FEDERAL AND STATE AGENCIES TO CRACKDOWN ON MORTGAGE MODIFICATION FRAUD

The March 26, 2009 article I published on this site explained why the Obama administration’s homeowner bailout program would fail.  Among other things, I stated: “Loan modification is a relatively complex and time-consuming process.  Most borrowers do not have the wherewithal, time, or resolve to work through the process.  As a result, many homeowners who qualify for modification under the Program will not complete the modification process.”

The complexity related to loan modifications, made many homeowners easy prey for companies that offered to represent the homeowner in the modification process.  These companies obtained their fee from the homeowner upfront, and in many cases made little or no effort to modify the homeowner’s mortgage.  As a result, these homeowners did not obtain a mortgage modification, and lost their homes to foreclosure.

Today, Treasury Secretary Geithner announced a multi-agency plan to crackdown on companies and individuals who run foreclosure rescue scams, and otherwise defraud homeowners.  Federal and State prosecutors will coordinate their efforts as part of the plan.

Secretary Geithner’s initiative will not make the Obama administration’s program more likely to succeed, but it will prevent many financially distressed homeowners from losing money to unethical self-proclaimed modification specialists.

© 2009, by John Butrus, All Rights Reserved

Obama’s Homeowner Bailout Program Will Fail

The Treasury Department published its Home Affordable Modification Program Guidelines (“Program”), which the Obama Administration touts as providing the framework to modify millions of mortgages and keep Americans from losing their homes to foreclosure. The proposed Program will fail for the same reasons all large-scale mortgage modification plans fail.

OBAMA – Never Allow A Superstar To Play To His Strength

In his prime, no one could stop Shaquille O’Neal when he had the ball within 10 feet of the basket. Moreover, opposing teams found it nearly impossible to prevent O’Neal from getting the ball while positioned near the basket; he was just too strong – unstoppable.

GM BAILOUT – Smoke and Mirrors

On March 12th, GM’s CFO Ray Young said that GM will not need the $2 billion March [bailout] installment. Mr. Young reported this as a positive development.  The media reported this development as a possible change in GM’s fortune.  Hardly!

DICK MORRIS – EXAGGERATED MONEY SUPPLY FIGURES?

In Fox television appearances, and in a March 3, 2009 article published on TheHill.com Dick Morris made the following claim: “In the past five months, according to the Federal Reserve Board, the money supply in the United States has increased by 271 percent.” [Emphasis added].  This highly inaccurate statement serves as the basis for  Mr. Morris’s prediction that hyperinflation will coincide with economic recovery.