*Transcendental *Logic

The American state of Kentucky, combining an F-you to the Constitution with the kind of critical thinking that rightfully leads to extinction via Darwinian smackdown, has decided that this is a reasonable legislation:

The 2006 law organizing the state Office of
Homeland Security lists its initial duty as “stressing the dependence
on Almighty God as being vital to the security of the Commonwealth.”

Specifically,
Homeland Security is ordered to publicize God’s benevolent protection
in its reports, and it must post a plaque at the entrance to the state
Emergency Operations Center with an 88-word statement that begins, “The
safety and security of the Commonwealth cannot be achieved apart from
reliance upon Almighty God.”

From, though if I were you I wouldn’t read it…

Ahem.

(Image of the evil ScanTron courtesy of some forum and Google Search.  ;)

So, the GRE sucked, pretty much exactly as I’d expected….I hate tests.  For any information or theory or skill that I’m supposed to have learned, I will do half as well on a multiple-choice test about it than I will on an oral exam, and 1/4 as well as I’d do writing a paper on it.  I was nearly despairing Saturday though; after two solid weeks of studying for the math part I still ended up flat-out guessing on most of the questions…I’m not terrible at things like algebra, but not great + horrible with tests = massive fail, for the most part.   And of course my verbal score was good, but only high-end average, because, well, it’s a $@!ing test.  My math score was inexplicably not a total fail, not what I’d hoped for but still…the experience of doing all that studying and then not even knowing how to begin answering most of the questions really had me in the dumps.  Every once in a while I try really hard to make up for the crappy math education I had in high school, and my natural non-affinity for raw symbol-manipulation, and it’s really, really depressing when all that effort basically does nothing.  I’m not a believer in the dismal dogma that says that some people just can’t learn some things…but some days it really does feel like math, algebra especially, is just hopeless for me.

Of course, I did well on the essays — one 45 min. argumentative, one 30 min. analytic, and I know I knocked them both out of the water.  I think I could argue pretty well that the ability to organize one’s thoughts and write them coherently is at least as important to graduate work than the memorization of rote facts and the ability to give the answer expected of you**, but guess how much those essays, which comprised almost half the test in terms of time, count for on your score?

Yup, NOTHING.  Not at all.  They’re graded later and the information is considered "supplemental" to your "actual" score.  Which really makes me wonder why the philosophy – you know, almost 100% writing-oriented — graduate program even requires the dumb test?  Meh.  Probably they’re just expected to.  Dammit though, their "expectation" cost me over a hundred bucks and ruined a Saturday!

Anyway, I didn’t do so badly that it hurts my chances to get in, probably, so I’m going to just try to forget about it, be grateful that I don’t have to study any more math (well, except for what I was studying so I could better understand that awesome MIT physics course I found), and move on to worrying about all the other stuff I have to prepare for grad school in, you know, about a month.

**This is the crux of why I don’t do well on tests, in case you were wondering.  Most tests, especially multiple-choice-oriented ones, are much more about your ability to pick the answer most people would pick, not your ability to distinguish a "right" from a "wrong" answer.  I just can’t turn off the parts of my brain that, ironically, make me good at philosophy; and those parts can often find justification for most or all of the answers offered…often the specific thing they’re looking for depends on context which is assumed but not given, or on other assumptions I either don’t make or don’t want to count on since they’re not explicitly given.  So out of A, B, C, & D, both you and I may know the relevant fact that points to D as the answer, but while you may just pick D, I’m going to struggle over the possible situations in which C and B could both be true, or the sense in which A is more correct if you’re referring to a certain macro- or microcosm of the problem….and often the answer I end up deciding is "best" is not at all the one I was "supposed" to pick.  

