The Mortgage Foreclosure Fraud Crisis: Whatcha Gonna Do About This, Obama?

Watch the video above featuring Congressman Alan Grayson, who now has a great big red target painted on his back for stepping forward to expose this multi-trillion dollar banking fraud in home  foreclosures. 

Very important.  This is really starting to come out (see my previous emails), and now has a “worst case scenario” potential of bringing the whole banking system down if something is not done quickly. 

Basically, what’s happening is that a huge number of the foreclosures — probably the vast majority of foreclosures that have taken place over the past few years — have been conducted fraudulently and illegally. 

That’s because the original mortgages on the homes had been packaged as “securities” and sold on Wall Street, often over and over again, until it is almost impossible to know who the true holder of the mortgage note is. 

Thus, the banks, in foreclosing on the mortgages have been committing fraud, because the banks no longer hold the notes.  They are doing these foreclosures fraudulently, by forging documents as if they are the actual note holders when they are not. 

As Congressman Alan Grayson puts it in the video below, “Obviously the banks to not want to grapple with the consequences of trillions of dollars of securatized mortgages, having no legal standing to foreclose. So they have simply created a system where servicers hire foreclosure mill law firms whose business is to forge documents showing, or purporting to show, that they have a legal right to foreclose.”

The horrific upshot of all of this — apparently — is that many people who have been foreclosed upon can now sue to get their houses back, because the foreclosures were not legal in the first place.  What’s more, many people being foreclosed upon can now tell the banks to go to hell unless the banks can produce the actual note, which they can’t.

Unfortunately, this means that homeowners who purchased any of those illegally foreclosed homes don’t actually own them.  In other words, if you purchased an illegally foreclosed home, you were the victim of a massive and pervasive fraud.  You don’t really own the house. 

If the original homeowner sues to get his home back, your only recourse, as far as I can tell, is to sue your Title Company since they guaranteed your title.  But…they guaranteed it based upon a FRAUD that was being committed. 

In short, the entire title insurance industry could collapse if enough of the previous owners of foreclosed upon homes sue to get their homes back.  That’s because it would trigger a backlash of lawsuits against the Title Insurance industry by the new “owners” of the homes who suddenly realize they don’t really hold title to anything.  It was all a fraud.  And the title companies simply don’t have that kind of money. 

Check out the video above to learn more.  Here are a couple of other links to news articles demonstrating how some of the consequences of this rampant fraud is beginning to unfold:

http://www.washingtonpost.com/wp-dyn/content/article/2010/10/01/AR2010100105392_pf.html

http://www.zerohedge.com/article/massive-mortgage-mess-update-title-companies-stop-insuring-foreclosed-properties

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