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Posted on 3/22/2014

SO WHAT EXACTLY IS A NPL?

     (PMT) PennyMac’s 2013 Stockholder report (Or…how to dehumanize a homeowner)

On February 6, 2014, PennyMac published it’s Forth Quarter Investment Trust report for 2013.  In order to interpret the content for our readers, I will first have to give you an acronym lesson.  Commit the following initials and their interpretations to memory to help in your analysis:  

1)   NLP – Non performing loan:  This is a homeowner and their family that is behind on their mortgage.  The reason does not matter for the purpose of the stockholder report.  The homeowner could be behind because their Adjustable Rate Mortgage just adjusted and they still haven’t gotten the modification they have been promised.  They could be behind because they got a note from their previous lender telling them not to send any more payments.  They could be behind because of a temporary illness or hospitalization.  Maybe they were not behind, but their payments were not credited correctly.  The reason does not matter for the purpose of the stock report…they are all deadbeats…dehumanized.  They are not hardworking families or people struggling to meet their obligations against insurmountable fraud, then are not people at all…The NPL is completely detached from the family it represents.

2)   UPB – Unpaid principle balance: Another acronym to alleviate the human factor behind the loan.

3)   GSE – Government Sponsored Enterprise:  Generally refers to Fannie Mae, Freddie Mac or Ginnie Mae, essentially run by the government.  An example of…how our government who has initiated the massive settlements is also betting against the Homebuyer.

4)   MSR – Mortgage Servicing Rights:  They get to collect monthly payments from homeowners for a fee.

5)   REIT – Real Estate Investment Trust – Securitized loan pools that may or may not contain a family’s mortgage or trust deed on their home.

6)   REO – Real-Estate Owned: Property owned by the lender, (I use the term ‘lender’ here loosely) usually due to foreclosure.

When reading Pennymac’s stockholders report, as with any stockholder report where property is involved.  Their wording removes all the human connection with the product that they praise.  There is a convenient disconnect between the ‘product’ and the people for who this product was provided.  We have become NPL (non-performing loans)  or re-performing loans, our homes, where we live and raise our children are now RMBS (residential mortgage-backed securities). 

In spite of the numerous “programs” to modify our loans, getting a loan modification has become akin to winning the lottery.  Yet the Wall Street corporations and their executive loan program designers that created this massive economic cataclysm continue to benefit from their former alleged fraud.  Homebuyers are been stereotyped as ‘deadbeats’ and their homes have become RMBS, an acronym that serves to further dehumanize the nature of the control fraud that has permeated our nation. 

Where are the statistics supporting the effectiveness of the modification programs, HAMP, HARP, HOPE?  Statistics are sadly lacking in this arena. HUD reports a 46% re-default rate on modifications.  Why?  The blame is still being laid on the backs of the homeowners…but the massive amount of settlements by the largest lenders tell us otherwise.  Yet the same pundits who brought us the greatest economic disaster since the great depression are allowed to amass millions continuing in the same practices that brought it on in the first place.

PennyMac, the illegitimate offspring of Countrywide, purchases loans – the homes of families – for pennies on the dollar and in spite of their original business model of helping the homeowners retain their homes,[1] they take back the homes through various methods, but seldom if ever, do they offer the homeowner a reduction in principle and the modifications are few.

[1] In March, Henry Blodget explained how the PennyMac business works:  From: http://www.businessinsider.com/ex-countrywide-execs-pennymac-files-for-an-ipo-2009-5 Kurland's new company, PennyMac (!), goes to a demolished bank or the FDIC and buys up delinquent mortgages at, say, 20 cents on the dollar. Kurland's people then call the delinquent homeowner and say, "How would you like to pay $2,000 a month instead of $4,000?" Once the homeowners realize it's not a scam, they say "hell, yes." PennyMac then books the  often-massive spread between what it paid for the loan (20 cents) and what it is getting from the loan (50 cents).

                            FROM PENNYMAC'S STOCKHOLDER REPORT:

“The last resort and typically the least desirable outcome for PMT is foreclosure. PMT has successfully employed alternatives to foreclosure including modifications, short sales and deeds-in-lieu foreclosure in 65% of the loan resolutions over PMT’s history. The chart on slide 7 shows resolution trends for distressed pools purchased by PMT going back to the first quarter of 2010. As you can see PMT has a strong history of effectively investing in and resolving loans.”

A short-sale and a deed-in lieu only serves the purposes of the lender and does not help to keep families in their homes.  PennyMac does not tell us what portion of the 65% loans mentioned in the above referenced paragraph are modified, verses short sale or deed in lieu, but what we do know is that 35% are left for foreclosure, and almost 100% of those families lose their home.  Since the release of the lawsuit outlining the 48 state settlement, we know many of these loans have been transferred using fraudulent signatures, so the question becomes; How do you modify fraud?  We have to ask; could it be that the reason that many loans are not modified is because of the need to bury the fraud under a new sale?  Doesn’t that leave a clouded title for the future buyer?  Could the fact that these loans are NPL have something or anything to do with the fact that the homeowners were promised a modification if they missed a payment?  

The argument of the lenders is that no modification is promised to any homeowner, however in this wording taken from an outline of the National Mortgage Settlement, homeowners were led to believe differently:

                     WORDING TAKEN FROM THE NATIONAL MORTGAGE SETTLEMENT

"Principal reduction. At least $10 billion will be dedicated to reducing principal for borrowers who, as of the date of the settlement, owe more on their mortgages than their homes are worth and are either delinquent or at imminent risk of default."

Compare this consent order from the National Mortgage Settlement to the recent announcement at PennyMac’s most recent quarterly report:  

                  FROM THE PENNYMAC QUARTERLY STOCKHOLDER REPORT:

"Subsequent to the end of the quarter, we entered into an agreement to acquire an additional $351 million in unpaid principle balance of non-performing loans. We expect to see a continued supply of distressed whole loans in the market, but we also anticipate tha"t new buyers will enter the market including REO acquisition vehicles."

So…PennyMac announced that they will acquire $351 million (for pennies on the dollar) of homes that will more than likely be foreclosed, sold as a short-sale or deed-in-lieu.  How many of these NPL’s will be purchased from the lenders named in the National Mortgage Settlement seeking to unload their responsibility to comply with the consent orders? How many more families will be forced out of their homes? Families…not NPL’s.  

As so many families seeking modifications or relief to keep their homes, companies like PennyMac, run by the former executives of Countrywide line their pockets with the pain and tears of families who struggle to stay in their homes.  PennyMac becomes increasing wealthy from the former alleged fraud and liar loans of their predecessors, while the homebuyers are stripped of their assets and their credit and reputations are ruined.  

FROM PENNYMAC'S REPORT TO THE SEC ON FEBRUARY 22, 2014:

We may be subject to liability for potential violations of predatory lending laws, which could adversely impact our results of operations, financial condition and business.
        

Various U.S. federal, state and local laws have been enacted that are designed to discourage predatory lending practices.

