>

10/16/10

Quality

Is a well thought out process that is followed through...

Banks and mortgage companies lent money for real estate without thinking out the consequences of not following a quality process in handling of documents. The result is deeper than "robo-signing" of documents and improper affidavits and notarizations due to the way the loans were originally securitized, which was in a manner contrary to the way property has been legally transferred and titled since the beginning of the United States. Lenders created their own process and procedures, without regard to established law and legal procedures or seeking sanction from the legal system to do so. To state that property rights as we understand them is at stake is an understatement.

The lenders want everyone to believe that the problem can be resolved as easily as it was created. They want to get out from under the loans processed in a system that had no quality control as quickly as they made the loans without proper procedures. It will not be as easy as that since the financial world has now tangled with the legal world. Unwinding "Mortgagegate," by the very nature of property law and legal procedures, requires a quality process and that takes time. How much time is yet to be determined but it is clear it will not be as fast as the financial institutions would like.

How this proceeds makes me think of the entwined, everlasting legal case, Jarndyce vs. Jarndyce in Charles Dickens' novel Bleak House.


[FORECL]
graphic from WSJ "Mortgage Damage Spreads" 10/16/10