits and cannot pay the higher bill.

The statistics on federal employees do not include those who are on payment plans. The IRS doesn’t publicize the data, but makes it available upon request. The data was first reported by Washington radio station WTOP.

The recession has put a big dent in federal tax receipts. Individual income tax receipts for the fiscal year that ended in September were down about 20 percent from the year before.

I recently discovered that the servicer of my mortgage made TWENTY-TWO mistakes (that I know of) during 2009 with regard to my mortgage! That, of course, pushed me into wondering what in the hell is going on? . . . the IRS has trouble even with routine tasks. According to another IG report, the agency has a staggering 70 percent error rate in its processing of taxpayer identification numbers for individual taxpayers:

The Treasury Inspector General for Tax Administration (TIGTA) today publicly released its review of the IRS’s processing of applications for Individual Taxpayer Identification Numbers (ITINs). TIGTA reviewed a sample of ITIN applications and found that almost 70% contained significant errors and/or raised concerns that should have prevented the issuance of an ITIN. The IRS estimates that it has issued more than 14 million ITINs as of December 2008. ITINs are intended to provide tax identification numbers to resident and nonresident alien individuals who may have U.S. tax reporting or filing obligations but do not qualify for Social Security Numbers, which generally are only issued to U.S. citizens and individuals legally admitted to the U.S. . . . ”The number of individual income tax returns filed using ITINs and reporting wage income has increased by 247 percent from 2001 to 2008,” commented J. Russell George, the Treasury Inspector General for Tax Administration. “If the IRS continues to issue ITINs without proper verification, the risk of fraudulently filed returns – along with fraudulently claimed refunds – will continue to rise,” added Inspector General George.

Everything by Dr. Seuss
Just think how much fun it will be when the IRS is in charge of determining those of us who should get fined or jailed for noncompliance with government-run healthcare! No wonder so many taxpayers put a flat tax or national sales tax on their Christmas lists.

Perhaps Dr. Seuss is our only hope . . . We’ve added a link to a collection of his books, including Dr. Geisel Goes Green (warnings against mindless progress), The Lorax, Mr. Brown Can Moo!, One Fish Two Fish Red Fish and others. The Economics of Dr. Seuss

A proposal: Keep track of every mistake your bank/lender makes. If we do our “homework” with due diligence, you may save your home (if foreclosure is looming) and not only will your finances be in better shape, but we can help banks do their job efficiently and accurately. Why should we? Because their screw ups do NOT cost them; they cost us. Each bank client ultimately pays for the bank’s messes and the only way to straighten this out is to call them on it.

WHY are the keepers of our money allowed to operate carelessly and sometimes outside of the law? Apparently it’s been sloppy for 15-20 years and no one has called them on it. This is our money we are talking about: yours, mine, ours. People work hard only to have their income carelessly handled by banks and lenders. Where is the control over these institutions? Who owns the Federal Reserve? Apparently, no matter who is “in charge,” of America’s lending institutions, they are not paying attention (or are looking the other way for profit/percentages).

Important note: I do not hate banks. They pay reasonably well, still provide benefits (health insurance and vacations), and have a growth plan for their employees . . . including funding for additional schooling. In my 20s, I worked in Bank of America’s Corporate Finance Department in their San Francisco Headquarters under A.W. Clausen and Robert Frick, both of whom rose to prominence in national and international banking. They were fine men. And most bank employees are wonderful people — although, unfortunately, I’m now thinking someone needs to be watching the store because of the multitude of errors made by those wonderful people.

Bank errors are costing you a fortune (as are erroneous credit reports, but that is another story). Start tracking the errors — when they are bank errors and not such things as overdrafts caused by your mismanagement of your own accounts; that IS your responsibility.

