Occupy Detroit will be demonstrating at Bank of America, 500
Griswold, downtown Detroit at Congress, this Friday October 21, 2011,
12 Noon, to demand a Moratorium on Foreclosures and Foreclosure
Related Evictions.
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Occupy Detroit will be demonstrating at Bank of America, 500
Griswold, downtown Detroit at Congress, this Friday October 21, 2011,
12 Noon, to demand a Moratorium on Foreclosures and Foreclosure
Related Evictions.
If there is a moratorium on foreclosures, there would be no real reason for anyone to pay their mortgage. The housing "crisis" can't come to an end until the market hits its natural bottom. Banks, contrary to some people's ideas, do not maintain giant vaults full of all their client's money. The money that is deposited in a bank goes back out in large measure as loans. Loans are the depositors' money. Remove the ability to foreclose on a home, remove the ability of depositors to get their money back.
Banks do bear some responsibilty for people's mortgage situations, but not most of it. The bulk of the blame belongs to the person who signed the mortgage. Literally millions of people stupidly signed mortgages they would not realistically be able to afford in the long run. What your payments are [[or could be in the case of adjustable rate mortgages) is not hidden by the bank when you take out a loan. Some blame also belongs to the federal government, which used regulatory threats and coersion to force banks into making loans to "underrepresented" communities, paying less rigorous attention to the credit history or earning potential of the mortgage seekers.
Also- and I speak from personal experience- banks are very conciliatory when people in a money crunch responsibly approach them about their payment dificulties. Foreclosures are difficult, time consuming, and very expensive for the banks. They strongly prefer to work out an alternate payment schedule than go through a foreclosure. Foreclosure is only inevitable when the homeowner throws up his hands and wrecklessly just stops making payments. At that point, all a bank can do is force a sale and lose as little money as possible. Note: banks DO NOT make money on a foreclosure. If a foreclosure brings in money over the amount that is owed to the bank [[in today's market that is quite rare), the difference is owed to the homeowner [[minus legal costs and fees).
How about, instead of this silly protest today, a demand for a moratorium on loans to irresponsible people? The chant can be, "Hey, hey! Ho-ho! Fraudulent homeowners have got to go!"
We can pass out buttons that say, "Well it turns out there actually is no such thing as a free lunch."
If these people could not realistically afford to pay their mortgages, than why did the bank offer them the deal and allow them to sign for it?Quote:
Originally Posted by MikeyinBrooklyn
Like I said, banks do bear some responsibility. That which you quoted is their portion of responsibility. And they are punished for it by losing money on every single one of these defaulting transactions.Quote:
Originally Posted by Occurrence
I stopped reading your post at this point. Here's whose money is really involved.Quote:
Originally Posted by MikeyinBrooklyn
BOA and other banks have socialized risk and privatized profit. They pocket their money and our governments, we the taxpayers, are left holding their bad business decision debts while homeowners are left homeless.Quote:
Bank of America will receive $20bn [[£13.4bn) in fresh US government aid and $118bn worth of guarantees against bad assets.
The emergency funding will help the troubled bank - the US's largest - absorb the losses it incurred when it bought Merrill Lynch.In return for the money, the US Treasury will take a stake in the bank.
January 19, 2009 link
So consider these demonstrations as protests against socialism and you many feel better about them.
If the banks can't foreclose on a home, what should be the punishment for breaking the contract to repay that money to the bank? What recourse should there be for the bank [[which has a duty to defend the financial interests of both it's shareholders and the depositors).
If you adopt a child, but fail to feed the child and it dies, I would argue that you the negligent parent are more responsible for the death than the court that put the child in your care. The court would take some blame, of course, but not most of it.
Philosophically asking my friends on the Left, what things can one do in their own life for which they could personally take blame?
I am- for the record- opposed to any government money going to the banks. The money that these banks have taken from the government IS resprehensible. But the protest of that is properly directed at the governemnt. The TARP act actually empowers the government to force banks to take money, and the strings attached. Move the protest to the Federal Building, and protest irresponsible government policies that encourage bad lending and an unstable money supply and I'll join you there. I will not however seek to defend people who are properly thrown out of homes THEY DON'T PAY FOR.
