“In sum: the scale of bank lawlessness and abuse of borrowers is so epic that far more than this term sheet is needed. The AGs and the rest need to find their backbone and recognize they should be giving dictation, not negotiating away from a term sheet that’s at best a minimum demand.”

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What the Mortgage Mess Settlement Proposal Really Means

By ABIGAIL FIELD

Now that I’ve had a chance to read the mortgage mess settlement proposal I realize what it really is: a repudiation of the servicing industries’ standard business practices.

Thankfully, it includes a couple provisions I was concerned were absent. Servicers have to show their math when announcing if a modification is denied, so the consumer can challenge the calculation, and foreclosures will no longer start with incomplete or fraudulent documentation. Those steps buttress other good provisions: banning foreclosures while modifications are negotiated and tried, and making trial modifications permanent after three payments.

While I’m glad those provisions are in the document, the term sheet is nonetheless pathetic. Repudiating the servicing industry’s business model mostly means telling servicers they can’t break the law and must act with basic good faith, such as crediting payments as of the day they were received and charging only one late fee for a late payment. As a result, the agreement reads as an indictment — not just of the servicing industry, but also of law enforcement, regulators and Congress.

See full article from DailyFinance: http://srph.it/gOy9B1

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