L’shanah Tovah

Happy New Year to all of TrueGotham’s Jewish readers (although most won’t be reading today).  For those who aren’t Jewish, Rosh Hashanah is the beginning of the Jewish New Year and the beginning of a period of reflection, introspection and atonement for the mistakes made the previous year.  The 10 Days of Awe leading up to Yom Kippur are an opportunity to seek reconciliation with those who one may have wronged in the previous year. 

The impetus for this post today is this article from Peg Brickley at RealEstateJournal.com.  A disturbing article about thousands of homeowners facing foreclosure because of American Home Mortgage’s bankruptcy.

Thousands of homeowners face an "imminent risk" of losing their homes because of clashes between American Home Mortgage Investment Corp. and its former financial backers, according to Freddie Mac, a government-chartered housing financier.

In documents filed with the U.S. Bankruptcy Court in Wilmington, Del., Freddie Mac said it seized $7 million that homeowners sent to American Home to cover principal and interest payments, property taxes and insurance just before the company’s Aug. 6 collapse. American Home quit making payments to tax authorities and insurance companies Aug. 24.

Some serious reconciliation needs to be considered here and I don’t have any answers.  It just seems insane to me that homeowners could lose their homes solely based on their mortgage company.  Any thoughts from the financial gurus out there on how this may play out?

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