Dr. Ben Carson, the new secretary of Department of Housing and Urban Development HUD) believes that he can effectively run this department because of his experience as a neurosurgeon. See the video below.
However these facts should be taken into consideration:
HUD is illegally aiding and abetting corrupt San Bernardino County officials to cover up a FHA Mortgage fraud case caused by sheer incompetence of the two government agencies. To that end, these officials used the terrorist attack to divert attention from their illegal activities.
Visit SanBernardinoCounty.online for more details.
Secretary Castro took the reins of HUD right around the time the most egregious mortgage fraud case was unfolding around July of 2014. However because of his political ambitions he attempted to sweep the mess under the rug so as not to hurt his chances of political advancement.
Visit JulianCastro.online for more details.
HUD does not investigate allegations of fraud against Wall Street. Citizen complaints of fraud and corruption to the Inspector General of HUD all end up in a black hole as they already know the problem and they already do not care. Other than an automatic-reply no one receives any replies to the email complaints sent to the agency's watchdog.
Neither does HUD investigate allegation of misconduct and bribery against its personnel.
No contact info is provided anywhere to speak to a HUD supervising employee regarding a fraud activity. No contact info was ever provided for Castro. HUD personnel do not believe that they need to respond to the public.
HUD personnel only answer to Wall Street and it is the bankers who decide on department policies.
Not only The Office of Inspector General of HUD does not respond to any reports of corruption and abuse, but on the contrary it takes action against people who report such abuse, even if it is one of their own, as they wish these matters to stay away from public eye.
The former head of the department, a former City of San Antonio, Texas councilman and mayor, had been running this department since July 28, 2014 replacing the outgoing secretary, Shaun Donovan, who was tapped by President Obama to lead the Office of Management and Budget.
Both these secretaries, who have been heavily beholden to Wall Street, had turned a complete blind eye to the immense corruption ongoing at all levels of this department resulting in billions of dollars in loss to the tax payers who fund HUD's projects while putting the lives and safety of the occupants of HUD insured houses in danger.
Secretary Castro was simply chosen because of the favorable optics and not because of any experience in running a multi-billion dollar juggernaut which is responsible for the welfare and safety of millions of lower class and poorer Americans who rely on their government for safe and affordable housing. There has been more discussions in the media about Castro's looks than his actions at the helm of the agency.
A fact that is mostly unknown to most people is that HUD officials are directly responsible for the safety of the construction of the buildings occupied by the American people and insured by HUD. But it appears that HUD officials are either unaware of this fact, which makes them incompetent to run this department, or that they simply do not care, in which case it is absolutely fair to deem them negligent and corrupt.
Most buildings purchased through HUD loans comprise of distressed and foreclosed properties with deferred maintenance. Some of these buildings are outright dangerous to live in and require immediate attention and repair before they can be occupied by the next group of owners.
While most real estate sales are subject to rigorous mandatory disclosure requirements on the parts of sellers and inspections on the part of the buyers with heavy civil penalties for errors and omissions by the inspectors, but foreclosed buildings are sold "AS IS" and not subject to any such regulations and this is where HUD falls flat on its back where many stressed buildings are sold and insured by HUD while completely damaged, a fact which is never known to the buyers until it is too late and they have already moved in with no recourse except to abandon the house. HUD rules require that these buildings to be repaired and brought up to minimum saftey standards before being occupied.
HUD is billions of tax payer dollars in red, more than 16 billion as of last report available, mostly as the result of the properties insured without any proper checks and balances on the part of the government and completely at the behest of banks who wish to make quick turnarounds.
Although HUD has some excellent and unrivaled programs anywhere in the world for addressing such issues, such as FHA 203k, a completely unique process which provides both for the purchase and repair of the property lumped in a single loan, but these loans are almost always overlooked because of several reasons.
While the FHA 203k offers a unique opportunity to address both the purchase and repair loans at once, but it creates a dilemma for greedy and impatient brokers who do not want to wait for the process to play out its course. While in a standard home purchase brokers get to collect their commissions as soon as the sale is final, but the downside of a 203k loan is that the final loan is not approved until such time as the repairs are complete. In some cases this can prevent brokers from collecting their fat commissions for days or months after the initial approval while the repair process is ongoing.
