In foreclosure controversy, problems run deeper than flawed paperwork…….

I’ve been running this story over at Poilticaldog101.com….

It keeps getting bigger and bigger….

Banks and Mortgage companies …

Foreclosing on home’s with out checking paperwork…

The story gets worst everyday….

Millions of U.S. mortgages have been shuttled around the global financial system – sold and resold by firms – without the documents that traditionally prove who legally owns the loans.

• In foreclosure controversy, problems run deeper than flawed paperwork
• Wells Fargo settles over ‘pick a pays’
• Thousands of foreclosures are put on hold

Now, as many of these loans have fallen into default and banks have sought to seize homes, judges around the country have increasingly ruled that lenders had no right to foreclose, because they lacked clear title.

These fundamental concerns over ownership extend beyond those that surfaced over the past two weeks amid reports of fraudulent loan documents and corporate “robo-signers.”

The court decisions, should they continue to spread, could call into doubt the ownership of mortgages throughout the country, raising urgent challenges for both the real estate market and the wider financial system.

For struggling homeowners trying to avoid foreclosure, it could mean an opportunity to challenge the banks they argue have been unhelpful at best and deceptive at worst. But it also threatens to leave them in prolonged limbo, stuck in homes they still can’t afford and waiting for the foreclosure process to begin anew.

For big banks, “there’s a possible nightmare scenario here that no foreclosure is valid,” said Nancy Bush, a banking analyst from NAB Research. If millions of foreclosures past and present were invalidated because of the way the hurried securitization process muddied the chain of ownership, banks could face lawsuits from homeowners and from investors who bought stakes in the mortgage securities – an expensive and potentially crippling proposition.

For the fragile housing market, already clogged with foreclosure cases, it could mean gridlock and confusion for years. And there is concern in Washington that if the real estate market and financial institutions suffer harm, it could force the government to step in again. Attorney General Eric H. Holder Jr. said Wednesday he is looking into the allegations of improper foreclosures, and Sen. Christopher J. Dodd (D-Conn.), chairman of the Senate banking committee, said he plans to hold hearings on the issue.

At the core of the fights over the legal standing of banks in foreclosure cases is Mortgage Electronic Registration Systems, based in Reston…..

More….

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13 GOP Attorney General’s want the “Nebraska Compromise” stripped from the Healthacare Bill….

They have written to Speaker of the House Pelosi and Senate Majority Leader Reid formally requesting Senator Ben Nelson’s (D- Neb.) sweetner be eliminated as illegal……

Here’s more…..

“The fundamental unfairness of H.R. 3590 may also give rise to claims under the due process, equal protection, privileges and immunities clauses and other provisions of the Constitution,” they wrote.

The state officials say they are “contemplating” legal action but would not go through with it if it is removed from the bill. They claim they do not find any other Constitutional objections to the bill.

Some Republicans have argued that the bill’s individual mandate to buy health insurance also violated the Constitution.

…..and this is copy of the letter…….

December 30, 2009

The Honorable Nancy Pelosi

Speaker, United States House of Representatives

Washington, DC 20515

The Honorable Harry Reid

Majority Leader, United States Senate

Washington, DC 20510

The undersigned state attorneys general, in response to numerous inquiries, write to express our grave concern with the Senate version of the Patient Protection and Affordable Care Act (“H.R. 3590”). The current iteration of the bill contains a provision that affords special treatment to the state of Nebraska under the federal Medicaid program. We believe this provision is constitutionally flawed. As chief legal officers of our states we are contemplating a legal challenge to this provision and we ask you to take action to render this challenge unnecessary by striking that provision.

It has been reported that Nebraska Senator Ben Nelson’s vote, for H.R. 3590, was secured only after striking a deal that the federal government would bear the cost of newly eligible Nebraska Medicaid enrollees. In marked contrast all other states would not be similarly treated, and instead would be required to allocate substantial sums, potentially totaling billions of dollars, to accommodate H.R. 3590’s new Medicaid mandates. In addition to violating the most basic and universally held notions of what is fair and just, we also believe this provision of H.R. 3590 is inconsistent with protections afforded by the United States Constitution against arbitrary legislation.

