The average American does not know what Mers is, and what purpose it holds in their life. Mers is a corporation who was created by financial institutions such as Fannie and Freddie Mac, in 1995 to told title to a mortgage that would allow electronic reassignment of profitable owners to the mortgage. Mers’s database is a substitute for the county land record so recording fees can be bypassed and the change of ownership to title can be input electronically. Homeowners don’t know who they are paying their mortgages to because the ownership would frequently change lenders. MersCorp shouldn’t be able to track change of ownership because they have no obligation to do so. Also, Mers shouldn’t be allowed to exist, because it’s replacing the county …show more content…
Mers eliminates a county’s recording fee which is an average of $35. According to ThisMatter.com, Mers’s records contain 50% to 60% of the residential mortgages in the United States. However, companies who affiliates with Mers pays Merscorp membership fees and per transaction fees for access to the Mers database. Consumers should be careful with their mortgages, promissory notes, and know who or what rightfully has their title. Mers has a webpage for homeowners or anyone who may have questions about the mortgage. It provides series of actions for disputing any information in a Mers record. Although, Mers is vague on how a borrower would have knowledge on what was in their record. Mers is leaving borrowers clueless on who to talk to when they are having problems with their loan. Furthermore, Mers hurt many consumers financially because it was a major influence on the foreclosure crisis. Merscorp were allowing the original loan holders to pass their credit default risk to investors of securitized loans. Lenders were lending to risky borrowers, however, borrowers were being told that they can afford this loan when in reality they could not. As, a consumer it is important to know when a product seems too good to be true, because it usually is and be alert when a company says no down payment until a certain date. On top of that the mortgage companies and banks were not getting back their …show more content…
Bill Beckman, the president of MersCorp should close down the business and hand or over to HUD or the FHA. These government officials would be able to overlook, the misguided use of Mers and turn it into a more suitable business that handles the use of mortgages. Consumers are affected by Mers when they can are in default and when they face foreclosure. Mers wasn’t a legit interest holder in a homeowner or investors real property so, courts could not foreclose on the house. Consumers were in a mist when they wanted answers to their questions about their mortgage. Mers is just a scam, that anyone who pay taxes should look out
“Unless Washington acts boldly, mortgage delinquencies and foreclosures are sure to keep rising”, Jonathan Lain (How to Solve the Foreclosure Crisis). My solution is tied to a non-profit because, in my opinion, when there’s one person in charge, along with check systems in place, concrete steps are taken to complete the mission. Furthermore, I suggested that Brick-by-Brick tackle the problem, yet be funded by the government. Since the government will fund this foreclosure program, they can check on B-b-B’s progress on a monthly basis. In conclusion, having a non-profit organization become responsible for the foreclosure crisis would help to educate, support and inspire fellow Americans to truly comprehend the importance of credit, money management and the actual mortgage payment.
Leading up to the crisis of the housing market, borrowers got mortgages without understanding the terms. Banks were giving out loans to people the banks weren't sure could pay the money back. The closer to the crisis, the higher the frequency of illegitimate loans and mortgages. Because there were so many mortgages on houses that could not be paid back, millions of mortgages were foreclosed on, and the houses we...
In 1986, Mortgage-Backed Securities(MBSs) was introduced. About this, Esty, Tufano and Headley (1998) described that “Banc One replaced many of its municipal investments with MBSs, which were fixed-income investments whose payment stream was backed by pools of mortgage loans and which were
Subprime loans started out as a generous, philanthropic idea. Giving people who had bad credit the opportunity to own a home regardless of their income or past credit issues showed compassion and caring for the poor, middle class and elderly who couldn’t possibly qualify for a home loan under the previous strict lending standards. However, predatory lenders used this vulnerable groups desire to live the American dream, to own a home, against them. Billions of dollars were made by loan companies and similar financial institutions by writing relaxed standards loans for borrowers as fast as they could. (Jennings, 2012) To make matters worse, lenders knowingly wrote loans to speculators who had no intention of ever living in the home; or at least no longer than it would take to flip the property. In a marketplace with quickly rising property values, the adverse impact of this activity was completely shadowed, and yet lurking in the background is the one market constant, what goes up must come down.
