MIT Sloan: Was there ever a subprime crisis?

January 9, 2017

Fascinating read from MIT Sloan, challenging a central assumption of the housing crisis:

While all types of people participated in the crisis, borrowers defaulting on bigger mortgages were responsible for a greater dollar amount in defaults. The researchers found that the top quintile of borrowers by income were responsible for 13 percent of delinquent mortgage debt in 2003. That share increased to 23 percent by 2006. Meanwhile, the bottom quintile of borrowers saw their share of delinquent mortgaged debt drop from 22 percent in 2003 to 11 percent in 2006.

[Read More]

A Rejection Of Politics As Usual

November 25, 2016

From Reuben Guttman for Law360:

Good trial lawyers know not to drink their own Kool-Aid. They view a case not just from their own vantage point but from the vantage point of their opponent. And at the end of a case they explore what was important to the jurors who rendered a verdict.
Now that the jurors have heard closing arguments and ruled in Pennsylvania, Michigan, North Carolina and Wisconsin with ballots that delivered the decisive electoral votes denying Hilary Clinton the presidency, the process of verdict analysis has begun.

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The Foreclosure Vote

November 25, 2016

From Tom Adams for

The first map is from RealtyTrac, and indicates the states with the largest foreclosure inventory in 2012. The second is a map of the key battleground states. In 2008 and 2012, Obama won these states. In 2016 Clinton lost them. There’s a lot of similarities between those two maps.

Even in the best economic environment, residential mortgage foreclosure is a long, messy process. The massive wave of foreclosures that hit these regions after the financial crisis had enormous consequences economically.

[Read More]

Recent Articles

Who is Wilbur Ross?

By Lynn Szymoniak November 25, 2016

On Thanksgiving day, President-Elect Trump announced that he would name Wilbur Ross as Secretary of Commerce.

Wilbur Ross was described in new reports as a “billionaire investor” who was also known as the “king of bankruptcy.” Ross was famous for buying and selling companies that had hit hard times and filed for bankruptcy.

Ross, 78 years old, was a big financial contributor to the Trump campaign. His wealth was estimated to be $2.9 billion by Forbes magazine.

One of the companies Ross acquired through bankruptcy was American Home Mortgage Servicing, Inc. (“AHMSI”). In August 2007, American Home Mortgage, the 10th largest retail mortgage lender in the U.S., filed for bankruptcy. [Read More]


By Lynn Szymoniak August 28, 2016


Novation Companies, formerly known as NovaStar Financial, a company that made over $11 billion in mortgage loans that failed at very high rates during the housing crisis, filed for bankruptcy court protection in Baltimore on July 20, 2016.

NovaStar was a major participant in mortgage-backed securities. NovaStar created its first mortgage-backed trusts in 1997 and continued making trusts in 1998, 2000 and from 2001 through 2003. In 2004, NovaStar made four trusts, each with loan balances of over $1 billion:

Series 2004-1:  $1,727,250,100

Series 2004-2:  $1,374,800,100

Series 2004-3:  $2,156,000,000

Series 2004-4   $2,468,750,000


In 2005, NovaStar created four more … [Read More]


By Lynn Szymoniak August 28, 2016

The Consumer Financial Protection Bureau (CFPB) approved rules on August 5, 2016, to help prevent wrongful home foreclosures.

Mortgage servicers will be required to promptly notify borrowers when loss mitigation applications are complete.  Many mortgage servicers never considered an application complete and repeatedly demanded information and documents that the borrower had already provided.  Many borrowers complained that the servicers often demanded federal income tax returns over and over.  Borrowers were required to make adjusted monthly payments while the applications were pending.  The repeated stalling benefited the banks and servicers.  Many borrowers reported that when their applications were finally refused, the … [Read More]

Florida’s 4th DCA Reverses Many Foreclosure Judgments

By Lynn Szymoniak May 1, 2016

“Oops – Our Bad – The Banks Didn’t Have Standing to Foreclose”

In the first four months of 2016, Florida’s 4th District Court of Appeals reversed many foreclosure judgments, primarily on standing grounds. In these appellate opinions, the appellate court repeatedly held that the banks failed to prove that they had standing to foreclose when they failed to prove that they had possession of the indorsed original note at the time the complaint was filed. These were all cases where the foreclosure was sought by a bank that was not the original lender. In the vast majority of foreclosure cases … [Read More]