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Senior White House official: 'Not sure' about a national foreclosure moratorium

White House senior adviser David Axelrod signaled Sunday that the Obama administration is opposed to a national moratorium on foreclosures, even as pressure from Congress, labor unions and consumer groups mounts for the federal government to take action.

Calling the growing evidence that lenders have used inaccurately prepared and even fraudulent documents to foreclose on homes a "serious problem," Axelrod said it had already "thrown a lot of uncertainty into the housing market that is already fragile."

"I'm not sure about a national moratorium, because there are, in fact, valid foreclosures that probably should go forward, and where the documentation and paperwork is proper," Axelrod said Sunday on CBS' "Face the Nation."

Axelrod said the administration is "working closely" with mortgage companies so that they "expedite the process of going back and reconstructing these and throwing out those that don't work."

The foreclosure mess has become a hot-button political issue with mid-term elections coming up. A large number of influential Democrats -- including House Speaker Nancy Pelosi and Senate Majority Leader Harry Reid -- have called on the federal government to take more aggressive action.

On Sunday, Republican Rep. Eric Cantor of Virginia became one of the first Republicans to speak out. Appearing on "Fox News Sunday," he warned that freezing the foreclosure process would hurt an already struggling housing market.

"If you impose a moratorium on foreclosures, what you're telling people and institutions that lend money is they do not have the protection to take the risk they need to, to extend credit so people can get a mortgage," Cantor said. He added that "you're going to shut down the housing industry, if that's the case."

On the same show, Rep. Debbie Wasserman Schultz (D-Fla.) said she backs a foreclosure freeze.

"I think we need a combination of a freeze, potentially, and also we need to sit down with the banking industry and talk to them about ways in which we can help them be able to work those mortgages out, because it's absolutely imperative that we keep people in their homes," she said.

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By Ariana Eunjung Cha  | October 10, 2010; 4:20 PM ET
Categories:  Housing  
Save & Share:  Send E-mail   Facebook   Twitter   Digg   Yahoo Buzz   StumbleUpon   Technorati   Google Buzz   Previous: Congressman Alan Grayson explains what went wrong with the foreclosure process
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National moratorium on foreclosures is NOT the right approach. People have to take responsibility for themselves!

Posted by: humbleinla | October 10, 2010 4:42 PM | Report abuse

When the financial industry has become so corrupt and incompetent that it is incapable of enforcing contracts without resorting to document fraud, a moratorium is a perfectly reasonable response to restore faith in the system. I wouldn't invest in a company which borrows it's business practices from organized crime, and neither should anyone else.

Cantor says that "If you impose a moratorium on foreclosures, what you're telling people and institutions that lend money is they do not have the protection to take the risk they need to, to extend credit so people can get a mortgage." Cantor is a fool.

It's not the moratorium which has introduced risk and denied protection to people and institutions which make loans, it is the institutions which have so completely abdicated their fiduciary responsibility that they have to retroactively engage in felony counterfeiting just to produce anything resembling a legal contract. If the banks need a time-out until they can distinguish between a legal and legitimate contract and a product of fraud by their own employees, they should be given the time to sort it out, fix the organizational failures, provide evidence to prosecutors.

Posted by: Anonymous | October 10, 2010 5:44 PM | Report abuse

The document fraud is the least of the problem in this situation. The biggest issue is going to be whether the lenders/servicers have had a perfect legal right to use the foreclosure process to force delinquent borrowers out of their houses during the last 3-4 years. There is a growing realization by borrower counsel and politicians that the lenders/servicers in fact did not have a legal basis. I soon expect to see many class action lawsuits on behalf of these folks who were improperly foreclosed out of their homes. Along that same line, many folks whose mortgages were securitized and are still in their homes likely have a personal promissory note which is not secured against the title of their property--i.e. lenders are going to have to get a court approved judgement and then lien the property--this is going to throw a monkey wrench into the foreclosure industry.

It is time for RTC 2.0 so we can get the banks/lenders to admit they are overstating their balance sheets by failing to mark their mortgage portfolio to market value and get them out of the property management and property liquidation business. This is going to take the takeover of the large banks in this country as their losses are going to destroy all equity in them.

Posted by: Anonymous | October 10, 2010 6:15 PM | Report abuse

National foreclosure freeze??!?