The U.S. federal Home Ownership and Equity Protection Act of 1994, or HOEPA, prohibits inclusion of certain provisions in residential mortgage loans that have mortgage rates or origination costs in excess of prescribed levels and requires that borrowers be given certain disclosures prior to origination. Some states have enacted, or may enact, similar laws or regulations, which in some cases impose restrictions and requirements greater than those in HOEPA.

In addition, under the anti-predatory lending laws of some states, the origination of certain residential mortgage loans, including loans that are not classified as "high-cost" loans under applicable law, must satisfy a net tangible benefits test with respect to the related borrower. This test may be highly subjective and open to interpretation. As a result, a court may determine that a residential mortgage loan, for example, does not meet the test even if the related originator reasonably believed that the test was satisfied. If any of our production loans are found to have been originated in violation of predatory or abusive lending laws, we could incur losses, which could adversely impact our results of operations, financial condition and business.  (page 22)

Servicing standards for the foreclosure process continue to develop. The servicing rules issued by the CFPB on January 17, 2013 prohibit a servicer from initiating a foreclosure action or proceeding to a foreclosure judgment or sale in a pending action where the borrower has submitted a completed loss mitigation application to the servicer. Moreover, a number of states, including California, Massachusetts and Washington, have revised their foreclosure laws to require the suspension of a foreclosure action until all of the loss mitigation options are exhausted.

New state laws are also addressing "robo-signing" concerns by creating new requirements to validate the evidence of the right to foreclose and the accuracy of the foreclosure documents. We believe that additional states will adopt similar requirements. (Page 107)

                       JUST WHO IS PENNYMAC, ANYWAY?

Bullet points for fraud investigation:  
Ø  LEGAL RIGHT TO FORECLOSE:  Since PennyMac, and similar hedge funds acquire their assets at pennies on the dollar – on what basis do they have a legal right to foreclose.  The mortgage note was for the property in question and loaned accordingly.  The loans were not with PennyMac.

Ø  U.C.C. provision, U.C.C. §3-305(c):
“An obligor is not obliged to pay the instrument if the person seeking enforcement of the instrument does not have rights of a holder in due course and the obligor proves that the instrument is a lost or stolen instrument.

Ø  INSIDER TRADING:
- As we all know, most of the executives at PennyMac came from Countrywide and Bank of America: ·      

·       Stanford Kurland – Chairman of the Board and CEO of PennyMac – formerly CEO of Countrywide Homeloans.
·       David a. Spector – President and Chief Operating Officer at PMC – formerly Senior Managing Director for Countrywide.
·       David M. Walker – Chief Financial Officer at PMC – formerly chief lending officer at Countrywide.
·       Fazad Abolfathi – Chief Technology Officer – formerly Countrywide senior program analyst.
·       Scott D. Anderson – Chief Mortgage Operations Officer – formerly Countrywide executive vice-president of wholesale lending.
·       Anne D. McCallion - chief financial officer of PCM and PLS – formerly served Countrywide as deputy chief financial officer, chief operations officer, and chief administrative officer.
·       Michael M. Muir – chief capital markets manager of PCM – formerly senior vice president at Countrywide Home Loans.
·       Julianne Fries – chief compliance office of PCM – formerly served as managing director and chief compliance officer of Countrywide Capital Markets.
·       Aratha M. Johnson - chief administrative officer of PCM – formerly served as chief of staff and managing director of the executive office of the president for Countrywide.
·       Brandon Ohnemus.  -  director of portfolio strategy of PCM – formerly first vice president of lending finance for Countrywide Bank, N.A., a subsidiary of Countrywide.
·       Lee Trumble - director of due diligence of PCM – formerly worked for Countrywide Bank, N.A., a subsidiary of Countrywide, managing the counterparty asset repurchase process.
 
o   Nicole Sutherland – mortgage underwriter at PennyMac – formerly mortgage underwriter for Bank of America.
o   Doug Jones  - chief correspondent lending officer for PennyMac – formerly oversaw retail sales and institutional mortgage services for Bank of America Home Loans.
o   Jim Follette - Managing Director, Correspondent Fulfillment – formerly served as Senior Vice President for Bank of America Home Loans.
o   Kim Nicols - Regional Sales Manager for correspondent lending for the western region – formerly vice President, Regional Sales Manager, Institutional Mortgage Services for Bank of America.

This is not an exhaustive list by any means - research will show that there are many more transferees working at PennyMac.

             Former executives, Angelo Mozilo and David Sambol were sued by the SEC for mortgage fraud and insider trading and later settled out of court.  Yet Countrywide is allowed to reopen and profit from their former predatory loans under the guise of PennyMac?  

The U.S. Treasury’s Office of Thrift Supervision noted in 2010 (page 7):  The FBI estimates that 80 percent of all mortgage fraud involves collaboration or collusion by industry insiders.

   Ø  CONFLICT OF INTEREST –Countrywide now a division of (B of A) had made numerous settlements in lieu of Fraud and breach of contract.  Yet homeowners who have been seeking help for over 5 years are labeled as “deadbeats”.  PennyMac should not be allowed to be in possession of loans that were part of Countrywide since PennyMac is comprised of former Countrywide/B of A staff.
   Ø  INSURANCE FRAUD – Even when customer qualify for modification, it is more profitable to foreclose, collect the insurance guaranteed by our government, then resell the property at a price the former homebuyer could easily have afforded.  They are now selling our properties to “investors” who invest a few dollars resell it at a large profit…called “flipping”   isn’t this what got us into trouble in the 1st place?
   Ø  FAILURE TO HONOR AGREEMENTS – When PennyMac receives mortgage notes that they purchase for pennies on the dollar, they fail to honor former temporary modifications made by previous lender and force the homebuyer to restart the process.  Most homebuyers are denied modification, so that the purported lender can foreclose and double their profits.  

   Company Overview Private National Mortgage Acceptance Company, LLC operates as an asset management company that acquires and manages residential mortgage assets. The company, through its subsidiary, PennyMac Loan Services, LLC, offers home loan services for borrowers and investors; and engages in purchasing and managing mortgage investment portfolios, originating loans, servicing/managing assets, and facilitating sales on the secondary market. It offers also real estate properties on sale, real estate developers financing solutions, and residential loans. The company has strategic alliances with BlackRock and Highfields Capital. The company was founded in 2008 and is based in Moorpark, California. It has a facility in Tampa, Florida. Private National Mortgage Acceptance Company, LLC operates as a subsidiary of Blackrock Holdco 2, Inc.[1] http://investing.businessweek.com/research/stocks/private/snapshot.asp?privcapId=47576801

REAL LIFE CONSPIRACY THEORY (Let’s Follow the Money)
This is the way the Big Boys launder their money….
Or……The History of PennyMac

8-28-2012

  Let’s start with Merrill Lynch and their meltdown in 2006-2008. Bloomberg reported in September 2008 that Merrill Lynch had lost $51.8 billion in mortgage-backed securities as part of the subprime mortgage crisis.[1]

  If you haven’t watched the movies, Too Big Too Fail, or Margin Call, or Inside Job, you should, it will give you a good idea of what happened during that time.  Wall Street greed had turned our assets into stock options and created the bubble that resulted in the worse economic collapse in American History.           

