Massachusetts has joined the list of states with "foreclosure confusion". A judge ruled yesterday that because a bank did not prove it owned a couple of loans before it foreclosed on them, the foreclosures are not valid! Oops - to say the least.
In one of my blogs last year: http://activerain.com/blogsview/525644/More-Foreclosure-stuff-MERS-Mystery I tried to summarize what my research on MERS had shown me. It seems that these two loans were both examples of that kind of "lost paperwork".
This judge's decision raises some questions. 1) If banks now have to prove ownership before they foreclose, will that delay the foreclosure process? 2) If a loan has "disappeared" into a MERS like filing system, what checks are available to validate the current owner at the "reappearance" of the chain of ownership? 3) If a file cannot be found in MERS or a like system of non-public recordings, what happens to the property? 4) If the chain of ownership was passed around inside a MERS like system, who is going to check to make sure it was done properly and according to law? Will they give access to outsiders or will that have to be legislated? Will legislators make it happen or let it slide?
Whether foreclosures continue is now a matter of how well the bank can document its ownership. Some will proceed whether they can prove ownership or not. The uninformed public often isn't aware of the proper procedures in a foreclosure. Make sure those you know at least ask questions and get some local advice.
It seems that the foreclosure mess has hit another bump in the road. This bump has the capability to turn the truck over though.
Heath Coker, Associate Broker
Robert Paul Properties
www.CapeGroup.com / capegroup@capegroup.com
508-274-5613 Licensed in MA
Its a beautiful day on Cape Cod!
@CapeGroup Skype: heath.coker
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