If the identity of the mortgage holder is clear and they have legal standing, go ahead. If not, then a moratorium is the right way to go. The decision should be on bank-by-bank basis.

Local and regional banks, who never sold off their mortgages for slicing and dicing, will have no problem proving they hold the mortgage. National mega banks will have a problem. You know what they say in Urkaine: "Toughchitsky!"

Posted by: angelos_peter | October 10, 2010 9:52 PM | Report abuse

Did it ever occur to anybody that Congress doesn't have the Constitutional power to pass a law stopping state-court foreclosure actions? It doesn't.

Posted by: CaughtInAMosh | October 10, 2010 10:14 PM | Report abuse

Everything is true!
Go in look look:
Believe that you may need.

Posted by: Anonymous | October 10, 2010 10:14 PM | Report abuse

I loss my house bank well fargo octuber 1

Posted by: Anonymous | October 10, 2010 10:31 PM | Report abuse

For Cantor and his ilk, just put the blame on the consumer and give the crooks some fresh air . And fresh dough for their banks too, of course.

Posted by: bekabo | October 10, 2010 11:29 PM | Report abuse

You don't need a moratorium to enforce proper procedure. The papers that lawyers file with the courts must be accurate. The lawyers by their signatures attest to that accuracy. When it turns out the lawyers have acted improperly, there are legal remedies and lawyers should lose their means of making a living.

Posted by: BlueTwo1 | October 10, 2010 11:38 PM | Report abuse

Rep. Eric Cantor of Virginia became one of the first Republicans to speak out. Appearing on "Fox News Sunday...he warned that freezing the foreclosure process would hurt


David Axelrod signaled Sunday that the Obama administration is opposed to a national moratorium...


growing evidence that lenders have used inaccurately prepared and even fraudulent documents to foreclose on homes a "serious problem,"

How about calling the "growing evidence" of "frudulent documents" a C_R_I_M_E rather than a "serious problem"

Will remember this one on Election Day. Wait a minute...WHY FREAKING BOTHER???

Just goes to show me this bunch isn't interested in winning only in cashing in. Of course the Repos are oh so different, not.

So where does this leave the usa? I'll tell you where...This leaves us IN THE HANDS OF IDIOTS OR IN THE HANDS OF IDIOTS.


There's your choice.

Posted by: Anonymous | October 10, 2010 11:40 PM | Report abuse

it's a hoot to read "indignant" comments from p.r. hacks like Axe that "valid" foreclosures should go thru.
by definition, improper paperwork and unclear title and loan information render the mtgs. invalid. banks and investment houses, many of whom were Obummer's biggest donors (see Sachs, Goldman) are frantic not to have their fraud unmasked and eager to steamroll homeowners out of another 2.75 million homes.
the incomplete, un-notarized and unsigned doc with conflicting information, fake names and even contradictory loan amounts are no more valid than Monopoly money. no more valid than a photocopy of a $20 bill is the same as cash money.
sorry to trouble the Dems. funding machine but every one of the docs (average 85, many with more) needs to be fully scrutinized before a family is ejected from their home. if it takes five years, that is fine with me.
the cratering of the local tax base is an issue that accompanies the "off with their heads" school of thought. vultures pay peanuts and the resulting hit to local budgets is already seen in the 70,000 teacher layoffs.
thanks but no thanks to breaks for banker felons and vulture speculators paying cash for homes that have no claim to.
not the kind of change we want or need.

Posted by: Anonymous | October 10, 2010 11:42 PM | Report abuse

A brief moment of sanity from the Obama administration. Lets hope it begins to spread in the White House.

Posted by: concernedcitizen3 | October 10, 2010 11:43 PM | Report abuse

A few choice words for David Axelrod where are the notes?securities fraud? A few more words to the people who are in the dark yet about how extensive the fraud is here go to You people have no idea what you are talking about. The biggest securities fraud scandal in history is about to explode. Go educate yourselves before you make statements. You have no idea what you are talking about.Do not let the mainstream media dumb this down. It has nothing to do with struggling homeowners and responsibility. The fraud here by the banks, mortgage servicers, Wall Street, and a whole host of others is immeasurable. Foreclosure fraud is only the tip of the iceberg. A scandal of monumental proportion is about to blow up and it is from the top levels of government down to the local judicial branches. The cat is out of the bag.

