Posted by AzBlueMeanie: Press release from Yes on 400: Keep Tucson First: What is the Campaign Against Prop. 400 Trying to Hide? Keep Tucson First filed a complaint today with the Tucson City Clerk's office against the No on 400 committee for failing to disclose any expenditures in their campaign finance reports, a potential violation … Read more

Posted by AzBlueMeanie: Press release from the Pima County Democratic Party: Does Ruth McClung Accept Support From Racist Activists?                     Rep. Raúl Grijalva's opponent, Ruth McClung, is being promoted for Congress by a former Washington Times editor and conservative blogger who has a history of promoting hate speech and skepticism about interracial marriage. Robert Stacy McCain, … Read more

Posted by AzBlueMeanie: The 9th Circuit Court of Appeals today, in the case of Maria Gonzales, et al. v. State of Arizona, et al., Case No. 08-17094, has ruled that Arizona's Prop. 200 (2004) requiring documentary proof of citizenship to register to vote is superceded by the National Voter Registration Act (NVRA), 42 U.S.C. § 1973gg … Read more

Posted by AzBlueMeanie: The New York Times last week investigated the connection between the law firms that are "foreclosure mills" and the Wall Street private equity firms they represent. Private Equity Firms Linked to Foreclosure Mills: With a surge in lawsuits against law firms specializing in foreclosures, a case in Mississippi is casting light on … Read more

Posted by AzBlueMeanie: There’s been plenty of recent media attention to the prospect of investor lawsuits over fraudulent mortgages and mortgage-backed securities. But as Zach Carter writes at Truthout.org, The Elephant in the Foreclosure Fraud Room: Second Liens: The four largest banks hold nearly half a trillion dollars worth of second-lien mortgages on their books—loans … Read more

Posted by AzBlueMeanie:

Is the banks’ sloppy paperwork a matter of simple technicalities that are relatively easy to cure, as the banks contend? Or are there more far-reaching consequences for banks and the institutions that bought mortgage-backed securities during the mania? One Mess That Can’t Be Papered Over – NYTimes:

Oddly enough, the answer to both questions may be yes.

According to real estate lawyers, most banks that have gotten into trouble because they didn’t produce proper proof of ownership in foreclosure proceedings can probably cure these deficiencies. But doing so will be costly and time-consuming, requiring banks to comb through every mortgage assignment and secure proper signatures at each step of the way — and it surely will take much longer than a few weeks, as banks have contended.

Once this has been done appropriately (not by robo-signers, mind you) the missing links in the banks’ chain of ownership can be considered complete and individual foreclosures can proceed legally.

None of this will be easy, however. And it will be especially challenging when one or more of the parties in the chain has gone bankrupt or been acquired, as is the case with so many participants in the mortgage business.

Still, addressing all of these lapses is possible, according to Joshua Stein, a real estate lawyer in New York. “If there are missing links in your chain of title, you go back to your transferor and get the documents you need,” he said in an interview last week. “If the transferor doesn’t exist any more, there are ways to deal with it, though it’s not necessarily easy or cheap. Ultimately, you can go to the judge in the foreclosure action and say: ‘I think I bought this loan but there is one thing missing. Look at the evidence — you should overlook this gap because I am the rightful owner.’ ”

Such an unwieldy process will make it more expensive for banks to overhaul their loan servicing operations to address myriad concerns from judges and regulators, but analysts say it can be done.

On the other hand, resolving paperwork woes in the world of mortgage-backed securities may be trickier. Experts say that any parties involved in the creation, sale and oversight of the trusts holding the securities may be held responsible for any failings — and if the rules weren’t followed, investors may be able to sue the sponsors to recover their original investments.

Mind you, the market for mortgage-backed securities is huge — some $1.4 trillion of private-label residential mortgage securities were outstanding at the end of June, according to the Securities Industry and Financial Markets Association.

Certainly no one believes that all of these securities have documentation flaws. But if even a small fraction do, that would still amount to a lot of cabbage.

Big investors are already rattling the cage on the issue of inadequate loan documentation. Last week, investors in mortgage securities issued by Countrywide, including the Federal Reserve Bank of New York, sent a letter to Bank of America (which took over Countrywide in 2008) demanding that the bank buy back billions of dollars worth of mortgages that were bundled into the securities. The investors contend that the bank did not sufficiently vet documents relating to loans in these pools.

The letter stated, for example, that Bank of America failed to demand that entities selling loans into the pool “cure deficiencies in mortgage records when deficient loan files and lien records are discovered.” Bank of America has rejected the investors’ argument and said that it would fight their demand to buy back loans.

Mortgage securities, like other instruments that have generated large losses for investors during the crisis, have extremely complex structures. Technically known as Real Estate Mortgage Investment Conduits, or Remics, these instruments provide investors with favorable tax treatment on the income generated by the loans.

When investors — like the New York Fed — contend that strict rules governing these structures aren’t met, they can try to force a company like Bank of America to buy them back.