Faces Of Foreclosure

How long have bubbles been bursting? Probably since the dawn of time on myriad levels, as those determined to “have more” undermine the stability of everyone/everything else.

According to International Living (an online newsletter): It’s official . . . The end of the “Age of America” will happen in 2016. That’s when, according the latest forecasts from the IMF, China’s economy will surpass America’s. According to International Living, the next president of the United States will be the last to lead the world’s biggest economy.

A decade ago, the U.S. economy was three times the size of the Chinese economy. Up until now economists have predicted that China wouldn’t overtake the U.S. until 2030. What does this mean? Quite possibly quite a few more bubbles will be twisting around and bursting; International Living is predicting the biggest shake-up of wealth in 235 years.

These types of financial machinations are way beyond my brain; all I know is that the middle class (that would be those of us who have been shoring up the system for decades) is someone’s footstool.

Following are economic woes recognized in history which have had ruinous effects. Given America’s economy today, it seems nothing has been learned and greed repeatedly undermines planning as investors intentionally forget (have forgotten) everything they learned in Investing 101. Tulipmania has been invoked frequently in news stories . . . The following was written by Alice Hamilton (Harvard Medical School) in May 1930.

This year, if ever, it behooves us to think soberly of the need of giving some form of security to those upon whom the fluctuations of business throw the heaviest burdens. These are men and women who have no control over discount rates, or credit, or the manipulation of bull markets and bear markets, yet they are the first victims of the battles fought in those high and mysterious regions . . . It is time for us to devise ways of meeting the inevitable disaster of old age and the almost equally inevitable disasters of sickness and unemployment, and these must be ways that will not fail when the stock market breaks or a new machine is invented, that will function in the lean years as in the fat years, and that can be accepted without loss of self-respect.

1634-1638: TULIPMANIA

Known for their passionate love of flowers, the Dutch highly prized the tulip upon its introduction to Western Europe in the mid-16th century. Dutch collectors devised a hierarchy of tulip varieties based upon their species and coloring, assigning values to the various flowers. Because it was impossible to determine which variegation would bloom from a particular bulb, the tulip became an object of speculation. During their earliest years in Europe, the bulbs were primarily of interest to the wealthy, but by the mid-1630s the craze caught on with middle-class and poorer families. The increased demand caused the price of the bulbs to soar.

While there’s no accurate way to render prices in today’s currencies, some prices roughly equalled the annual income of a wealthy merchant. The Semper Augustus tulip sold for a record price during “tulip mania.”

Around 1630 professional tulip traders sought out flower lovers and speculators alike. The supply of tulip buyers grew quickly, however the supply of bulbs did not. It takes seven years to grow a tulip from seed. And while bulbs can produce two or three clones, or “offsets,” annually, the mother bulb only lasts a few years.

Bulb prices rose steadily throughout the 1630s, as ever more speculators wedged into the market.

Weavers and farmers mortgaged whatever they could to raise cash to begin trading. In 1633, a farmhouse in Hoorn changed hands for three rare bulbs. By 1636 any tulip–even bulbs recently considered garbage–could be sold off, often for hundreds of guilders. A futures market for bulbs existed, and tulip traders could be found conducting their business in Dutch taverns.

In order to buy the bulbs for resale at higher prices, people mortgaged their homes. British journalist Charles Mackay, in his definitive history of early financial bubbles, Extraordinary Popular Delusions and the Madness of Crowds (1841), published a list of objects (and their prices) which were exchanged for “one single root of the rare species called the Viceroy”:

• Two lasts of wheat (448 florins)
• Four lasts of rye (558 florins)
• Four fat oxen (480 florins)
• Eight fat swine (240 florins)
• Twelve fat sheep (120 florins)
• Two Hogsheads of wine (70 florins)
• Four tuns of beer (32 florins)
• Two tuns of butter (192 florins)
• One thousands lbs. of cheese (120 florins)
• A complete bed (100 florins)
• A suit of clothes (80 florins)
• A silver drinking-cup (60 florins)

Tulipmania reached its peak during the winter of 1636-37, when some bulbs were changing hands ten times in a day. The zenith came early that winter, at an auction to benefit seven orphans whose only asset was 70 fine tulips left by their father. One, a rare Violetten Admirael van Enkhuizen bulb that was about to split in two, sold for 5,200 guilders, the all-time record. All told, the flowers brought in nearly 53,000 guilders. The tulip market crashed. Despite the efforts of traders to prop up demand, the market for tulips evaporated.

1719-1720: MISSISSIPPI BUBBLE (French Mississippi Company)

This grew out of France’s dire economic situation in the early 18th century. By the time of Louis XIV’s death in 1715, the treasury was in shambles, with the value of metallic currency fluctuating wildly. The following year, the French regent turned to a Scotsman named John Law for help. Law, a gambler who had been forced into exile in France as the result of a duel, suggested the Banque Royale take deposits and issue banknotes payable in the value of the metallic currency at the time the banknotes were issued.

Law’s strategy helped the French convert from metallic to paper currency, and resulted in a period of financial stability.

In August 1717, Law incorporated the Companie des Indes (commonly known as the Mississippi Company), to which the French regent gave a monopoly on trading rights with French colonies, including what was then known as “French Louisiana.” In August 1719, Law devised a scheme in which the Mississippi Company subsumed the entire French national debt, and launched a plan whereby portions of the debt would be exchanged for shares in the company. Based upon the expected riches from the trading monopoly, Law promised 120 percent profit for shareholders, and there were at least 300,000 applicants for the 50,000 shares offered.

As the demand for shares continued to rise, the Banque Royale — which was owned by the French government but effectively controlled by Law — continued to print paper banknotes, causing inflation to soar. The bubble burst in May 1720 when a run on the Banque Royale forced the government to acknowledge that the amount of metallic currency in the country was not quite equal to half the total amount of paper currency in circulation. On May 21, the government issued an edict that would gradually depreciate Mississippi Company shares, so that by the end of the year they would be valued at half their nominal worth. The public outcry was such that one week later, on May 27, the Regent’s Council issued another edict restoring the shares to their original value. On the same day, however, the Banque Royale stopped payment in specie. When the Banque Royale reopened in June, the bank runs continued. By November, shares in the Mississippi Company were worthless, the company was eventually divested of its remaining assets, and Law was forced to flee the country.

The Evening Post, London, England

From Thursday September 21 to Saturday September 23, 1721

From the Amsterdam Courant, September 30, Hanover September 23.

he famous John Law arrived here Incognito last Thursday with his Son, and was since Treated by divers Persons of Distinction; The Saturday following he had the Honour of being introduced to Prince Frederick, he is since gone for England if the common Report is true.

The Evening Post, London, England

From Saturday December 23 to Tuesday, December 26, 1721

The Creditors of Mr. John Law have met at the Notary Maignan’s, to consider the properest methods ot recover their Debts.

The Evening Post, London England

From Saturday November 10 to Tuesday November 13, 1722

Hague, November 5: The Committee of Council, nominated in inspect the Affairs of Mr. John Law, have given Judgment for the Sale of his Real Estate.

