July 28, 2008
Judges and Foreclosure
The headlines proclaim that the country's judges are showing hostility to home foreclosures. In the body of the story are details of judges demanding technical correctness in proof of mortgagee rights to foreclose. Since many of the banks and the other securitization players were sloppy in gathering and holding paperwork through several transfers of the mortgage paper, the requirement can stymie banks and trustees attempting to foreclose on homes. The lesson for homeowners? Fight foreclosure in court. You can extract serious concessions from lenders and you may win (want a free house?). This is not new news. Even a quick look at foreclosure law in any state will reveal a process that is encumbered with multiple levels of procedural requirements from years, decades of legislative hostility to foreclosure. Consider the effect on banks if the judiciary successfully attacks the attempts of banks to execute on collateral behind loan defaults -- balance sheet write-downs on loan defaults, whatever they have been, will be too optimistic. So Congress gives tax incentives to borrow money to buy homes and courts attack lenders in foreclosure proceedings. The market dips and dives trying to figure out the mess.
July 28, 2008 | Permalink
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Actually the reverse is true. Judges are just starting to do their job, because they're learning that many foreclosures are without standing.
Lenders wouldn't foreclose if they didn't want to. There is big money in foreclosing and lenders often fabricate foreclosures when their is no cause.
It has also been discovered that lenders are foreclosing on properties they no longer own, but sold as securities. It's called "Double-Selling" and it's happening all over the country.
Posted by: Stephen | Jul 29, 2008 11:15:05 AM
Yes these foreclosures are getting out of control. These are some tough times.
Posted by: iphone Rog | Aug 3, 2008 9:22:13 PM