Nov 13, 2010

A Growing Tradition: Building a Hoop House for the Garden

Building hoop house 15
This weekend I finally got around to building my hoop house. I've wanted one for a long time now and had gone over the design in my head during the past three months. After many mental revisions and plenty of second guessing, I realized last week that time was running out and that I just had to wing it.

My goal was to erect a structure that would house six of my 3 x 6 ft raised beds. I wanted something that could be dismantled easily if needed and yet be sturdy enough to withstand our New England winters. Also I didn't want to spend an arm and a leg on the materials either.

Anyway, here is how it all came together:

Building hoop house 1
I started off by driving stakes made from 1/2 in PVC pipe into the ground spaced about 3 feet apart. (Marc is in the background loading firewood.)

Building hoop house 2
I installed the seven arches that will serve as the backbone of the hoop house by bending 15 ft lengths of 1 inch PVC piping and slipping the hollow ends onto the stakes. (PVC piping generally comes in 10 ft lengths but can be joined together easily using plastic couplings to create the desired length.)

Building hoop house 5
To help prevent the arches from buckling under the weight of snow, I drove 5 ft tall metal poles (8 total) into the ground and positioned each pair underneath every other arch.

Building hoop house 4
Metal wire was then used to attach the arches to the poles.

Building hoop house 6
I then used string to mark the center-ridge line as well as two additional side lines that will provide additional stability to the structure.

Building hoop house 7
I attached the three lines (3/4 inch PVC pipe) to the arches using metal screws. The lines help to keep the arches perfectly straight under the weight of snow.

Building hoop house 8
I also attached 3/4 in PVC piping to the base and down length of the structure.

Building hoop house 9
Once the hoop house frame was finished, the next order of business was to attach the plastic sheeting to it. I needed to cover an area that measured approximately 15 ft (the length of the arches) by 19 ft (the length of my beds). After deciding against purchasing professional greenhouse plastic, I went the practical route and bought two rolls of the 10 x 25 ft 3.5 mil polyethylene sheeting available at most hardware stores. (I opted for the 10 ft width because the difference in pricing between it and the 20 ft width was HUGE!)

Building hoop house 11
We attached the plastic sheeting to frame one roll at the time using heavy metal clips (the jumbo-sized ones found at most office supplies stores) and allowed for a 5 ft overlap at the top. The first roll went over the center-ridge line and was attached to the far side line. Then the second roll was draped over the first one at the top and attached to the side line on the opposite side.

Building hoop house 10
Metal clips were also used to attach the poly sheeting to the base of the hoop house.

Building hoop house 13
Next I focused on constructing the end-wells. The wooden frame pictured here was built using 1 x 3 inch lumber and is just wide enough to fit over the metal poles.

Building hoop house 12
The wooden frame was attached to the poles using screws and metal wire. (I was pleasantly surprised by how sturdy it felt.)

Building hoop house 14
I then wrapped the poly sheeting over the frame, stapled it to the inside and trimmed the excess. The end result looked reasonably neat and clean.

Building hoop house 16
I have yet to construct the hoop house doors but they will fit over and be hinged to the wooden frames.

All in all, I was very pleased with my (almost) finished hoop house. It feels really sturdy and best of all, the materials (not including the metal poles, which I had lying around) cost me a modest 120 dollars. I am really excited to see how my winter veggies will fair this year and will consider growing heat-loving summer veggies inside of it as well.

Life on a Southern Farm: The Saw Mill and Video

One day about 15 years ago as I was doing some yard work I could hear a clank, bang, clunk coming down our long dirt driveway through the woods.
As I looked up I saw FarmMan in his truck come through the gate. In the back of the truck looked like a big pile of scrap metal. I didn't even blink an eye. I knew that pile of scrap metal would become something useful around the farm.

And it did.

It was a very old sawmill. A friend of FarmMan's was going to throw it away. It hadn't been used in years and years. So FarmMan brought it home and put it to use.

One of the first projects was lumber for the barn.

The trees for the lumber came from the back of our property.

Some of the oak lumber became flooring for the kitchen.

more lumber was put to use as side bodies for the pick up truck.

for a chicken house

Cut boards were stacked out in the sun to dry for later use.

and stacked later in the barn loft to finish drying

which became more flooring for inside the house.

No, I wasn't concerned the least little bit about that pile of scrap metal that came clunking down the driveway years and years ago.

When a relative from the big city came to visit years ago she saw a collection of FarmMan's finds scattered around the farm. She asked " What is all that stuff? It looks like it was left over from the Civil War!". I just laughed. I could see beyond the rusty looks of the relics.
What looked like junk to someone else really wasn't junk to a hardworking farm man with plans and dreams. It was our future.

FarmMan putting that pile of scrap metal to use.

I am sure there will more unrecognizable piles of metal come through the gate here on the farm.
But... I won't even blink an eye!

Have a great weekend!

Passive Solar Design: Creating Sun-Inspired Homes - Green Homes - MOTHER EARTH NEWS

Equinox HomeInterview by Megan Phelps
Many people who are planning to build a house would like to end up with a green, energy-efficient home, but aren’t sure how to get started. While we may be familiar with the need for insulation, or even with the basics of passive solar design, it’s not always clear how to transform those ideas into an actual house. And just as importantly, how do you build that house without spending a fortune?
Fortunately, architect Debra Rucker Coleman would like to help us answer these questions. Her book, The Sun-Inspired House, outlines her design ideas, while her company, Sun Plans offers a range of house plans, custom design and consulting services for people who want to build beautiful homes that don’t consume a lot of energy.
Here’s what Coleman had to say about her work, the fundamentals of passive solar design, and why it’s always a good idea to design homes (or select house plans) with the sun in mind. As Coleman says, constructing a sun-inspired home begins with a thorough planning process, and choosing or developing a house plan is one of the first steps along that path.

Designing Sun-Inspired Homes

How would you define “sun-inspired” as opposed to “passive solar”?
I like to use the term “sun-inspired” rather than “passive solar,” because with passive solar, you run into confusion with all the different kinds of solar, such as photovoltaics, and now the new Passivhaus standard that’s coming out of Germany.
Also, “sun-inspired” incorporates more than just the heat from the sun — it also incorporates the light from the sun, and the necessity to keep the sun out in the summer.
(Note from MOTHER: We think the terminology gets confusing, too. If you’re trying to pin down what these different terms mean, check out these brief descriptions of the different types of solar and of the Passivehaus standard — which is not the same thing as passive solar design.)
Can you tell us a little about your company?
Sun Plans was established in 2002, and the goal was to be able to offer affordable architectural services throughout the United States, especially related to sun-inspired/passive solar design.
I’d had a lot of questions from people who were asking why there weren’t more passive solar architects or house plans available. So I thought, well, we’ll make them available on the Internet. It started out nationally and now it’s gone international, into Canada.
The other thing was to make it affordable. Typically architects will charge 6 to 15 percent of construction costs, and less than 5 percent of people hire them to design their homes. So we developed an affordable service that’s more along the lines of a house plan company. That keeps the fees — even for a new design — closer to 2 to 3 percent of total construction cost. And that’s only about half of what you’d pay a realtor if you were buying a home.
How much does the actual plan cost?
I’d say the typical cost for buying a plan we’ve developed is about $1,200. If we adapt a plan, those fees really vary, but I’d say on average about $3,000. And to create a completely new custom plan is about $8,000.

