|Subject:||Re: [socialcredit] the reality? -- the true assets of banks|
|Date:||Monday, November 22, 2004 09:13:30 (+0200)|
|From:||Jessop Sutton <sutton @...........za>
|In reply to:||Message 307 (written by Joe Thomson)|
I must thank Joe for coming in on this and for pointing out that there is
probably a difference [legislative?] between the practice in
America/Australia on the one hand and Canada on the other. That factor does
make for misunderstanding between members of this discussion group.
In South Africa the situation is the same as in Canada -- banks do
'reposssess' (that's the term used) houses or cars in the event of default.
Our government is committed to delivering proper housing to the low-earners
and tries to persuade banks to make loans availailable. Banks are
(understandably) reluctant because of the history of falling behind in
payments and, frequently, complete failure to catch up (also undestandably on
the part of people with small resources). We then often have the case of a
bank obtaining an eviction order and the whole local community marching in
protest against the eviction. The bank sells the repossessed house for
enought to cancel the debt.
The same happens with cars.
The term 'reposssess' implies prior possession. In effect, looking at the
broad canvas and not worrying about the bookkeeping, the bank purchases the
house or car from the seller and re-sells it to you, even though transfer or
registration is effected into your name. You fail to keep your end of the
bargain and --zapp!! -- you lose your house or car. Worse still, if the
bank doesn't recover the fulll amount outstanding, you continue to be liable
for the balance. And, the bank has no obligation to hold out for the full
value of the house (which usually will have appreciated over time) and to
make the excess over to you.
On Sunday 21 Nov 2004 7:22 am, Joe Thomson wrote:
> (Bill replied:-) In a chattel mortgage, like from a pawnshop, the
> lender takes physical possession of the collateral
> during the term of the loan but not beneficial
> ownership, which he gains only if the borrower
> defaults. The specific property law in the
> particular jurisdiction governs the matter. In a
> collateralized loan like a home mortgage, in most
> jurisdictions (deriving from English common law), the
> borrower maintains titular and beneficial ownership
> of the collateral during the term of amortization.
> The lender gains neither beneficial nor titular
> ownership if the borrower defaults and the lender
> forecloses. The property must be sold at public
> I don't think this is still the case in BC, Bill, though it may well be
> so in Texas, or other jurisdictions. I'm personally aware of instances
> where home mortgages were foreclosed upon here, and the properties were
> certainly not sold at public auction. In both instances the sellers of the
> properties had held the mortgage, and when the purchasers defaulted, I
> believe they recovered title to the properties. In one case, after renting
> the house he had recovered for a couple of years, the foreclosing vendor
> re-sold the property for a good deal more than he'd sold it for the first
> time. The titular ownership must have been transferred back to him, for he
> bragged to me more than once how much he made. And he certainly didn't
> share his windfall with the defaulted former title holder! I can't recall
> ever seeing any public auction notices for foreclosed upon residential
> properties here, although for businesses with mortgaged assets that
> default that seems to be somewhat of a different matter.
> In another separate instance, many years ago I purchased a house where
> the previous owner had defaulted on his mortgage, and had been foreclosed
> upon. The title holder was "Central Mortgage and Housing Corp.", a
> Canadian federal government Crown Corporation that guarantees many home
> mortgages written by the private banks. Presumably they paid off the Bank
> when the homeowner walked, and took title to the property. Don't you have
> some agency similar to that in the States? The house was sold to me
> through a listing realtor, in the regular manner any other property might
> be sold, and not by public auction.
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