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“The bottom line is that the value of a homeowner’s signature is going up and might be the best investment in existence. The walls are closing in on trillions of dollars in real estate that could be the subject of summary proceedings repatriating the property to their rightful owners using the most basic principles of property law.” — Neil F Garfield, livinglies.me
It isn’t just hype. Law firms like the one shown below are realizing that there really is money in servicing homeowners who are underwater. But lawyers should also beware of this offer. Think about it. What economic reason would there be to pay a distressed homeowner to enter into a short-sale? If they really thought they had the right to foreclose and/or collect on the promissory note they are using, the last thing they would do is pay a person who is already delinquent in their payments.
The banks have realized that in a short sale they don’t sign the deed — that job goes to the homeowner who is usually giving a warranty that title is all fine and dandy. The pretender lender is not doing the lying; they are getting the homeowner to do their lying. All that is fine if there was only one owner of the property or one prior mortgagee who is joining in the transaction and registering the appropriate releases, satisfactions and warranties.
If a third party or prior owner makes a claim against title, the pretender lender has succeeded in placing another layer between them and claimants who want title vested or re-vested as a result of wrongful, illegal foreclosures — or wrongful or illegal satisfactions (release and reconveyance). They now have a stronger argument about why the “chain of title” while imperfect, should not be disturbed because of the transactions that were in the public records and notice to the world.
If you are buying one of these short-sales or other REO property, take a good long look at the title policy they are offering and make sure you get advice of competent legal counsel — because most of the new “replacement” policies have language that excludes risks associated with the chain of title being mangled by securitization or claims arising out of securitization. So if you buy, you are getting naked paperwork that may or may not be ratified later — or could be the target of a wave a repatriating property to their rightful owners because the foreclosures are and were wrongful. With no title insurance proceeds you could be out of a lot of money and still have a liability if you financed the purchase.
I’ve heard some talk of the statute of limitations being applied against claims of repatriating property. I don’t know of any statute of limitations on defects in the title chain but there might be some on theft, fraud and adverse possession that could provide some cover for the older mortgages. That alone could be an interesting question. Imagine representing the bank and arguing “yes your honor, we admit that we stole this property and illegally evicted the owner. However, under the statute of limitations I have shown you, the homeowner has no cause of action because it is barred by the expiration of time.”
THAT is where civil rights violations should be alleged in Federal courts. If the states failed to safeguard the rights of homeowners in their procedures for foreclosures then the civil rights of the homeowners may well be the last and only claim the homeowner can make even after it is admitted that the foreclosures are wrongful and illegal.
The lesson here is stop waiting to see what happens. Get on your horse and have your bags packed with as much proof as you can and start your actions now. At this point, you need to show that the general policies resulted in wrongful, illegal foreclosures with “strangers” taking title to property on which they loaned no money and never financed or purchased the property; and then show that those policies that have been the subject so many studies, orders, decrees, fines, penalties, settlements etc. are the same same policies that were used in your case.
Remember, the burden of proof shifts when you cross the line of establishing a prima facie case. At that point the pretender is dead in the water unless they still have more rabbits in that hat.
BANKS PAYING HOMEOWNERS TO AVOID FORECLOSURES
by Harold Shepley & Associates, LLC, see www.jdsra.com
Banks, anxious to move troubled mortgages off their books, have started offering cash incentives to homeowners to sell their properties for less than what they owe – typically called a “short sale.”
In the past, banks have balked or dragged their feet at short sales. However, lately, they have decided that short sales are more advantageous than foreclosures, which can take a year or more to process. Additionally, banks take about 15% less of a loss on a short sale than they do on a foreclosure.
Some banks are now offering cash incentives to homeowners to have them sell their homes at a loss—sometimes up to $35,000. Experts believe that banks just want to get rid of bad loans. They can often afford to forgive the debt and offer incentives yet still make a profit, because they usually purchase the loan from another bank at a discount.
For a bank, approving a short sale can cut a year or more off the process of unloading a home and its accompanying loan. A short sale takes about 123 days on average. On the other hand, it takes nearly a year to foreclose on a home and then another 175 days to re-sell the property.
Allowing your home to go into foreclosure is may not be your only option. Every situation is different. For a in depth look at your situation you should contact a full service debt relief law firm like Harold Shepley & Associates that can answer any questions you may have about debt relief, mortgage modification, and short sales.
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