So in the effort to protect investors, our government manipulated Bank of America to purchase Merrill Lynch.


  From Wikipedia:   Sale to Bank of America          Significant losses were attributed to the drop in value of its large and unhedged mortgage portfolio in the form of Collateralized Debt Obligations. During the week of September 8, 2008, Lehman Brothers came under severe liquidity pressures, with its survival in question. If Lehman Brothers failed, investors were afraid that the contagion could spread to the other surviving investment banks. [Lehman Brothers filed bankruptcy on September 15, 2008, after government officials could not find a merger partner for it.] On Sunday, September 14, 2008, Bank of America announced it was in talks to purchase Merrill Lynch for $38.25 billion in stock. The Wall Street Journal [2]reported later that day that Merrill Lynch was sold to Bank of America for 0.8595 shares of Bank of America common stock for each Merrill Lynch common share, or about US$50 billion or $29 per share. Congressional testimony by Bank of America CEO Kenneth Lewis, as well as internal emails released by the House Oversight Committee, indicate that Bank of America was threatened with the firings of the management and board of Bank of America as well as damaging the relationship between the bank and federal regulators, if Bank of America did not go through with the acquisition of Merrill Lynch.[3] In March 2009 it was reported that in 2008, Merrill Lynch received billions of dollars from its insurance arrangements with AIG, including $6.8bn from funds provided by the United States taxpayers to bail out AIG.[4] http://en.wikipedia.org/wiki/Merrill_Lynch#Sale_to_Bank_of_America

Okay, if this is not all dizzying enough for you…along comes Countrywide Homeloans!  Our personal nemesis!  Apparently, we are not alone on that thought! http://www.countrywidehomeloansucks.com/ (opps…how did I let that site slip into my blog?)  

I will always associate Countrywide with that handsome and caring looking man in their ads who spouted the words:  “No one can do what Countrywide can.”                   

You can see the commercial here:  http://www.youtube.com/watch?v=LLFRIyRk3AA

I have to admit he stills gives me that warm fuzzy feeling.  He’s got that fatherly, I-really-do-care-about-you face, doesn’t he?           

“No one can do what Countrywide can.”        

  “The SEC filed charges against Mozilo, Sambol, and Sieracki on June 4, 2009, alleging that they failed to disclose to investors the significant credit risk that Countrywide was taking on as a result of its efforts to build and maintain market share. Investors were misled by representations assuring them that Countrywide was primarily a prime quality mortgage lender that had avoided the excesses of its competitors. In reality, Countrywide was writing increasingly risky loans and its senior executives knew that defaults and delinquencies in its servicing portfolio as well as the loans it packaged and sold as mortgage-backed securities would rise as a result.”[5]

  Angelo Mozillo co-founded Countrywide in 1969 and continued as CEO until July 1, 2008.            Condé Nast Portfolio ranked Mozilo second on their list of "Worst American CEOs of All Time".[6]
         
 Yet, we all have to know that Angelo did not come up with this destructive plan all by himself.  He didn’t walk into the company one day and say “I know, I have a plan and you all are going to go along with it,” and all of the other executives just nodded their heads in agreement.  “Yeah, sounds good, boss.”           

What about Angelo’s right hand man?  Stanford Kurland?           

Stanford Kurland served as the Chief Operating Officer of Countrywide Financial Corp. from 1988 to September 2006 and President from January 2004 to September 2006.[7]

We have to ask the question – Why wasn’t Stanford Kurland charged with anything?  Did he make a deal by turning in the other executives? Or testifying against them?  We may never know.  What we do know is that as COO of Countrywide, a major corporation, he was one of the senior executives that must have known about the default and delinquencies in its servicing portfolo…(see above and footnote #5) and yet he escaped prosecution and while Angelo Mozilo is forbidden from ever opening a public corporation again, Stanford Kurland opened a new corporation in 2008 working from the same city as Countrywide:

Company Overview
Private National Mortgage Acceptance Company, LLC operates as an asset management company that acquires and manages residential mortgage assets. The company, through its subsidiary, PennyMac Loan Services, LLC, offers home loan services for borrowers and investors; and engages in purchasing and managing mortgage investment portfolios, originating loans, servicing/managing assets, and facilitating sales on the secondary market. It offers also real estate properties on sale, real estate developers financing solutions, and residential loans. The company has strategic alliances with BlackRock and Highfields Capital. The company was founded in 2008 and is based in Moorpark, California. It has a facility in Tampa, Florida. Private National Mortgage Acceptance Company, LLC operates as a subsidiary of Blackrock Holdco 2, Inc.[8]

So let’s see if we can get that clear.  Angelo Mozilo was CEO of Countrywide until July 1, 2008…and while Angie-baby was dealing with charges of mortgage fraud and insider trading, his former second-in-command, Stanford Kurland is opening a new IPO named PennyMac.

I wonder whose idea that was?           

Wait for it….            Because if you don’t already know…           
It might come as a shock……           

It was the idea of our own United States Secretary Treasurer, Tim Geither!

  Timothy Geithner’s new TALF/PPiP/FDIC* plan, like all his other plans, seems designed to shovel billions into the coffers of the very same bankers who got rich on the mortgage bubble. When the public gets a glimpse of the tip of this giant iceberg, as they did with the AIG bonuses, they’re dismissed as angry rubes who Just Don’t Understand How Things Work. But his latest scheme is proof that they are absolutely right.[9]

  This must be part of “foaming the runway” that Barofsky mentioned in his book, “Bailout.”

Warren asked Geithner repeatedly about HAMP. After several evasions, Geithner said about the banks, “We estimate that they can handle ten million foreclosures, over time… this program will help foam the runway for them.” This is a revelatory moment for Barofsky in the book, and should be for everyone reading. Geithner’s concern, first of all, was with how the banks would respond to the program, not how homeowners would respond to it. In fact, homeowners are quite besides the point. Regardless of their situation, they will be one of the 10 million foreclosures, in Geithner’s construction. His goal was merely to space out the foreclosures and give the banks time to earn their way back to health, mostly through the other parts of the bailout, that enabled them to earn profits.”[10]


That means, dear homebuyer, that WE have become the sacrificial lambs to the “too big too fail” banks,    Kraken. 
…And our Secretary Treasurer Tim Geithner has been the one to chain us to the altar.            So….. [19]      

On June 1, 2008, Angelo Mozilo steps down as CEO of Countrywide.  On July 1, 2008, Bank of America purchases Countrywide.           

Now follow me here….because at the same time Countrywide Homeloans and many other lenders were raising out interest rates as high as 8-12%....in the back ground….the interest rates (LIBOR) were being manipulated.