Passive Solar in the ’70s and ’80s

Tell me more about your background and how you got interested in passive solar design.
I went to architecture school at the University of Arizona, where the College of Architecture has a five-year accredited architectural degree. That was in the late ’70s, so that was certainly before the current green movement, but also during the first energy crisis.
The instructors were very sensitive to the environment. I think the phrase might have been “environmental design.” You know, they would be asking, “How is your building going to face according to the sun? How are you going to keep the sun out? How are you going to let it in at different times of year? Are you going to work with native materials?”
So that’s where I got the basics of passive solar — even though it wasn’t called that, and it was taught as just one aspect of environmental design. The curriculum also integrated a solid foundation through various engineering classes. Mechanical engineering has to do with the energy a building consumes, so we were constantly aware of heat gain or heat loss through various surfaces.
When did you start actually designing passive solar homes?
It wasn’t until I left Arizona and started working for other firms, that I realized, “Oh my goodness, they’re not even thinking about the way a building should face. They’re not even thinking about where the sun is!” It was what I perceived as the lack of attention to that in other firms that made me decide to go out on my own in 1985, and at that point I established Energetic Design, the company that I had when I lived in North Carolina. I was intent on making all the buildings I designed more energy efficient and to work with the sun as much as possible.
That’s the point in time where I actually took a course called “passive solar design” from a technical college (Guilford Technical Community College), and then found out that North Carolina actually has a fantastic solar center — the North Carolina Solar Center. It didn’t take long to realize that we were a good match and I began assisting with workshops for them.
Also at that time, there was an organization called the Passive Solar Industries Council, which has since evolved into the Sustainable Buildings Industry Council. They developed some guidelines along with the National Renewable Energy Laboratory. It was those guidelines that helped me understand which were the important things to change in a home design in order to make a home passive solar and how to adapt it for different climates. Their simple worksheets included detailed energy data that showed passive solar gain, which is typically ignored in other energy software. It’s disappointing that funding wasn’t continued on developing these guidelines.

What Makes a House Passive Solar

What would you say are the basic elements of a passive solar or sun-inspired design?
Orientation of the home is probably the first.
Window placement within that orientation is next. (Most of your windows should be on the south side of the home if you’re in the northern hemisphere).
Third, the overhang of the south windows and the shading protection of the east-west windows (a lot of times these are porches, or they can be trees).
And then thermal mass (which helps store the sun’s heat) is probably fourth.
How do you add thermal mass to a home?
A lot of people are building with insulated concrete forms and there’s a lot of inherent mass within them. A 4-inch thick concrete slab is also a very economical way of adding thermal mass. Some homes will have 4 inches of brick or stone veneer on interior walls or 8-inch thick free-standing concrete block walls that have both sides exposed and finished with thin stone or tile.
Some people will choose to forgo extra thermal mass because there can be additional costs. So those people may say, OK, I know it’s going to get a little extra hot on sunny winter days, but I’m willing to sacrifice a little comfort, and to go with insulated shades or to crack a window to keep it from overheating. Thermal mass helps some with cooling too, because it reduces the temperature swing of interior temperatures.
What kind of changes to the house plans do you have to make for different climates?
There is surprisingly little difference in the basic house design requirements. However, the details may vary substantially, especially in relation to the amount of insulation needed and the type of south-facing glass. But those details are easily changed without major house plan adaptations.
Most data will say you wouldn’t want to put the exact same home in Minnesota as in Atlanta, but it’s not that different, mainly since they both need to have most windows on the south wall and have an overhang to protect the south windows from summer heat gain.
Warmer climates may need to have the south-facing glass reduced somewhat. For instance, in the United States, I think the very south lower level, which would be Southern California all the way to northern Florida, might need only 5 to 7 percent south glass. You certainly wouldn’t want to go above 7 percent.
And that’s because it would overheat?
Yes, and it would overheat in both summer and winter.
The middle range of climates starting at approximately 34 degrees north (the latitude of Los Angeles, or Columbia, S.C.) and upward are very forgiving with 7 to 10 percent glass.
The extreme northern part of the United States — with the exception of the Pacific Northwest, which as you know is not really that cold — those climates can handle 10 to 12 percent south glass.
But there are very few plans with that percentage of glass because there’s not enough available south wall area. Or you could end up with a long, rectangular home, and that’s not as efficient to heat and cool. The most efficient shape to heat and cool is a cube.
Why is that?
It has the least amount of surfaces to lose and gain heat through for the given volume. But the next most efficient design with passive solar is to stretch the building along the east-west axis to give it a little more south wall area.
One other thing with the extreme southern climates is that they can handle more north glass. We have some plans on the website with north glass, because for example, the client had a really fantastic north view and wanted to take advantage of it.
And the reason you’d want to minimize north glass is because of the heat loss?
Exactly. Because you have heat coming in through the south windows in the winter and the more that you can do to keep that heat in the better. Windows are the weakest link in a home’s thermal “envelope” and so the ones that do not also contribute to the winter heat gain should be minimized.
However, I am not a proponent of putting all your windows on the south and none on the east, west and north because that may result in a home that is uncomfortable in other ways. I think our connection to nature through views to the outside is equally as important as using the sun’s energy. You need to have those windows for the psychological benefit, as well as to provide balanced daylighting and some cross breezes, which are important for cooling.

