Aiding and Abetting Foreclosures

Just when the markets seem to be stabilizing to some degree, a number of the nation’s largest mortgage companies are starting to pursue foreclosures after a several-month hiatus.

Timing is everything. Now that the banks have been propped up by federal funds (aka taxpayer dollars) and their solvency most likely ensured, these banks seem to be getting that ol’ swagger back in their policies. It wasn’t long ago that these companies had their tails tucked and their hands extended to Uncle Sam to bail them out and save them from themselves.

How short these banks’ memories are. It was the banks’ reckless lending policies that started to unravel and helped bring the global financial system to its knees. At the end of the day, where would these banks be today without Uncle Sam coming to the rescue? They probably wouldn’t be around to discuss the answer. There has been minimal relief for consumers, and a moratorium on foreclosures that lasted a few months will not reverse the course of the Great Recession.

Once again, it is the American consumer who will suffer from the shift in sentiment to start the foreclosure process again. Not only will more Americans lose their homes, but any rise in foreclosures will further depress home values. This is odd because banks will once again be holding foreclosed properties or need to dispose of them, which they really don’t like to do. All I can say is, “Here we go again.”

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