In Massachusetts, Ownership Of Improperly Foreclosed Homes Thrown In Doubt

The highest court in Massachusetts just made the foreclosure crisis even more complicated.

The Massachusetts Supreme Judicial Court ruled on Tuesday that the buyers of improperly foreclosed properties do not legally own those homes, leaving hundreds of Massachusetts properties in limbo, according to The Boston Globe.

This is the second ruling on foreclosures by the Massachusetts Supreme Judicial Court in less than a year. In January, the court invalidated foreclosures by banks that could not prove that they owned the mortgages at the time that they started the foreclosures.

The court went one step further in its latest ruling on Tuesday, saying banks can't legally transfer an improperly foreclosed home through a sale, according to Bloomberg News.

The buyers of improperly foreclosed properties now have a number of complex options if they want to to try to keep their homes, including suing the lender behind the foreclosure and attempting to "reforeclose" on the previous owner, according to The Boston Globe.

But the ruling could make it easier for homeowners to fend off foreclosures in the future, Harvard Law School lecturer Max Weinstein said in a interview with Reuters.

Other state courts have sided with homeowners in similar cases. The Supreme Court of South Carolina ordered lenders in May not to foreclose on homes until they could show that they had tried to work with homeowners to modify their loans, according to The Washington Post.

An appeals court in Florida recently invalidated a foreclosure by a bank that could not produce the proper paperwork, according to The Palm Beach Post.

And the Nevada Supreme Court recently ruled that banks should not proceed with foreclosures in which they could not produce the proper documentation or prove that they gave homeowners the opportunity to modify the loan, according to DSNews.com.

A glut of foreclosed properties on the market, dragging home prices down, is keeping the housing market depressed. New home sales fell in August for the fourth straight month, and housing prices remain low.

At the same time, banks are now sending out a growing number of foreclosure notices, as the number of Americans at risk of foreclosure has grown.

Banks have been under increased scrutiny for foreclosure practices after legal proceedings revealed that banks had been rushing through foreclosures without verifying information in the paperwork that they were signing. The dubious practice -- known as robo-signing -- may date back to the 1990s. Banks reportedly continue to rush through questionable foreclosures, according to investigations by Reuters and the Associated Press.

Comments

[carolgregor]

08:15 AM on 10/21/2011

Massachusetts Supreme Court decision protecting homeowners and property rights. If you buy a home from foreclosure, it may not be yours. Illegal documents are making the foreclosure process illegal and titles clouded. As banks and AG's negotiate, our legal system is working protecting our assets. Now if the Congress and Senate would mandate stopping foreclosures, people might actually be helped and our economy would recover.

[ReaItors Are Liars]

04:42 PM on 10/20/2011

WALK AWAY from the house. Stick it to the bank. You won't recover financially if you stay and pay. Save yourself and get out while you still can.

[MSROADKILL612]

02:28 AM on 10/20/2011

suggestion to HP

if u moderate a post, at least email it back to the poster so their thoughts & work are not wasted.

can onsend to friends etc.

[frank day]

09:51 AM on 10/20/2011

If I take the time to compose a long post. I always copy it and save it in notepad.

You're correct, it is depressing to lose your thoughts.

[Brian Novotny]

09:56 AM on 10/20/2011

That is what I do, as soon as I am finished I copy and paste to notepad and save it for anything I want published. If they don't publish it, you obviously have to reword it, but not just the nasty words, sometimes I have had to rewrite a significant portion of it, I think they do a type of copy/duplicate test on them, so if they are too similar it will get rejected again. They should at least make it so they go into your comments, albeit not into the public commenting arena.

[MSROADKILL612]

10:40 AM on 10/20/2011

got 2 replies so i responded 2 u by replying 2 my self

[MSROADKILL612]

10:38 AM on 10/20/2011

yeah - ta guys - long story but i am that savvy - just

a/ why must it be so hard

& b/

am kind of betwixt & between right now

my up to date text file is on a dead pcS drive & have a fairly up to date log txt file on the cloud & am agonising as to which to use as a starting point given my scratch windows install isnt kosher & I have a koscher win install on yet another pc i inherited

am aware of the solutions u suggest - but why must my free content contributions be treated with such contempt? bad business model. Insulting & demoralising.

u wouldnt respond if u had not had such heartbreaking experiences - clearly u & many others relate 2 what i say

[MSROADKILL612]

02:24 AM on 10/20/2011

A tangental point I have often pondered, is what happens when a block of flats is condemned. Concrete cancer etc. I bet the strata title owners get next to zilch after the smart arses get their fees from the sale of block of land its on.

here in oz, a quorum of owners is required (gradually being reduced over time - which proves to me my point they are a scam) so e.g old folks will uneconomically vote for repairs on a lost cause in the hope it will see them out b4 it falls over.