In the case of a refinance loan on an existing HUD loan, the loan cannot be finaled until any required repairs identified by a certified HUD inspector has been performed and because of this very fact most unscrupulous brokers and real estate professionals do not disclose any defects in the structures lest it drags out the loan process indefinitely.
The number one reason for the failure of such programs is the immense greed and total impatience on the part of some unscrupulous brokers who unfortunately dominate the real estate industry, a fact which has resulted in the biggest real estate bust in history around 2008.
While some safeguards were supposedly put in place after the crash, but they were already breached on day one by very creative lending practices and Wall Street has maintained the exact status quo even to this date; only one more layer of bureaucracy was added to the mix to hide the identity of the culprits in a crime and not any real fixes to the problem.
The brokers, the Achilles heels of real estate industry, who are simply bridges between buyers and lenders, collect their commissions as soon as the escrow closes regardless of the outcome of the transactions down the road.
This very simple fact was the primary cause of the real estate collapse. While the market was oversaturated with real estate, brokers criminally encouraged more and more transactions because they knew full well that they would still earn their commissions even if the loan defaulted. Brokers engaged in predatory lending practices on the false assumption that the loans' underwriters had the option of the foreclosure on the property. This simplistic assumption did not take into account the very simple fact that too many foreclosures bring down the value of surronding proeprties, a domino effect which resulted in the total collapse of home prices.
Appraisals of properties are based on the value of comparable houses in the surrounding neighborhoods and if those houses have been foreclosed, which culminates in the reduction of the value of the house, the surrounding houses are also affected. Too many foreclosures of bad loan properties was the main reason for collapse of home values, a fact which became known to unscrupulous brokers and regulators only too late.
Despite sevral warnings to regulators at the time, unscupulous lenders and brokers were allowed to roam free and wreak havoc on the industry.
As brokers' commissions is usually a percentage of the sale price of the property, some unscrupulous brokers encouraged appraisers to inflate the prices of the properties in order to earn themselves higher commissions. Appraisers who refused to artificially inflate the prices, would get sidelined from the action.
Likewise these same brokers discouraged any inspectors from disclosing defects which could result in the reduction of value of property and long delays in closing of transaction because of required repairs.
As the direct result of this, many properties were overvalued which resulted in the burst. Any other cause of the tragedy is only secondary to this very basic and simple principle.
The only bandaid fix that was made after the mess was the fact that the brokers could no longer directly get into a deal with appraisers or inspectors and that the transaction had to go through a third party to alleviate the chances of a collusion. The wise men and women of our government decided that the best person for this job was a broker's employee. What a brilliant idea. Instead of fixing the problem only more leaches were thrown in the mix to help the bleeding.
Unscrupulous brokers who do not risk any financial losses at all, through self-interest and greed, and without the slightest regard for the buyers' and the lenders' interests, are now relying on their employees who also want a piece of the pie. These leaches are still adhering to the same routine entering into unacceptable transactions despite knowing full well about the shortfalls of the transactions.
Corrupt broker monsters, created by Wall Street, are the main driving force behind all real estate problems but they are still going strong.
In August of 2015, Washington Post reported that 25,000 people live in HUD's low income housing project who earn more income than approved by HUD to be qualified to receive low income housing through tacit approval by HUD. In fact HUD openly encouraged people to apply for these housings even though they did not qualify' HUD erroneously claims that they have no mechanism for evicting such tenants.
It was reported that a family in public housing makes $498,000 a year and HUD wants tenants like that to stay. More than 25,000 HUD tenants made more than the maximum income allowed to qualify for public housing while more than 300,000 families that really qualify for public housing were lingering on waiting lists.
- A family of four in New York City makes $497,911 a year but pays $1,574 a month to live in public housing in a three-bedroom apartment subsidized by taxpayers.
- In Los Angeles, a family of five that's lived in public housing since 1974 made $204,784 last year but paid $1,091 for a four-bedroom apartment. And a tenant with assets worth $1.6 million - including stocks, real estate and retirement accounts - last year paid $300 for a one-bedroom apartment in public housing in Oxford, Nebraska.
- ..the family in New York with an annual income of almost $500,000 raked in $790,500 in rental income on its real estate holdings.