John Law who had been born into a family of bankers, believed that money was only a means of exchange that did not constitute wealth in itself. He received a pardon in 1719, moved to London, then to Venice where he died a poor man on March 21, 1729.

1720: THE SOUTH SEA BUBBLE

During the same period that French speculators were driving up the price of shares in the Mississippi Company, English speculators were purchasing stock in the South Sea Company. Famous First Bubbles: The Fundamentals of Early Manias

Formed in 1711 by Robert Harley, the South Sea Company was created to convert £10 million of government war debt (incurred during the War of Spanish Succession) into its own shares. In exchange, the company would receive annual interest payments from the government and a monopoly on trade with the South Seas and South America.

The exchange was successful although the expected trade riches never materialized.

In 1720, following John Law’s example in France, the company proposed to take over the entire British national debt. As soon as the plan was announced to Parliament, the company’s share prices began to rise as speculators gambled on the conversion plan. The House of Lords approved the plan on April 7, 1720, after government officials had been bribed with secret allocations of shares. In order to make the deal more attractive, the company inflated the value of its stock. On April 14, £2 million of South Sea Company stock was offered to the public at £300 per share and the subscription sold out within an hour. The company made several more stock offerings, all of which sold out, with the subscribers representing all social classes. The apparent success of the South Sea Company’s scheme led to the appearance of many new joint-stock companies, which became known as “bubble” companies.

In an attempt to sustain their share price, the South Sea Company convinced the government to pass the Bubble Act in June 1720, which prevented the establishment of new companies without government permission, and allowed existing companies only to carry out those activities that were prescribed by their charters.

The price of South Sea stock peaked at £1050 in late June of 1720, before the scheme began to fall apart. The first large drop in the market occurred in August, as foreigners and other investors began to withdraw from the market.

Parliament conducted an investigation, corrupt politicians and businessmen were imprisoned, and over £2 million was confiscated from South Sea Company directors.

Historical Register, January 1, 1721, London, Middlesex (pg 68, 69)

On the 17th of February the Commons, in a Committee of the whole Houfe, confider’d of the King’s Message relating to the South Sea Company’s Petition and came to the following Resolution, viz.

1. Payment of the Sum of four Millions one hundred fifty six thoufand three hundred six Pounds four Shillings eleven Pence, due to the Publick by the South Sea Company, by Virtue of the Act of the last Session of Parliament, and made payable within one Year, by four equal and quarterly Payments, the first Payment commencing the 15th Day of March 1724 be farther delay’d and postponed to the Year 1732; and that farther Provision be made for the more effectual payment thereof.
2. . . . Repayment of the Sum or One Million, which was lent to the South Sea Company, on or about the 7th of June 1722 . . .
3. That the taking in or holding of Stock by the South Sea Company, for the Benefit of any Member of either House of Parliament, or Person concerned in the Adminifhation, (during the Time that the Company’s Propofals, or the Bill thereto, relating were depending in Parliament) without, any valuable Consideration paid, or fufficient Security given for the Acceptance of, or Payment for such Stock; and the Company’s paying or allowing such Person the Difference arising by the advanced Price of the Stocks, were corrupt, infamous, and dangerous Practices, highly reflecting on the Honour and Justice of Parliaments, and destructive of the Interests of his Majesty’s Government.
4. Any of the Directors of the South Sea Company selling their own Stock at high Prices to the Company or others, at the same Time that they gave Orders for buying stock upon Account of the Company, under pretence of keeping up the nominal Value of said stock, was a scandalous Practice, tending to enrich themselves, to the great Loss and Detriment of the Company, and of other of his Majesty’s Subjects, for which they ought to make satisfaction of their own estates . . .” with which we agree and that leads us back to Waiting For Permission? You Got It!

1924-1929: THE BULL MARKET

The raging U.S. stock market of the late 1920s was hailed by many as evidence of a “new era” of economic fundamentals. Coolidge administration policies included the extension of free trade, anti-inflation measures, and the relaxation of anti-trust laws; and corporate improvements such as increased worker productivity and expanded research and development.

In reality, the driving factor behind both the inflation and the bursting of this bubble was the expanding use of leverage (i.e., debt) by individuals as well as corporations. America’s current sorry state of financial affairs echoes this era; have we learned nothing?

The decade was marked by an enormous expansion of consumer credit, which Americans used to finance purchases of new products such as automobiles and radios, which were created using new techniques of mass production that additionally helped to drive down prices. Consumers also used credit to purchase stocks, and as the stock market escalated, investors began to take advantage of margin loans provided by their brokers. Their primary targets were industries involving new technologies, such as the automobile, motion picture, and aircraft industries. Radio stocks boomed, rising by 400 percent in 1928 alone,7 and the stock market attracted an immense public following.

Oct. 24, 1929 became known as “Black Thursday”: it marked the beginning of the stock market’s “Crash of 1929.” Following the chaos of October, the market briefly rallied through Spring 1930 before plummeting again during the early 1930s.

1930s: THE GREAT DEPRESSION

In a February 1930 article entitled “The Revolution in Banking Theory,” Bernhard Ostrolenk sought to explain the forces at work behind the failure of so many banks during the previous decade. For the first century and a half of our history, he explained, the federal government, and most of the states, had prohibited “branch banking”—the ownership of one bank by another—instead fostering a system of small, independent “unit banks” . . .

The unit bank was well suited to financing the small, independent businesses that had dominated the American economic landscape throughout the 19th Century. But the trend toward centralization of the economy, set in motion during the Industrial Revolution, called for banks with far greater resources.

Investment banking had undergone significant changes as well during that same period. In the January 1930 Atlantic, Edgar Lawrence Smith described how Wall Street’s lending practices had come to violate the basic principles of sound banking. Prior to this era, banks rarely, if ever, made loans to people with whose affairs they were not reasonably familiar.

During the high-flying ’20s, when a customer borrowed from a stockbroker to invest in the market, Smith observed, such caution was abandoned. Iindividuals assumed (and were allowed to assume) large amounts of debt in order to purchase stock they could not afford.

Stockbrokers, in pursuit of commissions and with an eye towards driving prices ever higher, readily extended unwise loans, referred to as “debit balances.” The ability of the borrowers to pay back the loan depended on “the general level of stock prices.” The flaws in this system soon became tragically apparent, ruining many unwitting investors.

1984-1989: THE JAPANESE BUBBLE ECONOMY

From the 1960s to the 1980s, Japan had one of the highest economic growth rates in the world. In the 1970s, the government began to deregulate financial markets, which allowed banks to actively seek out new customers. During the mid-1980s, Japan took a loose approach to monetary policy, which caused the money supply to increase and interest rates to fall. After obtaining low-interest loans, corporations were easily able to raise funds on the markets. While these funds sometimes fueled capital investment, they often were recycled back into further speculative market activities.

Land speculation was another important part of the bubble economy. Japanese land prices were traditionally high, partly due to the mountainous island nation’s small amount of available land and population growth. Because of its high value, banks often accepted property as collateral and land served as the engine of credit for the entire economy.

