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(CNN)   Worried that hurricane victims might not know how to best spend a sudden windfall of insurance money, banks have decided to just "hold on" to about $210 million in Sandy payments. You know, for a rainy day   (cnn.com) divider line 73
    More: Asinine, Superstorm Sandy, Andrew Cuomo  
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11947 clicks; posted to Main » on 13 Feb 2013 at 10:29 AM (1 year ago)   |  Favorite    |   share:  Share on Twitter share via Email Share on Facebook   more»



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2013-02-13 08:51:09 AM
You should go ahead an let me hold on to that money for you.  You don't want to put it in a bank.  See, banks get robbed.  Nobody's gonna rob me.
 
2013-02-13 08:53:30 AM
FTFA: Delays can follow when banks request proof of repairs or servicing required by federal mortgage agencies. But many residents have complained that they haven't received the funds they need to start the repairs.

So you're requiring them to repair the house before you pay for house repairs. It must be nice to live in a world where money is no object.

/oh wait... it is everything to bankers
 
2013-02-13 08:58:11 AM
Cuomo also wants $400M to buy out people in the most vulnerable areas. It would be nice to know that he cross-checked the list of people waiting for their money with the list of people up for buyouts - because it would be very Albany to demand money to rebuild a storm-trashed house, then demand money to demolish it once the repairs were done.
 
ZAZ [TotalFark]
2013-02-13 09:01:30 AM
An underwater house leads to an underwater mortgage. In a no recourse state I take the money and run. Move out, stop payments. The bank forecloses on a wreck. I use the money to build a new house. So I understand why the banks might want to keep track.
 
2013-02-13 10:17:34 AM

ZAZ: An underwater house leads to an underwater mortgage. In a no recourse state I take the money and run. Move out, stop payments. The bank forecloses on a wreck. I use the money to build a new house. So I understand why the banks might want to keep track.


And the bank has no right to decide it knows best and withhold money, none.
 
2013-02-13 10:33:47 AM

GAT_00: ZAZ: An underwater house leads to an underwater mortgage. In a no recourse state I take the money and run. Move out, stop payments. The bank forecloses on a wreck. I use the money to build a new house. So I understand why the banks might want to keep track.

And the bank has no right to decide it knows best and withhold money, none.


Not to mention the banks might not even hold the mortgage on the house that they're witholding the money from.
 
2013-02-13 10:41:05 AM
FTFA: Delays can follow when banks request proof of repairs or servicing required by federal mortgage agencies.

What they meant to say is that delays can follow when they need that money to sit in their bank for a few months so that they can invest it and get a return. Once they get their cut, you can have yours.
 
2013-02-13 10:41:05 AM
http://www.youtube.com/watch?v=Fg6J1Skptbs

I'm REEACH BEEATCH HONK HONK
 
2013-02-13 10:44:52 AM
FTFA "use maximum discretion and effort to speed the release of funds."

Double speak
 
2013-02-13 10:44:55 AM
biz a usual.
 
2013-02-13 10:44:56 AM
They ought to team up with the Red Cross. You know, to make sure the money is spent in the right ways.
 
2013-02-13 10:47:32 AM

ZAZ: An underwater house leads to an underwater mortgage. In a no recourse state I take the money and run. Move out, stop payments. The bank forecloses on a wreck. I use the money to build a new house. So I understand why the banks might want to keep track.


There are states where it is legal to do this?
 
2013-02-13 10:48:14 AM

Girion47: GAT_00: ZAZ: An underwater house leads to an underwater mortgage. In a no recourse state I take the money and run. Move out, stop payments. The bank forecloses on a wreck. I use the money to build a new house. So I understand why the banks might want to keep track.

And the bank has no right to decide it knows best and withhold money, none.

Not to mention the banks might not even hold the mortgage on the house that they're witholding the money from.


Bad reporting is bad reporting.

What the article means is that the checks from the insurance companies are payable to the order of "John Homeowner and The Lending Bank that Holds JH's Mortgage (in other words, the Mortgagee)."  In order for such a check to be deposited, it must be indorsed by BOTH JH and The Mortgagee.  It is not the bank where JH has a deposit account that's causing the holdup; it's the lack of indorsement by the Mortgagee.

