When the economy took a nose-dive, the housing market across the county – including here in Kansas – went down with it. Some homeowners attempted to have their loans modified while others succumbed to foreclosure. Years later, the validity of some of those foreclosures are being called into question. This has lead individuals to wonder if the financial institution that held their loan utilized unfair business tactics.
US Attorney General Eric Holder recently renewed his pledge to prosecute any financial institutions that were involved in the financial crisis of 2008. He recently encouraged federal prosecutors to remain aggressive in their investigations and subsequent prosecutions. This financial crisis has not yielded many convictions. In 2012, only about 100 people were criminally charged with mortgage fraud. One reason cited for the low conviction rate is a lack of resources. Another reason is the high level of complexity. As time passes, it is increasingly more difficult to follow the trail of products and facts that led to the collapse of the housing market.
Though the road to criminal prosecution is not a smooth one, the Justice Department continues to file law suits. Most recently, Bank of America was sued for fraudulent mortgage origination and securitization practices during the financial crisis. Unfortunately, the window of opportunity is closing because the statute of limitations will soon close leaving the Securities and Exchange Commission outside of its authority to handle these cases.
As it stands, Kansans who have been victims of these financial institutions are left to piece together the remnants of their finances. However, those currently struggling with money or facing foreclosure should know that filing Chapter 13 can often stop foreclosure proceedings. In addition, it can be a real solution to get one’s finances back on track to paying debt and meeting obligations. Homeowners who are facing foreclosure amidst financial difficulties can better understand their options by working with an experienced bankruptcy attorney.
Source: NPR, “Is Government’s Renewed Push On Mortgage Fraud Too Late?,” John Ydistie, Aug. 22, 2013.