  WSJ Libor study Libor manipulation to lower rate “Hi Guys, We got a big position in 3m libor for the next 3 days. Can we please keep the lib or fixing at 5.39 for the next few days. It would really help. We do not want it to fix any higher than that. Tks a lot.” Barclays Bank trader in New York to submitter, 13 September 2006[11]   On 29 May 2008, The Wall Street Journal (WSJ) released a controversial study suggesting that some banks might have understated borrowing costs they reported for the Libor during the 2008 credit crunch that may have misled others about the financial position of these banks.[12] [13]

As I mentioned at the beginning of this article, Bank of America, was forced to purchase Merrill Lynch.         

Merrill Lynch was one of those institutions considered too big too fail.  Why was Bank of America chosen for purchasing Merrill Lynch?  Why not Chase or JP Morgan?  The answer to those questions have yet to penetrate my understanding, yet this much I do know.  Merrill Lynch is sill alive and well inside the Bank of America Covering.                                      

Next, B of A chose to purchase Countrywide.  Countrywide bragged of being the #1 lender in          the nation.                                      

With the acquisition of Countrywide, B of A stood to be #1 in mortgage lending in the world.  Definitely, too big too fail and by far too big to shoulder billions of dollar losses, so why did they agree to acquire a mortgage lender that had so many distressed mortgages on their books?

  The first document everyone should read is by S&P, the largest of the rating agencies.              The context of the document is that a professional credit rater has told his  superiors that he needs to examine   the mortgage loan files to evaluate the risk of a complex financial derivative whose risk and  market value depend on the credit quality of the  nonprime mortgages "underlying" the derivative. A senior manager sends a blistering reply with this forceful punctuation: Any request for loan level tapes is TOTALLY UNREASONABLE!!! Most investors don't have it and can't provide it. [W]e MUST produce a credit estimate. It is your responsibility to provide those credit estimates and your responsibility to devise some method for doing so.   Fraud is the principal credit risk of nonprime mortgage lending. It is impossible to detect fraud without reviewing a sample of the loan files.[14]

  So Bank of America must have been feeling a little over-whelmed, at this point.  They were bloated with default swaps and derivatives (that is a nice way of saying sub-prime loans that have been guaranteed and securitized).  These company’s have found a way of dehumanizing the families they have managed to deceive in all of this mess, by finding names for us that have nothing to do with our humanity and everything to do with mining us for our remaining assets.

           And in 2008 as all of this was converging upon an unsuspecting public, the FHFA placed Fannie Mae and Freddie Mac in a conservatorship and we, the taxpayers, footed the bill.           

Now we come into “modifications”.  The amount of losses was going to be staggering, and people were angry.  Senators and lawmakers were getting letters from angry and frustrated homebuyers.  

       The Senate and legislatures demanded that the government needed to keep track of the money poured into Wall Street as a condition of TARP.           

      It all got very complicated and confusing, but the banks did not want to cooperate.  They did not want to reduce their profits and they did not want to sacrifice their bonuses, so they began stroking the propaganda of the deadbeat homebuyer.  They had no legal obligation to modify the loans, rather it was a verbal agreement as a condition of using government money.  As time passed we all came to realize how few modifications were really being achieved.  Lenders purposely stalled.  There was no oversight, but they couldn’t stall forever, they needed to get the problem loans off of their books.           

     As part of the TARP/PPiP plan, our government poured billions of tax payer dollars into the big lenders with little or no oversight.           

     So along came PennyMac.  PennyMac is the brain child of Timothy Geithner – PennyMac would take the “non-performing” loans off the hands of the lenders that had to answer to the Federal Government for the money they borrowed.  Once these loans were off their books, they could deduct the loss from their inventory and they no longer had to work out a solution with the borrowers.

      PennyMac would be a hedge fund that did not have to answer to government regulators.  PennyMac would be able to run with a minimum amount of regulation.  All they needed was an IPO and they were off and running.
       Now we know that Timothy Geithner came up with the idea for PennyMac, but wait until you find out who is underwriting it….. 

       On October 7, 2009, SIGTARP, (Special Inspector General for Troubled Asset Relief Program) submitted a study titled:  “Selecting Fund Managers for the Legacy Securities Public-Private Investment Program.”[15]

The reason for the report was stated as follows:   “The Chairman and Ranking Member of the Subcommittee on Contracting Oversight, Senate Committee on Homeland Security and Governmental Affairs, requested that SIGTARP review Treasuey’s selection of fund managers for PPIP.  This study complements another planned SIGTARP audit tht examines PPIP fund managers’ compliance programs to prevent fraud, waste, and abuse in executing the program.  SIGTARP’s reporting objectives for this audit were to determine:
 
     ·    What criteria Treasury used to select the fund managers and their minority partners.   
     ·    Whether Treasury consistently applied its criteria in the selection of the fund managers;
     ·   The extent that Treasury performed due diligence reviews on the fund managers and their minority partners; and
     ·      Whether financial agreements between Treasury and the successful fund manager applicants were governed by the Federal Acquisition Regulation.  

In addition to the information presented in this report SIGTARP has begun a separate audit to determine whether Treasury has established operational controls to prevent or mitigate conflicts of interest.  (italic is mine)”           

It is important to note that avoiding a conflict of interest was a factor in choosing the operational controls, especially considering that Tim Geithner’s past associations.[16]

Nine of the finalists applying for the $700 billion dollars of TARP funds are as follows:  

     1)    Alliance Bernstein, L.P. and it’s sub-advisors Greenfield Partners, LLC and Rialto Capital Management, LLC
     2)    Angelo, Gordon & Co., and GE Capital Real Estate
     3)    BlackRock, Inc.
     4)    Invesco Ltd.
     5)    Marathon Assett Management L.P.
     6)    Oaktree Capital Management, L.P.
     7)    The Trust Company of West Croup, Inc.
     8)    Wellington Management Company, LLP
     9)    RLJ Western Asset Management L.P.           

Blackrock funding was partially owned by Bank of America (it was a package deal with Merrill Lynch) until Bank of America unloaded its shares in 2011.[17]           

Yet in 2008 when our Treasury began to dole out the money, Blackrock was still a part of B of A.  Important to know when following the money.           

Now if you have read this far…you must continue to the end…if you do you will find a plan so diabolical, so reprehensible that you will believe it must be a plot of a movie where some leader wants to take over the world!           

For those of you who have children around the age of our children…just think “Pinky and the Brain.”………



Since Countrywide was the #1 lender in the nation and most of the Countrywide loans were considered “liar loans”, the lenders needed a way to recoup their losses.  Bank of America had purchased Countrywide and along with it all of their problems.  Thus, the inception of PennyMac came into play.  PennyMac was born very shortly after the day that Countrywide ceased to exist.
 
The underwriters of PennyMac were BlackRock Funding and Highland Financial.  BlackRock was funded by none other than our own taxpayer dollars, through the TARP FUNDS.  