...but if it were only that simple. Look at Lowell's post above. Perfect assessment - public risk and private profit. The banks charge PMI. Most folks who are underwater or who were sold loans they really couldn't afford paid PMI. Lots of it...in fact, earlier this year the ceiling on the amount of PMI that could be charged went up I believe 1/2 percent [[a HUGE windfall for the banks that flew under the radar), and PMI is now paid for five years at a minimum no matter what happens to the value of your home. So, on top of PMI protection, the banks get the $120 billion public charity, and are still able to foreclose on homes, guaranteeing no loss, and privately pocketing the profits, albeit paying back the "loans" with interest.Quote:
Originally Posted by MikeyinBrooklyn
I think the banks should be able to foreclose on homes. I'm against the fact that the foreclosure is basically the third layer of guaranteed insurance against them losing a dime on any mortgage.
Seeing is how they offered these deals that they knew people couldn't afford, I would say they bear most of the responsibility. If they didn't offer these mortgages, then the idiots who signed for them wouldn't have been able to get into the mess in the first place.Quote:
Originally Posted by MikeyinBrooklyn
This is dumb. Its easy in hindsight to blame the bank, but the truth is that public pressure and overwhelmingly positive attitudes about the value of home ownership abounded for much of the past few decades - creating an environment that made it very easy for everyone involved to over-promise and under commit. A public fix is necessary because the problem is very large and threatens everyone; should private enterprise or homeowners be let off the hook? No, of course not. But the sad truth is that if we could have prevented all of this housing mess we would have, but we lacked the foresight to do so and we didn't. Now its time to pay for our mistakes.
You can get around PMI by coming up with 20 percent down. In todays market there are literally tens of thousands of properties in the metropolitan area that you should be able to get into if you honestly save for that goal. A person who has a 20 percent or more stake in thier home is less likely to walk away from it. A huge number of the distressed properties on the market now are the result of those late night 'make money buy houses no money down' guys you see in informercials. These were bought by people who were motivated by greed and the lure of easy money. Unfortunatley, these folks were not the sharpest knives in the drawer and had little invested in the properties so they ended up taking down entire neighborhoods.Quote:
Originally Posted by bartock
Of course. Fannie Mae and Freddie Mac have always been the implicit lender of last resort. The guise is enabling high risk loans to the disadvantaged, but there were no other strings attached. Couple that with the fed keeping interest rates super-low, making it difficult for banks to charge normal interest rates and making money the traditional way, the government opened the door for these lousy loan practices.Quote:
Originally Posted by bartock
Only if you put less than 20% down on the home. If you couldn't put 20% down you probably couldn't afford the house to begin with.Quote:
The banks charge PMI. Most folks who are underwater or who were sold loans they really couldn't afford paid PMI.
I didn't think people would take my comments as a misunderstanding of how PMI works. I get it.Quote:
Originally Posted by JBMcB
...but that sort of goes to my point. The doors WERE open for this, and the banks charge/charged PMI - INSURANCE - to those who could not put down 20%. It was/is insurance against loss, the way most of us have insurance, and the consumer pays the premium for it, as it should be. But again, three layers of protection for the banks...PMI, then the bailout/loan/whatchamacallit of $120 billion, and foreclosure while the banks keep their private profits.
Foreclosure should be a banks remedy. But couple that with multiple other layers of protection in a mix of public/private funding so that the banks are guaranteed not to lose money and free market doesn't run its course, and I can understand why people are pissed. The irony is that the fiscally or otherwise conservative, "capitalist" folks defending the banks don't realize that they are defending a fundamentally socialist structure.
Or better yet, how about a moratorium on posting long diatribes where all you really know is what your own personal experience is....Quote:
Originally Posted by MikeyinBrooklyn
The only thing silly here are some of your longwinded comments.
You don't know jackshit about what other people had to go thru with their banks... and it shows.
Banks DO NOT alwasy want to work with you... sometimes the will pull the rug right out from under you without any warning. Or they will reinstate your load with a huge escrow account figure... and then later [[surprise to them) when you do bring your loan up to date... they refund you thousands in excess... because they made a mistake.... but not before you had to jump over an even bigger hurdle than you should have.
I know many people who were blindsighted by their banks... and the horror stories are not for the faint of heart.
