Monthly Archives: December 2013

The Wolf of Wall Street” flick is reviving talk of the “too big 

to jail” crooks who ran the too big to fail banks and mortgage

companies.  Said companies blew up the real estate bubble and

escaped virtually all the damage from its explosion, which left many

Americans worse off, though not all homeless as our friend in the photo.

How Does This Relate To Bankruptcy?

As the bad guys, with the cooperation of our government, caused housing prices to spiral up with rivers of too easy mortgage money, more and more folks were sucked into buying houses they could not afford, reassured by all, that interest rates would go down more, or stay low, and, housing prices ALWAYS go up.

Except when they don’t.

When the bubble burst, the government used our tax dollars to bail out the bad guys, but had no problem letting the average consumer get crushed by mortgage debt.  Many were forced out of their homes, as the mortgage companies would NOT reduce principal to the fair market value of the home.

Chapter 13 bankruptcy no longer worked to keep people in their homes, as it did not make sense to pay more money per month to keep a house that was now tens, or, more common, hundreds of thousands of dollars in the hole.  

Underwater, as we say.

Chapter 13 worked well only for those who could afford the first mortgage payment, and get rid of a second or even a third mortgage because their home was worth less than the balance on the first mortgage alone.

Why Are The Sons of Bitches Still Free?

And rich.  Most of them.

The short answer?

They bough both political parties when the money was flowing in.  I defy you to delineate a difference between the bail out policies of Bush-Paulson and Obama-Geitner et. al.

From Mark Hughes Forbes review linked to above:

The worst excesses and representation of broken moral compasses and debauchery are not the sex and drugs and big boats and parties that everyone keeps talking about. It’s the money, or rather how they made the money, that should be the most shocking and offensive thing about their behavior . . . . . . 

And all of the things they were doing were, ultimately, the same things (or variations of the same things) being done all over Wall Street. Jordan Belfort‘s actions were not, when you get right down to it, any worse or more extreme than what went on prior to and during the whole housing and banking collapse a few years ago. But nobody went to jail in the 2000s, none of the top CEOs were arrested and I doubt seriously if any of them had their phones bugged for FBI investigations. No, Belfort’s crimes were immoral and corrupt, but they were frankly nothing particularly special when it comes to shenanigans in the financial world.

If the federal government enforced existing criminal laws, they WOULD be in jail.

Before you vote next time, think about why that is not the case.

Justice For The Villains?

BANKripOFFshirt

At last?  Bank of (EVERYTHING IN) America, which bought Countrywide, the greatest perpetrator of mortgage fraud in the real estate bubble burst which is still with us, may get nailed by a U. S. District Court Judge. We can only hope. I stopped writing for my mortgage blog, out of despair for getting relief forContinue ReadingContinue Reading

Bankruptcy Reaffirmation

(Bankruptcy Reaffirmation Guest post from Marie Nelson.  Is reaffirming nuts, like what is in the bowl in the picture?) What Do You Understand About Reaffirming A Debt During Bankruptcy?   You can always consider the option of keeping some of your debts if you are planning for bankruptcy. You need to realize that, for someContinue Reading