Serious Energy Savings

Do you have any estimates on how much people reduce their heating costs by choosing a passive solar design?
It really ranges a lot, and it depends on climate. But to answer your question simply, purely on the sun I would say, approximately 20 to 40 percent, with conventional construction. The higher latitudes are going to be at the lower number. However, if you were to take the same building and double the insulation, you’ve probably just doubled the percent of heat gain that the sun is providing.
You know, the heat from the sun is really just one more type of energy. People talk about “zero-energy homes,” but really by heating with the sun you’re just replacing one type of energy with another and reducing the amount of purchased energy required such as gas, electricity or even wood with a more environmentally-friendly alternative.
I would say that for most of the houses we’re designing, energy savings of 30 percent over a code-built home is the minimum that we recommend our clients strive for: 10 percent comes from energy efficiency and a minimum of 20 percent from the sun. Most of our clients are achieving about 50 percent energy savings, and that’s more like 30 to 40 percent from the sun, and 10 to 20 percent better attention to insulation and air sealing.
Some people are going for net zero. But from what I’m reading, 80 percent is a goal that many people are starting to aim for — 80 percent energy savings over a code-built home. With that level of savings, extreme attention to air sealing and additional insulation is required.
Unfortunately, just meeting code really isn’t very energy-efficient since building codes point to minimum requirements. When we prepare Custom Energy Specs, we’ll ask the client, “what are your personal goals” and if they do not know, then we will make recommendations.
Some people will say they want the current Energy Star standard, which is 15 percent better than code, or the new Energy Star 3.0 standard which is 30 percent better than code. And some clients will tell us they intend to get the home Passivhaus-certified, and in that case we’ll specify another, much higher, level of insulation and possibly recommend changes to the type of wall and roof framing, although the design may be able to stay the same.
So this is really the advantage of custom design — you can help people find a plan that fits their particular needs?
Yes, although what I’m finding is that it’s not so much to help them find a plan, because typically people are very particular about what they want in a house plan. They don’t necessarily want the most energy-efficient plan, they want the most energy-efficient plan that fits a particular design.
Also, for most of our homes, the actual drawings may not necessarily need to be modified for increased energy efficiency. When we write Custom Energy Specs, we may list five strategies of reaching R-40 in the walls if the client wants to achieve Passivhaus standards, or five strategies for achieving the Energy Star 3.0 standard. The homeowner and builder can then choose which of the strategies work best based on local costs, available materials and the builder’s familiarity with various construction methods. Then, they can work out the modified construction details with the builder in the field if this is acceptable with the building inspector. Through Adapt-A-SunPlan, those changes can also be made on the drawings if desired.
Do you make recommendations to people on heating systems?
We have a consultant now who works with us, or in some cases works with the clients directly. That’s to help the clients right-size their heating and cooling systems, so they don’t buy a super-high cost system that they may not need for this house because heating loads are so low. Our consultant can work with a subcontractor to help them get the right size system.
Unfortunately, code doesn’t typically accept a woodstove as the code-compliant backup heat source since it has to be maintained and could not work when the homeowners may be away, but we’re talking that level of heating. Sometimes, as inefficient as it might be, the recommendation may be going with electric baseboard heat, because it may be seldom needed, especially in homes with super-high levels of insulation.
Because it’s expensive to run, but you don’t have to run it as often?
Yes, and it meets the code requirements. And yes, if you ran it all the time in a leaky, non-passive solar home it would get expensive, but in this case it’s a very cost-effective option. A small propane unit is another option so long as venting and other safety issues are adequately addressed.

What People Don’t Know About Passive Solar

What are some of the biggest misconceptions you run into with passive solar design?
One is that the house is going to overheat in the summer. But really, what’s more of an issue is the possibility of overheating in the winter. And yes, if the home is not properly oriented within 15 degrees of true south and if there’s not a properly sized overhang on those windows, it can overheat. The Custom Energy Specs that we prepare look at both the proposed orientation of the home and the latitude to verify that the overhang as shown on the plans is an adequate compromise between both the heating and cooling needs for the particular climate. If not, we make a recommendation for the contractor to modify the overhang length in the field. There is not a “one size fits all” solution for overhang lengths for any given climate since it varies based on the south wall height, the window size, window placement on the wall and the roof and overhang construction type.
The second misconception is that people think that it’s going to cost a lot more. But in a lot of ways, there are really no extra costs with passive solar design. You’re taking most of the windows that are typically in a home and you’re putting most of them on the south side. There is a little more cost as you get into the higher amounts of glass due to extra window costs and extra thermal mass needed to store the extra heat.
What else do you want to tell people about designing an energy-efficient, passive solar home?
I would emphasize the importance of a smaller footprint, and a smaller home. One of my biggest frustrations is when people go to our website and say, oh I don’t see a 1,400 square foot plan that has everything I want, so therefore I’ll settle for this 1,800 square foot plan. And then that extra square footage costs — probably as a national average, $120 a square foot, but it varies greatly — and you’re also paying more to heat and cool. It’s worth working with someone, either with us, or, if you’re not comfortable with the web-based design process that we use, working with a local architect or experienced home designer who can help you obtain a right-sized plan.
I’d like to emphasize the hierarchy of thinking about what you want your home to be. Think small and good insulation first, then passive solar. Third, let’s think about a really low-tech simple auxiliary heating system. And then fourth, is to add the active solar, with typically solar hot water being first and photovoltaics last, or other forms of renewable energy that create electricity, such as wind generators.
Also, if people are looking at a two-story home, it’s a good idea to think about reversing that. Instead of your additional floor space being on the second floor, make it a daylit basement. If you have land that slopes to the south, you can build it so that you don’t even know you’re in a basement. And that’s a very energy-efficient space.
What do you like most about passive solar?
I love the fact that we’re taking something from nature that is available on every single site no matter where you live, and we’re incorporating it into our homes to save energy and connect to the environment.
During the ’70s and ’80s, did you ever think that eventually passive solar would be everywhere, that by now almost everyone would be doing it?
Well, yes, I’ve been surprised by how slow the construction industry is to change. More than 20 years ago I published a booklet of passive solar house plans with the slogan “for a green home tomorrow, save energy today,” and the industry is just now “going green.” And still many of the green building programs do not adequately allow for passive solar credits.
I find myself continuously wondering “why would you not integrate something into a new design when it saves you money, costs very little extra, is good for the environment, and makes you comfortable and happy to be home?”
One more question: We’d like to add links to a few of your favorite plans, so people can see examples of passive solar design. What would you say are your 10 favorite plans that you’ve done?
The following Sun Plans are my favorites, primarily because each has one or more of the following features: a small footprint, compact design, ease of construction, a popular floor plan, or creative design.

