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I’ve been hearing a story this past week that intrigues me. I can’t prove it, but I would love to know if it were true. I will throw this out to the blog world and see what comes back. Who knows, we may get some clarity on a key issue.
I have heard this story directly from a few folks in Nevada. I know someone in NY who has a similar story. But when I heard from yet another person in Florida this morning I said, “There must be something to this”. My sample of information is too small. I want to know if this is a coincidence or is there something bigger and nefarious afoot.
There has been (from my narrow perspective) a flood of approved loan mods in just the last few weeks. People who were on the edge and not paying a mortgage get a letter in the mail that says their application has been approved. After weeks and months of hanging on a phone and waiting for an axe to drop some relief arrives.
Nothing particularly unusual about that. Mods are granted all the time. But I was struck by the timing. The foreclosure story is exploding around the banks. It is not possible to see where this will end but it is a certainty that it will cost the banks big time.
What might a banker do if he was sitting on a pile of defaulted mortgages and now the traditional route of foreclosure was blocked? Adding to the problems of the bankers is that there is no assurance that they even have a valid claim to foreclose given that so much of the paperwork is tainted.
One possible response would be to get all troubled borrowers to reaffirm their debt, the second is to get the trouble borrowers back to paying something on the mortgage, even if it were a fraction of what was formerly owed on a monthly basis. A loan modification would achieve both results. When a borrower signs up for a loan mod they sign new papers. A portion of this process will re-establish any loan balance that is due. The language in the mod could have new foreclosure terms that eliminate the banker’s problem with past tainted documentation. Once a borrower makes a few months of new lowered payments they are, in effect, confirming their acceptance of the new terms.
Read more: http://www.businessinsider.com/wave-of-mortgage-modifications#ixzz12eoMwi4h
This fact marks our political age: The pendulum is swinging faster and in shorter arcs than it ever has in our lifetimes. Few foresaw the earthquake of 2008 in 2006. No board-certified political professional predicted, on Election Day 2008, what happened in 2009-10 (New Jersey, Virginia and Massachusetts) and has been happening, and will happen, since then. It all moves so quickly now, it all turns on a dime.
But at this moment we are witnessing a shift that will likely have some enduring political impact. Another way of saying that: The past few years, a lot of people in politics have wondered about the possibility of a third party. Would it be possible to organize one? While they were wondering, a virtual third party was being born. And nobody organized it.
Here is Jonathan Rauch in National Journal on the tea party’s innovative, broad-based network: “In the expansive dominion of the Tea Party Patriots, which extends to thousands of local groups and literally countless activists,” there is no chain of command, no hierarchy. Individuals “move the movement.” Popular issues gain traction and are emphasized, unpopular ones die. “In American politics, radical decentralization has never been tried on such a large scale.” Here are pollsters Scott Rasmussen and Doug Schoen in the Washington Examiner: “The Tea Party has become one of the most powerful and extraordinary movements in American political history.” “It is as popular as both the Democratic and Republican parties.” “Over half of the electorate now say they favor the Tea Party movement, around 35 percent say they support the movement, 20 to 25 percent self-identify as members of the movement.”