If the servicer followed the law on carrying through foreclosures then it would have to go through a costly and time-consuming process of getting its paperwork in order and ensuring that it actually did have possession of the title before going to a judge and getting a judgment that would allow them to take possession of the property. Instead banks got in the habit of skirting the proper procedures and filling in forms inaccurately and improperly in order to take possession of properties.
GMAC, the former financing arm of GM, has become the poster child for these sorts of practices. Jeffrey Stephan, a leader of one of its foreclosure units, acknowledged that he had signed thousands of affidavits claiming that he had reviewed documents that he had never seen.
In addition to being a major subprime lender during the heyday of the housing bubble, GMAC -- following its collapse last year -- also has the notoriety of being primarily owned by the federal government. This fact may ensure greater accountability at GMAC, but there is no reason to believe that its practices are qualitatively different than those of other servicers carrying through foreclosures. The basic point is that the banks foreclosing on homes don’t feel that they should be held to the letter of the law like ordinary people.
http://www.counterpunch.org/baker09292010.htmlContrary to popular belief, GM's auto business is profitable. Their casino business was where their losses came from. These were the losses that explain why starting wages in US auto are now around $14/hr, & why all the majors are in the process of trying to rachet them down to $12/hr.
Labor cost = 10% or less of the cost of a car.
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