Nov 12, 2010

Matt Taibbi: Courts Helping Banks Screw Over Homeowners | Rolling Stone Politics

Illustration by Victor Juhasz
By Matt Taibbi
Nov 10, 2010 2:25 PM EST
The following is an article from the November 25, 2010 issue of Rolling Stone. This issue is available Friday on newsstands, as well online in Rolling Stone’s digital archive. Click here to subscribe.
The foreclosure lawyers down in Jacksonville had warned me, but I was skeptical. They told me the state of Florida had created a special super-high-speed housing court with a specific mandate to rubber-stamp the legally dicey foreclosures by corporate mortgage pushers like Deutsche Bank and JP Morgan Chase. This "rocket docket," as it is called in town, is presided over by retired judges who seem to have no clue about the insanely complex financial instruments they are ruling on — securitized mortgages and laby­rinthine derivative deals of a type that didn't even exist when most of them were active members of the bench. Their stated mission isn't to decide right and wrong, but to clear cases and blast human beings out of their homes with ultimate velocity. They certainly have no incentive to penetrate the profound criminal mysteries of the great American mortgage bubble of the 2000s, perhaps the most complex Ponzi scheme in human history — an epic mountain range of corporate fraud in which Wall Street megabanks conspired first to collect huge numbers of subprime mortgages, then to unload them on unsuspecting third parties like pensions, trade unions and insurance companies (and, ultimately, you and me, as taxpayers) in the guise of AAA-rated investments. Selling lead as gold, shit as Chanel No. 5, was the essence of the booming international fraud scheme that created most all of these now-failing home mortgages.
The rocket docket wasn't created to investigate any of that. It exists to launder the crime and bury the evidence by speeding thousands of fraudulent and predatory loans to the ends of their life cycles, so that the houses attached to them can be sold again with clean paperwork. The judges, in fact, openly admit that their primary mission is not justice but speed. One Jacksonville judge, the Honorable A.C. Soud, even told a local newspaper that his goal is to resolve 25 cases per hour. Given the way the system is rigged, that means His Honor could well be throwing one ass on the street every 2.4 minutes.
Foreclosure lawyers told me one other thing about the rocket docket. The hearings, they said, aren't exactly public. "The judges might give you a hard time about watching," one lawyer warned. "They're not exactly anxious for people to know about this stuff." Inwardly, I laughed at this — it sounded like typical activist paranoia. The notion that a judge would try to prevent any citizen, much less a member of the media, from watching an open civil hearing sounded ridiculous. Fucked-up as everyone knows the state of Florida is, it couldn't be that bad. It isn't Indonesia. Right?
Well, not quite. When I went to sit in on Judge Soud's courtroom in downtown Jacksonville, I was treated to an intimate, and at times breathtaking, education in the horror of the foreclosure crisis, which is rapidly emerging as the even scarier sequel to the financial meltdown of 2008: Invasion of the Home Snatchers II. In Las Vegas, one in 25 homes is now in foreclosure. In Fort Myers, Florida, one in 35. In September, lenders nationwide took over a rec­ord 102,134 properties; that same month, more than a third of all home sales were distressed properties. All told, some 820,000 Americans have already lost their homes this year, and another 1 million currently face foreclosure.
Throughout the mounting catastrophe, however, many Americans have been slow to comprehend the true nature of the mortgage disaster. They seemed to have grasped just two things about the crisis: One, a lot of people are getting their houses foreclosed on. Two, some of the banks doing the foreclosing seem to have misplaced their paperwork.
For most people, the former bit about homeowners not paying their damn bills is the important part, while the latter, about the sudden and strange inability of the world's biggest and wealthiest banks to keep proper records, is incidental. Just a little office sloppiness, and who cares? Those deadbeat homeowners still owe the money, right? "They had it coming to them," is how a bartender at the Jacksonville airport put it to me.
But in reality, it's the unpaid bills that are incidental and the lost paperwork that matters. It turns out that underneath that little iceberg tip of exposed evidence lies a fraud so gigantic that it literally cannot be contemplated by our leaders, for fear of admitting that our entire financial system is corrupted to its core — with our great banks and even our government coffers backed not by real wealth but by vast landfills of deceptively generated and essentially worthless mortgage-backed assets.
You've heard of Too Big to Fail — the foreclosure crisis is Too Big for Fraud. Think of the Bernie Madoff scam, only replicated tens of thousands of times over, infecting every corner of the financial universe. The underlying crime is so pervasive, we simply can't admit to it — and so we are working feverishly to rubber-stamp the problem away, in sordid little backrooms in cities like Jacksonville, behind doors that shouldn't be, but often are, closed.
And that's just the economic side of the story. The moral angle to the foreclosure crisis — and, of course, in capitalism we're not supposed to be concerned with the moral stuff, but let's mention it anyway — shows a culture that is slowly giving in to a futuristic nightmare ideology of computerized greed and unchecked financial violence. The monster in the foreclosure crisis has no face and no brain. The mortgages that are being foreclosed upon have no real owners. The lawyers bringing the cases to evict the humans have no real clients. It is complete and absolute legal and economic chaos. No single limb of this vast man-­eating thing knows what the other is doing, which makes it nearly impossible to combat — and scary as hell to watch.
What follows is an account of a single hour of Judge A.C. Soud's rocket docket in Jacksonville. Like everything else related to the modern economy, these foreclosure hearings are conducted in what is essentially a foreign language, heavy on jargon and impenetrable to the casual observer. It took days of interviews with experts before and after this hearing to make sense of this single hour of courtroom drama. And though the permutations of small-time scammery and grift in the foreclosure world are virtually endless — your average foreclosure case involves homeowners or investors being screwed at least five or six creative ways — a single hour of court and a few cases is enough to tell the main story. Because if you see one of these scams, you see them all.
It's early on a sunny Tuesday morning when I arrive at the chambers of Judge Soud, one of four rotating judges who preside over the local rocket docket. These special foreclosure courts were established in July of this year, after the state of Florida budgeted $9.6 million to create a new court with a specific mandate to clear 62 percent of the foreclosure cases that were clogging up the system. Rather than forcing active judges to hear thousands of individual cases, this strategy relies on retired judges who take turns churning through dozens of cases every morning, with little time to pay much attention to the particulars.
What passes for a foreclosure court in Jacksonville is actually a small conference room at the end of a hall on the fifth floor of the drab brick Duval County Courthouse. The space would just about fit a fridge and a pingpong table. At the head of a modest conference table this morning sits Judge Soud, a small and fussy-looking man who reminds me vaguely of the actor Ben Gazzara.
On one side of the table sits James Kowalski, a former homicide prosecutor who is now defending homeowners. A stern man with a shaved head and a laconic manner of speaking, Kowalski has helped pioneer a whole new approach to the housing mess, slowing down the mindless eviction machine by deposing the scores of "robo-signers" being hired by the banks to sign phony foreclosure affidavits by the thousands. For his work on behalf of the dispossessed, Kowalski was recently profiled in a preposterous Wall Street Journal article that blamed attorneys like him for causing the foreclosure mess with their nuisance defense claims. The headline: "Niche Lawyers Spawned Housing Fracas."
