They say that time “Heals All Wounds”, but for so many Americans the ‘Foreclosure Crisis’ affected them in ways that will never heal or be forgotten. Losing one’s home and shelter is way up the list of most traumatic experiences. Sure people move on with their lives, what other choice do they have, (although there were countless stories of suicides due to the Mortgage Crisis). In fact there were even situations where the head of the household shot and killed each and every one of their family members while they slept before killing themselves, because they did not want their family to live in shame and a compromised lifestyle.
Homelessness, our Nat’l Shame. This article by Michelle Chen underscores how Predetory Banks & Bankers set folks up for failure, in pre-meditated, pre-planned mortgage schemes knowing full well that the potential borrowers would probably end up in foreclosure. So, that they could acquire the homeowner’s equity at the foreclosure sale. Not to mention the cash from the sale of Mortgage Backed Securities and Certificates in the securitized Trusts that the individual Notes were pooled into. Which yielded the sponsors of the Trusts (Banks), up to a 30-to-one return on the face amount of each Note (ie; The Big Short & Inside Job flims). Shameful, pitiful greed on display, and NO prosecutions. Lots of rhetoric, finger ponting, huff and puff, but no prosecutions.
Here are some quotes from the Micelle Chen article; “The lawsuit, filed by Brooklyn Legal Services, with support from Center for Responsible Lending and private attorneys, charged Emigrant Savings Bank under the Fair Housing Act, Equal Credit Opportunity Act, and New York City Human Rights Law for “aggressively marketing toxic mortgages to Black and Latino homeowners,” using a process is known as “reverse redlining” — pushing high-cost, toxic products that inevitably led homeowners into a financial disaster that still scars the city’s increasingly unaffordable working-class neighborhoods.”
“The refinancing loan product they marketed, STAR NINA (No Income, No Assets), was tailored toward homeowners who were cash poor but had considerable equity in their properties. Under the “no income, no assets” feature — basically Wall Street’s version of “see no evil” — the plaintiffs, all black, Latino, or immigrant homeowners — got loans that looked reasonable initially, but were embedded with a stealth interest rate ballooning up to 18 percent.”
“Emigrant did not want to know the income of the borrower,” says Brooklyn Legal Services attorney Rachel Geballe, “but they could certainly tell.” Financial records the company had tracked displayed subpar credit and past-late payments at lower rates, revealing “that the borrower doesn’t have enough income to cover a much higher payment. In this case, none of the loans was actually affordable.”
To read the entire article by Michelle (CLICK HERE) –