In Helvering v. Davis, 301 U.S 619, 640 (1937), the United States Supreme Court warned that Congress does not possess the right under the Spending Power to demonstrate a “display of arbitrary power.” Congressional spending cannot be arbitrary and capricious. The spending power of Congress includes authority to accomplish policy objectives by conditioning receipt of federal funds on compliance with statutory directives, as in the Medicaid program. However, the power is not unlimited and “must be in pursuit of the ‘general welfare.’ ” South Dakota v. Dole, 483 U.S. 203, 207 (1987). In Dole the Supreme Court stated, “that conditions on federal grants might be illegitimate if they are unrelated to the federal interest in particular national projects or programs.” Id. at 207. It seems axiomatic that the federal interest in H.R. 3590 is not simply requiring universal health care, but also ensuring that the states share with the federal government the cost of providing such care to their citizens. This federal interest is evident from the fact this legislation would require every state, except Nebraska, to shoulder its fair share of the increased Medicaid costs the bill will generate. The provision of the bill that relieves a single state from this cost-sharing program appears to be not only unrelated, but also antithetical to the legitimate federal interests in the bill.

The fundamental unfairness of H.R. 3590 may also give rise to claims under the due process, equal protection, privileges and immunities clauses and other provisions of the Constitution. As a practical matter, the deal struck by the United States Senate on the “Nebraska Compromise” is a disadvantage to the citizens of 49 states. Every state’s tax dollars, except Nebraska’s, will be devoted to cost-sharing required by the bill, and will be therefore unavailable for other essential state programs. Only the citizens of Nebraska will be freed from this diminution in state resources for critical state services. Since the only basis for the Nebraska preference is arbitrary and unrelated to the substance of the legislation, it is unlikely that the difference would survive even minimal scrutiny.

We ask that Congress delete the Nebraska provision from the pending legislation, as we prefer to avoid litigation. Because this provision has serious implications for the country and the future of our nation’s legislative process, we urge you to take appropriate steps to protect the Constitution and the rights of the citizens of our nation. We believe this issue is readily resolved by removing the provision in question from the bill, and we ask that you do so.

By singling out the particular provision relating to special treatment of Nebraska, we do not suggest there are no other legal or constitutional issues in the proposed health care legislation.

Please let us know if we can be of assistance as you consider this matter.

Sincerely,

Henry McMaster

Attorney General, South Carolina

Rob McKenna

Attorney General, Washington

Mike Cox

Attorney General, Michigan

Greg Abbott

Attorney General, Texas

John Suthers

Attorney General, Colorado

Troy King

Attorney General, Alabama

Wayne Stenehjem

Attorney General, North Dakota

Bill Mims

Attorney General, Virginia

Tom Corbett

Attorney General, Pennsylvania

Mark Shurtleff

Attorney General, Utah

Bill McCollum

Attorney General, Florida

Lawrence Wasden

Attorney General, Idaho

Marty Jackley

Attorney General, South Dakota

Ok, how far is this going to go?……Does a state have a chance against something the majority party wants?…..the Supremes can read the tea leaves also……

Stay tuned….

13 GOP Attorney General's want the "Nebraska Compromise" stripped from the Healthacare Bill….

They have written to Speaker of the House Pelosi and Senate Majority Leader Reid formally requesting Senator Ben Nelson’s (D- Neb.) sweetner be eliminated as illegal……

Here’s more…..

“The fundamental unfairness of H.R. 3590 may also give rise to claims under the due process, equal protection, privileges and immunities clauses and other provisions of the Constitution,” they wrote.

The state officials say they are “contemplating” legal action but would not go through with it if it is removed from the bill. They claim they do not find any other Constitutional objections to the bill.

Some Republicans have argued that the bill’s individual mandate to buy health insurance also violated the Constitution.

…..and this is copy of the letter…….

