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Fannie and Freddie's Foreclosure Barons

By Implode-Explode Heavy Industries

``Stern's company is one of dozens of mills that now churn through more than a million cases a year for Fannie and Freddie, big banks, and private lenders. Built like industrial assembly lines, the mills employ small armies of paralegals and other low-level employees who mass-produce court filings, run title searches, and schedule scores of hearings and property auctions daily... the business model is simple: to tear through cases as quickly as possible. (Stern's company handled 70,382 foreclosures in 2009 alone.) This breakneck pace stems from how the mills get paid. Rather than billing hourly, they receive a predetermined flat fee for the foreclosure?typically around $1,000?plus add-ons for each of the related services. The more they foreclose, the more they make. As a result, consumer attorneys and legal experts say, even families who have been foreclosed upon illegally?and who can afford to make good on their mortgages?end up getting steamrolled.''

Full post as published by Mortgage Lender Implode-o-Meter on August 09, 2010 (boomark / email).