Bank forecloses on wrong house; owners told tough.

[Ogie Oglethorpe]

Awesome paranoia.

[MrFun]

What are you, some 25 year old ****ing Canuck transplant? Large scale, information driven business? What exactly does that mean for you? Counting how many ice cubes you can create out of the vast wastes of Canuckistan?

How about lage sclae, like, perhaps, the United States Government (oversight of $9.87 billion of DoD and DHS task orders). Biopharmaceutical industry? Amylin, Pfizer or Ligand ring a bell? IBM, back in the days when IBM ruled the goddamn earth? Lockheed? Large scale organizations tend to suck because they're full of small-minded mediocracy-accepting types who are either busy playing office politics and backstabbing their way up, or else going bureaucratic and into CYA and excuse making mode, or else figuring out who's shagging who at the office and what toy they're going to buy next after they get done partying on the weekend.

Foreclosing the wrong property is a little bit more of a multi-step repeated ****up than getting a SKU code off by one digit at WalMart, or whatever it is you do. Or maybe you process foreclosures for BofA.

The fact that you work in a failure-tolerant environment and excuse failure as inevitable has zero relevance to foreclosure errors of this magnitude.

Do you know anything about real estate law? Or the foreclosure process? Foreclosure is not strictly a "large scale, information driven" process. You may generate delinquency notices and all sorts of workflow and automated process events, but there are more local area manual steps than there are centralized automated steps. Processing of foreclosures is not time critical (they're often delayed for months, especially if institutions already have high REO) and foreclosure approval typically involves multiple manual and policy-driven approvals. In every one of these steps, and especially when dealing with the preparation of documents for recording, there are multiple opportunities to screen for and catch an error of this magnitude. It's not just "the wrong address" - it's an address for which there is no recorded trust deed to foreclose against. Pretty tough error to make if you know the process. Yeah, you can ****up foreclosures. Get the wrong middle initial for one of the grantors or grantees. Get the execution date date and recording date of the original trust deed or reconveyance mixed up. Yeah, in a million mortages, you can get a fair number of minor errors like that, but they're non-critical and have no ultimate effect on any party. Foreclose the wrong house when you don't even have a trust deed or reconveyance in the first place? That takes a special sort of talent, worthy of you.

Did MTG just spank KH and put the boy in his place?

Why yes, yes he did.

[DaShi]

I played "which would KH say" on GS Elevator Gossip today. I've gained more respect for him after that.

[Straybow]

http://www.huffingtonpost.com/2010/1..._n_794194.html

Nice job, bankers.

Huffington-puffington gets it wrong again.

To understand the banks' back-office dysfunction, you have to travel back to the credit bubble of the early 2000s. Rising home prices were turning real estate into the new national casino. Lending standards evaporated. No job or down payment necessary! Banks, meanwhile, stopped holding on to mortgage loans and pooled them into securities that were sold to investors.

No, lending standards didn't "evaporate." Lending standards were deliberately twisted by Frank-Dodd. The Clinton DoJ then forced banks, at the threat of Federal investigation and regulatory punishment, to make loans to individuals who could not remotely prove the ability to repay.

[KrazyHorse]

What are you, some 25 year old ****ing Canuck transplant? Large scale, information driven business? What exactly does that mean for you? Counting how many ice cubes you can create out of the vast wastes of Canuckistan?

No, you dumb ****, like the management of a book of positions with NPV around a trillion dollars and trades totalling tens of billions a day. Or the management of the tens of millions of lines of code that make that happen. Or multibillion dollar betting systems based on tens of thousands of data streams.

How about lage sclae, like, perhaps, the United States Government (oversight of $9.87 billion of DoD and DHS task orders). Biopharmaceutical industry? Amylin, Pfizer or Ligand ring a bell? IBM, back in the days when IBM ruled the goddamn earth? Lockheed? Large scale organizations tend to suck because they're full of small-minded mediocracy-accepting types who are either busy playing office politics and backstabbing their way up, or else going bureaucratic and into CYA and excuse making mode, or else figuring out who's shagging who at the office and what toy they're going to buy next after they get done partying on the weekend.

In other words, you've got some work experience in the boring real economy, you've made and seen loads of mistake, and you're holding baml to a higher standard than you've held yourselfnor the people you've worked with. Thanks for proving my point.

Foreclosing the wrong property is a little bit more of a multi-step repeated ****up than getting a SKU code off by one digit at WalMart, or whatever it is you do. Or maybe you process foreclosures for BofA.