Posted by: venny2020 | October 11, 2010 12:18 AM | Report abuse

ยท His level of ignorance is shocking. The moratorium arises from the failure of the banks to treat these mortgages as mortgages. Because they did not follow the stringent procedures, some going back to English common law, that protect these very serious transactions the banks are getting thrown out of court all over the country.
Those procedures arose because even before there was a United States the law protected the sanctity of the individual home.
It is alarming that Obama is surrounded by people who do not understand things like this. It is alarming that he doesn't understand. I suppose he didn't take a course in mortgages in Law School. Probably not. It's not a very sexy subject.

Posted by: miriamac2001 | October 11, 2010 12:55 AM | Report abuse

I am seriously pissed off now. there is out and out fraud that even I can find by just perusing the county recorder's documents... Obama.. do not listen to Axelrod... listen to those of us who have been affected by this mess.

Posted by: Anonymous | October 11, 2010 1:09 AM | Report abuse

The foreclosure system has shown itself to be capable, in at least a few instances, of foreclosing on people who don't even have mortgages, but own their homes outright. If that's not an indication of problems serious enough to shut that system down for retooling, what would be?

Posted by: billmosby1 | October 11, 2010 1:26 AM | Report abuse

It has been done and banks are doing it , without this present government doing a dam thing about it!

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Posted by: Anonymous | October 11, 2010 1:43 AM | Report abuse

If you are planning a mortgage refinance then you should search online for "123 Mortgage Refinance" before you decide they can find 3% refinance and also instant analysis of your mortgage.

Posted by: Anonymous | October 11, 2010 2:54 AM | Report abuse

Lawd, Lawd... People are always going after banks because they are Republican run, owned, and operated. A few thousand illegal foreclosures take place and there is talk of a national moratorium on foreclosures - ridiculous! Leave the billionaires alone! When are they going to be able to catch a break in the Communist regime???
~ the Right Reverend Dr. Thurgood Goodlove
the Savedest man in the history of the Republican party
Youtube/Facebook/Google sensation

Posted by: kharma99 | October 11, 2010 2:58 AM | Report abuse

"People have to take responsibility for themselves."

Apparently, that bromide doesn't extend to the mortgage companies that perpetrated this huge fraud on America in the first place.

If you buy a home in America, and you fail to do a title search before closing, you risk getting a home that still has liens on it and/or other issues.

If you robo-sign forclosure documents without getting the legal signatures required, you risk getting a home that still has a legal claim on it.

Mr. Axelrod's failure to stand with the victims in this huge ponzi scheme, the home buyers, and to stand instead with the perpetrators, the big banks, reveals all you need to know about President Obama's first two years in office and why his base is unenthused about the upcoming midterm elections.

Posted by: Anonymous | October 11, 2010 3:00 AM | Report abuse

So, given my twisted Washingtonized view of how the world works, I would fully expect that it is the Banks themselves who have created this recent hysteria, simply in order to protect themselves from futher losses, as the values of the homes that they would now otherwise be FORCED to accept, decline. In short, what these banks then may be saying is simply, "Hey, we don't want these devaluated properties either". Which may suggest that we have again a much greater problem ,outside of the Beltway, than we in Washington choose to address. But, let's keep it simply for those who can't keep up. Man, I love this place !! And hey, it's all your fault.

Posted by: Anonymous | October 11, 2010 3:52 AM | Report abuse

O'Neil founded the newspaper IBD in 1984 to "offer information not available in The Wall Street Journal and other publications" for "investors and business executives who did not have time for two and three section papers each day."

Posted by: Anonymous | October 11, 2010 3:54 AM | Report abuse

the House bill to allow congress to wave a magic wand was filed on October 4, 2009 so Congress knew, at least since then, that a fraud was afoot.

But what is clear and known to some that other laws have been passed to facilitate the the concentration of wealth in the hands of a few but (BUT) some are coming to light and all the benefits that accrued to those individuals will disappear.
boo hoo for them and ha ha for us.

Posted by: JohnAdams1 | October 11, 2010 4:00 AM | Report abuse

Funny: here in Florida a lot of us think banks have been *delaying* foreclosures so that they don't have to take responsibility for maintenance, HOA fees, taxes, and other expenses that fall on homeowners.

