While it seems that Geithner isn't in any hurry to consider action on the foreclosure fraud crisis by declaring a national moratorium on foreclosures, saying that "a national moratorium would be very damaging to exactly the kind of people we’re trying to protect," the SEIU is trying to help people protect themselves to the extent that they can.
They've launched "Where's the Note" an online tool that will help homeowners figure out who it is that is actually holding their mortgage note. The mortgage note is the document homeowners sign when securing a home loan. The original mortgage note with the the borrower's signature is the only proof that that the borrower owes the debt. Banks need the note to prove that they own the loan and can collect payments, or have the right to foreclose if payments aren't made. And here's the rub.
The problem is, banks now buy and sell mortgages up and down Wall Street – slicing them up and repackaging them to sell to other banks. The bank you bought your mortgage from two years ago may not be the bank that owns it today. But, in all the shuffle, the mortgage notes often don’t get transferred along with your debt.
This is where the SEIU's new tool comes in. With it, you can find out who actually now holds your note. Here's how they explain it:
The Wall Street banks’ foreclosure system is a mess. Their total disregard for mortgage laws and standards is what created the foreclosure epidemic in the first place. Now, their total mismanagement is catching up to them. As of today, some of the largest mortgage lenders – JPMorgan Chase, Bank of America, and GMAC (now called Ally) – have been forced to halt foreclosures in 23 states and growing. We can’t rely on Wall Street banks to follow basic rules. We have to hold them accountable. At very least, they must provide the mortgage notes.
When Wall Street banks securitized, packaged, sold, and resold our mortgages, they created a system where it is often impossible to figure out who actually owns mortgage notes and therefore has the authority to foreclose on properties. But the big banks are getting tangled up in their own web. Recent events have exposed a handful of banks that are throwing families out of their homes even though they don’t have the mortgage note that proves they actually have a legal right to do so. There have been instances of two banks trying to foreclose on the same home, and in at least one case, of a bank trying to foreclose on a house where the homeowner had never even taken out a mortgage with anyone in the first place.
Whether you are facing foreclosure, have an underwater mortgage, or are just a concerned homeowner, it’s important that you contact your bank and demand to see the original note on your mortgage.
This is allowing us, regular people, to protect ourselves and fight back. So far, according to SEIU's John VanDeventer, over 60,000 have visited the tool in 2 days. More than 6,000 people, and rising fast, have submitted a formal request for their note. Fifty people have heard back and came back to the site to report on what they heard. The reports are mixed; some have found their note, some have needed to provide more information to the lender, and some have found out who the mortgage was sold to.
This simple tool, which walks users through a quick process of e-mailing their bank to request the note, has the potential to help tens of thousands of people avoid becoming a victim of foreclosure fraud.