On the other side of the table are the plaintiff's attorneys, the guys who represent the banks. On this level of the game, these lawyers refer to themselves as "bench warmers" — volume stand-ins subcontracted by the big, hired-killer law firms that work for the banks. One of the bench warmers present today is Mark Kessler, who works for a number of lenders and giant "foreclosure mills," including the one run by David J. Stern, a gazillionaire attorney and all-Universe asshole who last year tried to foreclose on 70,382 homeowners. Which is a nice way to make a living, considering that Stern and his wife, Jeanine, have bought nearly $60 million in property for themselves in recent years, including a 9,273-square-foot manse in Fort Lauderdale that is part of a Ritz-Carlton complex.
Kessler is a harried, middle-aged man in glasses who spends the morning perpetually fighting to organize a towering stack of folders, each one representing a soon-to-be-homeless human being. It quickly becomes apparent that Kessler is barely acquainted with the names in the files, much less the details of each case. "A lot of these guys won't even get the folders until right before the hearing," says Kowalski.
When I arrive, Judge Soud and the lawyers are already arguing a foreclosure case; at a break in the action, I slip into the chamber with a legal-aid attorney who's accompanying me and sit down. The judge eyes me anxiously, then proceeds. He clears his throat, and then it's ready, set, fraud!
Judge Soud seems to have no clue that the files he is processing at a breakneck pace are stuffed with fraudulent claims and outright lies. "We have not encountered any fraud yet," he recently told a local newspaper. "If we encountered fraud, it would go to [the state attorney], I can tell you that." But the very first case I see in his court is riddled with fraud.
Kowalski has seen hundreds of cases like the one he's presenting this morning. It started back in 2006, when he went to Pennsylvania to conduct what he thought would be a routine deposition of an official at the lending giant GMAC. What he discovered was that the official — who had sworn to having personal knowledge of the case — was, in fact, just a "robo-signer" who had signed off on the file without knowing anything about the actual homeowner or his payment history. (Kowalski's clients, like most of the homeowners he represents, were actually making their payments on time; in this particular case, a check had been mistakenly refused by GMAC.) Following the evidence, Kowalski discovered what has turned out to be a systemwide collapse of the process for documenting mortgages in this country.
If you're foreclosing on somebody's house, you are required by law to have a collection of paperwork showing the journey of that mortgage note from the moment of issuance to the present. You should see the originating lender (a firm like Countrywide) selling the loan to the next entity in the chain (perhaps Goldman Sachs) to the next (maybe JP Morgan), with the actual note being transferred each time. But in fact, almost no bank currently foreclosing on homeowners has a reliable record of who owns the loan; in some cases, they have even intentionally shredded the actual mortgage notes. That's where the robo-signers come in. To create the appearance of paperwork where none exists, the banks drag in these pimply entry-level types — an infamous example is GMAC's notorious robo-signer Jeffrey Stephan, who appears online looking like an age-advanced photo of Beavis or Butt-Head — and get them to sign thousands of documents a month attesting to the banks' proper ownership of the mortgages.
This isn't some rare goof-up by a low-level cubicle slave: Virtually every case of foreclosure in this country involves some form of screwed-up paperwork. "I would say it's pretty close to 100 percent," says Kowalski. An attorney for Jacksonville Area Legal Aid tells me that out of the hundreds of cases she has handled, fewer than five involved no phony paperwork. "The fraud is the norm," she says.
Kowalski's current case before Judge Soud is a perfect example. The Jacksonville couple he represents are being sued for delinquent payments, but the case against them has already been dismissed once before. The first time around, the plaintiff, Bank of New York Mellon, wrote in Paragraph 8 that "plaintiff owns and holds the note" on the house belonging to the couple. But in Paragraph 3 of the same complaint, the bank reported that the note was "lost or destroyed," while in Paragraph 4 it attests that "plaintiff cannot reasonably obtain possession of the promissory note because its whereabouts cannot be determined."
The bank, in other words, tried to claim on paper, in court, that it both lost the note and had it, at the same time. Moreover, it claimed that it had included a copy of the note in the file, which it did — the only problem being that the note (a) was not properly endorsed, and (b) was payable not to Bank of New York but to someone else, a company called Novastar.
Now, months after its first pass at foreclosure was dismissed, the bank has refiled the case — and what do you know, it suddenly found the note. And this time, somehow, the note has the proper stamps. "There's a stamp that did not appear on the note that was originally filed," Kowalski tells the judge. (This business about the stamps is hilarious. "You can get them very cheap online," says Chip Parker, an attorney who defends homeowners in Jacksonville.)
The bank's new set of papers also traces ownership of the loan from the original lender, Novastar, to JP Morgan and then to Bank of New York. The bank, in other words, is trying to push through a completely new set of documents in its attempts to foreclose on Kowalski's clients.
There's only one problem: The dates of the transfers are completely fucked. According to the documents, JP Morgan transferred the mortgage to Bank of New York on December 9th, 2008. But according to the same documents, JP Morgan didn't even receive the mortgage from Novastar until February 2nd, 2009 — two months after it had supposedly passed the note along to Bank of New York. Such rank incompetence at doctoring legal paperwork is typical of foreclosure actions, where the fraud is laid out in ink in ways that make it impossible for anyone but an overburdened, half-asleep judge to miss. "That's my point about all of this," Kowalski tells me later. "If you're going to lie to me, at least lie well."
The dates aren't the only thing screwy about the new documents submitted by Bank of New York. Having failed in its earlier attempt to claim that it actually had the mortgage note, the bank now tries an all-of-the-above tactic. "Plaintiff owns and holds the note," it claims, "or is a person entitled to enforce the note."
Soud sighs. For Kessler, the plaintiff's lawyer, to come before him with such sloppy documents and make this preposterous argument — that his client either is or is not the note-holder — well, that puts His Honor in a tough spot. The entire concept is a legal absurdity, and he can't sign off on it. With an expression of something very like regret, the judge tells Kessler, "I'm going to have to go ahead and accept [Kowalski's] argument."
Now, one might think that after a bank makes multiple attempts to push phony documents through a courtroom, a judge might be pissed off enough to simply rule against that plaintiff for good. As I witness in court all morning, the defense never gets more than one chance to screw up. But the banks get to keep filing their foreclosures over and over again, no matter how atrocious and deceitful their paperwork is.
Thus, when Soud tells Kessler that he's dismissing the case, he hastens to add: "Of course, I'm not going to dismiss with prejudice." With an emphasis on the words "of course."
Instead, Soud gives Kessler 25 days to come up with better paperwork. Kowalski fully expects the bank to come back with new documents telling a whole new story of the note's ownership. "What they're going to do, I would predict, is produce a note and say Bank of New York is not the original note-holder, but merely the servicer," he says.
This is the dirty secret of the rocket docket: The whole system is set up to enable lenders to commit fraud over and over again, until they figure out a way to reduce the stink enough so some judge like Soud can sign off on the scam. "If the court finds for the defendant, the plaintiffs just refile," says Parker, the local attorney. "The only way for the caseload to get reduced is to give it to the plaintiff. The entire process is designed with that result in mind."