Sorry, but on the scale of a 2 trillion dollar loan book, the few tens of thousands of dollars of hardship to somebody you **** with is just the cost of doing business. You **** up, you pay for your mistake, you move on.

The fact that you work in a failure-tolerant environment and excuse failure as inevitable has zero relevance to foreclosure errors of this magnitude.

The fact that you've got an idiotic view of what's a realistic failure rate tells me that you've never managed anything more complicated than hitting the bowl from a standing position. You figure out what the cost of failure is, you figure out what the cost of reducing failure rates is, then you balance the two. Anything else is the mark of childishness.

but there are more local area manual steps than there are centralized automated steps

Are you invoking manual involvement as a factor likely to reduce failure rates?

[MichaeltheGreat]

No, you dumb ****, like the management of a book of positions with NPV around a trillion dollars and trades totalling tens of billions a day. Or the management of the tens of millions of lines of code that make that happen. Or multibillion dollar betting systems based on tens of thousands of data streams.

Sounds like Canuckistani ice cubes. I you too.

In other words, you've got some work experience in the boring real economy, you've made and seen loads of mistake, and you're holding baml to a higher standard than you've held yourselfnor the people you've worked with. Thanks for proving my point.

The real economy, as opposed to your fantasy one. Yep, the "real" economy is boring. Yep, seen loads of mistakes, mostly by people like you. Some dumber though, and most less entertaining. Make mistakes? Only in terms of some clients I've picked to work with. The last bunch of ****up clients were Canuckistani, go figure. Not in my final product, though. The people I work with vette and QA the hell out of our work product. We may make statements of opinion that people disagree with, but no actual hard mistakes. That's also why I went into self-employment/consulting, so that I only have to deal with mediocrities on the client side.

Sorry, but on the scale of a 2 trillion dollar loan book, the few tens of thousands of dollars of hardship to somebody you **** with is just the cost of doing business. You **** up, you pay for your mistake, you move on.

Sorry, but your comment illustrates your "commitment to mediocrity" mindset. First, the two trillion dollar loan book is irrelevant - it's only the delinquent/default loan percentage that is even potentially subject to the foreclosure process. Second, we're not talking typos or the wrong date, or trivial unavoidable errors. We're talking "whole process is abysmally ****ed up" magnitude of error. And you just make a blanket excuse. It's people with your "just the cost of doing business" and "anything goes" mindset that are the biggest impediment to real quality control.

The fact that you've got an idiotic view of what's a realistic failure rate tells me that you've never managed anything more complicated than hitting the bowl from a standing position.

The fact that you're a bootlicker who justifies unecessary failure tells me you better own stock in cleaning product manufacturers, because you not only can't hit the bowl, you're in the kitchen, not the bathroom.

You figure out what the cost of failure is, you figure out what the cost of reducing failure rates is, then you balance the two. Anything else is the mark of childishness.

Actually, to the extent childishness is involved at all here, it's in comments like that - assuming all failures are the same and have the same costs, and that failure reduction is the same and has the same cost/benefit. There is a spectrum of distinct failure types and separate cost/benefit for each one. You're a plaintiff's litigator's wet dream. The type of failure Oerdin described in the OP is easily preventable and way off the cost/benefit curve. Easy to fix, and potentially far more expensive in terms of tort liability and degree of negligence creating risk of punitive damages awards. Nobody gives a **** about correcting every random typo.

Are you invoking manual involvement as a factor likely to reduce failure rates?

Are you being cavalierly simplistic about assuming all types of failure and all types of QA are the same? Yes, but that's what we expect from you. Increased manual involvement can either increase or decrease failure rates depending on the specific process and scope of manual involvement. Same thing with automation. In a situation like this, where you have the totally wrong ****ing address and a property in which you have no legal interest, the litigation over the false foreclosure can get into 8 figure punitive damages, and there are a very few, clear, straightforward steps that nobody with a 3 digit IQ and more than 30 seconds of time could **** up, then yes, manual involvement would reduce failure rates.

[notyoueither]

I'm curious how these foreclosures get through the courts. Did anybody look at the addresses?

[MichaeltheGreat]

Most foreclosures don't end up litigated in court. Most in the present crisis don't even end up in court. It's primarily administrative filings with the county recorder for the county in which the real property is located. Foreclosures generally only litigate (not counting bankruptcy process) if the lender sues for insufficiency, or the borrower or tenant contests the foreclosure or otherwise gets squirrely. Even then, the process often goes no further than specific writs or declaratory relief, which are often summary or default processes with no appearance in court by the respondent.

