Pushback on the San Francisco City Assessor-Recorder Foreclosure Audit

Sunday May 20, 2012

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Pushback on the San Francisco City Assessor-Recorder Foreclosure Audit - Credit Slips

Not surprisingly, there's been some attempts to downplay the significance of the SF City Assessor-Recorder foreclosure audit. The attacks have come in three flavors: questions about the auditors' own background; questions about the accuracy of the report; and the "who cares, as these are just lousy deadbeats" argument. Even if we acknowledge that there is something to each of these attacks, they don't take away from the core finding of the report, which is that things are FUBAR in mortgage documentation, and that is going to inevitably result in some honest, but unfortunate homeowners being harmed.

The first attack is on the credentials and former activities of the auditors. Given the deeply compromised background of the OCC foreclosure review auditors, this is a chutzpadik attack. The sad truth is that there isn't a huge pool of people who can do this sort of audit. (Yes, takes it takes a thief and all that...)

The second attack on the audit is to point out that it doesn't get everything right. I address specific criticisms below, but it's kind of irrelevant. The issue isn't whether the audit gets things 100% correct. Instead, it's a gestalt point, namely that things are FUBAR in mortgage documentation, both on the front end (securitization) and the back end (foreclosure). Whatever quibbles one might have with the audit's methodology, it's pretty hard to deny that there aren't serious paper work problems.

If you want a "neutral" audit of the paperwork screw ups,

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