The banks have been foreclosing on homes they don’t even legally own. That’s what robosigning is. Would you be willing to accept a measly $2,000 for being tossed out of your home and onto the street by someone who doesn’t even own the mortgage? Of course, not.What Whitney is referring to is one of the so-called grand provisions of the recently announced 50-State Foreclosure Settlement engineered by the Obama Administration. A small portion of the people who lost their homes and had their lives screwed up will be eligible to receive a one-time payment of up to $2000.
~ from Why Hasn’t Anyone Gone to Jail? by Mike Whitney ~
I'm certainly not saying that, in this day and age, a grand or two won't be helpful to working and middle class families, but would you be willing to give up your current house right now for what amounts to a little more than peanuts?
Two grand (and remember, that is the maximum amount) is not going to help you buy a new house. At most, it will cover 1 - 4 months rent. If you're out of work and have been getting by with credit cards, then most or all of that money will wind up right back in the pockets of the same folks who illegally threw you out of your house in the first place!
From the standpoint of those who have suffered the most re this fraudulently illegal racket, this "deal" stinks! But as Whitney shows in his article, the rest of us won't fair much better because this wondrous settlement is really nothing more than yet another bailout for the banking industry!
Under the terms of the 50-state mortgage foreclosure settlement, US taxpayers could end up paying billions in penalties that were supposed to be paid by the banks. That’s the gist of a front-page story which appeared in the Financial Times on Thursday, February 17. The widely-cited article by Shahien Nasiripour notes that the 5 banks that will be effected by the settlement — Bank of America, JPMorgan Chase, Citigroup, Wells Fargo and Ally Financial – will be able to use Obama’s mortgage modification program (HAMP) to reduce loan balances and “receive cash payments of up to 63 cents on the dollar for every dollar of loan principal forgiven.”If you're an everyday thief, chances are good that you will wind up in prison. However, if you're a well-connected financier, not only do you not need to worry about ever seeing the inside of a jail, but you will be feted with taxpayer dollars, so that you won't have to skip a beat in keeping up your lavish lifestyle.
And that’s not all. If borrowers stay current on their payments after their loans are restructured, the banks could qualify for additional government funds which (according to the FT) “could then turn a profit for the banks according to people familiar with the settlement terms.”
How do you like them apples? Leave it to the bank-friendly Obama administration to turn a penalty into a windfall. In effect, the settlement will help the banks avoid losses on mortgages that are vastly overpriced on their books and which were probably headed into foreclosure anyway.