From October 7, 2010, SIGTARP REPORT page 8:  

“Between February 10, 2009, and the beginning of the PPIP fund manager application process on March 23, 2009, Treasury officials held conversations with priviate investment firms BlackRock, Inc. (“BlackRock”), Pacific Investment Management Company, LLC (“PIMCO”), and The Trust Company of the West Group, Inc. (“TCW”) to seek advice on the structure of the planned program that would later be called the Legacy Securities Program.  Treasury told SIGTARP that it consulted the companied on the market feasibility of different proposed structures for the Legacy Securities Program, including the size of the program and the amount of capital that could feasibly be raised from the private sector for such an effort, and the relative impact of differently sized programs on illiquid securities markets.  Treasury officials told SIGTARP that it contacted these thee firms because each had successfully developed distressed asset funds and raised private capital for their own investors similar to the funds Treasury envisioned for PPIP.  Treasury did not document its communications with the three firms.”[18]

  So…was part of the Legacy Securities Program, the birth of PennyMac?  Did they need the previous executives of PennyMac to help them foreclose on their former bad loans? 

Is PennyMac the bulldog of B of A?

  …..and not only the Bulldog of B of A, but of Citimortgage and Fannie Mae and Freddie Mac, who owned most of the distressed loans!   Is PennyMac simply “Countrywide” reopened  under a new Corporate logo and IPO?

Read this response by a PennyMac shareholder:

  “Oh, Countrywide had some very bad apples at the top of the bank that did some bad things, but the back office, for the most part, still had control of the mess they were creating, as they still had some of the best folks in the industry running the back office (hint, that wasn't where the problems were in Countrywide). You might even find a bunch of them at PMT, since they seem to have some pretty bright folks there as well, and no so-called leaders of the industry doing any side deals.  

But when the government came to BofA and said to take this turkey off their hands, they didn't realize they were handing a viable company to a bunch of incompetents. Had Warren Buffet not shown up with $5 billion to spare when he did to pick of one hell of a deal (10% preferred shares, with a gazillion share option at around $7 per share on the common), the liars running BofA would have had to come clean and tell everyone it wasn't Countrywide, where they installed some of their own with no mortgage banking experience to run things, but their own incompetence in their own loan portfolio that was the real problem.  

How do I figure I know these things? Because the government was nearly begging PMT to take a bunch of the bad BofA loans over and get the government out of a bad spot. From what I heard, PMT had the good sense to decline.”[24]

[24] http://seekingalpha.com/article/858301-pennymac-mortgage-investment-trust-ceo-at-barclays-capital-global-financial-services-conference-transcript?page=2

Take a good look at PennyMac’s line-up of executives and decide for your self:  
·       Stanford Kurland – Chairman of the Board and CEO of PennyMac – formerly CEO of Countrywide Homeloans.
·       David a. Spector – President and Chief Operating Officer at PMC – formerly Senior Managing Director for Countrywide.
·       David M. Walker – Chief Financial Officer at PMC – formerly chief lending officer at Countrywide.
·       Fazad AbolfathiChief Technology Officer – formerly Countrywide senior program analyst.
·       Scott D. Anderson – Chief Mortgage Operations Officer – formerly Countrywide executive vice-president of wholesale lending.
·       Anne D. McCallion - chief financial officer of PCM and PLS – formerly served Countrywide as deputy chief financial officer, chief operations officer, and chief administrative officer.
·       Michael M. Muir – chief capital markets manager of PCM – formerly senior vice president at Countrywide Home Loans.
·       Julianne Fries – chief compliance office of PCM – formerly served as managing director and chief compliance officer of Countrywide Capital Markets.
·       Aratha M. Johnson - chief administrative officer of PCM – formerly served as chief of staff and managing director of the executive office of the president for Countrywide.
·       Brandon Ohnemus.  -  director of portfolio strategy of PCM – formerly first vice president of lending finance for Countrywide Bank, N.A., a subsidiary of Countrywide.
·       Lee Trumble - director of due diligence of PCM – formerly worked for Countrywide Bank, N.A., a subsidiary of Countrywide, managing the counterparty asset repurchase process.  

o   Nicole Sutherland – mortgage underwriter at PennyMac – formerly mortgage underwriter for Bank of America.
o   Doug Jones  - chief correspondent lending officer for PennyMac – formerly oversaw retail sales and institutional mortgage services for Bank of America Home Loans.
o   Jim Follette - Managing Director, Correspondent Fulfillment – formerly served as Senior Vice President for Bank of America Home Loans.
o   Kim Nicols - Regional Sales Manager for correspondent lending for the western region – formerly vice President, Regional Sales Manager, Institutional Mortgage Services for Bank of America. 

This is by no means an exhaustive list, rather just a few of the executives that transferred over from Countrywide and Bank of America to create PennyMac.            

Former executives, Angelo Mozilo and David Sambol were sued by the SEC for mortgage fraud and insider trading and later settled out of court.  Yet Countrywide is allowed to reopen and profit from their former predatory loans under the guise of PennyMac?

Was the inception of PennyMac, that is the “brainchild” of Tim Geithener, really the foam on the runway of bank foreclosures?  Is the promise of modification really just a ruse to lead us into default and cash in on our distress?  Distress, I might add, caused by the very lenders that are now profiting from these foreclosures?

  The SEC definition of insider trading is as follows:

Illegal insider trading refers generally to buying or selling a security, in breach of a fiduciary duty or other relationship of trust and confidence, while in possession of material, nonpublic information about the security. Insider trading violations may also include "tipping" such information, securities trading by the person "tipped," and securities trading by those who misappropriate such information. Examples of insider trading cases that have been brought by the SEC are cases against:

Corporate officers, directors, and employees who traded the corporation's securities after learning of significant, confidential corporate developments;  

Friends, business associates, family members, and other "tippees" of such officers, directors, and employees, who traded the securities after receiving such information;  

Employees of law, banking, brokerage and printing firms who were given such information to provide services to the corporation whose securities they traded;  

Government employees who learned of such information because of their employment by the government;

and   Other persons who misappropriated, and took advantage of, confidential information from their employers. Because insider trading undermines investor confidence in the fairness and integrity of the securities markets, the SEC has treated the detection and prosecution of insider trading violations as one of its enforcement priorities.[20]

Angelo Mozilo is famous in his infamy of running Countrywide Homeloans into the ground, yet when his time as CEO of Countrywide ended on July 1, 2008, the former executives of Countrywide were already beginning to flee and were forming a new company.  Countrywide’s former 2nd –in-command, Stanford Kurland, opened a new corporation, PennyMac Loan Services, started on April 28, 2008….  

Stanford Kurland, former COO of Countrywide Homeloans openly admits his responsibility in starting the subprime loans.  In an article in the New York Times it states: 

“Mr. Kurland acknowledges pushing Countrywide into the type of higher-risk loans that have since, in large numbers, gone into default. But he said that he always insisted that the loans go only to borrowers who could afford to repay them. He also said that Countrywide’s riskiest lending took place after he left the company, in late 2006, after what he said was an internal conflict with Mr. Mozilo and other executives, whom he blames for loosening loan standards.   In retrospect, Mr. Kurland said, he regrets what happened at Countrywide and in the mortgage industry nationwide, but does not believe he deserves blame. “It is horrible what transpired in the industry,” said Mr. Kurland, who has never been subject to any regulatory actions.”[21]

  So we cannot help but question his decision to open a new company founded on the premise of profiting from these former bad loans.   

