Monday, November 19, 2007

Who owns your home? Not even your bank knows.

Foreclosures Hit a Snag for Lenders
By GRETCHEN MORGENSON
Published: November 15, 2007

...Judge Christopher A. Boyko of Federal District Court in Cleveland dismissed 14 foreclosure cases brought on behalf of mortgage investors, ruling that they had failed to prove that they owned the properties they were trying to seize...

...On Oct. 10, Judge Boyko, 53, ordered the lenders’ representative to file copies of loan assignments showing that the lender was indeed the owner of the note and mortgage on each property when the foreclosure was filed. But lawyers for Deutsche Bank supplied documents showing only an intent to convey the rights in the mortgages rather than proof of ownership as of the foreclosure date.

...Saying that Deutsche Bank’s arguments of legal standing fell woefully short, the judge wrote: “The institutions seem to adopt the attitude that since they have been doing this for so long, unchallenged, this practice equates with legal compliance. Finally put to the test, their weak legal arguments compel the court to stop them at the gate.”

...A spokesman for Deutsche Bank declined to comment on the ruling. But the inability of Deutsche Bank, as trustee for the pools, to produce proof of ownership at the time of the foreclosures will fuel borrowers’ concerns that they are being forced out of their homes by entities that may not even hold the underlying loans....

...“We see a trend toward judges having enough of this trampling of the rules and procedure and care and reverence with which lawyers and litigants and participants in the judicial process should comply,” Ms. Charney said. “Hopefully this will convince everybody that the time to work out these home loans is now.”

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So, class, if you are in, or believe you may soon be in, a foreclosure situation, make sure your attorney is aware of this ruling. Federal laws requires the entity that is trying to foreclose you to prove they in fact are the owners of the mortgage agreement you signed - and if they can't prove that, they have no legal standing to sue you at all.

I especially liked the point in the article where the attorney for the foreclosing party condescendingly told the judge that he "doesn't understand how these things work."

Apparently, it's the securities experts who don't.

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