The government increased interest rates five more times before August 1990, to try and halt the continued rise of property prices. The government was forced to intervene in a futile attempt to try and revive the market and stave off recession. Throughout the 1990s, Japan experienced slower growth than any other major industrial nation.

First published in 1841, Extraordinary Popular Delusions and The Madness of Crowds by Charles Mackay is often cited as the best book ever written about market psychology. This Harriman House edition includes Charles Mackay’s account of the three infamous financial manias – John Law’s Mississipi Scheme, the South Sea Bubble, and Tulipomania. These three historic episodes confirm that greed and fear have always been the driving forces of financial markets, and, furthermore, that being sensible and clever is no defence against the mesmeric allure of a popular craze with the wind filling its sails. Charles Mackay proved himself a master chronicler of social as well as financial history. Blessed with a cast of characters that covered all the vices, gifted a passage of events which was inevitably heading for disaster, and with the benefit of hindsight, he produced a record that is at once a riveting thriller and absorbing historical document. A century and a half later, it is as vibrant and lurid as the day it was written. For modern-day investors, the moral of the popular manias scarcely needs spelling out. When the next bubble comes along — be it stock market, real estate, or tulips — be advised to recall the plight of some of the unfortunates on these pages, and avoid getting dragged under the wheels of the careening career bandwagon yourself.

Resources: The Atlantic, PBS.org, Newspaper Archive (online), Wikipedia, and as noted above.

The following may seem irrelevant to families fighting foreclosure. It is here only to show that no matter how bad it is in America for millions of families (and Ireland, Greece, Spain and significant portions of the rest of the world) — and IT IS — there are pockets of our world that are beyond comprehension.

For the most part, most Americans are faced with psychological tyranny whereas many others are faced with brutal force that costs their lives. People in countries such as El Salvador fought for their lives between 1980 and 1992. It’s a long list around the world and touched on briefly here: Tent Living

Machine Gun Preacher” is based on the true story of Sam Childers. Childers is an ex-convict who got his life right through the help of his wife, Lynn, who became a Christian. His newfound faith has led him to take up a crusade to save the children of Sudan by building an orphanage and rescuing them from the murderous clutches of the Lord’s Resistance Army. Responses during an interview with Childers about the movie and his experiences:

What was the exact moment you decided you were going to make a serious change in your life? Do you remember?

What is shown in the movie definitely did happen. It’s just the timeline was messed up. I first knew I was going to change my life in Orlando, Fla. I was in a bar fight that turned into a shootout. I was almost killed. On my way home that night, I made up my mind that I was done. I speak about drugs and alcohol all the time. If there’s one thing I share with everyone it’s if you ever want to stop an addiction, it’s all right here (points to head.)

God can do anything. A lot of times we want to think that God is like a genie in a bottle. If you have an addiction, you have to first make up your mind, “I’m not living this life anymore.” That’s what I did. It wasn’t until four years later that I ended up saying, “Hey, I’m done. I’m going to spend the rest of my life walking with the King.”

This isn’t here to recommend any form of religion. It is here to help keep balance, give us impetus to stand for our rights, but also realize that no matter how bad it is here, it is far worse elsewhere.

Having been caught up in America’s real estate debacle for four years, and having worked with families to try to save homes from foreclosure, it’s clear that a substantial mistake made by many of us was to keep pulling money out of our homes — money that we could not pay back — and often to buy things that aren’t needed. We don’t realize it, but we have been brainwashed from birth to SHOP. That is a whole other story, but global economy is based on shopping! One of the reasons why our government wants loan modifications is so we have money to buy things which will “stimulate the economy!”

Excuse the broad generalization, and everyone’s story is different, but too many us us have used our homes as piggybanks and have gotten caught in one of the world’s economic downturns. These downturns have been happening since the dawn of time starting with world conquerors such as Genghis Khan, Alexander the Great, Islamic, Ottoman Empire, the British Empire, Spain, . . .

For those who still have their homes, there is a relatively simple way to pay off your homes in 5-7 years. Soon that will be posted here.

I’m sorry if you found us . . . odds are it means that you or someone close to you has been been impacted by America’s ongoing financial nightmare and are incredibly distressed. I started this blog to help maintain my sanity as I tried to save my home from foreclosure.

It was also started with the hope that one or more of my favorite crime shows would pick up stories and air them as a “Queen For A Day” fundraiser for families . . . you know: “Save A Home Today” by voting for the family you think needs/deserves the most help. TV and movies have the power to help people through these messes. Incredible TV episodes and movies HAVE been aired addressing lending fraud, but none, that I know of, have directly helped anyone with their mortgage mess. TV spends far more time playing with bachelors and hoarders.

I’m 2.5 years into working to save my home from foreclosure. After two years of battle, and an 8-inch thick 20 pound binder, I was accidentally given a 5-year loan modification.

“Accidental” meaning that after all paperwork was signed, my lender tried to rescind the offer. I took the paperwork to an attorney; he supported my premise that it was a legal and binding document. The lender wiggled but I do have a modification.

Since I seem to have some breathing room, I thought I would take time to give you some notes on what I did to survive this nightmare of fraudulent forbearance agreements and fear of foreclosure during forbearance periods, which is NOT uncommon.

I wrote my way through cancer, so I am writing my way through this, along with volunteering with Marin Family Action to help others save their homes.

When I was laid off from my real estate marketing job in 2009, my life became an ongoing attempt to control my own thoughts and fear so I would not go crazy; volunteering and trying to help others made a huge difference in maintaining balance; I was not alone by a long shot.

Years ago, during drug experimental days in San Francisco’s Haight Ashbury, a friend suggested I could stay balanced with classes and tapes of Yoga. He was serious. I started classes which kept me fit and out of psychological trouble through renewed strength and a sense of peace. Of course, given that I’m from San Francisco, we also joined Maharishi’s Transcendental Meditation crew and practiced Zen meditation for hours on end. All of this stuff works!

Because I could not get work after 40 years of full time employment, I had to retrain myself in something. I happen to like computers and working from home, so I opted for Starting and Operate My Own Home-Based Business by taking online courses. I couldn’t afford to attend school. Because of the Internet, online learning is easier to do now than ever.

For any business, you need to know Marketing on a Shoestring.

If you have a family and can’t leave home, or don’t have the funds to take courses outside of your home, consider online learning. Online learning does work and during these times you may have to reinvent yourself. Dust off your dreams; see if you can put together a future that is appealing rather than frightening.

A note of caution, please consider carefully, especially if your dream career is photography. Yes, it is a seemingly “romantic” career path. It is also an extremely difficult one because everyone with a tiny camera or cell phone is shooting these days. If you don’t need income (and I’m assuming you wouldn’t be on this site if you don’t), this is a rough road.

I was a professional photographer and won a couple of awards; however, my daughter, who is a banker, has an exceptional eye for composition. Shots from her cell phone often equal or exceed what I take with my “professional” cameras. (The photo above right was taken with her cell in a very dark chapel in Greece.) Photography, like Web design, carpentry, database administrator, accountant, etc. takes a great deal of skill. None of those skills are random.

That link up there will also take you to business classes; if you have never taken, say, a financial planning course or never developed a business plan for a start-up, I highly recommend either or both. They will serve you well no matter what you do in life.