[MSROADKILL612]

02:08 AM on 10/20/2011

The main point fo the story methinks is folks who bought these forcelosed homes dont own them.

you cant give title to the new ownerif the note holders cannot legally prove title.

There was an initial binding contract re the mortgage, but the banks sliced & diced these rights & onsold it to others who onsold it - now they cant untangle it & cant prove their right to the title as per the original contract, so they cannot enforce the rights in court.

They cant put humpty dumpty together again.

The banks are simply agents for the rael owners. In theory, they collect the revenue, & divvy it up & distribute it.

The rights and wrongs of jingle mail seems off topic & tired except the point re why pay the mortgage if you could well be paying the wrong bank.

Prove you are still the legal agent for my mortgage & then I will pay arrears it seems a valid argument. I dont want to end up in your legal disputes - your problem you nasty morons.

I cannot get a fair price for my house cos no buyer trusts its title - a breach of your duty of care.

Just my laymans 2c.

[ReaItors Are Liars]

07:34 AM on 10/20/2011

And to think all they had to do is buy title insurance.

[MSROADKILL612]

08:10 AM on 10/20/2011

Yeah - have seen your comments around the traps & cant say i am impressed

a/ it fallacious as insurance is about risk & u only get what u pay for which is a lot right now

&

b/ what exacly do u claim - claims in my experience are more trouble than they are worth - u may claim compensation for what u got dudded for but u still have to go find a new house & prove all the costs incurred to bureaucrats who fight u every inch of the way

so u r saying the insurance company will guarantee u can stay put & just relax - no hassle - yeah right

funny u should reply - was tempted to flame u for your empty vessel, excruciatingly repetitive comments off my own bat

[frank day]

09:57 AM on 10/20/2011

I think you have a good grasp of things.

Look for the Government to let them off the hook at the expense of the homeowner.

The whole thing is a huge mess.

The small investors will get scrooed and so will the homeowner.

The banks will walk away with record profits and bonuses.

[MSROADKILL612]

10:56 AM on 10/20/2011

yep - good point - the mums & dads 401k funds will never hear they have a piece of of a dubious mortgage

dont quote me on the acronyms - am not from US, but methinks u know what i mean

[MSROADKILL612]

11:47 AM on 10/20/2011

ta mate - but far more flattering would be i synthesized it in layman's terms - many get things but cant convey it - which kinda means they dont really get it

guess u know am already a fan

[Marc Lewis]

01:54 AM on 10/20/2011

Why does this remind me of Nikoli Gogol's "Dead Souls" where a Russian goes about buying dead peasants to prove he is rich so he can get a loan. At the time a Serfs death was only reported at years end, so, technically, if they died in May they were legally still alive till January 1 and because Serfs were property, the more you owned the richer you were.

[Social Construct]

10:08 AM on 10/20/2011

lol. Perusing the comments and I came upon my real name! Groovy. We share the name and political preference. Small world.

[Marc Lewis]

10:38 AM on 10/20/2011

I assume you are Marc Lewis, not Nick Gogol. Well, throwing caution to the winds, it's not as strange as all that but if you were Marc Lewis but were born with the name James Finnegan, then I'd truly be in shock. There, now you have the secret question/answer to prove you're not me. (Unless of course you are).

[walkerhds]

11:05 AM on 10/20/2011

why am I seeing the eyes of mid-level bank employees charged with boosting revenues glittering with the light of an idea, and calling lobbyists on speed dial?

[Marc Lewis]

01:14 PM on 10/21/2011

Just wait for the junk mail to arrive and the late night infomercials.

[ReaItors Are Liars]

11:45 PM on 10/19/2011

Stick it to the banks. WALK AWAY from the house. Besides... you'll never recover financially if you continue making grossly inflated payments on a rapidly depreciating house.

Stick it to the banks.

[frank day]

09:59 AM on 10/20/2011

Pay off your loan early if you can.

They won't make a dime off of you if you don't let them.

[ReaItors Are Liars]

10:48 AM on 10/20/2011

Why chase a rapidly depreciating asset?

Walk away and buy later for 60% less.

[walkerhds]

11:07 AM on 10/20/2011

and oddly, some states have tried passing laws that make it illegal to pay off loans early...

[Aleks Hunter]

10:16 PM on 10/19/2011

When a bank calls the sherriff to evict based on a foreclosure of a property that bank did not hold a mortgage on, how many diffferent crimes is it?

[ReaItors Are Liars]

11:36 PM on 10/19/2011

When a defaulted home debtor stays in a house for months after they've defaulted, how many different crimes is it?

[Aleks Hunter]

12:31 AM on 10/20/2011

I don;t know that it is a specific crime. Debtor's prisons cwere shut down a long time ago.

Specifically what misdemeanor or felony would it be?