Our foreclosure, by Southtrust... I mean Wachovia... I mean Wells Fargo... I mean Freddie Mac... took well over a year. It finally finished and, since Florida is one of the states where a bank can sue you for an unpaid balance even after they've taken the real estate, delayed our bankruptcy.

Yep. Bankruptcy. We're taking the same amount of financial responsibility as Donald Trump has for his actions several times -- except for us it's the result of losing a job and running through what we *thought* was a decent amount of savings before we realized that we are now officially Surplus Humans who would best serve America (at least the Hayek/Koch thugs' version) by killing ourselves.

Posted by: roblimo | October 11, 2010 4:11 AM | Report abuse

The end result of all this hand wringing by Congress will be the same as the ill fated HAMP, delay the inevitable. Its an election year, so politicians of the left have to pretend that they are doing something to help the deadbeats who elected them.

This is the same thinking that got us into trouble in the first place. Liberals made a pact with the financial devils; lend to the most disadvantaged and we'll look the other way when you engage in other risky behavior. Need to pass off that risk to others? No problem, create derivatives and build a house of cards backed by the full faith and credit of the U.S. taxpayer.

Posted by: Anonymous | October 11, 2010 6:22 AM | Report abuse

"If you impose a moratorium on foreclosures, what you're telling people and institutions that lend money is they do not have the protection to take the risk they need to, to extend credit so people can get a mortgage," Cantor said. He added that "you're going to shut down the housing industry, if that's the case."



This is the same logic used to justify the bailout of financial corporations. We were told to take it, or else. The corporations have learned they can screw up big time and government will be there to bail them out with our taxpayer dollars. How else can such incompetence at the corporate level be explained?

Seriously? One man signing off on tens of thousands of foreclosures? Computers making decisions for financial companies that have no idea about the individual? And teabaggers and conservatives are OK with this?

Posted by: swatkins1 | October 11, 2010 6:57 AM | Report abuse

CaughtInAMosh wrote: "Did it ever occur to anybody that Congress doesn't have the Constitutional power to pass a law stopping state-court foreclosure actions? It doesn't."


Really? If our elected representational legislators meet and determine the citizens are getting screwed, they don't have the constitutional power to act? What are you smoking? Oh. Teabagger. Sorry. I just figured it out.

Posted by: swatkins1 | October 11, 2010 7:02 AM | Report abuse

venny2020, after reading your post and going to the website you sugeested, all I can say is: oh my god oh my god oh my god we're all going to die! the sky is falling! oh my god!

thank you for my morning laugh.

Posted by: swatkins1 | October 11, 2010 7:16 AM | Report abuse

The gov't can't run anything.
Fannie Mae and Freddie Mac caused the housing meltdown, and the recession.
Now we are supposed to trust them with our Obamacare?
Here is another example of your gov't at work:
Surprise inspections of Gulf of Mexico deepwater drilling rigs dwindled to about three a year over the past decade, even as exploratory drilling far from shore increased, according to federal data. And since 2004 U.S. authorities haven't made a single surprise inspection on any of the 50 or so deepwater natural gas and oil production platforms in the Gulf, despite a law requiring periodic unannounced inspections. Like rigs, these semi-permanent structures also handle enormous amounts of oil and natural gas and are at risk for oil spills and worker fatalities.

Posted by: joanz3 | October 11, 2010 12:30 PM | Report abuse

A national moratorium on foreclosures is much akin to throwing the baby out with the bath water. A bit of overkill. Yes, many foreclosures are questionable and certain banks, who best understand this, have put their own freezes into effect. After all, it is the banks that lose the most if the foreclosure goes bad.

But once again, had the financial industries involved done it right the first time, we would not be in this mess. Face the fact that government regulators and agencies were just too quick to approve many loans, many chose to look the other way ending up with bad mortgages.

Posted by: RedRat | October 11, 2010 2:04 PM | Report abuse

It seems they are stuck on the people who may deserve to be foreclosed on and forgetting about the many who are tirelessly trying to save their homes and honestly a few that they might put in the category of deserving to loose their homes, May not. It is amazing how they Wrote the check to bail out the banks but wont freeze foreclosures to make sure the banks don't get away with Fraud against millions of Americans.

Posted by: Anonymous | October 17, 2010 10:09 PM | Report abuse

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