No matter what you decide to do, ALWAYS have a Plan B, a way out. For years, my car was stocked with a year’s supply of basics;  in my case that included a tent, sleeping bag, backpacking stove change of clothes, flares, first aid kit, etc. It came in part from being a camper, but beyond camping that stuff came in handy repeatedly. It also gave me a strange sense of freedom, as in “I don’t need these people.” And in the case of America’s lenders, that is how I feel. On a brighter side, if I decided I wanted to stay in a coastal campground at a moment’s notice, I could.

My goal when I bought my home in 2006 was to figure out a way to pay off my home within five years; due to illness and job loss I was thrown off track, but I’m getting back on that track now. This link takes you to 900+ products to help you with your emergency preparedness and I truly hope some of this works for you to give you peace of mind as you Battle the Banks.

I will be writing more about what is helping me and others get through this and, again, I hope this helps you find ways to stay calm and WIN!

No matter what your situation in life, always stay on top of your credit. Poor credit will affect everything you do and everything you buy on time, whether it’s a house, car, refrigerator, computer, will cost you more. If you do not know how to handle this yourself, click through to Lexington Law Firm to Clean Up Your Credit Report. Before I started paying strict attention to my credit reports, I had a home loan at 12% at a time when it should have been 7%. I sold that house thinking the payments were too high when all I had to do was reduce the interest by getting my credit report cleared!

I read everything I could find, including Rich Dad’s Advisors®: The Abc’s Of Getting Out Of Debt: Turn Bad Debt Into Good Debt And Bad Credit Into Good Credit and Perfect Credit: 7 Steps To A Great Credit Rating starting in the year 2000. Each book got me closer to living debt free and I was so good at it prior to our current financial crises that I was able to travel to 24 countries around the world.

Because Wall Street caused our current Mortgage and credit crisis, in part due to our lack of their deep financial machinations, many of us are having to climb out yet again. My earlier reading provided knowledge that I would in fact climb out and I’m against just about there. You can get out of debt and stay out of debt with almost any of these books, including The Everything Improve Your Credit Book

True story.

Homeowners received notices January 18 and 29 from Wachovia saying home loan is being considered for HAMP modification and stating it will not be sold as long as it is under review.

It was sold on January 18.

The home is owned by a mother/daughter; the mother is going through chemo for cancer right now.

I suggested to the young woman that she call the bank immediately. She did.

Wachovia representative said: “Oops, we’ve never seen anything like this happen before.”

Really? Liar. We see it all the time.

Through a local non-profit, we are seeking help through HERA, a not-for-profit advocacy group in Oakland, California on her behalf. (Update: June 27, 2011: Even though HERA had funds for this type of intervention, and this woman and her mother live in the East Bay, which is HERA’s location, HERA referred the family to Marin Family Action, a small, under-funded non-profit miles away from the family in a separate county. These things do NOT make sense! Fortunately, the Marin non-profit does an excellent job and the family is still in their home.)

The Foreclosure Of America: Life Inside Countrywide Home Loans And The Selling Of The American Dream: An inside look at Countrywide Home Loans and the mortgage crisis from a former mortgage lender executive Adam Michaelson who was/is part of this debacle. In July 2004, Michaelson attended a high-level meeting at Countrywide Financial headquarters about a new loan product that would allow borrowers to pay less than their minimum monthly payment. The “finance jocks” believed that the booming housing market would only get bigger supporting homeowners in a cycle of borrowing against their houses and refinancing later. Purportedly, Michaelson asked “Are you nuts?” Countrywide’s decision-makers believed these exotic loans were “worth the risk.”

When the bottom dropped out, Countrywide took millions of Americans down with them. Michaelson tells his side of the story about the marketing of a mirage, the bad business decisions that destroyed a company and millions of families and the ethical questions that have arisen in the wake of the foreclosure crisis. While the book presents an interesting view from the inside, Michaelson IS a marketing professional, which means he will say what he thinks he has to say to sell anything to anyone.

Because Michaelson was part of the giant public mousetrap, it’s my opinion that he, too, belongs in prison rather than reaping the rewards of authorship.

However, another review suggests: “Michaelson took a risk, and many seem quick to judge and blame him. I believe the author is on the money and set the forward the facts in a way which explained what happened and why. Don’t blame the messenger. Read the facts and make up your own mind.” The last few chapters have the most weight.

Given that we are talking about lies we live with, here’s a gem:
All Marketers Are Liars (With A New Preface): The Underground Classic That Explains How Marketing Really Works–And Why Authenticity Is The Best Marketing Of All by Seth Godin, who is a brilliant marketing expert. Godin’s three essential questions for every marketer: “What’s you story?” “Will the people who need to hear this story believe it?” “Is it true?” All marketers tell stories. And if they do it right we believe them. We believe that wine tastes better in a $20 glass than a $1 glass. We believe that an $80,000 Porsche is vastly superior to a $36,000 Volkswagen; they are essentially the same car . . . well, same engineering. We believe that $125 sneakers make our feet feel better–and look cooler–than a $25 brand. And believing it makes it true.

As Godin shows in this controversial book, great marketers don’t talk about features or even benefits. Instead they tell a story, one that we believe whether it’s factual or not. Every organization is a marketer and all marketing is about telling stories.

Think of the Dyson vacuum cleaner or Fiji water or the iPod. If your stories are inauthentic you cross the line from fib to fraud. Marketers fail when they are selfish and scurrilous when they abuse the tools of their trade and make the world worse . . . which brings us back to the foreclosure debacle and the bill of goods we have all been sold by scurrilous marketers, and that brings us to Big Fat Liars: How Politicians Corporations And The Media Use Science And Statistics To Manipulate The Public. Statistics that prove points about health issues, economics, what we do/don’t need, are frequently based on false information; much of our national dialogue is dictated by patently bad science-encouraged solely by public and private organizations that leverage these demonstrably untrue facts to bolster their own philosophies and fatten their own pocketbooks. And that brings us to: Jack Cafferty’s It’s Getting Ugly Out There: The Frauds, Bunglers, Liars, and Losers Who Are Hurting America

If you are in California and if you are in a position to get a modification through Wells Fargo/Wachovia, please read the following.

Even if they do agree to work with you, they will likely start with a three-month forbearance period. A word of caution: Even when that starts, you will have to stay on top of them. They will screw up, probably by losing your paperwork. They will blame it on you and, as a result, they will try to deny a modification agreement, thus the importance of keeping copies and sending everything registered/certified.

As soon as you pay your second month forbearance payment, request a copy of the permanent modification offer; they will try to get out of it. You won’t believe it, but I’m not going to let you go into denial of how botched it all is. It is worse than you could possibly imagine. America is in fact in trouble financially and big banks such as Wells Fargo are part of the problem.

