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
Source: REUTERS


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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