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Posted at 12:24 PM ET, 11/18/2010

Rep. Frank: Homeowners should not have 'false hopes' in foreclosure mess

By Ariana Eunjung Cha

barneyfrank.JPG

(Photo Credit: Melina Mara/The Washington Post)

Rep. Barney Frank (D-Mass.) on Thursday called for bipartisan support for legislation that will make sure another foreclosure "mess" does not happen again, but said that homeowners who are delinquent should not have "false hopes" that a substantial number will get their homes back due to the paperwork problems.

The outgoing chair of the House Financial Services Committee said at a subcommittee hearing that there is need for a single entity to make decisions about whether a borrower gets loan assistance.

Frank expressed concern that the "tangle" of interests of the mortgage holder, servicer and investors are not always the same, which results in conflicts of interest and makes it difficult for borrowers to get the help they deserve.

"There should not be important decisions that need to be made in the private sector and no one has the authority to make them," Frank said.

While Frank said that those involved in the foreclosure process who "have ignored the law are culpable," he cautioned that it does not necessarily mean that homeowners who missed their payments will necessarily get their homes back.

Borrowers should not have "false hopes that this is going to lead to a substantial number of foreclosures being permanently forgotten," Frank said.

More on Thursday's hearing on foreclosures before the House Financial Services Committee subcommittee on housing:

Bachus, Waters: Why didn't regulators know of problems sooner?
Bank of America outlines reform measures
CitiMortgage admits to foreclosure mistakes

By Ariana Eunjung Cha  | November 18, 2010; 12:24 PM ET
Categories:  Congress, Housing  
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Comments

and PA voters re-elected this fraud.

dear liberal voters:

are you proud that you maintained the ruling aristocracy of millionaire lawyers in the last election? Because, I am ashamed of you.

Posted by: docwhocuts | November 18, 2010 2:01 PM | Report abuse

docwhocuts: It's unlikely that the people of Pennsylvania had anything to do with the reelection of MASSACHUSETTS Rep. Frank.

Posted by: Anonymous | November 18, 2010 2:18 PM | Report abuse

Bottom line is : How can you think just because some of your paperwork was not handle under due diligence that this causes you to be awarded with a free home. Remember, if you are in foreclosure it's more than not because you are not current or miss 3 to 5 mortage payments !!

Posted by: Raidersfan2 | November 18, 2010 2:19 PM | Report abuse

"... it difficult for borrowers to get the help they deserve."

Why do they "deserve" help? How about "they qualify for under various taxpayer funded programs?"

The problem is that liberals want to hand out money we borrow from China and have no hope of paying back; "deserving" basically means anyone with a hand out.

Posted by: Curmudgeon10 | November 18, 2010 2:39 PM | Report abuse

Finally, someone clarifying the real issue, whereas the Post has been confusing the matter by writing articles that makes the issue sound like a national crisis and giving ex(or to be ex)-homeowners false hope.

Posted by: Anonymous | November 18, 2010 2:44 PM | Report abuse

Barn is from MA not PA.

Posted by: Anonymous | November 18, 2010 2:52 PM | Report abuse

"Rep. Barney Frank (D-Mass.) on Thursday called for bipartisan support for legislation that will make sure another foreclosure "mess" does not happen again,.." That's an amazingly brave statement coming from one of the key causes of the present housing mess! Can you spell CRA, Carter, Clinton, Frank, Waters, Raines, and the names of some of the others who caused this mess?

Posted by: Anonymous | November 18, 2010 3:23 PM | Report abuse

As long as Barney is alive, no one should have any hope or faith whatsoever in our government. Nice work there Barney.

Posted by: richard36 | November 18, 2010 4:06 PM | Report abuse

Frank is a disgraceful slob.

Posted by: coogene | November 18, 2010 4:36 PM | Report abuse

This is some bull

Posted by: Anonymous | November 18, 2010 4:48 PM | Report abuse

Bottom line is : How can you think just because some of your paperwork was not handle under due diligence that this causes you to be awarded with a free home. Remember, if you are in foreclosure it's more than not because you are not current or miss 3 to 5 mortage payments !!

Posted by: Raidersfan2 | November 18, 2010 2:19 PM


Raidersfan - Should Citibank or Bank of America get a home they didn't pay for just because it's in foreclosure? Why do you think they were "robo - signing" affidavits saying they own the mortgages being foreclosed on? They don't. They can't prove that they do. The only reason they want to foreclose is so that they can go to the Feds and get a 2d bailout for the foreclosure. So what's better - letting the banks steal the homes or letting the owners keep them at the same rate as a foreclosure sale would yield? The banks created the mess, and the foreclosures are devastating whole sections of the country with empty, uninsurable homes. We're all better off if the owners get to keep owning. Why should they be the only ones to pay the full price for this mess?

Posted by: Anonymous | November 18, 2010 4:54 PM | Report abuse

The last person who should be talking is Bawney Fwank. Hey Bawney sit down and shut up. Your years at the helm of this committee are some of the most costly to the American taxpayer in our history. Through your bungled administration you made a bad situation catastrophic. The voters of MA should be forced to bail out Fannie and Freddie out of their own pocket as punishment for sending this idiot back to Washington.

Posted by: Desertdiva1 | November 18, 2010 5:54 PM | Report abuse

So Rep. Barney Frank, one of the people that caused this mess is going to save us?
And people voted him back into the US Congress ........ who is nuts?

Posted by: Anonymous | November 18, 2010 7:36 PM | Report abuse

@Curmudgeon10

All you jokers out there casting stones on the borrowers being foreclosed on, if you are buying homes keep in mind that the self-same taxpayers you are so worried about are paying a BIG part of YOUR mortgage because of the mortgage interest rate deduction.

Each case is different. While some are those who stopped making their mortgages when they had the money, there are many more that were victims of fraud, unlucky dupes who believed the experts who told them that housing prices would never go down, or simply people who lost their job and are going down the tubes because of it.

But more importantly, stop and consider... even if compassion for your fellow man is not a consideration, think about how YOUR home price will fall when people don't get help staying in their homes. Foreclosures are a blight on the neighborhood, and destroy EVERYONE's property values. Its in everyone's enlightened self-interest to limit the damage as far as possible.

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Posted by: Anonymous | November 18, 2010 8:20 PM | Report abuse

Some bank CEO's and their lawyers need to go to jail and to disgorge their ill-gotten bonuses.

They created a mess by setting up an illegal scheme for recording mortgage ownership and ignoring the legal system for doing so. That is where the paperwork mess came from. Because the mortgage ownership wasn't recorded legally, when they went to do foreclosures the legally recorded paperwork they needed didn't exist. So they falsified it and lied when they had to sign that it was done properly. They also cheated states and localities out of the fees and taxes that are charged for recording mortgage ownership.

This wasn't just a set of technical paperwork flaws. It was a huge, profit-driven, illegal scheme. Some people need to go to jail for setting it up, falsifying the paperwork the legal system would have produced and lying about the falsification.

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