Illinois has the third highest rate of foreclosures in the US

New data shows that Illinois has the third highest rate of foreclosures in the country

Almost 7.5 percent of all one-to-four-unit mortgage loans in Illinois were in foreclosure in the first quarter, compared with a national average of 4.39 percent, according to data released Wednesday by the Mortgage Bankers Association.

“Illinois and New Jersey trail only Florida as being the worst in the country, and they’re getting worse,” said Jay Brinkmann, the association’s chief economist “The rate in Illinois more than twice that of California. In the judicial states the problem continues to get worse in terms of the backlog of loans in the foreclosure process.”

Added Michael Fratantoni, the association’s vice president of research and economics, “This is not a case that loans are entering foreclosure at a greater extent than in nonjudicial (states.) It’s that they’re staying in foreclosure longer.”

Illinois is not alone, according to the trade group’s quarterly national delinquency survey. In judicial states, the percent of loans in the foreclosure process reached an all-time high of 6.9 percent during the first quarter. That compares with a rate of 2.8 percent in non-judicial states, the lowest since early 2009.

The larger story about foreclosures in recent years has tended to focus on certain Sunbelt places like Florida, Las Vegas, and California so it is interesting to hear that Illinois has one of the highest rates – even if this is due to the particulars about how foreclosures are dealt with in the courts.

Based on this, could one argue that places like Las Vegas, said to be hard-hit by foreclosures, actually will be able to move past foreclosures more easily because of quicker court procedures? Speaking broadly, is it better for a state’s economic health and for its citizens for foreclosures to move more quickly in the courts even if this has some negative shorter-term effects? What is the proper trade-off between helping current residents and clearing bad mortgages off the books?

Winklevoss twins continue lawsuit against Facebook

The key conflict in The Social Network (reviewed here and here) is the lawsuit that the Winklevoss twins bring against Facebook founder Mark Zuckerberg. This lawsuit is continuing as the Winklevosses seek a larger settlement:

If they prevail, their legal appeal would overturn the settlement, now worth in excess of $160 million because of the soaring value of the privately held company.

The Winklevosses won’t say exactly how much they would seek in their high-stakes grudge fest with the billionaire Facebook founder, but by their own calculations they argue they should have received four times the number of Facebook shares. That would make any new settlement worth more than $600 million based on a recent valuation of Facebook at more than $50 billion…

Facebook has won multiple court rulings, and legal experts say the Winklevosses are likely to lose this one too…

The controversial origins of Facebook — who actually founded it and how — have been the subject of renewed debate since Hollywood offered its dramatization of the conflicting stories from the Winklevosses, both portrayed in “The Social Network” by actor Armie Hammer, and former Zuckerberg friend and Harvard classmate Eduardo Saverin, portrayed by Andrew Garfield. In 2005, Saverin sued Facebook for diluting his stake in the company and reportedly reaped a $1.1-billion settlement.

Zuckerberg has called the film, which received eight Academy Award nominations including best picture, “fiction.” In it, his character tells the Winklevosses: “If you guys were the inventors of Facebook, you’d have invented Facebook.”

But that’s exactly what the Winklevosses said they did.

The article suggests that the Winklevosses can’t really lose here: if the courts say they shouldn’t receive more money, they still get to receive the initial settlement. We can ask how much The Social Network influenced the decision to seek more money. There were relatively few people in the media who concentrated on the veracity or one-sided nature of this story. For many who saw this Oscar-nominated film, Zuckerberg looks like a jerk.

Of course, this movie and portrayal should have little influence on the courts. And the Winklevosses say they have new evidence for the courts to consider. But I suspect the case was brought in part because of the positive portrayal of the Winkevosses in this film. If this case were in the court of public opinion (and perceptions), would the Winklevosses win?

Thinking about a legal framework for a potential apocalypse

This story about the State of New York thinking about the legal challenges of an apocalyptic event might cause one to wonder: why are they spending time with this when there are other pressing concerns? Here is a description of some of the issues that could arise should an apocalypse occur:

Quarantines. The closing of businesses. Mass evacuations. Warrantless searches of homes. The slaughter of infected animals and the seizing of property. When laws can be suspended and whether infectious people can be isolated against their will or subjected to mandatory treatment. It is all there, in dry legalese, in the manual, published by the state court system and the state bar association.

The most startling legal realities are handled with lawyerly understatement. It notes that the government has broad power to declare a state of emergency. “Once having done so,” it continues, “local authorities may establish curfews, quarantine wide areas, close businesses, restrict public assemblies and, under certain circumstances, suspend local ordinances.”…

“It is a very grim read,” Mr. Younkins said. “This is for potentially very grim situations in which difficult decisions have to be made.”…

The manual provides a catalog of potential terrorism nightmares, like smallpox, anthrax or botulism episodes. It notes that courts have recognized far more rights over the past century or so than existed at the time of Typhoid Mary’s troubles. It details procedures for assuring that people affected by emergency rules get hearings and lawyers. It mentions that in the event of an attack, officials can control traffic, communications and utilities. If they expect an attack, it says, they can compel mass evacuations.