While it was only after public uproar that HUD agreed to reverse its course, but there is absolutely no indication that HUD has in fact complied with its own rules in doing so.
Despite the deceitful inclusion of "Urban Development" in the agency's moniker, HUD does not plan or oversee any development programs but simply grants loans to third parties who wish to develop communities without the slightest oversight as to how tax payer money is spent by unregulated third parties.
HUD Programs provides:
Capacity Building for Community Development and Affordable Housing - Grants to national intermediaries to develop the capacity and ability of community development corporations (CDCs) and community housing development organizations (CHDOs) to carry out community development and affordable housing activities that benefit low income families.
There are currently no safeguards or accountability in place as to how these loans, some of which cost tax payers billions of dollars, are executed.
There has been an uproar against Secretary Castro for selling HUD property to Wall Street in lieu of non-profit organizations at dontsellourhomestowallstreet.org.
Many non-profit organizations believe that the Distressed Asset Stabilization Program (DASP), a program enacted in 2010 to allow mortgages going toward foreclosure to be sold to what HUD considers "qualified bidders" encouraging them to work with borrowers to help bring the loan out of default.
Many non-profit organizations contend that the term "qualified bidders" is more reflective of them than Wall Street since they care more about their communities than Wall Street sharks. They believe that the 98% rate of sell-out to Wall Street is not in the spirit of enactment and certainly not to the benefit of the local communities.
There are several reasons as to why HUD consistently sides with Wall Street over the little guy.
This agencies is actually being run by the banks. No HUD secretary could possibly hold on to the position without tacit Wall Street approval, an entity which operates completely in the opposite direction of the tax payers' interests, the very people who fund the agency and pay the HUD secretary's salary. The HUD secretary is there merely to comply with Wall Street's never ending wish lists.
In order to be eligible for a HUD/FHA loan, the property must meet certain criteria firmly set in HUD's rules and regulations. The criteria must be inspected and approved by HUD certified inspectors, consultants and appraisers and certified under penalty of perjury.
However as the process is costly and time consuming, and almost 98% of the time the buildings do not meet HUD's very own restrictive rules requiring some form of improvement or repair on the property before it becomes eligible for a HUD certification, more often than not the process gets completely bypassed and properties which do not really meet HUD standards are certified by either unqualified or unscrupulous individuals who have done so falsely under the penalty of perjury.
These types of substandard properties constitute 98% of HUD inventory, ironically the very same exact percentage that goes to Wall Street as they do not care about such little oversights. They conceal the defects and sell the property in "AS IS" conditon.
HUD fears that community organizations might not be so forgiving when they realize HUD was asleep at the desk insuring loans that did not qualify just in order to enrich the coffers of bankers at the expense of the tax payers.
Before the crash of 2008, only a certain group of people, mainly low income first-time home buyers were eligible for HUD loans. Howevere after Shaun Donovan took office in 2009, these restrictions were completely lifted.
Whereas before Donovan's tenure house flippers who bought fixers uppers for the sole purpose of cosmetic touch up and immediate sale were implicitly forbidden from acquiring and selling such property for a set period of time, the bulk of the vast amount of the foreclosures that poured into the market after the 2008 collapse were purchased by house flippers who made the purchases through HUD insured loans by bypassing these laws and selling them right away without upgrading the buildings to HUD's minimum required safety standards.
In almost all of HUD's approved properties sold this way, the transaction amounts to criminal activity. HUD criminally, willfully and knowingly ignores the fact that some of these properties might expose its occupants to severe life and safety issues.
This type of en masse sell-off to Wall Street not only alleviates HUD's exposure to criminal prosecution, as transactions conducted this way are considered "AS IS" and without checks and balances, but in order to sweeten the deal HUD receives indemnity from banks.
Ironically while the whole idea behind HUD's insurance of mortgages was to provide assurances to the lender that the real estate transaction process was safe and that the government stood firmly behind it, but in reality how it ends up being processed is that HUD tells Wall Street we will insure these properties any which way you want us to, even if they do not qualify, just as long as you get us out of trouble if unwanted objects start flying hitting the fans.
Under these circumstances HUD has no choice BUT to sell to Wall Street so as not to be exposed itself to scrutiny while meeting its obligations to its real bosses, the banks.