Tuesday, March 29, 2011

With Doubt Intensifying Around Foreclosures, New Homes With Clear Titles Look Good

With Doubt Intensifying Around Foreclosures, New Homes With Clear Titles Look Good

Everything you need to know about the foreclosure freeze...

- Lawyers poke around and question the accuracy of legal documents from mortgage lends, putting the brakes on foreclosure proceedings.

- What's a foreclosure? You have a mortgage. You can't make the payments. The bank takes your property. You've been foreclosed.

- To foreclose on a house, a lender must prove it has a valid claim. Banks used
robo-signers" to plow through thousands of foreclosures and sign affidavits.

- What's a "robo-signer"? Not an automated machine, but a mid-level bank official who signs thousands of affidavits a month.

- Many robo-signers allegedly signed affidavits without reading them or having a notary present.

- It gets worse. Some lawyers say the people hired as "foreclosure experts" had no previous training in foreclosure law.

- The allegations prod banks to halt foreclosures while they conduct internal investigations.

- The scandal adds further uncertainty to an already toxic housing market, keeping potential buyers away.

- The revelation of fraudulent practices opens up the possibility of legal challenges on foreclosed homes. Who's going to buy a foreclosed home when its legal ownership is under dispute?

- Foreclosed properties made up nearly a quarter of home sales in Q2 of this year, nagging uncertainty among home buyers threatens to delay the housing market's recovery for at least another year.

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