While our government and the corporate leaders have tried to blame the homebuyers for knowingly getting in “over their heads” and purchasing bad loans, they then, in turn, want us to believe that Stanford Kurland and the other executives who ran Countrywide, had no idea of the fraud being wrought by their company and they were innocent of all culpability in the matter.  Huh?

I think it might be easier to believe that they are trying to take over the world.  

Consider the following:

PennyMac was started up shortly before Countrywide was sold to Bank of America.  Blackrock Funding (the backers of PennyMac) was meeting with Tim Geithner in private meetings along with a few other private investment firms, in February and March of 2009.  What was the purpose to open up a new corporation before the HARP program was even started?   

THEY were formulating a plan to structure a program later known as the Legacy Securities Program.  There were no homebuyers included in this meeting and planning committee.  What was their motivation for looking out for our best interests?  We had been labeled “deadbeats” without benefit of facing our accusers or a fair trial.  So PennyMac must have been formed to be part of the foam for the foreclosure runway.

Did Angelo Mozilo agree to be the “scapegoat” so that the other former executives could have a free market run?  Are we to actually believe that the former executives had no knowledge of the past wrong-doings?  Are we asked to accept that one man…Angelo Mozilo…and two other executives were solely responsible for this massive fraud?  Are they asking us to believe that his second-in-command, Stanford Kurland, a senior executive, who acknowledges pushing Countrywide into high-risk loans, knew nothing?  

“The SEC filed charges against Mozilo, Sambol, and Sieracki on June 4, 2009, alleging that they failed to disclose to investors the significant credit risk that Countrywide was taking on as a result of its efforts to build and maintain market share. Investors were misled by representations assuring them that Countrywide was primarily a prime quality mortgage lender that had avoided the excesses of its competitors. In reality, Countrywide was writing increasingly risky loans and its senior executives knew that defaults and delinquencies in its servicing portfolio as well as the loans it packaged and sold as mortgage-backed securities would rise as a result.”[23]

Our own government guaranteed Mortgage Backed Securities (our mortgages), and because of this our government had to take over Freddie Mac and Fannie Mae.  Freddie Mac and Fannie Mae were in trouble due to all of the bad mortgages, which meant our Treasury was in trouble.  They can’t raise the taxes because our debt is estimated to be about $177,000 per person.  So they have created a vortex of greed and fraud by collecting on underwater mortgages, from a bubble fraudulently created by WallStreet, which they bailed out with our tax dollars.  This is a simple rendition of a complex problem, but if you are following the money…you probably have the idea by now:

Millions of home buyers and their families have become the sacrifice to cover-up WallStreet fraud and the massive amounts of money poured into their coffers to cover up the damage. 



 ….And PennyMac becomes rich!

  ““It has been very successful — very strong,” John Lawrence, the company’s head of loan servicing, told Mr. Kurland one recent morning in a glass-walled boardroom here at PennyMac’s spacious headquarters, opened last year in the same Los Angeles suburb where Countrywide once flourished. “In fact, it’s off-the-charts good,” he told Mr. Kurland, who was leaning back comfortably in his leather boardroom chair, even as the financial markets in New York were plunging.”[25]


[25] http://www.nytimes.com/2009/03/04/business/04penny.html

Wednesday, August 4th, 2010, 11:53 am
PennyMac Mortgage Investment Trust (PMT: 15.90 +0.51%) Wednesday reported a Q210 net income of $8.2m or $0.48 per share, up 630.8% from $1.3m in Q110. The company reported a total net investment income of $13.3m and increase of 630% over last quarter's earnings.[26]  

[26] http://www.housingwire.com/2010/08/04/pennymac-net-income-grows-630-in-q210-on-mortgage-investments

630%  - NOW THAT'S RICH!

And how much does PennyMac pay for our mortgages that they are unwilling to lower the principle on?

Kurland's new company, PennyMac (!), goes to a demolished bank or the FDIC and buys up delinquent mortgages at, say, 20 cents on the dollar.[27] 

 
[27] http://www.businessinsider.com/ex-countrywide-execs-pennymac-files-for-an-ipo-2009-5

If only that is what really happened, but statistics state other wise.    In fact, let’s take a look at the foreclosure statistics:

New paragraph

So tell me again, why Bernie Madoff  is in jail?  Why did Martha Stewart serve jail time?  Honestly, how does the Federal government justify this stuff?   Families cannot get better jobs, prices are going up, properties are dropping and our Federal government is pouring money into the coffers of the perpetrators. 

Just today I read that our government has decided to pour $40 million a month into mortgage-backed securities to help stimulate the economy!

http://www.huffingtonpost.com/2012/09/13/fed-stimulus-federal-reserve-qe_n_1881216.html  

“The Fed in its statement on Thursday said it plans to buy $40 billion in mortgage-backed securities every month and continue another program, called "Operation Twist," in which it trades short-term bonds for long-term bonds. Along with another program to reinvest income from bonds it already holds into buying more mortgage-backed securities, the Fed expects to add $85 billion to its balance sheet until the end of the year.  

In an unusually aggressive step, the Fed also said it would buy more bonds, and consider other measures, if unemployment, currently at 8.1 percent, does not start falling more quickly:   "If the outlook for the labor market does not improve substantially, the Committee will continue its purchases of agency mortgage-backed securities, undertake additional asset purchases, and employ its other policy tools as appropriate until such improvement is achieved in a context of price stability," the Fed said.””

This move is supposed to help increase jobs.  Let’s see what increases first…jobs or foreclosures.  

In an article in the Chicago Tribune it looks like the FHFA is planning on going after the homebuyers rather than the fraudulent lenders:

Mortgage cops taking tough stance
Office of Inspector General on the prowl for strategic defaulters

http://www.chicagotribune.com/classified/realestate/foreclosure/sc-cons-0913-strategic-default-20120913,0,4134066.story

“Strategic defaulters, beware.

The feds are coming for you. And they are not happy. Not the FBI. The Office of the Inspector General at the Federal Housing Finance Agency.

The OIG may not have the same fearsome "G-man" reputation as its better-known counterparts at the Federal Bureau of Investigation, but it is every bit as much a law enforcement agency, with the same powers to search, seize and arrest. Special OIG agents are even authorized to carry firearms.

The OIG's mission is to seek administrative sanctions, civil recoveries and criminal prosecutions against anyone who abuses the FHFA's programs. And it is pursuing its calling with passion, if not vengeance.”

Our own government oversight committee, SIGTARP, tried to warn us what was coming and our leaders still did not listen!  

From the SIGTARP report of 3/25/2010 titled:  Factors Affecting Implementation of the Home Affordable Modification Program:

WHAT SIGTARP FOUND:  

When HAMP was launched in the first few months of 2009, Treasury justified the program by stating that it would “help up to 3-4 million at-risk homeowners avoid foreclosure,” and that it would do so “by reducing monthly payments to sustainable levels.” Notwithstanding this laudable aspiration that the program would actually help 3-4 million homeowners avoid foreclosure, Treasury has stated its 3-4 million homeowner goal is not tied to how many homeowners actually receive sustainable relief and avoid foreclosure, but RATHER that 3-4 million homeowners will receive offers for a TRIAL MODIFICATION. (emphasis mine)……..  