The reason the insurance companies draw the checks payable to the order of both JH and the Mortgagee is because the Mortgage requires it, as does the insurance contract.  After all, the house is Mortgagee's collateral and there is an obligation to repair the house (rather than take the money and move to the Bahamas, leaving the lender to foreclose on a rotted-out moldy shell worth zip).
 
2013-02-13 10:48:55 AM
It is rather obvious the the Bankers just cannot deal with a Black Man in their White House.

They took their marbles and went home back in '08.

Still won't come out and play.
 
2013-02-13 10:49:44 AM

GAT_00: ZAZ: An underwater house leads to an underwater mortgage. In a no recourse state I take the money and run. Move out, stop payments. The bank forecloses on a wreck. I use the money to build a new house. So I understand why the banks might want to keep track.

And the bank has no right to decide it knows best and withhold money, none.


Is the bank giving them the money, or the insurance company.   Its not uncommon for auto insurance payments to be made out to the owner AND the repair shop.
 
2013-02-13 10:52:42 AM

snocone: It is rather obvious the the Bankers just cannot deal with a Black Man in their White House.


Obama is their biatch. He'll keep his mouth shut and do as he is told like a good little boy.
 
2013-02-13 10:53:58 AM

IkonOlator: Girion47: GAT_00: ZAZ: An underwater house leads to an underwater mortgage. In a no recourse state I take the money and run. Move out, stop payments. The bank forecloses on a wreck. I use the money to build a new house. So I understand why the banks might want to keep track.

And the bank has no right to decide it knows best and withhold money, none.

Not to mention the banks might not even hold the mortgage on the house that they're witholding the money from.

Bad reporting is bad reporting.

What the article means is that the checks from the insurance companies are payable to the order of "John Homeowner and The Lending Bank that Holds JH's Mortgage (in other words, the Mortgagee)."  In order for such a check to be deposited, it must be indorsed by BOTH JH and The Mortgagee.  It is not the bank where JH has a deposit account that's causing the holdup; it's the lack of indorsement by the Mortgagee.

The reason the insurance companies draw the checks payable to the order of both JH and the Mortgagee is because the Mortgage requires it, as does the insurance contract.  After all, the house is Mortgagee's collateral and there is an obligation to repair the house (rather than take the money and move to the Bahamas, leaving the lender to foreclose on a rotted-out moldy shell worth zip).


Yes, I agree, but I think the money should be held in escrow at a third party, not providing float for the lien holder.
 
2013-02-13 10:54:09 AM
"Hey John, we got this $200 million in insurance payouts, right?"
"Right."
"How much money could we make with that if we don't pay it out for like 6 months?"
".....Ben, add another VP to your title and schedule a board meeting."
 
2013-02-13 10:55:12 AM

DROxINxTHExWIND: FTFA: Delays can follow when banks request proof of repairs or servicing required by federal mortgage agencies.

What they meant to say is that delays can follow when they need that money to sit in their bank for a few months so that they can invest it and get a return. Once they get their cut, you can have yours.


My thoughts exactly.
 
2013-02-13 10:55:31 AM

WhoopAssWayne: snocone: It is rather obvious the the Bankers just cannot deal with a Black Man in their White House.

Obama is their biatch. He'll keep his mouth shut and do as he is told like a good little boy.


THIS. So much this, it really isn't funny.
 
2013-02-13 10:56:15 AM
It was a hurricane. I know when something hits the East Coast, especially New York, that it has to be the worst/best (insert superlative) whatever, but it was a hurricane. There is no meteorological term "Superstorm". Katrina, Ike, Sandy and Andrew were all really bad hurricanes in that they were major disruptions to the ways of life for thousands of people. But why is it we only call Sandy the "Superstorm"?
 
2013-02-13 10:56:36 AM

GAT_00: ZAZ: An underwater house leads to an underwater mortgage. In a no recourse state I take the money and run. Move out, stop payments. The bank forecloses on a wreck. I use the money to build a new house. So I understand why the banks might want to keep track.

And the bank has no right to decide it knows best and withhold money, none.