Setting the stage: Around 1997, my then-home-loan was sold to Washington Mutual. I wasn’t informed. I sent my payment to the prior lender and it was lost in the transfer process. After ONE YEAR of getting nowhere in straightening this out, I pulled a negative Better Business Report on Washington Mutual. I put on my best business suit and stood outside their Greenbrae, California branch handing them out to people with a suggestion that they read the report before doing business with WaMu. After successfully turning away several people, I explained my process to the bank manager and insisted he straighten out the missing payment mess immediately or I would continue handing out the BBB report. Bristling, he demanded, “Are you threatening me?” Calmly I responded, “No. I’m promising you that I will hand out this negative report re WaMu.” He cleared the record while I waited. Technically, I should have taken that further; because of the resulting poor credit report due to the lost payment, my home loan interest was higher than it should have been.

More setting the stage: In 2007 and 2008 Wells Fargo Bank lost payments on my home loan. Because of the WaMu fiasco, I began tracking all conversations and letters to/from Wells Fargo.

When the mortgage payments did not clear my account, I called Wells who informed me they did not have the checks. So I paid by phone with their assurances that they would NOT put through both payments should they find the missing checks. However, they found the “lost” payments and put both checks through. The result: $580 in overdraft fees. In 2007 I let the overdrafts go as it takes too much time to deal with bank mazes. However, in 2008, I’d had it: It took almost a month, several phone conversations and five letters to straighten this out. They reversed the overdrafts for 2007 and 2008; however, a great deal of time was spent in cleaning up their mistake. Of course, I wasn’t covered for that.

In December 2008, when I began “negotiating” for a loan modification with Wells Fargo, I began tracking all conversations and letters and now have a four-inch-thick binder and nine typed pages of who said what to whom. I’ve learned far more about banking than I ever wanted to know.

So, back to the list you should keep and the whys of it all: On December 28, 2009, curious about the volume of mistakes made by Wells Fargo since they have held my mortgage beginning July 2006, I started counting from my lists of who said what to whom.

As near as I can figure there are TWENTY-ONE errors during the past year alone. Wells’ mistakes include repeatedly lost documents resulting in denials, misinformation during telephone conversations, two outright lies (one before a Superior Court Judge and one in writing in response to a Congressional Inquiry) . . .

I’m not alone. This IS how banks are doing business – sloppy, as is indicated by my timeline, conversations with others, checking blogs with complaints about various banks, and as indicated by the loss of original mortgage papers for thousands (millions) of people.

However, hope springs eternal:

From a Wall St. Journal article written by Amir Efrati on December 24, 2009: “Now, after the country has been mired in a housing crisis for more than two years, more judges are calling these companies on their paperwork glitches, and in some cases going much further in their efforts to help homeowners.”

and

“It makes sense for judges to demand that mortgage companies follow the rules to the letter if they want to win foreclosure cases in court, says Raymond Brescia, an assistant professor at Albany Law School who has written about the role of the courts in the financial crisis. ‘I don’t think that’s a crazy idea,’ he says. ‘To expect plaintiffs to prove their case is what the judicial system is founded on.’”

SO PLEASE keep a list of your dealings with your banks, lenders (and the credit reporting agencies). For decades I considered these bastions of industry as sacrosanct; I actually thought credit reporting agencies were government agencies. They are not, and, like the banks, they hold your financial life in their shaky hands.

Never afraid of anything in my life, I am now afraid of our mortgage lenders and our banking system; they have too much control, do not manage it accurately or efficiently, seem to have no checks or balances, and can take our homes without having to prove ownership. They have also quite studiously ignored Presidential requests.

In December 2009, I received a three-month forbearance offer. This is wonderful, except that too many forbearance offers disappear into thin air as your lender does not hold the note, has no authority to negotiate anything, and after the three months may foreclose anyway — that IS happening in California.

One of Wells Fargo’s own branch managers expressed worry about this “offer” when I stopped by to give the wonderful news. The manager suggested that I track payments carefully and confirmed what I already know: “Horrible things have happened.”

I love my home and country, and Wells Fargo was a favorite bank of mine until this mess. Because of their history in California, Wells is featured on one of my Web sites (although I’m contemplating taking the time to remove all mention of them from the site), and two of their horses — Molly and King — live in my home (the stuffed ones, not the real ones). This is SO sad.