Now all of this — the obviously cooked-up documents, the magically appearing stamp and the rest of it — may just seem like nothing more than sloppy paperwork. After all, what does it matter if the bank has lost a few forms or mixed up the dates? The homeowners still owe what they owe, and the deadbeats have no right to keep living in a house they haven't paid for.
But what's going on at the Jacksonville rocket docket, and in foreclosure courts all across the country, has nothing to do with sloppiness. All this phony paperwork was actually an essential part of the mortgage bubble, an integral element of what has enabled the nation's biggest lenders to pass off all that subprime lead as AAA gold.
In the old days, when you took out a mortgage, it was probably through a local bank or a credit union, and whoever gave you your loan held on to it for life. If you lost your job or got too sick to work and suddenly had trouble making your payments, you could call a human being and work things out. It was in the banker's interest, as well as yours, to make a modified payment schedule. From his point of view, it was better that you pay something than nothing at all.
But that all changed about a decade ago, thanks to the invention of new financial instruments that magically turned all these mortgages into high-grade investments. Now when you took out a mortgage, your original lender — which might well have been a big mortgage mill like Countrywide or New Century — immediately sold off your loan to big banks like Deutsche and Goldman and JP Morgan. The banks then dumped hundreds or thousands of home loans at a time into tax-exempt real estate trusts, where the loans were diced up into securities, examined and graded by the ratings agencies, and sold off to big pension funds and other institutional suckers.
Even at this stage of the game, the banks generally knew that the loans they were buying and reselling to investors were shady. A company called Clayton Holdings, which analyzed nearly 1 million loans being prepared for sale in 2006 and 2007 by 23 banks, found that nearly half of the mortgages failed to meet the underwriting standards being promised to investors. Citi­group, for instance, had 29 percent of its loans come up short, but it still sold a third of those mortgages to investors. Goldman Sachs had 19 percent of its mortgages flunk the test, yet it knowingly hawked 34 percent of the risky deals to investors.
D. Keith Johnson, the head of Clayton Holdings, was so alarmed by the findings that he went to officials at three of the main ratings agencies — Moody's, Standard and Poor's, and Fitch's — and tried to get them to properly evaluate the loans. "Wouldn't this information be great for you to have as you assign risk levels?" he asked them. (Translation: Don't you ratings agencies want to know that half these loans are crap before you give them a thumbs-up?) But all three agencies rejected his advice, fearing they would lose business if they adopted tougher standards. In the end, the agencies gave large chunks of these mortgage-backed securities AAA ratings — which means "credit risk almost zero."
Since these mortgage-backed securities paid much higher returns than other AAA investments like treasury notes or corporate bonds, the banks had no trouble attracting investors, foreign and domestic, from pension funds to insurance companies to trade unions. The demand was so great, in fact, that they often sold mortgages they didn't even have yet, prompting big warehouse lenders like Countrywide and New Century to rush out into the world to find more warm bodies to lend to.
In their extreme haste to get thousands and thousands of mortgages they could resell to the banks, the lenders committed an astonishing variety of fraud, from falsifying income statements to making grossly inflated appraisals to misrepresenting properties to home buyers. Most crucially, they gave tons and tons of credit to people who probably didn't deserve it, and why not? These fly-by-night mortgage companies weren't going to hold on to these loans, not even for 10 minutes. They were issuing this credit specifically to sell the loans off to the big banks right away, in furtherance of the larger scheme to dump fraudulent AAA-rated mortgage-backed securities on investors. If you had a pulse, they had a house to sell you.
As bad as Countrywide and all those lenders were, the banks that had sent them out to collect these crap loans were a hundred times worse. To sell the loans, the banks often dumped them into big tax-exempt buckets called REMICs, or Real Estate Mortgage Investment Conduits. Each one of these Enron-ish, offshore-like real estate trusts spelled out exactly what kinds of loans were supposed to be in the pool, when they were to be collected, and how they were to be managed. In order to both preserve their tax-exempt status anddeserve their AAA ratings, each of the loans in the pool had to have certain characteristics. The loans couldn't already be in default or foreclosure at the time they were sold to investors. If they were advertised as nice, safe, fixed-rate mortgages, they couldn't turn out to be high-interest junk loans. And, on the most basic level, the loans had to actually exist. In other words, if the trust stipulated that all the loans had to be collected by August 2005, the bank couldn't still be sticking in mortgages months later.
Yet that's exactly what the banks did. In one case handled by Jacksonville Area Legal Aid, a homeowner refinanced her house in 2005 but almost immediately got into trouble, going into default in December of that year. Yet somehow, this woman's loan was placed into a trust called Home Equity Loan Trust Series AE 2005-HE5 in January 2006 — five months after the deadline for that particular trust. The loan was not only late, it was already in foreclosure — which means that, by definition, whoever the investors were in AE 2005-HE5 were getting shafted.
Why does stuff like this matter? Because when the banks put these pools together, they were telling their investors that they were putting their money into tidy collections of real, performing home loans. But frequently, the loans in the trust were complete shit. Or sometimes, the banks didn't even have all the loans they said they had. But the banks sold the securities based on these pools of mortgages as AAA-rated gold anyway.
In short, all of this was a scam — and that's why so many of these mortgages lack a true paper trail. Had these transfers been done legally, the actual mortgage note and detailed information about all of these transactions would have been passed from entity to entity each time the mortgage was sold. But in actual practice, the banks were often committing securities fraud (because many of the mortgages did not match the information in the prospectuses given to investors) and tax fraud (because the way the mortgages were collected and serviced often violated the strict procedures governing such investments). Having unloaded this diseased cargo onto their unsuspecting customers, the banks had no incentive to waste money keeping "proper" documentation of all these dubious transactions.
"You've already committed fraud once," says April Charney, an attorney with Jacksonville Area Legal Aid. "What do you have to lose?"
Sitting in the rocket docket, James Kowalski considers himself lucky to have won his first motion of the morning. To get the usually intractable Judge Soud to forestall a foreclosure is considered a real victory, and I later hear Kowalski getting props and attaboys from other foreclosure lawyers. In a great deal of these cases, in fact, the homeowners would have a pretty good chance of beating the rap, at least temporarily, if only they had lawyers fighting for them in court. But most of them don't. In fact, more than 90 percent of the cases that go through Florida foreclosure courts are unopposed. Either homeowners don't know they can fight their foreclosures, or they simply can't afford an attorney. These unopposed cases are the ones the banks know they'll win — which is why they don't sweat it if they take the occasional whipping.
That's why all these colorful descriptions of cases where foreclosure lawyers like Kowalski score in court are really just that — a little color. The meat of the foreclosure crisis is the unopposed cases; that's where the banks make their money. They almost always win those cases, no matter what's in the files.
