Robo-Signers

A few months ago, when I visited my local Citibank office to tender a payment on our mortgage, I was barraged by invitations from bank officers and employees to move my regular bank accounts to Citibank.

But I wasn't buying into it. I told them that my business with Citibank consists only of our residential mortgage, and a credit card, and that such was quite appropriate for our needs at this time.

They all touted the convenience of doing all of my banking under one roof. But if all my accounts are with the same banking institution, and if my bank is also my creditor, then I would run the risk of financial paralysis if I ever were to fall out of Citibank's good graces. One woman told me that I was envisioning something that was quite far fetched. But I, being about 20 years her senior, pulled rank and informed her that once upon a time, as a result of a misunderstanding on the part of my then bank, I had to spend lots of time and effort in successfully contesting a number of bounced check fees.

She then gave me the line about how Citibank is a full service bank. So I poignantly asked her why Americans should trust the banking industry. I then hastened to remind her that Citibank did not get to be a key recipient of the government bailout funds (from my tax money) because it was run in a prudent manner. She finally got off my case, brought my cash payment to the teller, and got me my receipt.

Now, it seems, what little confidence I had in the financial industry's good faith has been quite overestimated. The banks have been in such a mortgage foreclosure mania that they have now effectively admitted to hiring people to apply live pen signatures to moretgage foreclosure documents without knowing the particulars. And now, all of the state Attorneys General are on board the investigation.

I, for one, will not take the AGs all too seriously unless and until they begin some meaningful criminal prosecutions against the officers and directors in the banking industry who authorized the robo-signing.

Having strived, along with my wife, to remain current in the payment of our debts, I have extremely limited sympathy towards the residential homeowners who now face mortgage foreclosure. My wife and I have foregone or postponed many desired activities and acquisitions because the monies we would have expended towards them were necessary for the timely payment of our debts. We would have preferred to have more trips out of town (and out of country), home remodeling, jewelry, and the like, however, our creditors -- and our good word -- have been given and continue to be given priority.

Accordingly, those in mortgage foreclosure predicament mode only have my sympathies if their predicament came upon them through unforeseen circumstances, despite the exercise of reasonable prudence in their financial affairs.

But our real property system has been assailed. There are serious questions regarding the integrity of real property ownership in America. When the mortgage holders can evict people from their homes without following all of the due process requirements, and upon false statements, there now are serious questions regarding the integrity of real property ownership in America. This is a threat to our freedom.

And so, notwithstanding whether those who failed to pay their mortgages are or are not evicted from their homes, there needs to be some definitive, visible and meaningful consequences visited upon the individuals who occupy the upper levels of the mortgage industry hierarchies.

The Citi Never Sleeps

Here are the first five paragraphs of a news item from this morning:

"NEW YORK – Citigroup says it is imposing a moratorium on most foreclosures as part of a series of initiatives aimed at helping at-risk borrowers remain in their homes — making Citi the latest big bank to announce sweeping efforts to try to curtail losses from souring mortgages.

Citi said late Monday it won't initiate a foreclosure or complete a foreclosure sale on any eligible borrower who seeks to stay in a home if it is the borrower's principal residence, the homeowner is working in good faith with Citi and has sufficient income to make affordable mortgage payments.

Citi said it is also working to expand the program to include mortgages the bank services but does not own.

Additionally, over the next six months, Citi plans to reach out to 500,000 homeowners who are not currently behind on their mortgage payments, but who are deemed as potentially needing assistance to keep current with their payments. This represents about one-third of all the mortgages that Citigroup owns, the bank said.

Citi plans to devote a team of 600 salespeople to assist the targeted borrowers by adjusting their rates, reducing principal, or increasing the term of the loan, steps known in the mortgage industry as a workout."


I'm sure that it will promote societal stability by keeping more people in their homes.


Query: How about people like me and my wife, who have at all times remained punctual and current in paying our mortgages to Citigroup? What sort of freebies do we get? Wouldn't we be better off defaulting, so that Citigroup can then reduce our mortgages too?

Just wondering!