The Sub-Prime Mortgage Crisis of 2008 has been the largest financial crisis to take place since the end of the Great Depression. It was the actions of individuals and companies that caused this crisis. For although it could have been adverted, too much money was being made by too many people in place of authority to think deeply on the situation. As such, by the time actions were taken to attempt to rectify the situation, it was already too late. Trillions of dollar of tax payers’ money was spent trying to repair the situation that was caused by the breakdown of ethics and accountability in the private sector. And despite the government’s actions to attempt to contain the crisis, hundreds of thousands lives were negatively affected before, during, and after this crisis.
Mortgage loans are a substantial form of revenue for the financial industry. Mortgage loans generate billions of dollars in the financial industry. It is no secret that companies have the ability to make a lot of money by offering a variety of mortgage loan products. The problem was not mortgage loans but that mortgage companies were using unethical behavior to get consumer mortgage loans approved. Unfortunately, the Countrywide Financial case was not an isolated case. Many top name mortgage companies have been guilty of unethical behavior. Just as the American housing market was starting to recover from its worst battering since the Great Depression, a new scandal, an epidemic of flawed or fraudulent mortgage documents, threatens to send not just the housing market but the entire economy back into a tailspin (Nation, 2010).
Dodd-Frank Act was “based on a set of beliefs about the causes and consequences of the housing boom and collapse that preceded the recession” (Johnston). This act ensured that mortgage terms are suitable for borrowers from lenders, imposing massive legal risks on any lender that decides to write mortgage contracts that do not meet up to “qualified” mortgages. In the early 2000s bankers and mortgage brokers used high-pressure sales tactics and even using fraud to sell
During the boom years from the mid 90’s to 2006 in the U.S. housing market experienced a boom. During this period many mortgages were offered to people who were in the high risk category of defaulting. This was very relevant in the investments bankers took, including in the profile of mortgages they gave out. The culture that evolved was get as many mortgages on the books as possible, even if the recipient of the mortgage was not a sound investment and in many cases had not the wages to cover the mortgages they received from the banking institutions. Ridiculous coverage of 100% mortgages was being issued to folks who could never ever pay back the loan. These customers did not have to go through the normal credit checks, these loans became known as subprime loans. These high risk mortgages were processed as securitisation; this is a financial practice of combining mortgages into one large pool. Most of the pools became mortgage – backed security (MBS) and were traded on the financial markets by firms such as Fannie Mae and Freddie Mac. These MBS delivered high rate of return for the traders increasing their bonus but were not sound investments for the bank. This careless disregard of the compan...
Mortgage fraud has been increasing globally harming homeowners, businesses and the economy. New ways to detect and prevent mortgage fraud have been developed to discover and prevent criminals before the fact; rather than after the damage has been done. The article An Insight into the World of Mortgage Fraud in the US and UK by Beverly Houlbrook talks about mortgage fraud and how it is becoming more evident “as economies enter recessionary periods and house prices tumbles” (34). It states how the global mortgage markets are providing “more opportunities for professional, innovative fraudsters to exploit and profit from loopholes and system weaknesses” (34).
To what extent are Mercutio, the Nurse and Friar Lawrence responsible for the deaths of Romeo and Juliet?
An argument can be made that someone should be held accountable for the subprime mortgage situation. The main focus now is to preventing a continuous meltdown. The first step to cure the situation is taking immediate and corrective action. Kevin Alexander Gray states “We‘ve got to do more to stem the tide of foreclosures and stabilize communities throughout the country,” (Gary, 2009). In order to thoroughly understand the impact this crisis has had on the economy, it will be important to look at what has really prompted this housing meltdown. The immediate cause or trigger of the crisis was the bursting of the United States hous...
Cooper v. Hobart is a case involving the Registrar of Mortgage Brokers, a statutory regulator of mortgage licenses. In the case, Eron Mortgage Corporation was a mortgage broker as defined by the Mortgage Broker’s Act. “Eron acted as a mortgage broker for large syndicated loans. It arranged for numerous lenders (or investors) to pool their funds for the purpose of making a single loan to a borrower, which was typically a developer of commercial real estate. The syndicated loans were made in the name of Eron or one of its related companies, which held the security in a trust for the investors. Cooper, an investor, had advanced money to Eron. Hobart, in his official capacity as Mortgage Broker Registrar, suspended Eron’s mortgage broker’s license in October of 1997 because Eron was allegedly using the funds of their investors for unauthorized purposes. Shortly after the suspension of its license, Eron we...