The Federal Government, Throwing Families Into The Street To Make Billionaires Out of Millionaires

June 17th, 2012 | Author: Matthew D. Weidner, Esq.

“The largest transfer of wealth from the public to private sector is about to begin. The federal government will be bulk-selling the massive portfolio of foreclosed homes now owned by HUD, Fannie Mae and Freddie Mac to private investors — vulture funds.”
So warned Roger Arnold, chief economist for ALM Advisors of Pasadena, California, in a column for RealMoney on August 11, 2011, that first lifted the lid on this latest colossal scandal to come out of the 2008-2009 financial crisis.
“These homes,” wrote Arnold, “which are now the property of the U.S. government, the U.S. taxpayer, U.S. citizens collectively, are going to be sold to private investor conglomerates at extraordinarily large discounts to real value. You and I will not be allowed to participate. These investors will come from the private-equity and hedge-fund community, Goldman Sachs (GS) and its derivatives, as well as foreign sovereign wealth funds that can bring a billion dollars or more to each transaction.”
Warren Buffett, one of the richest men in the world, obviously, would have no trouble qualifying for the privilege of bidding in this fire sale for the super-rich. And the “Oracle of Omaha” appears to be more than casually interested in getting in on the game.
The Wall Street Journal reported on March 20, 2012: “Warren Buffett, considered a sage investor and chief executive of Berkshire Hathaway Inc., said in an interview with CNBC-TV last month that he would buy up ‘a couple hundred thousand’ single-family homes if he could do so easily, given the high yields on rental investments.”
FOR BILLIONIARES ONLY
And More Depth and background on the fusion of government and the businesses that own our government: (This forms part of the pretext for seizing properties from a private person and transferring them to government/corporate fused entities.)
An Enterprise’s failure to effectively manage its contractors’ implementation of basic REO responsibilities, i.e., securing, maintaining, repairing, and marketing properties, would place it at considerable financial risk. It could also endanger the stability of the communities in which the properties are located. For example, if a contractor fails to secure properties for which it is contractually responsible, then the properties may be broken into, looted, and used for illegal activities. Similarly, a contractor’s failure to maintain a property, e.g., remove debris, cut lawns, fix broken windows, etc., can reduce its value and detract from its marketability, as well as the marketability of near-by homes. The deteriorated condition of an REO property may cause it to remain on the market and in an Enterprise’s inventory for an extended period, thereby increasing the Enterprise’s total carrying costs. This, in turn, will reduce the Enterprise’s returns on the sale of such properties and, ultimately, increase the taxpayer costs associated with the conservatorships.
AND HERE’S A BIG TELL THAT DEMONSTRATES HOW WE’RE ALL GETTING HOSED HERE BY CONTRACTORS RIPPING US ALL OFF:
Finally, there is also the risk of considerable fraud and abuse associated with the failure to manage Enterprise REO contractors effectively. Under the best of circumstances it may be challenging for the Enterprises to verify that certain types of maintenance and repairs, such as interior painting and plumbing, are being completed in accordance with quality standards and within established timeframes for thousands of foreclosed properties across the nation. Therefore, it is important for the Enterprises to establish effective property inspection procedures and controls to prevent fraudulent contractor reimbursements.
FHFA REPORT
FANNIE MAE SERVICING GUIDELINES
On September 6, 2008, well over three years ago, FHFA exercised that authority, placing the Federal National Mortgage Association (Fannie Mae) and the Federal Home Loan Mortgage Corporation (Freddie Mac) (together, the Enterprises) into conservatorships. FHFA has since overseen the largest, most complex conservatorships in history.
Two years ago, FHFA sent Congress a letter setting forth the agency’s understanding of its conservatorship obligations and how it planned to fulfill those obligations. It is time to update and extend that plan in view of the status of the Enterprises and the country’s housing system today.
The two companies have received more than $180 billion in taxpayer support. The benefit to the country from maintaining their operations has been to ensure the secondary mortgage market continues to function. During this time, the Enterprises have completed more than 2 million foreclosure prevention actions, including more than 1 million loan modifications and they have refinanced more than 10 million mortgages. Together they are guaranteeing roughly $100 billion per month in new mortgage production, representing about 3 of every 4 mortgages being originated. But the Enterprises’ ongoing operations are entirely dependent on taxpayer support provided through the Senior Preferred Stock Purchase Agreements with the U.S. Department of the Treasury.
FANNIE POLICY