P.S. - I’m also tagging this post "security theatre" because, even though I didn’t describe it much (for all I know the contract I signed says that if I talk about it I’ll be hunted down and decapitated), there was truly ridiculous security/theatre at the GRE place.  I ended up smuggling my lucky rock in in my sock, because lucky rocks might help you cheat you know; but with a semi-competent fake I.D. it wouldn’t have mattered anyway.  *sigh*

America the Banana Republic: Politics & Power: vanityfair.com

Now ask yourself another question. Has anybody resigned, from either the public or the private sectors (overlapping so lavishly as they now do)? Has anybody even offered to resign? Have you heard anybody in authority apologize, as in: “So very sorry about your savings and pensions and homes and college funds, and I feel personally rotten about it”? Have you even heard the question being posed? O.K., then, has anybody been fired? Any regulator, any supervisor, any runaway would-be golden-parachute artist? Anyone responsible for smugly putting the word “derivative” like a virus into the system? To ask the question is to answer it. The most you can say is that some people have had to take a slightly early retirement, but a retirement very much sweetened by the wherewithal on which to retire. That doesn’t quite count. These are the rules that apply in Zimbabwe or Equatorial Guinea or Venezuela, where the political big boys mimic what is said about our hedge funds and investment banks: the stupid mantra about being “too big to fail.”

Learned something today…

MERS (the Mortgage Electronic Registration System), or more properly “MERS Inc.” as it is a private corporation (.org address notwithstanding; I hate it when companies do that!), was created by a group of big mortgage-industry players, including Fannie Mae, in 1997; it went fully operational in 1999.  Its mission is “to register every mortgage loan originated in the United States”; as it stands, 50% or more of all new mortgages are in that system.

And really, “to register” sounds pretty benign, if the only effect of it is to digitize and organize information on mortgage loans.  But what MERS actually does is more complicated and way more sinister, as I recently learned.  I was pretty shocked, after discussing MERS with some of the professionals I work with, to find that MERS doesn’t even have a Wikipedia entry, and that none of the information I could find on it addresses the truly icky implications it has, both for consumers and the economy.

So here, then, is why I, and at least a few other people I know, think that this whole MERS thing is one of the greatest cons perpetrated on the mortgage market yet.

MERS is a “membership”-type organization — mortgage originators (”lenders” for now) pay to be part of it.  For that fee, they and their many attendent shady investors get to wriggle out of a seriously annoying bit of transparency and consumer protection that’s supposed to be part of the system on a Federal level.  This is openly admitted everywhere, including on MERS’ own website’s front page, but no apology is made for it.  Apparently no-one in the “real estate finance industry” really sees a problem with just shuffling off that pesky assignment-recording requirement, like so many twelve-year-olds cleaning their rooms by shoving it all in the closet.

But there definitely are consequences.

First, something about mortgages, if you didn’t know it:  A mortgage is actually two “instruments” or, simplistically, documents — one promissory note (”note”) that obligates you to pay your lender back, and one mortgage note (”mortgage”) that contains the lien on your house and other provisions.  It is the law in this country that whenever a mortgage changes hands, the borrower must be notified — the idea being that 1) people have a right to know who has a lien on their house, and 2) it’s fundamentally unfair to hide information about how to contact/research/etc. the entity that owns your mortgage.  One could also, I think, make a good argument that obscuring the paper trail of who-transferred-what-to-who is fundamentally bad for a trading market that includes mortgages as a securitized commodity.

Well, that’s where MERS comes in.  See, MERS will, for a fee, allow you to transfer the mortgage into their name, “completely” legally, while you retain the note.

Think about it:  You, Mr. Big Lender Man, still hold the paper that says you get paid.  And that’s the paper that you can sell on the market, or assign to a servicer to collect on if you’re the old-fashioned type.  But the mortgage is owned by MERS, and it remains owned by MERS no matter how many times the note gets bundled, packaged, sold, resold, washed, rinsed and repeated.  So, no matter how many times that loan changes hands, you, the lender community, no longer have to write it all down, or notify the consumers of any change.  Their mortgage company may have changed a hundred times, but the mortgager on paper remains the same.

