Posts Tagged ‘baltimore’

Kondaur Capital and Jon Daurio In Foreclosure News Again

vulture

 

I wrote about the debt buyer, Kondaur Capital, back in May. Remember those guys, the company that’s headed by former Ameriquest executive Jon Daurio?  They buy “scratch and dent” mortgages for pennies on the dollar, then get the homeowners out as quickly as possible and sell the home for a profit.  The Wall Street Journal just did another piece on them.

Apparently, one Baltimore homeowner, Eddie Patrick, was talked into dropping his lawsuit against Kondaur when it promised to “work with him” on a loan modification. They foreclosed on him anyway and then offered to sell the house back to him for $140k, which Mr, Patrick, not being made of money like these Wall Street scum, can’t afford.  Mr Patrick’s six year old son is battling brain cancer and recently had two operations. Kondaur has since generously offered Mr. Patrick $8,100 to move by the end of August and has lowered the sales price on the home to $130k.

This Daurio guy is a virtual font of insane and inane comments, especially since the fellow used to originate subprime loans that he knew full well the borrowers could never repay:

We help borrowers understand they have a house they can’t afford.

Except that they probably CAN afford the home with a decent mortgage on it. Most of the people who were sold “subprime” loans could have qualified for cheaper and safer conventional mortgages, as I noted here

The vast majority of these people knew the risk they were taking. Like so many of the borrowers I dealt with when I was originating loans, they thought housing prices were going up.

Actually, it was guys like Daurio who sold borrowers the bill of goods that prices would always go up and they could always refinance at a later date to get a better deal.  I’m going to get a little nasty here, but I can’t stand people like this Daurio, the architects of the current depression. No, Daurio, you ass, the borrowers weren’t aware of the risks, but you sure were, and you convinced them that home prices never fall. You and your Wall Street magic made it seem like they could afford these loans, when in fact, they could not.

Attributed to him, but paraphrased by the author of the WSJ article  is this little gem:

It is no surprise that some borrowers are unhappy when Kondaur forces them to face the music, Mr. Daurio says, but it isn’t his fault that borrowers got themselves into houses they can’t afford.

At the risk of repeating myself, actually, it is your fault, Daurio. You and your Wall Street brethren created these toxic mortgages and foisted them off on people. And now you want to profit off of the mess you made? Really? And this is being allowed?

Ok, enough excoriating of our pal, Daurio.  The real story here is that the regulators don’t know how to treat debt buyers like Kondaur. Are they debt collectors or mortgage lenders?  North Carolina’s chief deputy banking commissioner, Mark Pearce says:

I have concerns that some of these activities fall through the cracks of the regulatory structure.

For the first time, debt buyers, those denizens of the debt collection underworld, are entering the mortgage market, and our current laws aren’t clear on how to deal with them.  This doesn’t meant that current law won’t protect you from these predators, it just means it’s going to be a tougher fight.

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