This becomes evident after Kowalski leaves the room.
"Who's next?" Judge Soud says. He turns to Mark Kessler, the counsel for the big foreclosure mills. "Mark, you still got some?"
"I've got about three more, Judge," says Kessler.
Kessler then drops three greenish-brown files in front of Judge Soud, who spends no more than a minute or two glancing through each one. Then he closes the files and puts an end to the process by putting his official stamp on each foreclosure with an authoritative finality:
Each one of those kerchunks means another family on the street. There are no faces involved here, just beat-the-clock legal machinery. Watching Judge Soud plow through each foreclosure reminds me of the scene in Fargo where the villain played by Swedish character actor Peter Stormare pushes his victim's leg through a wood chipper with that trademark bored look on his face. Mechanized misery and brainless bureaucracy on the one hand, cash for the banks on the other.
What's sad is that most Americans who have an opinion about the foreclosure crisis don't give a shit about all the fraud involved. They don't care that these mortgages wouldn't have been available in the first place if the banks hadn't found a way to sell oregano as weed to pension funds and insurance companies. They don't care that the Countrywides of the world pushed borrowers who qualified for safer fixed-­income loans into far more dangerous adjustable-rate loans, because their brokers got bigger commissions for doing so. They don't care that in the rush to produce loans, people were sold houses that turned out to have flood damage or worse, and they certainly don't care that people were sold houses with inflated appraisals, which left them almost immediately underwater once housing prices started falling.
The way the banks tell it, it doesn't matter if they defrauded homeowners and investors and taxpayers alike to get these loans. All that matters is that a bunch of deadbeats aren't paying their fucking bills. "If you didn't pay your mortgage, you shouldn't be in your house — period," is how Walter Todd, portfolio manager at Greenwood Capital Associates, puts it. "People are getting upset about something that's just procedural."
Jamie Dimon, the CEO of JP Morgan, is even more succinct in dismissing the struggling homeowners that he and the other megabanks scammed before tossing out into the street. "We're not evicting people who deserve to stay in their house," Dimon says.
There are two things wrong with this argument. (Well, more than two, actually, but let's just stick to the two big ones.)
The first reason is: It simply isn't true. Many people who are being foreclosed on have actually paid their bills and followed all the instructions laid down by their banks. In some cases, a homeowner contacts the bank to say that he's having trouble paying his bill, and the bank offers him loan modification. But the bank tells him that in order to qualify for modification, he must first be delinquent on his mortgage. "They actually tell people to stop paying their bills for three months," says Parker.
The authorization gets recorded in what's known as the bank's "contact data­base," which records every phone call or other communication with a home­owner. But no mention of it is entered into the bank's "number history," which records only the payment record. When the number history notes that the home­owner has missed three payments in a row, it has no way of knowing that the homeowner was given permission to stop making payments. "One computer generates a default letter," says Kowalski. "Another computer contacts the credit bureaus." At no time is there a human being looking at the entire picture.
Which means that homeowners can be foreclosed on for all sorts of faulty reasons: misplaced checks, address errors, you name it. This inability of one limb of the foreclosure beast to know what the other limb is doing is responsible for many of the horrific stories befalling homeowners across the country. Patti Parker, a local attorney in Jacksonville, tells of a woman whose home was seized by Deutsche Bank two days before Christmas. Months later, Deutsche came back and admitted that they had made a mistake: They had repossessed the wrong property. In another case that made headlines in Orlando, an agent for JP Morgan mistakenly broke into a woman's house that wasn't even in foreclosure and tried to change the locks. Terrified, the woman locked herself in her bathroom and called 911. But in a profound expression of the state's reflexive willingness to side with the bad guys, the police made no arrest in the case. Breaking and entering is not a crime, apparently, when it's authorized by a bank.
The second reason the whole they still owe the fucking money thing is bogus has to do with the changed incentives in the mortgage game. In many cases, banks like JP Morgan are merely the servicers of all these home loans, charged with collecting your money every month and paying every penny of it into the trust, which is the real owner of your mortgage. If you pay less than the whole amount, JP Morgan is now obligated to pay the trust the remainder out of its own pocket. When you fall behind, your bank falls behind, too. The only way it gets off the hook is if the house is foreclosed on and sold.
That's what this foreclosure crisis is all about: fleeing the scene of the crime. Add into the equation the fact that some of these big banks were simultaneously betting big money against these mortgages — Goldman Sachs being the prime example — and you can see that there were heavy incentives across the board to push anyone in trouble over the cliff.
Things used to be different. Asked what percentage of struggling homeowners she used to be able to save from foreclosure in the days before securitization, Charney is quick to answer. "Most of them," she says. "I seldom came across a mortgage I couldn't work out."
In Judge Soud's court, I come across a shining example of this mindless rush to foreclosure when I meet Natasha Leonard, a single mother who bought a house in 2004 for $97,500. Right after closing on the home, Leonard lost her job. But when she tried to get a modification on the loan, the bank's offer was not helpful. "They wanted me to pay $1,000," she says. Which wasn't exactly the kind of modification she was hoping for, given that her original monthly payment was $840.
"You're paying $840, you ask for a break, and they ask you to pay $1,000?" I ask.
"Right," she says.
Leonard now has a job and could make some kind of reduced payment. But instead of offering loan modification, the bank's lawyers are in their fourth year of doggedly beating her brains out over minor technicalities in the foreclosure process. That's fine by the lawyers, who are collecting big fees. And there appears to be no human being at the bank who's involved enough to issue a sane decision to end the costly battle. "If there was a real client on the other side, maybe they could work something out," says Charney, who is representing Leonard. In this lunatic bureaucratic jungle of securitized home loans issued by trans­national behemoths, the borrower-lender relationship can only go one of two ways: full payment, or total war.
The extreme randomness of the system is exemplified by the last case I see in the rocket docket. While most foreclosures are unopposed, with homeowners not even bothering to show up in court to defend themselves, a few pro se defendants — people representing themselves — occasionally trickle in. At one point during Judge Soud's proceeding, a tallish blond woman named Shawnetta Cooper walks in with a confused look on her face. A recent divorcee delinquent in her payments, she has come to court today fully expecting to be foreclosed on by Wells Fargo. She sits down and takes a quick look around at the lawyers who are here to kick her out of her home. "The land has been in my family for four generations," she tells me later. "I don't want to be the one to lose it."
Judge Soud pipes up and inquires if there's a plaintiff lawyer present; someone has to lop off this woman's head so the court can move on to the next case. But then something unexpected happens: It turns out that Kessler is supposed to be foreclosing on her today, but he doesn't have her folder. The plaintiff, technically, has forgotten to show up to court.
