Bank of America's "Settlement" Will Cause More People to Lose Their Homes

An analysis of the Bank of America $8.5 billion settlement for derivatives backed by toxic, worthless mortgages, that were sold to investors means more people will get kicked out of their homes.

Tens of thousands of Bank of America’s most distressed borrowers could be evicted and lose their homes more quickly as a result of a proposed settlement between the bank, which is the country’s largest mortgage servicer, and investors in its troubled mortgage securities.

But guess who makes out? The investors of course:

While powerful investors stand to benefit from the $8.5 billion settlement over the bank’s bundling of shoddy mortgages as securities, the fallout for the nearly 275,000 borrowers who took out those loans depends greatly on how deep they are in the foreclosure process and whether they earn enough money to dig themselves out.

There seems to be a new standard where only 31% of one's gross monthly income can go to a mortgage payment. Imagine all of the self-employed who will be locked out of buying a home with that criteria.

The reason this will kick people out of their homes is because so many are in foreclosure already but the processing is that bogged down from these mortgaged backed derivative bundles and backlogs. Additionally, many will not qualify for a mortgage modification now, mainly the customers of Countrywide.

Massachusetts Surpeme Court Says No to the Banksters' Foreclosure Mill

Finally, some in this country are actually paying attention to the law. Wells Fargo and U.S. Bancorp just lost their Foreclosuregate case in Massachusetts. The Supreme Court of Massachusetts just ruled against them. The case boils down to if the bank cannot locate the paperwork, too bad, they cannot foreclose, even when they bundle these things up in derivatives and trade them like baseball cards.

Financial Times has the background on the case itself and gives one of the court rulings on securitization of mortgages with respect to foreclosures:

The Land Court then proceeded to find that (1) neither Appellant had a valid assignment of mortgage at the time of publication of the notices or at the time of the foreclosure sale, (21 the foreclosure notices failed to identify the “holder” of the mortgage, and ( 3 ) the notices were deficient under Mass. Gen. L. ch. 244, 5 14. [A592-93]. Put another way, the Land Court held that Appellants lacked authority as assignees to conduct the subject: foreclosures.

Naked Capitalism on what this ruling means:

This is the key sentence from the decision, that the use of a securitization does not alter or reduce the requirements that apply to transfers and ownership of the loans and the related property.

BoA Tells Investors to Bail Out of China Due To No More Slave Labor

Bank Of America, you know that corporation based in the United States, land of the free, home of the brave, is telling investors to sell because wages in China might have to rise.

Investors should sell shares of Chinese cement and metal companies as increases in labor costs will curb capital spending in those industries, according to BofA Merrill Lynch Global Research.

Seven Chinese provinces raised minimum wages in the first quarter after halting them last year amid the global recession, according to the Labor Ministry. Higher salaries may deter foreign investment in China, which has been a low-cost manufacturing base.

Astounding huh? The Yuan is still undervalued ranging up to 40%, yet the minute Chinese workers get anywhere with wages, investors should pull out.

Chinese Honda workers managed to get a 30% wage increase and 30 states increased the minimum wage by 15%. This amounts to $23.5 a month. That's a cocktail to investors. Suck it up!

I guess BoA just wants workers to continue committing suicide so as to not disturb ROI:

Blog claiming BoA to increase foreclosures 600% in 2010

The blog Irvine Housing is reporting BoA plans to increase foreclosures 600% in 2010.

Bank of America is projecting a 600% increase in its already large number of monthly foreclosures.

This isn't unsubstantiated rumor; this comes straight from one of the most powerful men in Bank of America's OREO department (yes, that really is what they call it). It appears they have too many properties already.

The blog seems to be all for it!, that aside, these statistics:

1.2 million Bank of America homeowners are in default. Even if they forclosed on 45,000 a month for a full year, that is only 540,000 foreclosures.

Zombie Bank's Recent Losses, some details

What a surprise. Citigroup posted a $7.8 billion dollar loss in Q4 2009.

LA Times:

The bank said that it lost about $1.6 billion in 2009 — after a $18.72 billion loss the year before. It also reported $7.6 billion loss in the fourth quarter, mostly as a result of a $10.1 billion accounting charge tied to the repayment of its bailout money, which ended any chance of a profit. Last year, the bank had a fourth quarter loss of $8.29 billion or a $1.72 a share.

At Citigroup, most of the fourth-quarter loss stemmed from an accounting charge linked to the company's exit from the government's Troubled Asset Relief Program. Even without that charge, Citigroup would have lost $1.4 billion in the period.

New York Prepares Securities & Fraud Charges Against BoA over Merrill Lynch Bonuses

According to CBS:

The New York Attorney General's office is preparing charges against several high-ranking Bank of America executives over the bank's alleged failure to disclose details about its acquisition of Merrill Lynch, according to a person familiar with the investigation.

Attorney General Andrew Cuomo's office is likely to file civil charges against the executives over their role in failing to alert shareholders to mounting losses as well as accelerated bonus payments at Merrill, said the person, who requested anonymity because no charges have been filed yet.

These would be securities fraud charges.

TARP Banks own 66% of all credit cards, 50% of all mortgages

Do you ever have one of those moments of pause and say to yourself, what have they done!

This was my reaction to a Washington Post article, Banks 'Too Big to Fail' Have Grown Even Bigger.

The worst actors of the financial crisis, those who should have gone down in the flames they set themselves, who were rescued by our government, are now beyond belief mega financial oligarchs, limiting consumer choice and making a mockery of the phrase moral hazard:

WaPo Author Cho:

A Pound of Flesh - Hanky Panky, BoA & The Federal Reserve

Federal Reserve staff wanted to extract a pound of flesh from Bank of America for the Merrill Lynch acquisition.

So, think all Congressional hearings are sleepy, boring things? Get ready for the House Oversight Committee Hearing tomorrow!

In preparation for tomorrow's testimony by Federal Reserve Chair Ben Bernanke on the shot gun marriage between Bank of America and Merrill Lynch , we have this released memo:

Fed accused of 'cover-up' in BofA deal:

Lawmakers claim to have uncovered evidence that the Federal Reserve tried to hide from other financial regulators its involvement in Bank of America's (BoA) takeover of Merrill Lynch.

BoA, Wells Fargo, TARP Recipients, Forcing U.S. Workers to Train their Foreign Guest Worker Replacements Before Being Fired

Wells Fargo, a TARP recipient who bought Wachovia, is now forcing U.S. workers to train their foreign guest worker replacements before being fired. So is Bank of America.

Are you thinking wait a second, weren't those banks given billions and billions in U.S. taxpayer dollars? Aren't they supposed to first consider U.S. workers for jobs in the United States? Weren't Bank of America and Wells Fargo made H-1B and L-1 guest worker dependent employers by legislation recently passed by Congress?

Let the (Rigged) Games Begin! Reports of Citigroup, BoA Preparing to Ripoff the Taxpayer

This is one hell of a story. The New York Post is reporting:

As Treasury Secretary Tim Geithner orchestrated a plan to help the nation's largest banks purge themselves of toxic mortgage assets, Citigroup and Bank of America have been aggressively scooping up those same securities in the secondary market, sources told The Post.

Both Citi and BofA each have received $45 billion in federal rescue cash meant to help prop up the economy and jumpstart the housing market.

But the banks' purchase of so-called AAA-rated mortgage-backed securities, including some that use alt-A and option ARM as collateral, is raising eyebrows among even the most seasoned traders. Alt-A and option ARM loans have widely been seen as the next mortgage type to see increases in defaults.