Occupy Our Homes Targets Big Banks Over Shady Mortgage PracticesA spin-off group from Occupy Wall Street, called Occupy Our Homes, has formed to reverse and stop foreclosures. Lately, the group has been using some creative tactics to raise awareness about the banking practices that led to the housing bubble

Earlier this week, Occupy Our Homes protesters in cities across the country united in a day of action, which included reoccupying vacant properties and moving in people without homes -- in some cases, those homes' former owners. Protestors also shut down several auctions and ran off bidders, preventing dozens of homes from being sold that day.

In Atlanta, the members of the Occupy Our Homes movement helped one man convince the auctioneer to talk to his lawyer, and ultimately got his house taken off the auction block.

The protestors also had some success in getting banks to delay foreclosures and work with their clients on loan modifications. For example, Chase agreed to postpone the foreclosure sale of a California family's home and to discuss a loan modification. In Seattle, executives at Aurora Loans and Freddie Mac agreed to negotiate with a couple in a possible modification of their loan.

The movement has also succeeded in gaining media interest, with attention from TV hosts such as Rachel Maddow, Ed Schultz and Keith Olbermann.

So what are these dishonest banking practices the protestors want to hold banks like Bank of America (BAC), Wells Fargo (WFC), Citigroup (C) and JPMorgan Chase (JPM), accountable for? Here's what the protestors allege:

Encouraging risky loans: First, bankers used predatory lending practices to pressure some Americans to take on risky loans they may not be able to pay back. While some might claim that the borrowers are responsible for this decision, the bankers' positioning as "experts" allowed them to gain the trust of their clients about what they would be able to afford.

Allowing highly speculative investing: Bankers' and speculators' over-leveraged and risky investments surrounding the housing market played a huge part in the economic crash, which in turn caused many Americans to lose their jobs or take pay cuts. This, combined with the rapid fall in housing prices, created a situation in which homeowners could not recoup the money they'd put into their houses if they needed to move.

Taking taxpayer money for bailouts: Protestors are unhappy about the fact that while taxpayer money has been used to bail out the banks that engaged in irresponsible business practices, homeowners have not seen any benefits from the government's largesse.

Carrying out illegal evictions: Finally, protestors wish to draw attention to the fact that many banks are carrying out illegal foreclosures and evictions because they do not have the proper notes, mortgages, and other legal documents required to demonstrate valid ownership of the loans. This is a particularly interesting complaint, because it shows why protestors think they are perfectly within their rights in refusing to leave their foreclosed-upon homes.

It will be interesting to see how the action unfolds in upcoming weeks, and whether protests have a lasting impact on public policy and corporate behavior in the banking sector.

Motley Fool analyst Jim Royal, Ph.D., does not own shares of any company mentioned here. The Motley Fool owns shares of Citigroup, Bank of America, JPMorgan Chase, and Wells Fargo, and has created a covered strangle position on Wells Fargo.

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can you help me? I' m being stale mated by bank of america. trying to buy a short sale since may 2011. I've even signed docs and given them my down payment. now I'm being told nothing can happen and they won't close because they need an "extension approval " letter from bank of america. the realtor says he can't get a responce from the bank and meahwhile i want to move in to a place i already gave them the down money for. Is there no way to get them to jump?

January 10 2012 at 1:27 AM Report abuse rate up rate down Reply

This is fantastic news!
Anyone interested in this strategy should be made aware of the REST Report.
After 4000 submissions, the REST has not lost a single one - not one.
Mortgage Modification may easily be one answer, and suing for Broken Chain of Title could easily be the other.

It's about time the Occupy Wall Street movement gained some tangible focus to their efforts.

December 19 2011 at 11:39 AM Report abuse rate up rate down Reply

Counterfeit homeowners should get out and rent so that real hopeful homebuyers can find a house at its real value. Some of these hopeful homebuyers have been shut out by overpriced bubble houses for 10 years, some are elderely who were trying to buy their first house. Bailing out counterfeit homeowners is the same as bailing out banks and one questions thier reasoning. Hopefuly, they are not part of the real OWS.

December 14 2011 at 1:01 PM Report abuse +1 rate up rate down Reply

OWS is truely an amazing group. They protest banks, big business, big oil etc. And yet they are the same people that fill the foot ball stadiums on Sunday and the Base ball parks in the summer while some of those players sign contracts for as much as $250,000,000. That's to play a game and entertain the morons that set up camp to protest legitimate business. They are all idiots!!

December 14 2011 at 10:22 AM Report abuse +3 rate up rate down Reply

Now were talkin'! An occupy movement with a good purpose and great results! Way to go!

December 14 2011 at 10:02 AM Report abuse -3 rate up rate down Reply

There are a lot of people out there that can afford their mortgage that are either not paying it or walking away because it makes financial sense to them. I have seen nieghbors, co-workers, friends of freinds, etc do it. They then brag about it, as if they out smarted the system. Now is a great time to buy for rentals (people are willing to pay more for rent than buy and pay the mortgage, to stay flexible if they have to move), refinance (super low rates), or buy to live there (super low rates and super low prices normally do not go together).

December 13 2011 at 9:50 PM Report abuse rate up rate down Reply
1 reply to vlady1000's comment

There are always people who take advantage of the system. It is a shame and disgrace.

December 13 2011 at 10:44 PM Report abuse +3 rate up rate down Reply

If you still support the Socialist in the White House you are anti-American.

December 13 2011 at 9:05 PM Report abuse +1 rate up rate down Reply

Good Lord, we have met the enemy and he is . . er, an evil banker.

December 13 2011 at 3:25 PM Report abuse +2 rate up rate down Reply

Occupy homes !! come on - yes there is a issue of unemployment, and some other issues but this continued Occupy homes ??? In most all cases these home owner's are 2 years out on house payments and still don't care to move out and want to live for free..... and have no intention of taking any other action or even renting. SO it all rolls over to how can they cheat the system, and isn't that what going on here. So we need to stop with these demonstrations and lets clean up the problems and quit blaming everyone and anyone.... get up and start over, and stop the continued bitching and complaining - this is a country of people that need to get strong and go back to the simple things and be a little smarter... I did.

December 13 2011 at 10:43 AM Report abuse +1 rate up rate down Reply
1 reply to zulaufs's comment

greatest country on the planet, wake up pay attention vote the ******* out, make us even greater and stronger

December 13 2011 at 5:21 PM Report abuse +2 rate up rate down Reply

ummm, occupy also needs to stomp around capitol, barney frank, chris dodd and feds had a hand in this mess. up side, with someone occupying the homes, homes will be improved, taxes, utilites and insurance will be paid by the unemployed occupy crowd, awsome. this whole concept is a win win for everyone, not. critical thinking and fact checking is not a huge priority for jim royal, sad coming from the motley fool, now a liberal tool, hey it rhymes.

December 12 2011 at 9:31 PM Report abuse +1 rate up rate down Reply