Its not tresspassing if there is no foreclosure order.

[1dabut1]

01:04 AM on 10/20/2011

who cares

[OldTulsan]

09:54 PM on 10/19/2011

Around 60% of shipping containers are returned empty or left around U.S. ports.

They can be converted to housing:

http://www.bobvila.com/articles/316-home-sweet-container/pages/1
Home Sweet Container - Bob Vila

These would be affordable to a labor market whose wages and benefits are stagnate or declining.

[Aleks Hunter]

10:14 PM on 10/19/2011

And hey, how about all those sub-zero refrigerators the rich liek to put in their mc mansions, the cartons are just tossed aside, what a waste eh?

[OldTulsan]

11:19 PM on 10/19/2011

Those will be middle class dwellings if the elites continue to have their way.

[ReaItors Are Liars]

06:20 PM on 10/19/2011

If you're in default, you can be certain that you don't own the house anymore.

[Swanndog]

07:46 PM on 10/19/2011

Are you cheering for a wholesale sweep of all delinquent mortgages? How many homes do personally want to buy at your perceived deep discounts? There are plenty of deep discounts around now, so get in the game.

[ReaItors Are Liars]

07:49 PM on 10/19/2011

If you think prices are low now, you're going to be shocked a year from now.

Why buy now when you can buy later for 60% less?

[1ccc1]

12:22 AM on 10/20/2011

Excuse You. This is about Lying buyers that innocent people are being Forced to bail out. This is a travesty to every renter and young person who does Not own real estate and your contention that They should have to pay to keep Your bogus value inflated is selfish. Don't try to spin this into 'oh poor lil' homeowners' and everyone that call it bogus is out to profit somehow. That's silly.

[Aleks Hunter]

10:18 PM on 10/19/2011

If your morgtgate is with bank A, and bank a still holds it, Bank B has no right to foreclose.

[ReaItors Are Liars]

10:36 PM on 10/19/2011

If you default on your mortgage, you don't own the house anymore irrespective of who holds the note.

[wyattc71]

06:17 PM on 10/19/2011

The banks knew that they did not have properly endorsed notes and a proper chain of assignments requried to perfect title. Yet, they continued to proceed with foreclosing properties where they could not legally prove ownership. To add insult ot injury, they resold the properties they could not prove they owned to people where they had no legal standing to do so. This is nothing but fraudulent and criminal activiity that will unfortunately never be prosecuted given the immunity provision being granted in the proposed settlement agreement with the Govenment and banks relating to the foreclosure robo signinng issues.

[Frog in a pot]

03:51 PM on 10/19/2011

Republicans cheer the massive fraud by the banks.Its what they vote for.

[Swanndog]

07:41 PM on 10/19/2011

Your brain is cooked if you believe this is one parties doing.

[Frog in a pot]

07:59 PM on 10/19/2011

One party cheers for it.

[dadw5boys]

03:47 PM on 10/19/2011

it would be nice to see them go back and overrule all those Foreclosures that Fla Judge did 100's of them a day without even looking at any paperwork and the people never even notified they homes were being kicked out .
He just rubber stamped anything the banks put in front of him

[ReaItors Are Liars]

05:47 PM on 10/19/2011

Were the borrowers current or in default?

[tbryant80]

07:12 PM on 10/19/2011

Default occurs when the investor does not get paid. If it is securitized, chances are the servicer paid the investor. In those scenarios, default has not occurred.

[1dabut1]

01:08 AM on 10/20/2011

who cares

[truthfinderddw]

01:54 PM on 10/19/2011

And oh yes, the Feds are trying to close a fast deal with the Banks so they can avoid any Criminal action brought against them. The Banks will get exactly whats coming to them because they own Washington.

[Frog in a pot]

03:52 PM on 10/19/2011

Not just Washington.This is a worldwide coup.

[IndyFem]

01:33 PM on 10/19/2011

A valid CHAIN OF TITLE has always been the most "sacred" guaranty of a person's Property Rights. For Banks to totally disregard this is...in order to execute a scam...is unbelievable.

BLACK'S LAW DICTIONARY:
chain of title:
"The ownership history of a piece of land, from its first owner to the present one. For the holder to have good title, every prior negotiation must have been proper. If a necessary indorsement is missing or forged, the chain of title is broken and no later transferee can become a holder."

[cats530]

02:34 PM on 10/19/2011

check this out - and I can say I feel some schadenfreude for MERS:

http://mandelman.ml-implode.com/2011/10/mers-has-trouble-right-there-in-ohio-with-a-capital-%E2%80%98t%E2%80%99%E2%80%A6/

[Bleekerstreet]

03:17 PM on 10/19/2011

Exquisite! Let's hope!

[IndyFem]

04:54 PM on 10/19/2011

cats...Great Link...Thanks