When you make your first payment of the forbearance, send a letter confirming that to Wells Fargo, along with a receipt, and copy bank regulatory agencies such as:

• President Obama, WhiteHouse.gov; 1600 Pennsylvania Ave., NW, Washington, D.C. 20006
• If you are in California: Governor Edmund G. Brown, State Capitol Building, Sacramento, CA 95814
• Federal Trade Commission, Consumer Response, 600 Pennsylvania Ave, NW, Washington, D.C. 20580
• Office of Thrift Supervision, 1700 G Street, NW, Washington, DC 20552
• Your local senators 
• Your local Better Business Bureau
• Your local newspapers

My story: After a year of “negotiations,” Wells granted me a forbearance agreement in December 2009. I paid January/February/March and then their records and our conversations were screwed up for months.

If I did not keep accurate records I would not have my home. (That’s my binder on the right — 6 inches thick, 20 pounds, 22 pages of single space types notes indicating who said what to whom during this process.)

AFTER I started paying the forbearance agreement, it took from April 2010 to December 2010 for Wells Fargo to finalize the agreement; I have 10 pages of single-spaced notes during that period alone indicating glitches made by Wells! Excerpts from those notes follow. YOU will need to stay on top of it. The lenders have undertrained staff dealing with processes new to them that they don’t understand and don’t want to follow, and from executives who are larcenous on an international level.

I learned a new concept today from a investment research firm relating to this . . . the average American is in denial about the severity of our nation’s finances because it has never happened to us before. We just can’t believe it so we have tunnel vision.

A sample timeline starting with the 3-month forbearance period:

• April 2010:  Meeting w/Wells Fargo to discuss modification. Five times during that meeting they said they had missing paperwork. Because of that huge binder I had with me, I was able to pull out the appropriate paperwork and give them a copy to duplicate. In addition to showing them the paperwork, I was able to supply either a receipt from Kinko’s indicating when it was FAXed and received or a copy of my FedEx receipt indicating when it was received by Wells Fargo.
• January-March, 2010: Forbearance payments made. They did NOT offer a permanent modification.
• April 26, 2010: Attended meetings Wells Fargo had in Oakland and brow-beat them into signing a modification agreement with me.
• May 2010: Modification Agreement received in the mail from Wells with incorrect amounts — interesting to note tha tthe modification agreement was dated April 22, thereby predating the April 26 meeting with them.
• June 29, 2010: No statements received reflecting new terms.
• July 19, 2010: Notices on front door saying Wells wants to talk with me.
• July 19, 2010: Fed Ex delivered a package from Wells with NEW blank modification agreement. I called Wells to see what is going on. Was told that my loan is an “unconverted brokerage account,” and the modification had not been approved. Bottom line is that they did not want to honor the signed agreement.
• July 23, 2010: Letter from Wells saying I was in default, that the modification agreement they signed was not “approved” on their end. I met with two attorneys who verified that the document I have will hold up in court, so I told Wells to back off.
• July 24, 2010: My calls/issues could only be dealt with by one person — an “executive specialist” in the Office of the President. Works for me.
• July 29, 2010: First payment under this agreement sent w/USPS tracking system. They received in July 31, but had not applied it as of August 1.
• August 13, 2010: They tried telling me again that the modification was “moving through settlement right now.” I again reminded them that I have a modification agreement that will hold up in court.
• Phone calls on August 31, September 6, 13, 17 to straighten them out.
• October 9, 2010: 10:31 a.m., Melissa Slater called. Account is in “escrow analysis.” Seems they did not account for taxes and that is why there are discrepancies in the figures. They made a mistake (another one). Account is showing $2609.65 due instead of $2567.76 due. It is also showing that the October payment is still due – it is not.
• November 17, 2010: Still inaccurate. Executive said that 11/02 payment was not applied, she did not know why. She then said it was applied to the wrong account.
• December 1, 2010: Mortgage statements are finally accurate.

If you are here, you may need to Repair Your Credit. If you do not want to take on yet another battle and you are in Marin County, please contact Marin Family Action, a non profit which has been working with housing, financial literacy and credit issues since 1997. If you are not in their area, consider Lexington Law Credit Repair

CALIFORNIA LEGISLATURE FINDINGS

1. Recently, the California Legislature found and declared the following in enacting California Civil Code 2923.6 on July 8, 2008:

(a) California is facing an unprecedented threat to its state economy because of skyrocketing residential property foreclosure rates in California. Residential property foreclosures increased sevenfold from 2006 to 2007, in 2007, more than 84,375 properties were lost to foreclosure in California, and 254,824 loans went into default, the first step in the foreclosure process.

(b) High foreclosure rates have adversely affected property values in California, and will have even greater adverse consequences as foreclosure rates continue to rise. According to statistics released by the HOPE NOW Alliance the number of completed California foreclosure sales in 20’07 increased almost threefold from 2002 in the first quarter to 5574 in the fourth quarter of that year. Those same statistics report that 10,556 foreclosure sales, almost double the number for the prior quarter, were completed just in the month of January 2008. More foreclosures means less money for schools, public safety, and other key services.

(c) Under specified circumstances, mortgage lenders and servicers are authorized under their pooling and servicing agreements to modify mortgage loans when the modification is in the best interest of investors. Generally, that modification may be deemed to be in the best interest of investors when the net present value of the income stream of the modified loan is greater than the amount that would be recovered through the disposition of the real property security through a foreclosure sale.

(d) It is essential to the economic health of California for the state to ameliorate the deleterious effects on the state economy and local economies and the California housing market that will result from the continued foreclosures of residential properties in unprecedented numbers by modifying the foreclosure process to require mortgagees, beneficiaries, or authorized agents to contact borrowers and explore options that could avoid foreclosure. These Changes in accessing the state’s foreclosure process are essential to ensure that the process does not exacerbate the current crisis by adding more foreclosures to the glut of foreclosed properties already on the market when a foreclosure could have been avoided. Those additional foreclosures will further destabilize the housing market with significant, corresponding deleterious effects on the local and state economy.

(e) According to a survey released by the Federal Home Loan Mortgage Corporation (Freddie Mac) on January 31, 2008, 57 percent of the nation’s late-paying borrowers do not know their lenders may offer alternative to help them avoid foreclosure.

(f) As reflected in recent government and industry-led efforts to help troubled borrowers, the mortgage foreclosure crisis impacts borrowers not only in nontraditional loans, but also many borrowers in conventional loans.

(g) This act is necessary to avoid unnecessary foreclosures of residential properties and thereby provide stability to California’s statewide and regional economies and housing market by requiring early contact and communications between mortgagees, beneficiaries, or authorized agents and specified borrowers to explore options that could avoid foreclosure and by facilitating the modification or restructuring of loans in appropriate circumstances.

2. “Operation Malicious Mortgage’ is a nationwide operation coordinated by the U.S. Department of Justice and the FBI to identify, arrest, and prosecute mortgage fraud violators.” San Diego Union Tribune, June 19, 2008.

The Justice Department announced that it has been quietly conducting a nationwide sweep of the real estate industry for the past three and a half months, dubbed “Operation Malicious Mortgage.” Withing the first three months of operation, it charged 406 defendants with mortgage fraud in 144 cases, Deputy Attorney General Mark R. Filip said at a news conference this afternoon, and the fight against white-collar crime is far from over.

