Saturday, October 16, 2010

Foreclosure-Gate: The Lowest Bidder

by Bill McBride on 10/16/2010 10:42:00 PM

In the previous post I asked Why did the mortgage servicers use "robo-signers"?

Note: Apparently not all servicers used "robo-signers", but several of them did.

This might be an example of the "lowest bidder", from Ariana Eunjung Cha and Zachary Goldfarb at the WaPo: For foreclosure processors hired by mortgage lenders, speed equaled money

The law firm of David J. Stern in Plantation, Fla., for instance, assigned a team of 12 to handle 12,000 foreclosure files at once ... Each time a case was processed without a challenge from the homeowner, the firm was paid $1,300. ...

The office was so overwhelmed with work that managers kept notary stamps lying around for anyone to use. Bosses would often scream at each other in daily meetings for "files not moving fast enough," Tammie Lou Kapusta, the senior paralegal in charge of the operation, said in a deposition Sept. 22 for state law enforcement officials who are conducting a fraud investigation into the firm. ... "The girls would come out on the floor not knowing what they were doing," Kapusta said. "Mortgages would get placed in different files. They would get thrown out. There was just no real organization when it came to the original documents."
What a mess.

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