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NACA CEO Bruce Marks and George Mason University Real Estate Professor Anthony Sanders on the announced mortgage settlement between banks and regulato...
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-- -- Okay until another story and you probably heard about that's an eight and a half billion dollar settlement with the country's biggest banks.
Has critics wondering if the government is trying to shake down the financial industry in the wake of the mortgage meltdown.
Consumer advocates -- say it's consumers who are getting the shaft.
Banks they say should pay more joining me now Anthony Sanders.
He's real estate professor at George Mason university and Bruce marks CEO of the neighborhood assistance court of America welcome to you both it's great to have you both here.
Anything imminent start with you though because you've told us that you thought what the government was doing here was wealth redistribution.
Plain and simple what -- mean by that.
-- I mean by this this is really the fifteenth administration loan modification program they can't go through congress and get another one of these.
FHFA -- to -- the big prints were reductions the way the administration is hope it's not the regulators the OCC is now engaging in.
What -- eight and a half for the ten billion dollars of and new loan modifications.
I'm this is just something gets cut the trillion dollar -- -- kind of bypassing the regular -- the.
Nice -- did you not answering my question why is this wealth redistribution.
Also could -- of taking money from the banks is this handing it out to people that they deem worthy -- Bruce do you worry.
Can't be left feel sorry for the banks I mean come on and the what it is let me get to your -- -- can't beneath the independent consult I don't bring us.
Does -- you talk to the independent consultant what they say is that they -- documenting.
That the bank had modifications that were available for tens of thousands hundreds of the book of homeowners.
And those banks didn't give those homeowners the opportunity.
To save their home so they lost their homes.
So the independent consoles are out there showing that these banks we're doing violations.
They're doing illegal activity.
Taking peoples -- are the opportunity was there and also think this is not eight point five billion dollars it's 3.2 billion dollars.
Could the five point three billion and soft money is not real.
-- -- -- -- -- Very little -- get in here that kids I think he'll probably make some important points here.
About it too is getting this money first of all a lot of it is going directly to borrowers.
And so one of the questions our viewers ask every night is should we be bailing out consumers who made bad decisions about loans Anthony.
Well first what he called me Carr also -- -- Hansen and -- Karl Marx but secondly.
Align our name the only reminder of the group from this -- they're not Rwanda critic.
In any case let's that the problem this is real money and then I you know Bruce has -- say -- what have you on this I don't think so I think is coming straight out of the banks.
And this'll end up -- -- -- the mortgage market even more fees will go up.
And the be less mortgage availability of the I just don't think there's a particularly good ideas.
Are -- brits like that led by Hank.
The banks want this settlement could the bank.
-- -- settlement his name is Anthony.
That I get a okay is Anthony Sanders.
Anthony OK -- the banks want this settlement because he's independent consultant that the banks hired.
Had -- are showing that the banks were engaged in these activity and that's listen to this tank.
-- -- -- -- it is that the homeowners.
Were available have modification that was available.
And it was based on new lender is underwriting criteria the lenders never provided it to the homeowners and the homeowners lost their homes.
The independent consultant improve I don't know what kind of work you can afford right I -- Hello -- around in my it is not quiet the consumers in some -- responsible for what happened here.
Jerry this is what.
The this is -- modifications out there that were available and the homeowners lost their home so of course they need to compensate.
The home -- for their activities that were wrongful act.
That's the American way if you regularly at the -- -- way.
Anthony them better candidate the American way isn't the American way they make the -- hall when they make bad decisions.
-- -- -- -- -- -- -- They talk all please please there isn't a word edgewise.
If I don't want.
Vegas and gamble my money and I lose I don't go to -- -- big -- -- could you please reimbursed -- and made a terrible mistake.
This again just -- set record.
Starting in 20012008.
Fannie Mae and Freddie Mac purchased 30% of the portfolio were risky loans and is low LTV.
-- -- -- -- So this that the been brewing this risk giving it the homeowners -- can't afford belongs.
And then suddenly they everyone goes oh my gosh those evil banks this loan me money when -- couldn't afford -- -- yet.
We have to drug -- somewhere Bruce.
-- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- One of their findings that the SEC talked about in there and -- conference call with reporters and others was that.
The number of people were harmed harmed financially by these loans only six point 5% of the total.
Now this is interesting because you would think that everybody who would be eligible for money -- who would get money.
Would have been harmed financially but it seems that that is not the case at all how do you respond to that.
Because if you talk to the independent independents don't -- that -- we've been talking to what they're telling us is that they were just getting that information now.
And they were flying -- bitter -- widespread abuses by these banks but now they're stopping the one time.
In really history where you do independent thorough review.
Where they're finding gross misconduct of the lenders they stopped it in the track the lenders wanted -- then they got what they wanted.
And just to go back to do you -- previous points -- 100 a violation of the law we used to have.
Police -- country where everybody was responsible but somehow these lenders are getting off.
Without my friend Carnival networks and at home owners quickly -- in early -- I want both of you this state.
What should happen here and -- start with you what should happen here.
The homeowners who lost their homes through the wrongful acts of the lenders need to be properly compensated -- where appropriate get their homes back.
Alright Anthony what do you say.
And I don't disagree Bruce of there was a wrongful up foreclosure default.
-- -- there should be compensation the problem is I think the vast majorities were not wrongful.
There's nothing wrong with that in -- if you -- -- Mississippi that doesn't qualify -- for a loan modification.
But I think we're actually -- an easy but they didn't you and I let's wait that's anyway I didn't get we will and I want -- And -- don't look at.
Are right and -- respond and then we're gonna have to leave it there.
We agreed to the point that if there was damage done to the households but in the case.
The robo signing.
You can't really -- damages and that's.
Our point OK but -- let me get -- agreed to review worry here -- that I -- -- -- my guests for coming on tonight Bruce thank you for big winner says.
And -- articulating your point of view I think it's an important one Anthony always a pleasure to have you want thanks to both picture.