Between October 2008 and June 2010, the FBI opened 23 local mortgage fraud task forces around the country with the purpose of curtailing the illegal misstatement, misrepresentation or omission of material facts on mortgage applications.

As of June 2009, suspicious mortgage-related activity for the year was on track to exceed 70,000 cases, a 10 per cent increase over 2008 levels, according to preliminary FBI estimates. Mortgage fraud-related losses totalled $1.4bn in 2008, an 83.4 per cent rise over the previous year.

In the first six months of 2009, losses exceeded levels for the same period in 2008 by $208m. California and Florida, two states that played a key role in the subprime meltdown, had the most mortgage fraud in 2008, according to the latest data. Los Angeles, Miami, San Francisco, Chicago, Sacramento, New York, Tampa, Detroit, Minneapolis and Atlanta were the top cities in descending order for mortgage fraud.

3. “Home ownership is the foundation of the American Dream. Dangerous mortgages have put millions of families in jeopardy of losing their homes.” CNN Money, December 24, 2007.

4. “Finding ways to avoid preventable foreclosures is a legitimate and important concern of public policy. High rates of delinquency and foreclosure can have substantial spillover effects on the housing market, the financial markets and the broader economy. Therefore, doing what we, can to avoid preventable foreclosures is not just in the interest of the lenders and borrowers. It’s in everybody’s best interest.” Ben Bernanke, Federal Reserve Chairman, May 9, 2008.

5. “Most of these homeowners could avoid foreclosure if present loan holders would modify the existing loans by lowering the interest rate and making it fixed, capitalizing the arrearages, and forgiving a portion of the loan. The result would benefit lenders, homeowners, and their communities.” CNN Money, id.

6. On behalf of President Bush, Secretary Paulson has encouraged lenders to voluntarily freeze interest rates on adjustable-rate mortgages. Mark Zandl, chief economist for Mood’s commented, “There is no stick in the plan. There are a significant number of investors who would rather see homeowners default and go into foreclosure.” San Diego Union Tribune, id.

7. “Fewer than l%• of homeowners have experienced any help “from the Bush-Paulson plan.” San Diego Union Tribune, id.

8. The loss belongs where it was created — on Wall Street and Main Street Banks that rented their charter to Wall Street operatives who caused an unprecedented collapse of loan underwriting standards and crossing the line into fraud, forgery, and creation of false documentation. Companies SHOULD fail. Banks SHOULD fail. Borrowers CANNOT fail — because they are the backbone of the country and the economy.

9. There are plenty of lenders, investment bankers and money managers who did not play the game and are perfectly healthy. Bailout money should go to the players who played by the rules and are healthy. They are the ONLY ones who can and will lend, thus freeing up, somewhat, the tightening death grip of no credit and thus no commerce.

We are being “internally displaced” (meaning having to move within our own country) and our displacement rivals or exceeds international numbers:

• 2009, Sri Lanka: 300,000 war-displaced Tamils forced into camps;
• 2009, Yemen: 150,000 people fled fighting;
• 2009, Sudan: 250,000 displaced;
• 2009, Georgians: 192,000 displaced (Moscow, Reuters);
• 2008, Columbia: 380,000 forced off their farms by guerillas, paramilitaries or drug traffickers;
• 2008, World: 4.6 million from armed conflicts;
• 2008, World: 20 million displaced because of natural disasters such as flooding, earthquakes and storms.

Unfortunately History Does Repeat Itself

It is time to stand up and be heard.

"If you are not part of the solution, you are part of the problem." — Eldridge Cleaver

“All that is necessary for the triumph of evil is for good men to do nothing.” — Edmund Burke

"Justice is itself the great standing policy of civil society; and any eminent departure from it, under any circumstances, lies under the suspicion of being no policy at all.” — Edmund Burke

From Leo Tolstoy, one of the world’s greatest writers:

"Government is an association of men who do violence to the rest of us."

"I sit on a man’s back, choking him and making him carry me, and yet assure myself and others that I am very sorry for him and wish to ease his lot by all possible means – except by getting off his back."

"If you want to be happy, be."

"In all history there is no war which was not hatched by the governments, the governments alone, independent of the interests of the people, to whom war is always pernicious even when successful."

"In the name of God, stop a moment, cease your work, look around you."

A significant number of our families who are facing home loss by the agents of lenders are America’s senior citizens; these individuals are the very people who have spent 40 or 50 years working and paying taxes to underwrite our society, including underwriting the recent bank bailouts.

Emotional abuse includes: “Subjecting an individual to fear, isolation or serious emotional distress.”

Few things are worse than losing your home, particularly one you have been in for decades. Emotional abuse also includes “Verbal assaults, threats or intimidation.”

One of Marin Family’s Action’s members (image right) was taken from her home, handcuffed and sent to the county jail. This woman is A 74-year-old California native with degrees in economics and welfare from University of California at Berkeley. No notice was given. Earlier that week her pacemaker was replaced.

When asked what it was like to be in jail, she said she was “stunned as the reality of my circumstance had not yet sunk in.” Because her pacemaker had been replaced earlier that week, stress was to be avoided. Her arms were already bruising from rough handling and handcuffs “All I could do is wait. There is nothing to do, no means to go to the bathroom. I sat handcuffed.” The nurse checked her pulse: 195 over 97, pronounced the pulse rate “okay” and asked if the bruises on Mary’s arms were “needle marks.”

Elder abuse covers several areas. We are working with groups that focus on abuse as relates to one’s home and loss of one’s home through predatory lending, through lack of cooperation with homeowners with regard to loan modifications, home improvement scams, and illegal fees paid to individuals professing to be able to help with home loan modifications or restructures.

The State of California is quite clear on definitions of elder abuse. Their 39-page citizens guide may be important if you or someone in your family is a senior citizen and is being subject to harrassment by lenders — this includes loan modification agreements that are ignored by lenders and lenders’ agents.

Financial Elder Abuse: Financial abuse is the theft or embezzlement of money or any other property from an elder. It can be as simple as taking money from a wallet and as complex as manipuating a victim into turning over property to an abuser.

This form of abuse can be devastating because an elder victim’s life savings can disappear in the blink of an eye, leaving them unable to provide for their needs and afraid of what an uncertain tomorrow will bring.

California has designated $25 million to help senior individuals for elder abuse:

Anyone age 65 or older, who is suspected of being abused or neglected, is eligible for APS without regard to income. If you suspect that an elderly or dependent adult is being abused or neglected, call your local adult protective services.

America’s working men, women — and often children — shaped this country into the great place that it is (was?).

Why aren’t we being protected? How did we become “the enemy” and “inconvenient?”

We are being “internally displaced” (meaning having to move within our own country) and our displacement rivals or exceeds international numbers:

• 2009, Sri Lanka: 300,000 war-displaced Tamils forced into camps;
• 2009, Yemen: 150,000 people fled fighting;
• 2009, Sudan: 250,000 displaced;
• 2009, Georgians: 192,000 displaced (Moscow, Reuters);
• 2008, Columbia: 380,000 forced off their farms by guerillas, paramilitaries or drug traffickers;
• 2008, World: 4.6 million from armed conflicts;
• 2008, World: 20 million displaced because of natural disasters such as flooding, earthquakes and storms.

