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Foreclosure Doesn't Mean Honest Mistake

Should someone have a leadership position in Connecticut who "forgot" to pay his mortgage and went into foreclosure?

When a foreclosure is started there is good reason. That means someone hasn’t paid their mortgage for some time period, normally many months. How do you just forget to make your mortgage payment?

I’m very concerned about someone that is going to have a leadership position in my state that just forgets to make rent or mortgage payments. There is another problem, how does someone get a home equity loan, with credit that has gotten trashed, as a result of a foreclosure. Are you telling me that Webster Bank will do a mortgage for someone that has had a recent foreclosure?

If that is the case, there should be people lined up at every branch. You know the old saying, “It is not what you know, but who you know.” I guess Chris Dodd and Chris Murphy know people.

Check out this article with the facts regarding Chris Murphy's foreclosure:

Connecticut Senate hopeful Chris Murphy faced ’07 foreclosure By The Associated Press

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Jerry O'Connor September 11, 2012 at 05:08 PM
This is a valid concern. But should someone who has never held a public office at any level, gone bankrupt, was never active in their community, and seldom bothered to vote be elected to the Senate just because she’s had some sort of Pentecostal epiphany that’s transformed her from a tough, conniving, winner-takes-all, no-holds-barred business woman into a kindly grandmother with a magic plan that will create a lot of jobs?
Mariellen V. French September 11, 2012 at 05:33 PM
Kindly grandmother? Don't you recognize a wolf in sheep's clothing?
Jim G. September 11, 2012 at 05:40 PM
I have no intention of defending Chris Murphy; as an independent I am unlikely to vote for him. But anyone who follows the link you provide will see that you've managed to restate the case about as inaccurately and sloppily as is possible. Murphy was NOT foreclosed upon; he fell behind in payments and was served foreclosure notice. He paid the balance due immediately. There is no indication that this "trashed" his credit and getting a HELOC in 2008 was trivial even for people with rotten credit, so smarmy insinuations about "knowing people" are just that - smarm and innuendo. The only person you had to "know" at that time was the person to hand papers to at almost any financial institution. Mr. Petrowsky, I've commented on some of your posts and read through the backlog of the rest. Every one is a blur of half-truth, unsupported opinion, lousy advice and political sniping. I don't know which is is more appalling, your bumper-sticker politics or your inept and misleading financial advice. Go back to "right traccing" your clients, because your contributions here are a waste of space.
Sharon Pealer September 11, 2012 at 07:01 PM
Jim, just to clarify one point you made; whenever a payment is missed a report does go out to one of the national credit rating agencies. Therefore the claim that Mr. Murphy's credit was less than stellar is accurate here. His credit in all truth would have already been damaged when he failed to pay his rent and the eviction proceedings were started. Sadly while there may indeed have been a bit of the whole who you know thing going on in this case, there most likely was much more of the who you are and what can you do for me going on, and yes I am saying that it is probable that Webster bank gave him a special rate because he was on the Financial services committee. Why would any of them ever even think they would be caught? Lets face it Mr. Murphy is a Democrat and the media does not have much of a track record investigating politicians of this party. Had the media been doing it's job properly members of both major political parties would have been on point of watching what they did.
Kelly P September 11, 2012 at 07:46 PM
The rate was based on a line of credit in the form of a home equity line. In that sense, it's not a new mortgage as the balance is determined based on the home owner's election to draw upon it or not. It's most stunning that this get focused attention at all. The statement of Pealer is wrong - prove favorable rate, where, how do you draw that conclusion? Mr. G. has said something incredibly valuable in respect of the author's cavalier posts and, quite frankly, willingness to put highly politicized commentary on this site with no meaningful back-up. It's a strange approach for someone who, presumably, should want to build his business by not putting off any potential customers. Based on the level of analysis the author applies to any topic I've seen, he should carefully consider what potential customers would think of his abilities in his profession. At least 2 thinking people are totally offput, and he's probably happy not to have us. But there's more readers than posters. And everyone researchers anyone they do business with and this posts pop up front and center.
Jim G. September 11, 2012 at 08:39 PM