Rights are governed by money and power.  Banks have both.  Who's going to challenge them?  For every voice of dissent, they can hire ten Harvard educated lawyers to follow you around and yell "YOU'RE WRONG" in your face for a couple of months.  For that amount of money, they can afford to do it for years and still turn a pretty decent profit.  Even if you were 100% in the right and the law was 100% on you side, they'd drag out the 'open and shut case' in court for so long that your grandchildren's grandchildren would be fighting with them over it.

Honestly, if the mortgage is held by the bank, I can kind of understand it.  Until your mortgage is paid off, the bank owns the place and they're just letting you say in it.  Under a mortgage, your legal obligation is to keep the place habitable and in good condition.  The banks (presumably) are holding on to this money because the want to ensure that the houses actually get repaired and not just abandoned...there are probably plenty of people who were packing their bags for just that because they didn't want to be in the situation anymore, but the bank still wants to have them by the balls.  I'm a firm believer in the fact that if the apocalypse came and all technology were destroyed, you'd still get your mortgage bills in the mail, as if nothing happened.  Even if a mail system didn't exist.
 
ZAZ [TotalFark]
2013-02-13 10:57:01 AM
wild9

In some states foreclosure satisfies the entire debt, no matter how much the property sells for at auction. In that case you can walk away when you are underwater.
 
2013-02-13 10:57:14 AM
Delays can follow when banks request proof of repairs

Why would the bank require proof for a check written to me by my insurance company? It's not their farking money.
 
2013-02-13 11:02:55 AM

ajgeek: So you're requiring them to repair the house before you pay for house repairs.


Reminds me of this...

10 We can't hire you because you have no experience.
20 How do I get experience?
30 Get hired.
40 How do I get hired?
50 Have experience.
60 goto 20
 
2013-02-13 11:04:22 AM
Sounds like what my state is doing with 800million in over paid taxes, keeping it because tehy can spend it better than those they took it from in the first place. Although one part wanted to give it back to the people, guess which one?
 
2013-02-13 11:06:02 AM

Glancing Blow: What the article means is that the checks from the insurance companies are payable to the order of "John Homeowner and The Lending Bank that Holds JH's Mortgage (in other words, the Mortgagee)." In order for such a check to be deposited, it must be indorsed by BOTH JH and The Mortgagee. It is not the bank where JH has a deposit account that's causing the holdup; it's the lack of indorsement by the Mortgagee.

The reason the insurance companies draw the checks payable to the order of both JH and the Mortgagee is because the Mortgage requires it, as does the insurance contract. After all, the house is Mortgagee's collateral and there is an obligation to repair the house (rather than take the money and move to the Bahamas, leaving the lender to foreclose on a rotted-out moldy shell worth zip).

Yes, I agree, but I think the money should be held in escrow at a third party, not providing float for the lien holder.


The amount they gain from the float these days is small potatoes.  The problem is much simpler--they're simply overwhelmed.

abhorrent1: Delays can follow when banks request proof of repairs

Why would the bank require proof for a check written to me by my insurance company? It's not their farking money.


But it is.  In a case like this the check will be made out to the homeowner *AND* the lienholder.
 
2013-02-13 11:06:07 AM

ZAZ: wild9

In some states foreclosure satisfies the entire debt, no matter how much the property sells for at auction. In that case you can walk away when you are underwater.


I...I never knew this. Dang, I need to do some more reading.
 
2013-02-13 11:08:32 AM

born_yesterday: You should go ahead an let me hold on to that money for you.  You don't want to put it in a bank.  See, banks get robbed.  Nobody's gonna rob me.


3.bp.blogspot.com

"Banks get knocked off. No one knocks off Tony"

/not obscure?
 
2013-02-13 11:09:17 AM
"After insurance companies have sent homeowners checks to pay for repairs, the money should not be sitting with the bank because of red tape."

It's NOT sitting there because of "red tape".  It's sitting there because the daily interest on $200 million is pretty sweet.
 
2013-02-13 11:10:04 AM
Reminds me of that scene in Donnie Brasco, where Pacino gives Depp that Christmas card with all the money in it, and then asks him for a loan
 
2013-02-13 11:15:16 AM
Line them all up against the wall.  It's the only way.
 
