The Best Subprime Reporting and Analysis, Cont.

Tanta's on fire today. First came this, in re a court case in Ohio, where she suspected that Deutsche Bank had gotten sloppy with some paperwork:

When Wall Street analysts stand up and demand that companies beef up back rooms, pay veteran employees rather than outsourcing, and slow the hell down so that things are done right the first time, I'll eat every promissory note I've ever endorsed.

Then, Tanta got her hands on the opinion in question, and it turns out that Judge Christopher Boyko has no patience for overpriced financial professionals who think they can steamroller homeowners by sheer weight of fast-talking lawyers. His opinion is, well, priceless:

Plaintiff’s, “Judge, you just don’t understand how things work,” argument reveals a condescending mindset and quasi-monopolistic system where financial institutions have traditionally controlled, and still control, the foreclosure process. Typically, the homeowner who finds himself/herself in financial straits, fails to make the required mortgage payments and faces a foreclosure suit, is not interested in testing state or federal jurisdictional requirements, either pro se or through counsel...
In the meantime, the financial institutions or successors/assignees rush to foreclose, obtain a default judgment and then sit on the deed, avoiding responsibility for maintaining the property while reaping the financial benefits of interest running on a judgment. The financial institutions know the law charges the one with title (still the homeowner) with maintaining the property.
There is no doubt every decision made by a financial institution in the foreclosure process is driven by money. And the legal work which flows from winning the financial institution’s favor is highly lucrative...
The institutions seem to adopt the attitude that since they have been doing this for so long, unchallenged, this practice equates with legal compliance. Finally put to the test, their weak legal arguments compel the Court to stop them at the gate.
The Court will illustrate in simple terms its decision: “Fluidity of the market” — “X” dollars, “contractual arrangements between institutions and counsel” — “X” dollars, “purchasing mortgages in bulk and securitizing” — “X” dollars, “rush to file, slow to record after judgment” — “X” dollars, “the jurisdictional integrity of United States District Court” —“Priceless.”

Let this be a lesson to those of my commenters who claim that Tanta can't be considered a journalist since she doesn't do any reporting. This is a great little story, full of color, which Tanta has reported extremely well, in her own inimitable way. It also hints at a much bigger issue: that of mortgage servicers, who are being bought and sold far too frequently these days, and who I fear are getting very sloppy themselves as the default rate rises far above anything they're equipped to handle. But of course, Tanta's already gone there, too, in a very even-handed manner.

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