Sharon, the problem here is that the accusations are being made out of context. This was *five years ago* - in a time when millions of people were playing fast and loose with RE financing and mortgages, and when you had to be so dead you were stinking up the lobby before a bank would fail to give you a loan. The ding from a notice of foreclosure was not enough to "trash" one's credit in that time. Immediately getting more RE credit was not a special case. (So Murphy went to a bank he knew and worked with... so what? Wouldn't you?) There's no basis for accusations of favoritism and political malfeasance... not in 2007-8. Having the incidents discovered and reported is fine; Murphy is running for office and all public information is fair game for discovery and publication. If you think it makes him unworthy, fine. But turning what *in that era* were minor issues into some kind of condemnation, as if Murphy was the only one to continue unscathed by a near-foreclosure and get a sweetheart loan from a bank, is just sleaze and innuendo, which along with worthless financial advice is all this author seems good for.
Wyatt September 11, 2012 at 10:28 PM
Who cares about his foreclosure? Vote for someone based upon policies and what they and their party will do in office. I couldn't care less about my senator's foreclosures - I only care how he or she will vote once elected.
Sharon Pealer September 11, 2012 at 10:52 PM
Jim, from an article in a 2008 realtor magazine, if you will: http://www.ehow.com/how_4602244_approved-home-loan.html Credit was not as easy as you believe in the time in question according to this article, in fact credit is much easier today than it was then.
Jim G. September 11, 2012 at 11:12 PM
With all due politeness, nonsense. One article in an RE magazine doesn't contradict the reality we all lived through. RE lending was completely insane in 2007-8 and for every kindly, well-intentioned article that may have appeared there were a thousand people clawing their way into a mortgage they did not quality for and could not afford... and the banks were falling all over themselves to issue them. There is simply nothing unusual about Murphy's case, and anyone who's going to use these two incidents as reasons to vote against him needs to check their own past and that of friends and family. I'm not voting for Murph myself, but it's not because of trivialities five years ago.
Sharon Pealer September 12, 2012 at 03:49 AM
Jim, I suspect that you may be confusing time here. I agree that there was a time when far too many people got mortgages that they were far from qualified for, but that was before the time in question. I do have a child who has worked in mortgage processing and another family member who was and remains higher up in that industry. This is the time frame when many in the industry were being laid off and offices closed or consolidated because credit dried up. The crisis hit in the early Fall of 2007 and by 2008 was in full overdrive. Before that time, oh yes I do remember conversations about how could mortgages be getting approved with low doc or no doc. I have also checked on some of the names of "experts" claiming there is nothing there. They might be more believable if they did not show up as major donors or heads of PACs that donate strictly to Democrats.
R Eleveld September 12, 2012 at 05:00 PM
I was a collection manager many moons ago, generally a bank will start foreclosure proceedings AFTER an account is OVER 90 days old (missing a minimum of 3 mortgage payments). Then the process starts with a Lis Pendens (or a notice of intent to foreclose). Banks DO NOT want to foreclose (there is an exception), it IS an expensive option, and there are several risks to the bank. Murphy then made some sort of an agreement with the bank that stopped the proceedings. What I find interesting is with missed mortgage payments the bank extended him credit within 2 years I believe, and that is a little unusual since his FICO score would have tanked with the missed mortgage payments, and we could presume other missed debt payments. There is in fairness a possibility he had a low Loan to Value at that moment and rates were low I believe in the 5% range at that time. You can look up articles that indicate rates of 4% to 6%. Then again he may have had a deal with someone higher up within the bank, that allowed him to miss some payments, yet the automated bank systems kicked in and pushed the foreclosure along by accident. Something is not right, and Chris should just come clean and be done with it and get onto the real issues: How do you plan to reduce the deficit, enemy #1, and get people back to work, problem #1.
R Eleveld September 12, 2012 at 05:10 PM
The exception noted above is the back stopping of debt by regulatory or governmental agencies. These 'devices' backstop the mortgage or debt at face value and not another lower value. Banks can refinance, however the backstop is only on the specific instrument and not a future (refi'd) instrument. If they foreclose they get the backstop value. This makes a foreclosure in the best interests of the bank as dictated by the backstop.

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