The bad document mortgage foreclosure "crisis" appears to be turning into a political football that is likley to become a mess, ending up with more government control and legislation (The last thing the mortgage business needs.)
Congressman Alan Grayson has sent a letter to members of Financial Stability Oversight Council (which includes Fed chairman Ben Bernanke, Treasury Secretary Timothy Geithner, FDIC Chairman Sheila Bair, CGTC Chairman Gary Gensler) asking them to impose a moratorium on all mortgage foreclosures.
Although, we have objected to government interference in protecting banks against foreclosure, Grayson's demand swings completely in the other direction by halting all foreclosures.
What should be done is that each foreclosure should be judged on its own merits. If the documentation is proper and complete, the foreclosure should progress, if the foreclosure is not properly documented then the foreclosure should be halted.
There should be no special priviliges for bankers or mortgage holders. The rule of law, specifically, contract law, should apply. Otherwise we are simply headed further along the slippery slope toward Banana Republic status where laws change depending upon who is in power. No business can successfully operate under such conditions.
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