[notyoueither]

I understand that, but when filed at the courthouse (or wherever) nobody looks to see if there is a shred of evidence that a family should be turffed out of there home? You know, like there being a bundle of papers with mortgage stamped on it and the address of the residence being foreclosed?

[giblets]

Huffington-puffington gets it wrong again.

To understand the banks' back-office dysfunction, you have to travel back to the credit bubble of the early 2000s. Rising home prices were turning real estate into the new national casino. Lending standards evaporated. No job or down payment necessary! Banks, meanwhile, stopped holding on to mortgage loans and pooled them into securities that were sold to investors.

No, lending standards didn't "evaporate." Lending standards were deliberately twisted by Frank-Dodd. The Clinton DoJ then forced banks, at the threat of Federal investigation and regulatory punishment, to make loans to individuals who could not remotely prove the ability to repay.

Dodd-Frank is a law passed in 2010, so I don't think it played a role in causing the financial crisis, since causality is conventionally assumed to follow chronological order. Nice one blaming the Clinton administration and indirectly blaming black people for the financial crisis though.

[MichaeltheGreat]

I understand that, but when filed at the courthouse (or wherever) nobody looks to see if there is a shred of evidence that a family should be turffed out of there home? You know, like there being a bundle of papers with mortgage stamped on it and the address of the residence being foreclosed?

No, the County Recorder's office doesn't do that - in fact, due to workload and staffing limitations, they don't want to see anything other than the document(s) being recorded. Most recording activity is non-foreclosure, and recorder staff is fairly short in most counties. The onus is always on the recording party to assure the accuracy and validity of the documents - the recorder staff only looks for things which would make the recording void de jure, such as a non-existent APN (Assessor's Parcel Number), lack of notarization of a signature in states where notarization is required, etc. In other words, they are just concerned with wheter the present document to be filed is a legally recordable document, not whether there is any underlying legal issue with the transaction covered by the recorded document.

[Ming]

It's kind of sad that a drug dealer get's a jury of his peers, must be proved beyond a reasonable doubt, and could walk on a technicality, but a homeowner can lose his home without ever getting the chance to stop the process or having the bank have to prove they actually own the mortgage on the home.

It's one ****ed up legal system.

[Ben Kenobi]

indirectly blaming black people for the financial crisis though.

Interesting. Straybow never mentioned race at all. He just said, "individuals who lacked the ability to pay". Are you asserting that only black people were in this category?

[Hauldren Collider]

Did MTG just spank KH and put the boy in his place?

Why yes, yes he did.

No he didn't.

You couldn't spot a compelling argument if it danced naked in front of you. As long as it agrees with your preconceptions, it's brilliant.

[MichaeltheGreat]

It's kind of sad that a drug dealer get's a jury of his peers, must be proved beyond a reasonable doubt, and could walk on a technicality, but a homeowner can lose his home without ever getting the chance to stop the process or having the bank have to prove they actually own the mortgage on the home.

It's one ****ed up legal system.

It's the same with any secured loan - whether its your furniture or personal crap through something like Household Finance, if they're even still around, or auto/boat/RV loans or project finance in business. The lienholder has the first shot at calling the loan, and if there's any dispute (in a majority of cases, there isn't), it's up to the borrower to access the court system to contest the repossession/foreclosure/takeover of the security.

Another thing the HuffPo got wrong in the article somebody quoted above was the bit about a guy getting "sued" in a foreclosure against some woman he'd sued and had a judgment recorded (via a writ of attachment) against the borrower's house in a prior year. In that situation, assuming the overlying foreclosure is valid, it's entirely correct (and essential) to add other lienholders. It doesn't matter whether they're lienholders by judgment, second mortgage or line of credit, or whether it's paid off or not. What you end up with is a foreclosure action against the borrower, and "quiet title" causes of action against each lienholder with a common set of facts. The real issue for the guy in that situation is whether a credit reporting agency got a case of the stupids and claimed a foreclosure against him, and ****ed up his credit - that would be incorrect and a major issue, but nothing to do with the lender's action, which is legally essential to be able to subsequently unload the property.

Foreclosures and the recent mortage crisis are factually complex issues.

Edit: The truly ****ed up legal aspect is if you're a tenant in a rental property that is foreclosed - even if you've paid your rent, you get evicted without notice and you have no legally cognizable right to occupancy of the property - a property rental agreement does not attach to the property, it attaches to the owner (or property manager if they're the contracting party), so a renter has no procedural rights or protections whatsoever in most states. The renter's "remedy" is to sue the owner who just got foreclosed, but that exercise in futility does nothing to relieve you from a no-notice eviction.