Banks Still Looking For a Break Even After Foreclosure Mess in Miami, Nation

August 3, 2011

It's been four months since banks and states last floated a remedy to fix the mess banks created with robo-signed documents and shoddy recordkeeping and little has happened publicly, yet The New York Times wonders how a settlement will keep banks protected from future lawsuit.

Miami Foreclosure Lawyers wonder how homeowners will be protected throughout this mess. People have been tossed out of their homes with their rights trampled because banks and lending institutions have used falsified paperwork, documents reportedly signed by people who never saw them, and other incomplete paperwork. Now, they're hoping to send money into state coffers as a way to satisfy state attorneys general who are investigating. But the question remains -- what will be done to protect Miami homeowners who are fighting foreclosure?
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According to the news article, bank officials and state attorneys general met recently in Washington to try to settle their differences. In March, the initial terms of how much would be paid was $20 billion. The deal would be contingent upon the terms of future potential lawsuits against banks and what will happen to MERS -- Mortgage Electronic Registry Systems.

Miami Foreclosure Lawyer Blog has discussed this system, which was created in the mid 1990s as a way to better keep up with the influx of purchases and sales compared to county clerk offices. But the private registry has been fraught with problems because when information is registered in MERS, no assignment is recorded. During a foreclosure, it has led to banks losing the battle because they can't prove who actually owns the home.

The article states that MERS eliminated the need to record changes in property ownership in local land records, which ramped up lender profits. Over 10 years, MERS -- owned by major banks -- it is said to have saved $1 billion. About 60 percent of all home loans were registered to MERS. But as noted above, MERS has faced problems.

The article debates whether state prosecutors will release banks from liability created by MERS as part of a settlement. It notes that investigators haven't looked into MERS as part of investigations ongoing in all 50 states.

It is our hope that states don't go soft and allow banks to get away with these injustices simply by writing a check. Without accountability, homeowners' rights will again be trampled under the next bank-run catastrophe. It's obvious there are problems in the lending industry, and aside from Miami Foreclosure Defense Lawyers pointing out these problems on a case-by-case basis, a large-scale lesson would go a long way toward cleaning up the mess.

Meanwhile, our firm will continue helping homeowners who are thrown into the middle of the fray with banks who seek to take away a person's home. Pointing out problems with MERS, robo-signing, mortgage-backed securities and other issues can lead to saving people's homes and we will investigate and scrutinize the banks who continually try to cut corners in the process.

If you're battling foreclosure in Miami or the surrounding areas, contact Bruce Jacobs & Associates for a confidential appointment to discuss your rights. Call (305) 358-7991.

More Blog Entries:

Banks Still Using Robo-Signed Documents in Miami Foreclosures, Report Shows: July 27, 2011

Federal Housing Administration Concerned About Number and Severity of Enforcement on Miami Lenders: July 19, 2011

Additional Resources:

The Banks Still Want a Waiver, by Gretchen Morgenson, The New York Times