In a nutshell, MERS takes on the legal veil of being a mortgage lender, allowing lenders to abdicate some of their responsibility for how they handle mortgage “paper”, while MERS takes on none of that responsibility because they don’t have to, see, because they’re not collecting money or anything!  So the responsibilities lenders had, to homeowners and the taxpaying public who deserve transparency about the market, just sort of…disappear.

Oh, but it’s okay because MERS is keeping track of all those transactions, see?  Lenders don’t have to do all that onerous paperwork tracking those sales anymore, because the trustworthy industry-created private company will just handle it for their paid members, and of course everything will be done in the best interests of the public.

That’s why members of the mortgage-holding public get all those letters in the mail, notifying them every single time their note is sold. 

Oh wait; no they don’t.  I talk to people all the time who don’t even know how to find out who their mortgage company is; they pay a “servicer” and weren’t notified of anything, in spite of the loans having changed hands who-knows-how-many times.

That’s why people like me, who are more-than-reasonably educated mortgage consumers who read every single bit of the paperwork for their recent refinance, are totally informed about MERS and know how to call them and find out who currently owns their mortgage note. 

Oh wait; no we aren’t.  Professionals use MERS all the time to look up who owns a loan, but the experienced one who came to me today with this was genuinely shocked to have figured out what exactly the company was up to.  And even though I personally know just about everybody involved in my refinance, and had detailed talks with them about it on several occasions, MERS was never brought up at any time.  (Also, when I went looking for my data, I found that while it was eventually findable, what wasn’t findable was the “paper-trail” — who owned what when, and when it was sold.  Apparently that’s industry-only information, fellow taxpayers who just paid $850 billion in bailouts…)

That’s also got to be why the market isn’t having the slightest bit of trouble ironing out who owns what, who sold what when, and how things got so massively f’d up in the mortgage-trading business. 

Oh.  Wait…

[Warning:  I'm about to go off about companies insisting on using Social Security Numbers as unique identifiers for consumers, because it's illegal and stupid and MERS does it too.  You can safely skip this last bit if you don't care.]

Lastly, just to put the cream in the firehose we’re getting beaten with here?  If you call MERS’ voice system at (888) 679-6377 and give them the special 18-digit Mortgage Identification Number you mayr or may not be able to find, they’ll tell you who owns your mortgage.  Wait–don’t have that number?  No problem — just use a different, completely neutral and safe number instead…like the borrower’s SSN. 

[EDIT:  You can also search online here, a system which will find mortgage lenders based on either 1) address; 2) name/details and address; or 3) name, SSN and zip code.  Somebody tell me what possible good using the SSN in there does, unless you're deliberately courting hackers maybe?  ...Ironically though, I put in quite a few addresses and it wasn't able to find anything at all.]

That’s right; not only are they breaking the provision of the Social Security Act that forbids using SSNs as identifiers, they’re hella endangering people’s private information by storing all those SSNs on a VIR system.  (And that’s without even wondering how easy it probably is to social-engineer their help desk, which cheerily offers to provide mortgage information with just the name and/or address if you don’t have the MIN or SSN, to give you whatever information you might be missing once you have an SSN.  Remember, your name and SSN as a combination virutally is your identity, so guard it…sorry, off my soapbox-tangent-thing now, heh.)

In closing, Wow Ripoff and Gee, Thanks A Lot and What A Bunch of Scumbags We’ve Got Running The Mortgage Industry, Are We Sure Regulation Is Enough And Can’t We Just Shoot Them, Please?

——————-
My Sources For This Writeup Are:
The MERS Website
“A Brief Summary of ‘MERS’” by Kemp Law Office (no, I don’t know those lawyers)
Fannie Mae’s Info Page on MERS
Foreclosureforum.com’s info page on MERS

According to the Global Mammal Assessment, one in four mammal species on Earth faces extinction.

Anybody else thinking there’s a huuuuuuge “oops” in our future?