creditcrunch.jpgWho here thinks that a stern talking to from the President about renegotiating loans will send all those duly chastened financial giants out to be scrupulously honest?

Or that they'll find redemption in being fair and decent because now they have a "verbal agreement" to be good little lenders?


Not when there's money to be made, right? To wit:

...many mortgage companies are reluctant to give strapped homeowners a break because the companies collect lucrative fees on delinquent loans.

Even when borrowers stop paying, mortgage companies that service the loans collect fees out of the proceeds when homes are ultimately sold in foreclosure. So the longer borrowers remain delinquent, the greater the opportunities for these mortgage companies to extract revenue — fees for insurance, appraisals, title searches and legal services.

“It frustrates me when I see the government looking to the servicer for the solution, because it will never ever happen,” said Margery Golant, a Florida lawyer who defends homeowners against foreclosure and who worked in the law department of a major mortgage company, Ocwen Financial. “I don’t think they’re motivated to do modifications at all. They keep hitting the loan all the way through for junk fees. It’s a license to do whatever they want.”

But these companies wouldn't jack up delinquency proceedings against good ole Americans just to collect more and more of these fees instead of renegotiating terms, now would they?

Not after asking those self-same Americans for bail-out money with the promise of renegotiating those loans and helping out the hurting public, now would they?

feddelinquencyq1.jpgNope, nothing to see here in the Fed's first quarter sharp rise in delinquencies.

Just regular Americans watching everything they have worked their entire lives for sluice down the drain of lost jobs and inflexible financial giants.

But, in the short term? Woo hoo -- extra fees to inflate the bottom line! We'll leave the long-term financial drain to the next guy after cashing out the golden parachute!

The fact that more and more middle class families are desperately seeking help at homeless shelters, food banks and job fairs? Who cares so long as your company's financial bottom line stays solid. Innovation at all costs and full steam ahead, right?

More profits, and not having to lift a finger to help the little guy? Dude! It's win-win!