December 30, 2009

The Honorable Nancy Pelosi

Speaker, United States House of Representatives

Washington, DC 20515

The Honorable Harry Reid

Majority Leader, United States Senate

Washington, DC 20510

The undersigned state attorneys general, in response to numerous inquiries, write to express our grave concern with the Senate version of the Patient Protection and Affordable Care Act (“H.R. 3590”). The current iteration of the bill contains a provision that affords special treatment to the state of Nebraska under the federal Medicaid program. We believe this provision is constitutionally flawed. As chief legal officers of our states we are contemplating a legal challenge to this provision and we ask you to take action to render this challenge unnecessary by striking that provision.

It has been reported that Nebraska Senator Ben Nelson’s vote, for H.R. 3590, was secured only after striking a deal that the federal government would bear the cost of newly eligible Nebraska Medicaid enrollees. In marked contrast all other states would not be similarly treated, and instead would be required to allocate substantial sums, potentially totaling billions of dollars, to accommodate H.R. 3590’s new Medicaid mandates. In addition to violating the most basic and universally held notions of what is fair and just, we also believe this provision of H.R. 3590 is inconsistent with protections afforded by the United States Constitution against arbitrary legislation.

In Helvering v. Davis, 301 U.S 619, 640 (1937), the United States Supreme Court warned that Congress does not possess the right under the Spending Power to demonstrate a “display of arbitrary power.” Congressional spending cannot be arbitrary and capricious. The spending power of Congress includes authority to accomplish policy objectives by conditioning receipt of federal funds on compliance with statutory directives, as in the Medicaid program. However, the power is not unlimited and “must be in pursuit of the ‘general welfare.’ ” South Dakota v. Dole, 483 U.S. 203, 207 (1987). In Dole the Supreme Court stated, “that conditions on federal grants might be illegitimate if they are unrelated to the federal interest in particular national projects or programs.” Id. at 207. It seems axiomatic that the federal interest in H.R. 3590 is not simply requiring universal health care, but also ensuring that the states share with the federal government the cost of providing such care to their citizens. This federal interest is evident from the fact this legislation would require every state, except Nebraska, to shoulder its fair share of the increased Medicaid costs the bill will generate. The provision of the bill that relieves a single state from this cost-sharing program appears to be not only unrelated, but also antithetical to the legitimate federal interests in the bill.

The fundamental unfairness of H.R. 3590 may also give rise to claims under the due process, equal protection, privileges and immunities clauses and other provisions of the Constitution. As a practical matter, the deal struck by the United States Senate on the “Nebraska Compromise” is a disadvantage to the citizens of 49 states. Every state’s tax dollars, except Nebraska’s, will be devoted to cost-sharing required by the bill, and will be therefore unavailable for other essential state programs. Only the citizens of Nebraska will be freed from this diminution in state resources for critical state services. Since the only basis for the Nebraska preference is arbitrary and unrelated to the substance of the legislation, it is unlikely that the difference would survive even minimal scrutiny.

We ask that Congress delete the Nebraska provision from the pending legislation, as we prefer to avoid litigation. Because this provision has serious implications for the country and the future of our nation’s legislative process, we urge you to take appropriate steps to protect the Constitution and the rights of the citizens of our nation. We believe this issue is readily resolved by removing the provision in question from the bill, and we ask that you do so.

By singling out the particular provision relating to special treatment of Nebraska, we do not suggest there are no other legal or constitutional issues in the proposed health care legislation.

Please let us know if we can be of assistance as you consider this matter.

Sincerely,

Henry McMaster

Attorney General, South Carolina

Rob McKenna

Attorney General, Washington

Mike Cox

Attorney General, Michigan

Greg Abbott

Attorney General, Texas

John Suthers

Attorney General, Colorado

Troy King

Attorney General, Alabama

Wayne Stenehjem

Attorney General, North Dakota

Bill Mims

Attorney General, Virginia

Tom Corbett

Attorney General, Pennsylvania

Mark Shurtleff

Attorney General, Utah

Bill McCollum

Attorney General, Florida

Lawrence Wasden

Attorney General, Idaho

Marty Jackley

Attorney General, South Dakota

Ok, how far is this going to go?……Does a state have a chance against something the majority party wants?…..the Supremes can read the tea leaves also……

Stay tuned….