Professor Todd J. Zywicki

George Mason University School of Law

3301 N. Fairfax Dr.

Arlington, VA 22201

Email: Tzywick2@gmu.edu

Phone: 703-993-9484

Fax: 703-993-8088

Web: http://mason.gmu.edu/~tzywick2/

~

It’s Time To Finalize The Robo-Signing Settlement

Some notable quotes from the OP/ED

After months of wrangling, a multi-state settlement of the mortgage foreclosure “robo-signing” fiasco finally appears to be at hand that will punish banks for these seemingly-careless foreclosure practices, and break the litigation logjam that continues to drag down a housing market recovery.  Like most settlements nobody appears to be overjoyed with the terms: Banks view it as a shakedown by politically ambitious attorneys general across the country, and other critics think it too light.

Settlement would bring the matter to a close and eliminate the continued uncertainty that plagues the housing market.

It has been a year since the initial discovery of the robo-signing fiasco came to light.  During that time, the average length of time it takes to foreclose on a home has skyrocketed.  According to LPS Analytics, as of August 2011 the average home in foreclosure today has been delinquent for an average of almost two years, 50% longer than before the robo-signing scandal came to light.

During the period the home is in foreclosure the borrower need not pay the mortgage and has no incentive to invest in upkeep of the property.

Most important, of course, allowing the non-paying resident to occupy the house indefinitely prevents it from being owned by someone else who will pay.

Moreover, while it is completely appropriate and necessary to punish certain mortgage servicers for abuses, this does not justify turning their deficiencies into a selective windfall for homeowners who have stopped paying their mortgage while withholding the same benefit from the millions of underwater homeowners who have not.

The balking Attorney Generals’ calls for still further write down of principal is especially misplaced in light of the almost complete absence of any homeowners who have actually been injured by robo-signing, and who would thus be entitled to damages.

At its worst, robo-signing is not an issue of whether someone has the right to foreclose—the borrowers invariably admit that they haven’t made payments in months or years and have no intention of trying to bring their payment up to date—but which of several parties have the right to foreclose.  That’s a problem that needs sorting out, to be sure.  But the virtual absence of real victims makes it highly unlikely that delinquent homeowners will receive more in court than they could under the proposed agreement.

But for a year now, class-action lawyers, attorneys general, reporters, and housing advocates have searched in vain for multitudes of wronged homeowners and have come up largely empty-handed.

You can check out the piece in its entirety here..

If you disagree with Todd J. Zywicki on any of the points above, feel free to contact him by any means below…

I wonder how much he gets paid to write this crap.

~

Professor Todd J. Zywicki

George Mason University School of Law

3301 N. Fairfax Dr.

Arlington, VA 22201

Email: Tzywick2@gmu.edu

Phone: 703-993-9484

Fax: 703-993-8088

Web: http://mason.gmu.edu/~tzywick2/

~

4closureFraud.org