Just minutes before, I had watched what happens when defendants don't show up in court:kerchunk! The judge more or less automatically rules for the plaintiffs when the homeowner is a no-show. But when the plaintiff doesn't show, the judge is suddenly all mercy and forgiveness. Soud simply continues Cooper's case, telling Kessler to get his shit together and come back for another whack at her in a few weeks. Having done this, he dismisses everyone.
Stunned, Cooper wanders out of the courtroom looking like a person who has stepped up to the gallows expecting to be hanged, but has instead been handed a fruit basket and a new set of golf clubs.
I follow her out of the court, hoping to ask her about her case. But the sight of a journalist getting up to talk to a defendant in his kangaroo court clearly puts a charge into His Honor, and he immediately calls Cooper back into the conference room. Then, to the amazement of everyone present, he issues the following speech:
"This young man," he says, pointing at me, "is a reporter for Rolling Stone. It is your privilege to talk to him if you want." He pauses. "It is also your privilege to not talk to him if you want."
I stare at the judge, open-mouthed. Here's a woman who still has to come back to this guy's court to find out if she can keep her home, and the judge's admonition suggests that she may run the risk of pissing him off if she talks to a reporter. Worse, about an hour later, April Charney, the lawyer who accompanied me to court, receives an e-mail from the judge actually threatening her with contempt for bringing a stranger to his court. Noting that "we ask that anyone other than a lawyer remain in the lobby," Judge Soud admonishes Charney that "your unprofessional conduct and apparent authorization that the reporter could pursue a property owner immediately out of Chambers into the hallway for an interview, may very well be sited [sic] for possible contempt in the future."
Let's leave aside for a moment that Charney never said a word to me about speaking to Cooper. And let's overlook entirely the fact that the judge can't spell the word cited. The key here isn't this individual judge — it's the notion that these hearings are not and should not be entirely public. Quite clearly, foreclosure is meant to be neither seen nor heard.
After Soud's outburst, Cooper quietly leaves the court. Once out of sight of the judge, she shows me her file. It's not hard to find the fraud in the case. For starters, the assignment of mortgage is autographed by a notorious robo-signer — John Kennerty, who gave a deposition this summer admitting that he signed as many as 150 documents a day for Wells Fargo. In Cooper's case, the document with Kennerty's signature on it places the date on which Wells Fargo obtained the mortgage as May 5th, 2010. The trouble is, the bank bought the loan from Wachovia — a bank that went out of business in 2008. All of which is interesting, because in her file, it states that Wells Fargo sued Cooper for foreclosure on February 22nd, 2010. In other words, the bank foreclosed on Cooper three months before it obtained her mortgage from a nonexistent company.
There are other types of grift and outright theft in the file. As is typical in many foreclosure cases, Cooper is being charged by the bank for numerous attempts to serve her with papers. But a booming industry has grown up around fraudulent process servers; companies will claim they made dozens of attempts to serve homeowners, when in fact they made just one or none at all. Who's going to check? The process servers cover up the crime using the same tactic as the lenders, saying they lost the original summons. From 2000 to 2006, there was a total of 1,031 "affidavits of lost summons" here in Duval County; in the past two years, by contrast, more than 4,000 have been filed.
Cooper's file contains a total of $371 in fees for process service, including one charge of $55 for an attempt to serve process on an "unknown tenant." But Cooper's house is owner-occupied — she doesn't even have a tenant, she tells me with a shrug. If Mark Kessler had had his shit together in court today, Coop­er would not only be out on the street, she'd be paying for that attempt to serve papers to her nonexistent tenant.
Cooper's case perfectly summarizes what the foreclosure crisis is all about. Her original loan was made by Wachovia, a bank that blew itself up in 2008 speculating in the mortgage market. It was then transferred to Wells Fargo, a megabank that was handed some $50 billion in public assistance to help it acquire the corpse of Wachovia. And who else benefited from that $50 billion in bailout money? Billionaire Warren Buffett and his Berkshire Hathaway fund, which happens to be a major shareholder in Wells Fargo. It was Buffett's vice chairman, Charles Munger, who recently told America that it should "thank God" that the government bailed out banks like the one he invests in, while people who have fallen on hard times — that is, homeowners like Shawnetta Cooper — should "suck it in and cope."
Look: It's undeniable that many of the people facing foreclosure bear some responsibility for the crisis. Some borrowed beyond their means. Some even borrowed knowing they would never be able to pay off their debt, either hoping to flip their houses right away or taking on mortgages with low initial teaser rates without bothering to think of the future. The culture of take-for-yourself-now, let-someone-else-pay-later wasn't completely restricted to Wall Street. It penetrated all the way down to the individual consumer, who in some cases was a knowing accomplice in the bubble mess.
But many of these homeowners are just ordinary Joes who had no idea what they were getting into. Some were pushed into dangerous loans when they qualified for safe ones. Others were told not to worry about future jumps in interest rates because they could just refinance down the road, or discovered that the value of their homes had been overinflated by brokers looking to pad their commissions. And that's not even accounting for the fact that most of this credit wouldn't have been available in the first place without the Ponzi-like bubble scheme cooked up by Wall Street, about which the average home­owner knew nothing — hell, even the average U.S. senator didn't know about it.
At worst, these ordinary homeowners were stupid or uninformed — while the banks that lent them the money are guilty of committing a baldfaced crime on a grand scale. These banks robbed investors and conned homeowners, blew themselves up chasing the fraud, then begged the taxpayers to bail them out. And bail them out we did: We ponied up billions to help Wells Fargo buy Wachovia, paid Bank of America to buy Merrill Lynch, and watched as the Fed opened up special facilities to buy up the assets in defective mortgage trusts at inflated prices. And after all that effort by the state to buy back these phony assets so the thieves could all stay in business and keep their bonuses, what did the banks do? They put their foot on the foreclosure gas pedal and stepped up the effort to kick people out of their homes as fast as possible, before the world caught on to how these loans were made in the first place.
Why don't the banks want us to see the paperwork on all these mortgages? Because the documents represent a death sentence for them. According to the rules of the mortgage trusts, a lender like Bank of America, which controls all the Countrywide loans, is required by law to buy back from investors every faulty loan the crooks at Countrywide ever issued. Think about what that would do to Bank of America's bottom line the next time you wonder why they're trying so hard to rush these loans into someone else's hands.
When you meet people who are losing their homes in this foreclosure crisis, they almost all have the same look of deep shame and anguish. Nowhere else on the planet is it such a crime to be down on your luck, even if you were put there by some of the world's richest banks, which continue to rake in record profits purely because they got a big fat handout from the government. That's why one banker CEO after another keeps going on TV to explain that despite their own deceptive loans and fraudulent paperwork, the real problem is these deadbeat homeowners who won't pay their fucking bills. And that's why most people in this country are so ready to buy that explanation. Because in America, it's far more shameful to owe money than it is to steal it.
The following is an article from the November 25, 2010 issue of Rolling Stone. This issue is available Friday on newsstands, as well online in Rolling Stone’s digital archive. Click here to subscribe.