Unfortunately History Does Repeat Itself

It is time to stand up and be heard.

"If you are not part of the solution, you are part of the problem." — Eldridge Cleaver

“All that is necessary for the triumph of evil is for good men to do nothing.” — Edmund Burke

"Justice is itself the great standing policy of civil society; and any eminent departure from it, under any circumstances, lies under the suspicion of being no policy at all.” — Edmund Burke

From Leo Tolstoy, one of the world’s greatest writers:

"Government is an association of men who do violence to the rest of us."

"I sit on a man’s back, choking him and making him carry me, and yet assure myself and others that I am very sorry for him and wish to ease his lot by all possible means – except by getting off his back."

"If you want to be happy, be."

"In all history there is no war which was not hatched by the governments, the governments alone, independent of the interests of the people, to whom war is always pernicious even when successful."

"In the name of God, stop a moment, cease your work, look around you."

I thought I had a 7-year loan modification from Wells Fargo. Well, maybe not . . . I don’t believe this.

VERY IMPORTANT: The very second you start negotiating with your lender regarding a loan modification, get a large binder and put everything in it. You will need it. During the Home Modification workshop with Wells Fargo, they repeatedly said they did not have this or that document. I did AND I had the FAX confirmation that it was sent to them and received. I handed it to them and said, “please make a copy and bring this right back to me.” We did that four or five times. I’m sure they were looking for a reason to NOT modify.

On May 24, 2010, I met with Wells Fargo at a Home Modification workshop they held in Oakland, California. I had been trying to get a loan modification for 18 months. This started out in December 2008 as a projected six months of financial strife, after which time two retirement incomes would kick in and I could get back on track financially. My goal when I purchased my home in 2006 was to pay it off in five years because of the retirement incomes. It was all looking good until cancer (through which I worked), followed by a job layoff in 2008.

Wells Fargo helped stretch my potential six-months of strife into 20 months so far and I don’t see an end to it. (That image is of my 20 pound, 6 inch thick — and growing — binder.)

I came away from the modification workshop quite pleased and thinking I actually had a decent loan modification for five years — time to help me find the money to pay off this loan and get away from Wells Fargo for the rest of my life. And an opportunity to help others figure out their way through this financial maze.

Wells Fargo is either the most crooked corporation I’ve seen in more than 50 years of working in corporate America — including a stint in the corporate finance department at a major bank — or they are the most inept.

In either case, if they have your money, you should be worried. Wells Fargo is featured in various class actions across the nation and are an international financial collaborator with HSBC out of London, which is being investigated on three continents.

At that workshop, I signed an agreement with Wells Fargo, figured I bought a five-year “stay of execution,” and started to work on increasing my income with the prayer of being able to pay them off in the five year period. (The modification is actually for seven years, but it is not good in year six or seven.)

Today I received a statement dated July 5, 2010 (it is July 15 as I write this). It is 9:56 p.m. ’cause I just finished working from 8 a.m. this morning building Websites. (I am DETERMINED to pay off these bankers. There has to be a way.)

The agreement, which I have paid for two months, is roughly $2500/month (or $2,000 a month depending on which document I read); this statement is for $4,074.54 per month, and has tacked onto it $170.36 as late fees, two unapplied payments, the statement that $76,683.40 is due by August 1st.

I have the original agreement; it does NOT escalate to $4,074.54 per month in August of this year and $76,683.40 is NOT due on August 1st. This is insane, and it is NOT me that is insane.

Where is our government and/or our system of justice through this — either local judges or supervisors or governors or anyone? Have they all decided we are “wrong?” Are they married to lenders?

I can barely breathe. For the first time in my life I know what a “battered wife” must feel like. My back between my shoulders aches as though someone were pummeling me. I’m actually not a dramatic person, but I am a fighter. Put me in a corner and I will come out kicking. At this point, I don’t know who I am fighting. Wells Fargo agreed to a modification. This paperwork ignores that agreement. Who runs this company? Dumb question?

An aside. I heard someone at a meeting last week mention that Wells Fargo was going to institute drug testing to its employees — given his level, I assumed he meant middle-level executives. Turns out that 80% of them, per his information, tested positive for cocaine. Given that coke is the middle-level executive drug, and given how Wells Fargo is currently operating, I don’t doubt him.

I contacted Wells Fargo’s executive offices in Des Moines, Iowa. They had no answer as to why this continues, but said they will remedy it. Sure.

Following that conversation, I came home on Sunday, July 18th, 2010 to see a notice stuck in my front door . . . no name, no signature and no envelope. A good breeze would have blown it away . . . so much for “effort to make contact” and confidentiality.

That notice reads:

Please Call: Wells Fargo Home Mortgage
Contact: Loan Administration
At: 800 766 0987
Notice: Our Representatives called on you today while you were out. There is an important matter we would like to discuss with you. This inspection is not in any way an attempt to collect a debt.

I called on July 19, 2010 at 8:27 a.m.: Lolitha (EN5) in Wisconsin couldn’t help. She didn’t know why the notice was on the door. I called and left a voice mail for Teresa Warnock in the offices of the President of their mortgage in Des Moines, Iowa. Teresa called back and sounded as confused as am I. My “case” is being monitored by someone else in their offices as there is an “internal issue” they are trying to resolve.

And, no sooner do we hang up then I get yet another “Loan Modification Agreement” delivered via FedEx from Wells Fargo. This one seems to duplicate the one dated April 22, 2010 and it is, in fact, dated that same date. And it STILL is not per my understanding from the April meeting of a fully amortized PITI.

Dreaming Up America by Russell Banks

“A thoughtful and provocative meditation on our history, with a chilling look at what has happened to the American dream.” –Howard Zinn

Because my background is English literature and I worked for years in media and my operating word is “why,” I couldn’t help it. I looked up the word evil. Wikipedia has it as:

Evil is the intention of causing harm or destruction while threatening or deliberately violating morality. Largely due to the subjectivity of the word morality (which may refer to a society’s moral code, one’s own moral system, relative morality, absolute morality, etc.), there is no agreement about whether evil is a matter of social custom or universally correct principle that overrides custom. Evil, however, is most commonly used to refer to any intention that is socially perceived as the antithesis of a morally right or good intention.

Yes, this is subject to interpretation, and my interpretation — along with millions of Americans — is that these lenders may be evil. And while you are ruminating over whether or not they are evil, please know that they are absolutely inept; if you are not yet worried about who has your money and/or investments, you should be.

This is so sad. Many people, me included, worked 50-60 years for a gracious retirement. What am I doing? Fighting with an institution that I know beyond the shadow of a doubt is inept and crooked if you view their history — they cut a deal with Pancho Villa is the early 1900s — and that was documented by university libraries.

Does anyone have a clue as to what we do? We KNOW what is going on. How are these lenders stopped?

My notes keeping track of this fiasco started in December 2008; they are now 15 pages long.

I told them I am billing them for my time spent on trying to clear up this mess and the repeated FAXing of documents that they repeatedly lose. I now average $100/hour working from home. I have spent easily 2 hours per day keeping track of this. So: $100/hour x 2 hours per day x 5 days per week x 20 months = roughly $80,000 . . . not counting all the money wasted in FAXing documents to them repeatedly.