2013-02-13 11:15:54 AM

MythDragon: born_yesterday: You should go ahead an let me hold on to that money for you.  You don't want to put it in a bank.  See, banks get robbed.  Nobody's gonna rob me.

[3.bp.blogspot.com image 800x321]

"Banks get knocked off. No one knocks off Tony"

/not obscure?


The Professional?
 
2013-02-13 11:16:24 AM

ZAZ: An underwater house leads to an underwater mortgage. In a no recourse state I take the money and run. Move out, stop payments. The bank forecloses on a wreck. I use the money to build a new house. So I understand why the banks might want to keep track.


That would make sense, if you were expecting to get the money from your mom.  The bank is not your mom.  The bank is a bank.
 
2013-02-13 11:18:07 AM

ajgeek: FTFA: Delays can follow when banks request proof of repairs or servicing required by federal mortgage agencies. But many residents have complained that they haven't received the funds they need to start the repairs.

So you're requiring them to repair the house before you pay for house repairs. It must be nice to live in a world where money is no object.

/oh wait... it is everything to bankers


They have no choice in federally backed mortgages. What the FA doesn't mention is that most banks will release the funds after you provide them with a contract for the work to be performed. What they also do not mention is that if the mortgage is in or near default, the banks will not release the funds. They hold the security deed and it entitles them to do this. It creates a catch-22 situation, of course. When you are behind in your mortgage payments is the worst time for a disaster to strike.
 
2013-02-13 11:20:53 AM

Girion47: GAT_00: ZAZ: An underwater house leads to an underwater mortgage. In a no recourse state I take the money and run. Move out, stop payments. The bank forecloses on a wreck. I use the money to build a new house. So I understand why the banks might want to keep track.

And the bank has no right to decide it knows best and withhold money, none.

Not to mention the banks might not even hold the mortgage on the house that they're witholding the money from.


Do you know how I know that you haven't a clue?

"Banks" are not withholding payments.  If there is a mortgage, the insurance check is made out to A) the homeowner, and B) the institution holding the mortgage.  The mortgage-holder may have certain stipulations on how and when the money needed to make repairs is released, but it is never the case that a bank that is not the mortgage-holder is withholding anything.
 
2013-02-13 11:23:36 AM

Glancing Blow: IkonOlator: Girion47: GAT_00: ZAZ: An underwater house leads to an underwater mortgage. In a no recourse state I take the money and run. Move out, stop payments. The bank forecloses on a wreck. I use the money to build a new house. So I understand why the banks might want to keep track.

And the bank has no right to decide it knows best and withhold money, none.

Not to mention the banks might not even hold the mortgage on the house that they're witholding the money from.

Bad reporting is bad reporting.

What the article means is that the checks from the insurance companies are payable to the order of "John Homeowner and The Lending Bank that Holds JH's Mortgage (in other words, the Mortgagee)."  In order for such a check to be deposited, it must be indorsed by BOTH JH and The Mortgagee.  It is not the bank where JH has a deposit account that's causing the holdup; it's the lack of indorsement by the Mortgagee.

The reason the insurance companies draw the checks payable to the order of both JH and the Mortgagee is because the Mortgage requires it, as does the insurance contract.  After all, the house is Mortgagee's collateral and there is an obligation to repair the house (rather than take the money and move to the Bahamas, leaving the lender to foreclose on a rotted-out moldy shell worth zip).

Yes, I agree, but I think the money should be held in escrow at a third party, not providing float for the lien holder.


I think the logistics of that would be worse than the current situation.  When I had roof damage, my insurance sent me a paper check for half the repairs, which I then had to schlep down to the local Countrywide office to get stamped by them.  Before they did this, they ran a check to make sure I was current on my payments, otherwise they said they would confiscate the funds to go towards settling my arrears payments.  I bet a larger version of this is what's happening here and the banks are just overwhelmed, although I don't think it would necessarily take that long to process all that and give the homeowners their money.  The financial dis-incentive to do this in an expedient manner, however, really stinks.
 
2013-02-13 11:23:37 AM

tylerdurden217: It was a hurricane. I know when something hits the East Coast, especially New York, that it has to be the worst/best (insert superlative) whatever, but it was a hurricane. There is no meteorological term "Superstorm". Katrina, Ike, Sandy and Andrew were all really bad hurricanes in that they were major disruptions to the ways of life for thousands of people. But why is it we only call Sandy the "Superstorm"?


