>> I think it's a little weird to be calling this 'fraud' ...
and then writes:
> State prosecutor offices are joining together to investigate,
> which sounds to me like they think there is fraud.
... or they'd like to see their names in the papers :-)
> This might be to determine if the affidavit process has been phonied
> up.
Let me clarify: I can totally believe that Something Improper is going on here. But it seems like in the vast majority of these cases it's going to turn out that we're talking about incompetence/laziness rather than fraud. Fraud is fundamentally about saying something that's Not True in order to gain; many of these cases are guilty of poor documentation, but it seems unlikely that these foreclosure efforts are invented from whole cloth.
Even if the affidavit process has been phonied up, it doesn't mean that the loan doesn't exist.
It's an interesting -- even funny in some aspects -- story, but it's not going to keep anyone from losing their house. The best hope in that situation is to see Congress force refinancing.
http://www.npr.org/templates/story/story.php?storyId=130271708
My take is that this is a good plan; it's effectively a "tax cut" without impacting federal revenues much directly. Since many consumers see their household budgets in terms of "after-tax money" I think a lot of people include things like mortgages in the "tax" part of the equation. Whatever it would take to increase your take-home pay feels like a tax cut. I recently helped my (retired) mother refinance her house down 1.5% and it's $300 in her pocket each month. Change, baby!
/jordan