Inside sources confirmed that many of Fannie Mae and Freddie Mac's government loans will shortly be given for servicing to third-world countries. This is the result of the sale of Homeq Servicing to Ocwen and subsequent layoff of about 1,200 former Homeq employees. (The media misreported this. All 902 employees in Sacramento and employees in Raleigh have been handed their notices of lay-off.)
Obama's pilot HAMP program has already given 5,000 mortgages to be serviced by Ocwen, despite Ocwen's history of infringing its standards. Ocwen outsources almost all of its workforce to third-world countries and is named one of America's top 100 outsourcing companies. Despite being owned by British bank Barclays, Homeq's workforce was entirely inside the United States. Thousands of Homeq loans were transferred to Homeq today and will be serviced outside the United States, distributing America's wealth to those countries.
But there is a more sinister reason for Ocwen's $1.2 Billion purchase (most of which is now owed to the British bank.) Only Homeq and Ocwen had a high retention rate for HAMP, making them the only realistic contenders to service most of Freddie/Fannie loans that have yet to be given out. Ocwen is so confident that they will get these loans that they handed out lay-off notices to Homeq's entire workforce the first day of the acquisition. For months, top mortgage servicers have been negotiating with Freddie Mac and Fanny Mae for servicing rights to thousands of these subprime loans.
BCR laws from Congress stipulated that about 12 times as much capital must stand behind loans serviced by foreign companies as American companies, making Homeq no longer profitable for Barclays. Ocwen requires billions less capital to operate because their home is Florida despite the fact that they outsource their workforce to India while Homeq was entirely in the USA. Barclays only reason for holding on to Homeq this long was for the hope of receiving those government loans, hopes which were dashed in secret meetings around the beginning of this year with top officials. The Federal Government's laws, in an effort to save jobs and prevent losses has just caused the very thing they were meant to prevent!
A thousand Americans are now out of work. As I predicted it would go down earlier, over a hundred thousand American mortgages will go to India and Peru. And most of Fannie/Freddie's many other loans, besides the 5,000 already outsourced, are certain to get outsourced. The poor quality of service from third world country servicers will cause more shoddy loans. And America's wealth goes to third world countries.
Former Homeq employees have been indirectly threatened with losing their severance and unemployment benefits if they speak with the media about this scandal.
Don't expect to hear this in the media! [Originally posted at AP Check]
Wednesday, September 1, 2010
Posted by Dr B at 9:53 PM