The United States Government has created numerous commissions, agencies, bureaus, associations, and corporations to establish policies and implement and enforce laws in order to regulate the industry surrounding relationships between lenders and borrowers. You might look at these as demonstrations of the efforts of congress to protect the weak from the strong – to tamper with the law of the survival of the fittest (SOF). We can look at this regulation as a blessing and a curse. From the blessing view, it protects the unskilled borrowers from the intelligent, determined, and avaricious lenders. From the curse view, it has converted people who would otherwise save up money to buy what they want into debtor-consumers who buy stuff they generally don’t need with money they don’t have, and become slaves as a result.
But at least it keeps the very smart from actually physically slapping their victims (consumers) into chains and beating them with whips in order to keep the fruits of their labors as in the old plantation days. Now we have a much more civilized form of slavery – it is voluntary, so it doesn’t violate the 13th amendment, and it is effective because most debtors hand over half or more of their net earnings to creditor slave-masters. The slave-masters provide campaign finance money to elected officials, and so the laws favor the slave-masters.
Congress and the Federal Reserve work assiduously to make America an irreversible debtor society. First, it practices monstrous deficit spending and waste of money so eventually it will become impossible to pay the service on the national debt, let alone the debt itself. This deficit spending creates inflation that destroys the value of savings (think of it as a savings tax companion to abusive income tax), so it discourages saving. It also makes it seem more profitable to go into debt because as the debt goes on for decades, money becomes worth less and a fixed-interest debt becomes easier to pay as the borrower receives cost of living increases from the employer.
And, as I pointed out last week big investors have bought up tens of thousands of foreclosed-mortgage houses, intending to fix them up and rent them out, and then to securitize the rental income to make even more profits. Banks participating in this scheme also participated in the widespread predatory lending that started a decade ago, and continues through abusive loan modification schemes. You see, they figured out a way to steal home ownership from the people, and turn the bulk of the homeowners into renters with no assets that will appreciate if and when the economy turns around. Then, they will drive renters further into poverty with rising rents.
Ignoring this horrifying portent, and as a pretense of fairness and empathy, Congress has mandated that government provide means whereby slaves (debt consumers) can complain against abusive lenders and their abusive agents, including third party debt collectors. Some states have made it quite easy for creditors to snatch the collateral for loans by allowing a public trustee to mandate foreclosure of a loan in default by the borrower, without requiring court action. Others require a lawsuit to foreclose. But virtually all efforts to foreclose defaulted loans go through to completion.
In other words, it is quite stupid for the slaves to try to defend against foreclosure of their defaulted loans because they always lose.
Nevertheless, lenders, their agents, and debt collectors often do abusive things to borrowers in the lending and debt collection process. Myriad unresolved complaints about this have reached Congress. So Congress ordered agencies to make it easy for complainers to complain and harder for complainees to ignore the complaints. Congress thinks it’s just fine to make people into voluntary slaves, but the slave-masters and their agents must do it properly. Congress also knows, of course, that very few victims of lender/collector abuse will complain properly and follow through on it. Unlike most of them, I happen to know that lenders or their agents cheated 9 out of 10 mortgage borrowers, and unlike most of them, I also know how. So I know generally what to complain about. Most mortgage borrowers don’t, unfortunately.
Here I have listed some of the main agencies who offer help to distressed borrowers:
- Consumer Finance Protection Bureau
- Office of the Comptroller of the Currency
- Federal Trade Commission
- Federal Home Loan Mortgage Corporation
- Federal National Mortgage Association
- Federal Deposit Insurance Corporation
- U.S. Department of Housing and Urban Development
Here I have listed some specific sites and documents people with mortgages should study and use to lodge complaints and demand solutions.
I encourage all readers to eliminate their slave-hood status by becoming debt-free and diversifying investments to include targets like precious metals and mines that become more valuable in times of financial crisis.
Until you become debt free… if you have a mortgage and you want to know how to discover the myriad ways lenders and their agents cheatd you, drop me a line through my email link below, or pick up the phone and call.
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