There’s always something to howl about.

Foreclosuregate? A scandal? If you want to sue for damages, it behooves you to have suffered a real, actual, material injury.

I had buyers back out of a purchase contract at the last minute, earlier this year. They got cold feet, and they had no remaining contingencies, so they understood they were losing their earnest deposit. The seller’s agent wanted to fight about it, making a lot of noise about specific performance. But here is what was interesting to me, thinking about the legal issues in the abstract:

The deal was a short sale.

In other words, had the sale proceeded to closing, the seller’s actual material gain would have been zero dollars and zero cents.

Taking account that we cancelled the contract, the seller’s actual material loss was — wait for it — zero dollars and zero cents.

Arguably, the seller might have suffered financial damages as a result of losing the home to foreclosure, rather than losing it in a short sale, but these consequences could never have been subject to my buyers’ control.

In other words, though we did not go to court, I could not see a way for the seller to claim any sort of material injury by the cancellation of the contract. He had no real, actual, material consideration at stake.

Why bring this up?

Because I think this is the end of the road in the so-called “Foreclosuregate” “scandal.”

To bring us up to speed, the Wall Street Journal wonders if we’re headed for housing armageddon. Not to be outdone, CNBC insists that foreclosure fraud is worse than you think.

Here’s what I think: If there were procedural laxities in the handling of paperwork, there was no intent to defraud. And laying that aside, there are no former homeowners who can claim that they were avoidably injured by mis-handled paperwork.

Why was your mortgage foreclosed? Because you stopped paying it. Did you have any rational reason to believe that you could keep your house once you had stopped paying your mortgage? No. If the paperwork that led to your foreclosure was not prepared to perfection, does that give you the right to retain possession of a home you are not paying for? No.

Voters are fools, of course, and the Attorneys General of the many states are all up for reelection. This is a perfect “scandal” for getting lots of TV time — for both incumbents and challengers.

But judges are not fools — not the judges who do the everyday heavy lifting in the Superior Courts. If you want to be rewarded with damages for your injuries, you need to demonstrate an injury. Go tell a judge about how hurtful it was for you to be called out as a deadbeat with improperly-prepared paperwork, and you might just get to see a staid and stoical black-robed jurist have a good belly-laugh at your expense.

At the bundling level — and above — there may be hell to pay. And there may be a lot of catch-up work to be done at title companies, as they try to get their own paperwork in order. But I find it hugely implausible that any journeyman judge is going to let people call themselves injured for having gotten just exactly what they were asking for.

Am I wrong? I’ve got a boatload of REOs in the hopper — buyer’s side only — and I don’t want this mess to come grinding to a halt. And I’ve got quite a few buyers who are going to need financing, so if the lenders — or the title companies — go soft on us, we’re screwed.

But that’s the bigger picture, and, as much as I hate FannieMae and FreddieMac, they’re going to keep buying and bundling loans. The path through this morass may end up looking like the slaughterhouse floor, but we’re going to keep grinding sausage no matter how much papering over of bad paper we have to do.

This “scandal” is an excellent argument for getting government out of real estate — since it is the government that will ram its “solution” down everyones’ throats, thus to keep the sausage grinders running on time. But we are what we are, and we’re not going to cripple half or more of the American economy because busy people with no fraudulent intent did stupid things in a red-hot hurry.