But the guide also presents a sober rendition of what the realities might be in dire times. The suspension of laws, it says, is subject to constitutional rights. But then it adds, “This should not prove to be an obstacle, because federal and state constitutional restraints permit expeditious actions in emergency situations.”

Isn’t it better that authorities are doing some thinking about these situations now rather than simply reacting if something major happens? This reminds me of Nasim Taleb’s book The Black Swan where he argues that a problem we face as a society is that we don’t consider the odd things that could, and still do (even if it is rarely), happen. Taleb suggests we tend to extrapolate from past historical events but this is a poor predictor of future happenings.

Depending on the size or scope of the problem, it may be that government is limited or even unable to respond. Then we would have a landscape painted by numerous books and movies of the last few decades where every person has to simply find a way to survive. But even a limited and effective government response would be better than no response.

It would be interesting to know how much time has been spent putting together this manual.

The land of 100,000 lawsuits

Some enterprising anonymous researcher has determined that almost 100,000 copyright infringement lawsuits have been filed in the U.S. in the past year:

In the United States the judicial system is currently being overloaded with new cases, but the scope of the issue was never really clear until now. An anonymous TorrentFreak reader has spent months compiling a complete overview of all the mass P2P lawsuits that have been filed in the US since the beginning of 2010, listing all the relevant case documents and people involved in a giant spreadsheet.

The research shows that between 8th January 2010 and 21st January 2011, a total of 99,924 individuals have been sued. The vast majority of the defendants have allegedly used BitTorrent to share copyrighted works but a few hundred ed2k users are also included.

Of the 80 cases that were filed originally, 68 are still active, with 70,914 defendants still in jeopardy.

The raw data is available is spreadsheet form over on Google Docs.

As the disparity between 80 and 70,914 indicates, these types of lawsuits completely overwhelm the courts.  The U.S. justice system is simply not set up to handle this kind of volume, especially for suits as notoriously tricky to argue as copyright infringement.

How winning on minor technicalities can lead to a 25 year foreclosure battle

As lenders have recently had to slow down the foreclosure process because of running into trouble for not properly following procedures, the Wall Street Journal reports on another cautionary tale: one woman in Florida has stretched out her foreclosure for 25 years, not making a payment since 1985. According to the story, this has happened because the woman has been able to make successful arguments in the courts:

She has managed to stave off the banks partly because several courts have recognized that some of her legal arguments have some merit—however minor. Two foreclosure actions against her, for example, were thrown out because her lender sat on its hands too long after filing a case and lost its window to foreclose.

Ms. Campbell, who is handling her case these days without a lawyer, has learned how to work the ropes of the legal system so well that she has met every attempt by a lender to repossess her home with multiple appeals and counteractions, burying the plaintiffs facing her under piles of paperwork.

She offers no apologies for not paying her mortgage for 25 years, saying that when a foreclosure is in dispute, borrowers are entitled to stop making payments until the courts resolve the matter.

“This is every lender’s nightmare,” says Robert Summers, a Stuart, Fla., real-estate lawyer who represents Commercial Services of Perry, an Iowa-based buyer of distressed debt that currently owns Ms. Campbell’s mortgage and has been trying to foreclose. “Someone defending a foreclosure action can raise defenses that are baseless, but are obstacles for the foreclosing lender,” he says, calling the system “an unfair burden” for lenders.

I don’t know if the system is “unfair” for lenders but it is remarkable that the woman is openly guilty about not making a payment and yet is still able to win in court. Could lenders be this bad on following procedures? Or is the law really this in favor of people who haven’t made mortgage payments?

Just how much is the testimony of a veteran worth?

The case against David Hinkson included prominent testimony from a man claiming to be a decorated war veteran. The problem: the witness’ claims about killing men and being decorated in combat were false.

All lies. Mr. Swisher had never seen combat, had killed no one and had served without distinction. The document was a forgery. Mr. Swisher has since been convicted of lying to federal officials, wearing fake medals and defrauding the Department of Veterans Affairs of benefits for combat injuries.

But the jury knew none of this, and with Mr. Swisher’s testimony it convicted Mr. Hinkson of soliciting three murders. He was sentenced to 33 years for those crimes, along with 10 years for tax evasion, and he is serving his sentence in the maximum-security prison in Florence, Colo.

The New York Times uses this case to illustrate a larger question: just how different is testimony from a veteran in court? According to veteran’s groups, jurors respect military service and put more faith in testimony from veterans.

Culturally, being a veteran does seem to confer certain respect from other citizens. Think of instances where veterans are applauded, perhaps at a sporting event, church, or civic gathering. Serving in the military is equated with bravery, courage, and patriotism.

But do these qualities necessarily translate into providing true testimony or acting legally or morally? Not necessarily. In cases where the credibility of witnesses matters, it seems like being truthful about decorated military service would matter – if it didn’t, there would be no reason to lie to claim one was a decorated veteran. It sounds like it will take some work to translate cultural ideas about veterans as honorable citizens into court proceedings.

h/t Instapundit