A year into the program, although more than a million trial modifications have been initiated, the number of permanent modifications thus far, 168,708, has been, even according to the Treasury, “disappointing.”   One Treasury official’s current estimate for how many permanent modifications will result from HAMP – 1.5 TO 2 million over the course of a four-year program – may be only a small fraction of the total number of foreclosures that will occur during that period.  It is the current projected estimate of permanent modifications (and not Treasury’s still repeated 3 – 4 million figure) that should inform the debate on whether HAMP is worth the resources being expended or whether the program needs to be re-vamped to actually help more borrowers.

 ………………….Finally, given the prevalence of negative equity in mortgages eligible for modification, re-defaults resulting from negative equity, including strategic defaults, may be a factor as borrowers decide that it makes more economic sense for them to walk away from their mortgages notwithstanding the lower payments.[29]


[29] http://www.sigtarp.gov/Audit%20Reports/Factors_Affecting_Implementation_of_the_Home_Affordable_Modification_Program.pdf

All the while companies like PennyMac cash in on a massive Ponzi scheme started by their own peers.           

What about all the company’s that claim they are losing massive amounts of money due to foreclosures?

          That is where the alleged money laundering comes in.  Let’s take CitiMortgage, for example, they lose our mortgages on their “books” and write them off.  (Please don’t forget that Mortgage-backed securities are guaranteed by our government….our tax dollars).  Then they sell these “written-off” mortgages to hedge fund companies, such as PennyMac.  Then PennyMac forecloses on borrower..and then sell our property for market value…an amount we could probably have afforded if we had been given the option.

             You remember we started this blog with Merrill Lynch?  Merrill Lynch who is now part of Bank of America?  The same Bank of America that also owns Countrywide?

            Well on August 16th, 2012, PennyMac filed a purchase agreement with the SEC for 15,000,000 common shares to Merrill Lynch, Citigroup and Credit Suisse.  For those of you who understand this stuff….here it is:

Each of PennyMac Mortgage Investment Trust, a Maryland real estate investment trust (the “Company”), PennyMac Operating Partnership, L.P., a Delaware limited partnership and the operating partnership of the Company (in such capacity, the “Operating Partnership”), and PNMAC Capital Management, LLC, a Delaware limited liability company and the manager of the Company (in such capacity, the “Manager”), confirms its agreement with each of Merrill Lynch, Pierce, Fenner & Smith Incorporated, Citigroup Global Markets Inc. (“Citigroup”) and Credit Suisse Securities (USA) LLC (each, an “Underwriter” and collectively, the “Underwriters”, which term shall also include any underwriter substituted as hereinafter provided in Section 11 hereof), with respect to the issue and sale by the Company and the purchase by the Underwriters, acting severally and not jointly, of the respective numbers of common shares of beneficial interest, $0.01 par value per share, in the Company (the “Common Shares”) set forth on Schedule A and with respect to the grant by the Company to the Underwriters, acting severally and not jointly, of the option described in Section 2(b) hereof to purchase all or any part of 15,000,000  additional Common Shares.  The aforesaid 15,000,000 Common Shares (the “Initial Securities”) to be purchased by the Underwriters and all or any part of the 2,250,000 Common Shares subject to the option described in Section 2(b) hereof (the “Option Securities”) are hereinafter called, collectively, the “Securities.”   The Company understands that the Underwriters propose to make a public offering of the Securities as soon as they deem advisable after this Agreement has been executed and delivered.[30]


[30] http://www.sec.gov/Archives/edgar/data/1464423/000110465912059475/a12-18834_1ex1d1.htm

          So now CitiMortgage, and other lenders, who have written off these “bad mortgages” can now collect on them via stock options with PennyMac.  Merrill Lynch, a division of Bank of America (Countrywide) can now begin to bring in a profit from their former loses via PennyMac, who in their most recent meeting with Barclays (are you seeing a pattern here yet?) bragged of their awesome profits:[31]

[31] http://seekingalpha.com/article/858301-pennymac-mortgage-investment-trust-ceo-at-barclays-capital-global-financial-services-conference-transcript?page=2

  (My input is in red)

  “Our investment activities perform well and we are pleased with the performance on PMTs distressed mortgage loan investments during the quarter.

(distressed mortgages are people who are losing their homes, or their homes are underwater and PennyMac anticipates they will lose their homes soon.) 

Pretax earnings increased 82% from the first quarter driven by a 144% increase in net investment income. We purchased 402 million in UPB reports distressed home loans during the quarter which were comprised of 224 million in UPB non-performing home loans and 178 million in UPB of re-performing home loans. 

 (They are making a ‘killer profit’ on people losing their homes)

Re-performing pools are likely to become more prevalent in the pipeline distress available to purchase going forward.

(here they are referring to loans that are modified or in temporary modification that people are current on.  They anticipate that the underwater status will cause them to be delinquent in the foreseeable future)

The second quarter’s results underscore the strength of PMTs business model and our ability to capitalize on opportunities as they emerge. 

 (They will make money as these people begin to lose their homes)

Look at the highlights for the third quarter today, we begin with the equity offering we complete in August of over 70 million shares generating proceeds totaling 357 million. The offering was met with both strong institutional retail demand and the underwriters green shoe option was fully exercise, we expect to use a portion of the capital assurance to purchase a $452 million pool of nonperforming loans.

(We will use the money we make from foreclosing and reselling to buy more loans that are underwater and in trouble.)

This purchase alone would make the third quarter 2012 the highest quarter for distress loans purchased since the first quarter of 2011 and we are actively pursuing additional distressed home loan pools.” 

(there are a lot of people going into foreclosure, they stand to make a fortune from the distress of others).

This needs to be exposed and stopped. 

We need to get our country back on track before our history begins to read like the “Fall of the Roman Empire.”  

When the distressed mortgage market runs it course we will be passing homeless people on our way to work and tent cities that we will want to chase out of our communities because they will create a "blight". There will be empty homes taken over by the new “indigents” who will be families that have been striped of all their assets by this lending fraud, mixed in with law breakers who will no longer fear the law.    

Communities are filing for bankruptcy because when the community loses its middle class, they lose their source of income.  Crime will multiply, because young people will lose their hope in achieving success by doing things the "right way."

Wealth is now being aggregated to the hands of those who know how to cheat the system, what does this say to our future generations?   Here in California there are cities talking about using "eminent domain" to take back the land "stolen" by these fraudulent lending practices. Which demonstrates that even our own government is becoming divided.  Families that are creating "fortresses" around their foreclosed home and refusing to leave.  

There are people being foreclosed upon when they own their homes outright, but because of securitization, the lenders have lost track of what is theirs and what is not. More often than not these families are able to prove their cases, but the cost and emotional toll is horrendous.