So spare us your condescending lecture....:mad:
I agree 100%. I'm just pointing out that the banks don't operate in a vacuum. The government pressures them to loosen up credit beyond what the market is demanding to try and get the economy going, and/or spur development in the housing industry, and this is the result.Quote:
Originally Posted by bartock
Great. Go out and intimidate a bunch of low paid bank tellers. That is what democracy is about!
What worse, is that much of Michigan's financial industry is out in Troy and Southfield. Maybe they should march on the Somerset Mall.
Most mortgages are not held by banks. They sell them almost immediately to investors to free up capital in order to make more loans. A bank whose loan capacity is limited by their own deposits is handcuffed.
For most people, the "bank" only services the loan which is held by an investor somewhere -- Iceland, Cleveland's Firefighter Pension Fund, TIAA-CREF, whatever. Some mortgages were bundled up, then the cash flows were sliced and diced according to risk and yield so your note may be held by a dozen different entities. In some cases, these loans were backstopped by PMI or insurance bought by the investors or Fannie, Freddie, etc.
So there may be many different players involved in just one non-performing loan. Stopping foreclosures doesn't even really affect the banks that much, they still get paid to service the loan by the investors. It hits the investors and insurers of the note -- the pension funds, insurers and US citizens who are on the hook for all this.
Of course, the protesters outside BoA in Detroit today don't understand any of this. They just "know" that big banks are bad and "people" are good. That why my support for the OWS groups is limited for even though I share their outrage over what's happened, I don't share their ignorance as to the true causes or solutions to the real estate and economic crisis we find ourselves in. When they're done barking at the moon someone knowledgeable still has to craft a path forward that doesn't do more harm than good.
Hey, I do know that making it harder for lenders to recoup their legal due and make a profit off lending- especially in hard hit places like Detroit- will make it much less likely that they'll lend money.Quote:
Originally Posted by Gistok
And, Gistok, feel free to not read my posts if you hate 'em so much! I do read yours. They reveal quite a bit more than they actually say.
I hope the protesters also protest the five dollar fee BOA is initiating for the use of their debit card. I mean, they only had a six billion dollar profit margin their last fiscal year.
Four mounted sheriffs are out on Griswold. They must be expecting a crowd soon.
The 99 Percenters are preparing for a socialist war against all corporations who possess their need for greed. We will block everyone who comes and goes from any Downtown Detroit banks in their so called Financial District. We will prepare to go to jail for our conrads. But we 99 Percenters will get our mantra across Detroiters and join in to win this war. Fight my conrads! We have a world to win.
WORD FROM THE STREET PROPHET
For the 99 Percenters from the Spirit of Guy Fawkes, Neda, I miss you so.
Why are the banks discriminating against people named Conrad?
so your reply to his long winded diatribe about personal experience only is a long winded diatribe about your feelings on what you heard about foreclosures?Quote:
Originally Posted by Gistok
http://youtu.be/yJmjf_gZOUs
they make money on foreclosures and short sales, if all is true.....
Quote:
Originally Posted by bartock
The evil corporate banks in the United States have stole what belongs to us, our taxations from main street American, Proletarians and the middle class. The beg the U.S. Government to lend them some money so they don't fail. Our U.S. Government gave it to them and we proletarians have to pay their bills. Now we have to pay their fees in order to use our debit cards. We middle class and proletarians have the right to keep our hard earned money and give whatever we want. The 99 Percenters will put a stop to their diabolical shemes. We will march into all banks in the world, demanding them to give us back our money or else. We will take our monies our of their accounts and take it to our socialist credit unions. We will let them fail and collapse our ecomony. Then real capitalism will be restored back to day of socialist stability. There will be fair competition along the corporations, companies and proletarians investors. If they fail let them, its their fault that they can't make a profit by gaining their loyalties.
Our time will come, my conrads; that corporations and global government will be separated and regulated. We shall overcome against international kleptocracies that is interfearing with our way of life. People will get a better life, liberty and the pursuit of happiness. Freedom is not an illusion. Its a reality for all of mankind. In order to create a better 21st Century we must bring materialism out of the closet from the last ages of reason. Create prosperity my conrads! The 99 Percent will not quit until our mantra is heard all the Earth, beyond the universe and across the heavens.
Fight my conrads to the end! We have a world to win. Keep you eyes on the prize.
WORD FROM THE STREET PROPHET!
For the spirit of Guy Fawkes and 99 Pecenters, Neda, I miss you so.