A consensus has appeared to emerge, even among the legal and corporate players in the Foreclosure debacle that the status quo is unacceptable. The debate in State Attorneys General’s Offices, the new Federal Consumer Protection Agency and among the Loan Servicers is trying to frame an appropriate remedy for the problem. Todays New York Times outlines how the debate is shaping up.
Unfortunately some important players remain in denial. According to the Times The acting comptroller of the currency, John Walsh, the top federal banking regulator said:
“… that while there were widespread problems with documentation and oversight of law firms and other crucial links in the foreclosure chain, only a “small number of foreclosure sales should not have proceeded.”
He clearly has not been litigating foreclosure cases in Cuyahoga County. The problems are much more widespread than anyone is willing to admit.
Others are just starting to wake up to the problem. HSBC has announced that it is suspending its foreclosure processes.
Some players want to assess penalties and damages and apply those funds to a renewed modification process. For the first time the idea of using assessed fines and penalties to buy down mortgage principal in underwater mortgages is being seriously considered. Although there is still no discussion of reeling in the Federal Housing Administration’s arbitrary, costly and anti-consumer policies.