The problem could be remedied if the lenders would work out a way to work with the borrowers that would acknowledge the lose of value in the land that the lenders created. People who bought homes were basically hard working family types and anyone who tells you differently is exploiting them. In working with people, instead of seeking ways to annihilate all their years of hard work by stealing their home out from under them, they could still make a steady profit, and in doing so, salvage our retirement funds and encourage future business by creating a reputation of ethical and fair business dealings. That is still a good way of doing business, isn't it?  

The alternative is that we destroy the United States of America as we know it. And yes, in the process, some people will make a nice profit. Is that all that matters?  

Do not let the intellectual rhetoric of the large corporate executives fool you, these companies need to be called to task for their role in the destruction of our families and our AMERICA!

ABUSE OF THE AMERICAN PEOPLE...by those we were supposed to be able to trust....
June 26, 2012

PennyMac is comprised of the same executives that ran Countrywide.[1]  Countrywide, the largest lending institute in the nation, is one of the primary lenders known for their fraudulent mortgage practices, and primarily responsible for our current economic downfall.

         In November 2009, CitiMortgage called us to ask us if we were interested in a modification.  Since our loan was a 10-year interest only, we knew that we would need to stabilize our loan before then and we agreed to a modification.  We were still waiting for our lawsuit against Countrywide (B of A) to make it to court and we knew we would not be getting a resolution any time soon.

         By now, we all know modifications are not working, not because the people are not willing, but because the lenders are playing games.  The normal process is to lose paperwork for a year or so, then offer a “temporary modification”, which is a set-up for foreclosure.  If it were only a few incidents we could overlook it as “coincidence”, but this pattern of financial abuse has become the blueprint of foreclosure fraud.  The lenders are claiming all the time that they are following “government procedures”, as they lead millions of homeowners into foreclosure.  We are forced to give them all of our most personal financial information, so they are aware of our savings and our spending habits.  This makes it easy for them to drag it out until our savings are exhausted.

We have to hear how we, the people, should learn not to “depend on the government”, that we feel “entitled”, and we hear this from men who make their living from their offices manipulating hedge funds and default swaps!  These are not people who work by the sweat of their brow.  Their entitlement comes from profiting from the labor of the masses!  

         We have heard the justifications for the delays in justice.  We have heard the excuse that tags the “moral hazard” of the homebuyers.  All the while we watch and wait as Wallstreet and the lending institutions continue with their questionable and fraudulent practices while they receive large salaries and bonuses, it is very simply abuse.  The lawlessness is contagious.  Already people are moving back into their foreclosed homes.  The Occupy movement is growing and changing tactics.  Violence is beginning to erupt…among the police who are becoming corporate security guards…and among the people who fear for their way of life.   We are all waiting in fear that the violence will increase.

         Our empire is naked and even a child can see it.  So as our leaders debate and debate some more the middle class is slowly dying.  People are becoming homeless and fraud is triumphing over truth.  The American people carry the burden of bailing out the banks and then bailing them out again by allowing them to foreclose on us after they had robbed us through their unmitigated risk taking and greed.  Where are our lawmakers and leaders in all of this?

   In April, 2010, in a 3-way conversation between American Law Firm, Citimortgage and myself, they confirmed that our modification was only 30 – 45 days away.  That was when they began losing paperwork, or simply telling us that they were working on it.  They had all of our financial information, we were paying on time and we were struggling with the additional expenses we had incurred with Countrywide.  We were honest about our struggles and they assured us that they were doing their best to complete the paperwork and get us relief.

         We missed a payment in August.  In December 2010 we were scheduled to go to trial.  We missed a payment in order to pay our attorney.  We knew we would have an answer soon regarding the fraud.  However, our attorney settled without our consent.  He told us the trial date was vacated due to a full calendar and wouldn’t be rescheduled until later the following year.

         In January, we called CitiMortgage, they told us that they would be sending our modification that month.  Then Citimortgage told us we did not qualify for Hamp and turned us down for modification.[2]  A week later, they told us they would give us a temporary “in-house” modification for 3 months, which we were to pay until we received the full modification.  We were elated.  We thought that, at last, we had a resolution to hold us until we had our opportunity to be heard in court.

         We received the temporary modification on January 31st and had to send in our payment overnight to make the February 1st deadline.  Which we did.  Then in March we paid the 2nd of our temporary modification payments.  On March 17th CitiMortgage sent us a notice telling us to cease making our payments since they had sold our loan to PennyMac.[4]  We were to wait to hear from PennyMac.

PennyMac was contacted by our attorney’s, American Law Firm.  They were NOT going to honor the temporary modification.

         American Law Firm, who we hired to help us obtain a modification, refused to help us any longer without additional funding.  PennyMac sent us a letter introducing themselves and immediately talking about foreclosure.

         Upon researching PennyMac, we discovered that they were the very same executives that we had escaped at Countrywide Home Loans!
         PennyMac housed the same executives we were asked to testify against by the state of California. Yet once again, they have escaped litigation and possible conviction by making an outside settlement.  Their reward for this deplorable situation?  They are allowed to open another corporate IPO and profit from the same predatory loans they made in the first place!  They are allowed to do this with the encouragement and approval of top government officials![8]  Instead of having to answer to puplic regulatory agencies such as the SEC and FDIC, they privatize so they can foreclose without having to answer to any government regulations.

Currently, the executives at PennyMac have numerous lawsuits lined-up against them for mortgage fraud and securities abuse[9], including our own government!  The FHA and the FHFA are suing the top executives at PennyMac, yet they still get to make money “hand over fist” profiting from their previous predatory practices while the American homebuyers are led into foreclosure unabated by the fact that there are numerous irregularities in the foreclosure proceedings.[10]  While the lenders are rescued by our tax dollars, we are thrown out on the streets and have become nothing more than another resource to be used and discarded.

         Now that is….ABUSE…of the American taxpayers.  It is the destruction of the very foundations and principles this country was founded upon!

[1] Where are the Countrywide executives now? (2 articles)  (http://www.forbes.com/2008/03/24/pennymac-countrywide-update-markets-equity-cx_ra_0324markets29.html)  (http://www.businessinsider.com/ex-countrywide-execs-pennymac-files-for-an-ipo-2009-5)
.
[6] Article outlining PennyMac’s IPO  (http://www.businessinsider.com/ex-countrywide-execs-pennymac-files-for-an-ipo-2009-5)

[8] copy of article regarding Tim Geithner and PennyMac  (http://firedoglake.com/2009/03/23/timothy-geithner-making-countrywide-executives-rich-again/ Page)

[9] copy of Justia lawsuits  (http://dockets.justia.com/search?query=Stanford++Kurland) 

(http://dockets.justia.com/search?query=David+Spector&search=Search&s…orcourt=&judge=&lawsuit&documentfilter=allcases&after=&before=)

[10] copy of articles regarding mortgage fraud.  (http://www.huffingtonpost.com/2012/03/07/gregory-mackler-whistleblower-bank-of-america_n_1328381.html)

New paragraph

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