After 18 months of trying for a loan modification through Wells Fargo Bank, and after 8 months of working with a group fighting lenders, it is painfully clear that we have been duped across the nation.

Sloppy Banking Practices

The image is of the binder I have been keeping since December 2008. Wells Fargo lost one of my payments in 2007; it took weeks to straighten that out. So it seemed prudent to begin keeping a file of all correspondence with that lender. The binder is now six inches thick and weighs 20 pounds. My conclusion is that Wells Fargo is either insanely incompentent or frightenly corrupt — it is definitely one or the other or both, but their actions have nothing to do with good business practices and/or ethics.

Yesterday, during a conversation with a worldly and knowledgable couple, who read the New York Times, Wall St. Journal, San Francisco Chronicle and the Marin Independent Journal, it was clear that they knew little of our national debacle (which has created an international debacle). Because newspapers cater to advertisers — even though they will swear they do NOT — the news you read is couched so as to not overly offend major advertisers and banks ARE major advertisers.

From Living Lies:

THE INCONVENIENT TRUTH: Profits piled up off-shore that are being repatriated on a gradual basis showing incredible gains at the Wall Street Banks that supposedly lost hundreds of billions of dollars. The truth is they never lost a dime. The truth is the loan was sold multiple times through multiple intermediaries each of whom in each “sale” were paid fees and profits vastly exceeding any prior compensation to those who arranged or made loans prior to securitization.

Second Hidden Yield Spread Premium: As I have pointed out before the hidden yield spread premium was jaw-dropping (when the loans were packaged by the aggregator and then sold to the Special Purpose Vehicle that issued and sold the mortgage-backed securities. This second YSP was sent off-shore to the Bahamas or the Caymans to Structured Investment Vehicles with their own trustees, who scattered the actual depository accounts all around the world. The beneficiaries were the 100 Club — the main players in the creation, promotions and protection of the scheme through government contacts, plausible deniability, and simple non-disclosure sometimes achieved through the sheer complexity of the arrangements.

The Penguin Guide To The United States Constitution: A Fully Annotated Declaration Of Independence U.S. Constitution And Amendments And Selections From The Federalist Papers If you are new to the fight to save your home, you are going to think some of us who have been in the midst of this for 2-3 years are nuts. We’re not. We are hard-working responsible citizens who are being trampled on by not only lenders, but sometimes by local officials, some of whom hold stock in the very banks we are up against. Inept Attorneys In an effort to get help, one of my early stops was to Legal Aid in San Rafael, Marin County, California. The director of that agency, Paul Cohen, has received large grants to help people. What did he do when I asked for help in saving my home? He handed me a one-page timeline indicating when I could expect to LOSE my home. He offered NO help. Were it up to Mr. Cohen, I, along with dozens of other people he turned away, would be living under a bridge in a tent with a feral cat or two. Mr. Cohen and his Legal Aid are a disservice to community. Were it up to me, he would be seeking new employment. My surname is Jewish, thus this is not from any type of prejudice; he is simply incompetent, he had my life in his hands, and he did NOTHING. I’m at an age where recovering from losing my home would be impossible.

Nobody wants to acknowledge this fact because it would be admission that the con game is still on and that government is still part of it. They took many trillions of dollars to “bail out” banks that had arranged the bad loans but never underwrote them.

The repercussions of what lenders have done during the past decade is playing out across the nation. People who worked hard to grow and provide for their families are sinking.

Suing Wells Fargo

From the New York Times:

. . . The mayor and former bank loan officers point a finger of blame at large national banks — in particular, Wells Fargo. During the last decade, they say, these banks singled out blacks in Memphis to sell them risky high-cost mortgages and consumer loans.

(Editor’s Note: I don’t think the banks were as picky as stories would have it. It seems to me that people of ALL races have been hurt and wrote about this as Equal Opportunity Prejudice!.) The group I work with — Families Fighting Forelosure is pretty well balanced between Black, Hispanic and White and everywhere from around 30 years of age to 73 years of age. There does not seem to be a common denominator except that, perhaps, we trusted our lenders and did not read every single word of those loan documents. I was just told that I have an interest-only loan. In my opinion, negative-am loans and/or interest-only loans are insane. How does one ever own one’s home. I would not have agreed to an interest-only loan . . . thus my reason for having a forensic audit undertaken.

The City of Memphis and Shelby County sued Wells Fargo late last year, asserting that the bank’s foreclosure rate in predominantly black neighborhoods was nearly seven times that of the foreclosure rate in predominantly white neighborhoods. Other banks, including Citibank and Countrywide, foreclosed in more equal measure.

In a recent regulatory filing, Wells Fargo hinted that its legal troubles could multiply. “Certain government entities are conducting investigations into the mortgage lending practices of various Wells Fargo affiliated entities, including whether borrowers were steered to more costly mortgage products,” the bank stated.

Wells Fargo officials are not backing down in the face of the legal attacks. They say the bank made more prime loans and has foreclosed on fewer homes than most banks, and that the worst offenders — those banks that handed out bushels of no-money-down, negative-amortization loans — have gone out of business.

More than 200 families are working with Families Fighting Foreclosure to save their homes in Marin County, California. The sponsoring Group Marin Family Action has just been featured in the beginning of a series from Pulitzer Prize winning newspaper, the Pt. Reyes Light.

The Penguin Guide To The United States Constitution: A Fully Annotated Declaration Of Independence U.S. Constitution And Amendments And Selections From The Federalist Papers

One of the strengths of the group is “The Buddy System.” No one goes to court alone when facing opposition from attorneys, lenders, and courtrooms. The group has been shocked at all turns by how sloppy and/or lazy some judges run their courtrooms.

The latest story is of a woman whose husband took out a second on their house without her knowledge. He died shortly thereafter, leaving her confused and about to lose her home from foreclosure. She tried repeatedly to find out what happened, to no avail.

This writer — who has been battling to save her home for 18 months — was in court during one of these legal proceedings (and thinks “illegal proceedings” might be a more appropriate term). The judge pronounced from the bench that “The file is incomplete. I have not reviewed it.” And “It is what it is.” That judge either opened the door for mis-trial, which happened in a round-about way, or she was performing her civic duties in a sloppy manner. It was an appalling view of justice; in fact no justice was going to happen that day if it stayed in the hands of the judge and opposing counsul.

Earlier during the day, that judge told the distressed homeowner that she should prepare to move. She was ready to throw her out of her home of 17 years without knowing any facts and without caring about the facts.

This is being written two weeks after that dreadful Day in Court, and it looks like it is going to have an amazingly happy ending. We’re not at liberty to say yet and the point of this is that you have to be willing to fight or “They” will run over you.

The story about families fighting foreclosure.

If you are here, you may need to Repair Your Credit. If you do not want to take on yet another battle and you are in Marin County, please contact Marin Family Action, a non profit which has been working with housing, financial literacy and credit issues since 1997. If you are not in their area, consider Lexington Law Credit Repair