Because when it made landfall, it wasn't a hurricane any longer.
 
2013-02-13 11:27:39 AM

born_yesterday: You should go ahead an let me hold on to that money for you.  You don't want to put it in a bank.  See, banks get robbed.  Nobody's gonna rob me.


that70scard.com
Agrees
 
2013-02-13 11:28:29 AM
HAHAHAHA cool, at this rate it will only take 5333+ months to pay off the national debt.
 
2013-02-13 11:30:16 AM

Comic Book Guy: Before they did this, they ran a check to make sure I was current on my payments, otherwise they said they would confiscate the funds to go towards settling my arrears payments.


You nailed it. This actually happened to a friend of mine a few years back. He had some water damage after a storm. The insurance company paid the claim quickly, but he was three payments behind in his mortgage and the bank would not release the finds. They applied the money as back payments. I loaned (make that gave) him the money to pay for the repairs. The situation only staved off the inevitable for a few more months. He was in a cheater mortgage and under water too. The bank foreclosed on him about six months later.
 
ZAZ [TotalFark]
2013-02-13 11:30:56 AM
Before they did this, they ran a check to make sure I was current on my payments, otherwise they said they would confiscate the funds to go towards settling my arrears payments.

If the check is made out to both you and the bank, they can't have the money either until you endorse the check.

I reread the article and it seems that the banks are not holding onto money. They are preventing insurance company checks from being cashed. Insurance companies have the money until the check is cashed.

You file a claim. Insurance company sends a check made out to you and Bank of Evil. Bank of Evil requires a notarized affidavit from your parents, God and Ayn Rand before it will endorse the check. The bank may be evil but it is not rich, because it can't cash the check without your consent.
 
2013-02-13 11:34:35 AM

ZAZ: Before they did this, they ran a check to make sure I was current on my payments, otherwise they said they would confiscate the funds to go towards settling my arrears payments.

If the check is made out to both you and the bank, they can't have the money either until you endorse the check.

I reread the article and it seems that the banks are not holding onto money. They are preventing insurance company checks from being cashed. Insurance companies have the money until the check is cashed.

You file a claim. Insurance company sends a check made out to you and Bank of Evil. Bank of Evil requires a notarized affidavit from your parents, God and Ayn Rand before it will endorse the check. The bank may be evil but it is not rich, because it can't cash the check without your consent.


But if the homeowner refused to endorse it, they'd still release it to the mortgage holder.
 
ZAZ [TotalFark]
2013-02-13 11:35:47 AM
But if the homeowner refused to endorse it, they'd still release it to the mortgage holder.

Really? I've never been in that situation. What's the point of issuing a joint check then?
 
2013-02-13 11:39:40 AM
Here's what we should do:
1) give the banks ANOTHER slap on the wrist
2) ANOTHER multi-billion dollar bailout
3) ???
 
2013-02-13 11:43:50 AM

ZAZ: But if the homeowner refused to endorse it, they'd still release it to the mortgage holder.

Really? I've never been in that situation. What's the point of issuing a joint check then?


Because that's the legal requirement, and part of the "illusion" of home ownership.  You purchased the home so you have a legal requirement to be on the check as the homeowner, but in the actual sense you're really nothing more than a steward for the bank, who as primary lienholder can gobble up that joint money whenever they damn well please if you start missing payments.  The moral to this story is to not miss payments and you'd never be in that situation, strategic defaults aside.
 
2013-02-13 11:56:56 AM
bankers giving whores a bad name since (insert date here)
 
2013-02-13 11:59:47 AM
i552.photobucket.com

It's good to be a bankster.
 
2013-02-13 12:00:31 PM
Are they going to pass along the money made off of interest?
 
2013-02-13 12:12:45 PM

ZAZ: An underwater house leads to an underwater mortgage. In a no recourse state I take the money and run. Move out, stop payments. The bank forecloses on a wreck. I use the money to build a new house. So I understand why the banks might want to keep track.




I'm going to wait 4 months before paying my next insurance bill, you've convinced me.
 
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