And while some out-of-state banks and property owners moan at this supposed hardship, it means that Massachusetts also has among the lowest number of land ownership disputes in the nation.
Now, banks are being forced to lay in the bed of their own making. Back during the mortgage boom, banks were flipping these mortgages so fast that the transactions were never recorded at the Registry. (I’d argue that this in itself should be enough for prosecutions, but that’s another story.)
This court ruling could mean a nightmare for banks who now have to untangle years and years of transactions. It means homeowners facing foreclosure may get extra time to stay in their homes and work out a solution to the problem.
Maybe this will be the impetus needed to force banks to actually work with homeowners in an expedient manner, instead of taking weeks or even months to get back to them. It may take less time to restructure a mortgage than actually untangle the title mess and figure out who actually “owns” the home.
It is also worth nothing that this follows a major ruling by the Kansas Supreme Courtwww.globalresearch.ca/index.php?context=va&aid=15324.com. That body ruled that the MERS, the nation-wide database that basically tracks more than half of the nation’s mortgages, has no legal standing to bring forward a foreclosure since it also doesn’t hold the title. This ruling, if upheld on a national scale, could throw out 60 million active foreclosure proceedings as invalid. Again, because the banks can’t get their $#%& together
Stocks are up and Wall Street is shining brightly! Oil is up too! Hurray! Looks like the banks have been doing their jobs taking bailout dollars while continuing to scrape every profit dollar from America’s struggling middle class.
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p>Dow Closes Above 10,000, Led by Banks
Only Wall Street can turn falling retail sales into something positive.
Have you ever noticed that at the closing bell there’s a lot of applause regardless of what kind of day the Dow has had? It’s as if on good days they are applauding progress and on the bad days they are applauding the fact that the day is finally over.
Of course they leave out the facts that the stock market doesn’t produce wealth (as a factory would), that the 10,000 mark today is lower than the 10,000 mark earlier due to inflation (yes, take away the minus of the housing bubble and you have inflation — go to the supermarket!), benefits from the dumping of gold (and still the price of gold goes up).
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p>Yessiree! We’re gonna have one of them recovery things. To hell with those tent city folks and unemployed. They just ain’t with the program.
I think the Massachusetts case and the Kansas case need to be considered separately, and each on its own merits.
I think the Mass. case is right on the money–a bank should not be able to foreclose unless it can prove that it is entitled to foreclose. Should be obvious, right?
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p>But I think the Kansas case came out wrong. MERS is an elegant system meant to facilitate real estate transactions, just as the DTC facilitates stock transactions: by “immobilizing” the legal title to the land and then allowing transfers to take place on the books of MERS rather than in the registry of deeds. I don’t see a problem with this, and in fact, I think it promotes certainty and efficiency.
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p>TedF
The Kansas case, I think, basically said that MERS alone doesn’t have standing to foreclose because it doesnt hold both the title and the mortgage. Both parties have to come together in order to enact a foreclosure proceeding. Good luck figuring out how to get the 100 owners of the mortgage into the same room.
We refinanced our last house in 2001 with Fleet (now BoA) and they sent us out a discharge of lien. I assumed (incorrectly) that this was a copy for our files.
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p>6 years later we’re 3 days from closing on our new house and come to find out that we had 2 mortgages on the house since Fleet never bothered to record the discharge. By some miracle (in the midst of packing) was able to locate the original paper for our lawyer.
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p>You’d think that they would be taking care of this registering of deeds as part of their services. Guess again.
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p>And this issue of titles has been looming over the last year. The securitization trend has also in many cases made it about impossible for people to restructure loans.
BofA is the perfect example of a monolithic company who stomps all over their customers because they can, and doesn’t answer to anyone.
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p>I hope all their dogs get hit by cars.
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p>And, yes, I have had some bad experiences with Bank of America.
Surely they weren’t responsible for the securitization of home mortgages.
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p>I think you should revise your epithet.
I hope all their
dogsluxury autos gethitpissed on by dogs.When an ordinary citizens buys a house, the paperwork hurdles are high and expensive. Title searches, insurance, tax provisions, fire and building codes – the list goes on and on.
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p>When banks switched or altered titles all of the legal niceties were either forgotten or disregarded. The banks’ motto seens to be, “do as I say, not as I do”. Hooray for the Mass. Land Court that insists that what is good for the private homowners gander is also good for the banks duck.
…told me that the paperwork is overhead. It costs money and doesn’t generate revenue. Too, managers and employees both know that the bank (or other lender) will go through merger, buy-out, or some re-org that will either eliminate or transfer their jobs. There will be no responsibility on anyone.
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p>They were right. Now the banks pay the piper. Too bad, so sad. ;o)
Open your daily newspaper. Go to the foreclosure tombstones (that’s what they’re called)for non-commercial property and count them. Then go to the local library that maintains microfilm newspaper records. Go back forty years. Chances are you’ll find one maybe every six months of so. As you go closer to the present you find the frequency increasing.
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p>Why the change? Forty years ago the banks were local. The money was that of the depositors. There was a responsibility to protect the depositors. The banks were loath to foreclose. Foreclosure was costly. It was bad press. They would go the extra mile to resolve the problem without foreclosing. Now mortgages are run by big government (on again-off again) and “too big to succeed” banks that handle every late payment as a foreclosure process.
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p>Do we have progress? Is it too late to go back to where we were?
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p>Three cheers for a judge that sits back, analyzes the situation, and applies the law rather than lets the bank make the rules.
that came down to who held title for some property. I think the property in question was out of state, but the person getting sued was a MA resident. It was a totally specious case that was eventually thrown out (b/c the litigant couldn’t prove they actually had the title), but it wasted a couple days of court time.
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p>Title and deed registration is basic, necessary record-keeping; hooray for living in a state that understands this.
Just read the actual decision thanks to David’s link.
What an absolute slap in the face to these banks.
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p>The banks in question tried to auction off these properties in Springfield, without actually holding proof they owned the properties.
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p>And then it took the banks TWO MONTHS AFTER the initially land court trial and judgement to pull together all the documentation needed to show ownership — and even then they couldn’t do it because the paperwork was in such disarray!!!
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p>
This is a great decision — well written and correctly decided. It is immensely satisfying to see the subprime mortgage-backed security machine exposed as a big fraud. But putting the status of hundreds or thousands of properties in Massachusetts into legal limbo is a neighborhood and social policy disaster.
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p>Imagine you live on a street in Lawrence or Springfield or Brockton with dozens of vacant properties that now may remain empty for years (and become ripe for crime and arson) as these issues get appealed. Imagine you’re a lower-income home buyer who recently bought a foreclosed property in good faith, after making a down payment and getting a conventional mortgage, and now discover you don’t have valid title to your own home.
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p>I’ve always felt that we needed a legislated national solution to this subprime mess that offers investors a take-it-or-leave-it payout of cents on the dollar and gives distressed subprime borrowers an opportunity to restructure their loans on a standardized basis. Not every foreclosure can (or should) be stopped and not every borrower can (or should) be rescued. The longer these problems fester, the more damage gets done to our distressed urban neighborhoods. Unfortunately it’s not the “bankers” who’re getting hurt the most.
I read the judge’s decision-well reasoned and fundamentally sound. As a homeowner who had a lot of trouble getting the mandated paperwork out of Countrywide for a mortgage discharge, I’m personally happy that the system of land records we’ve had for hundreds of years hasn’t crumbled before the securitization practices of the global investment banks.
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p>That said, I wish this decision had come a couple of years ago-there are a lot of people who have bought foreclosed houses that now have a cloud on their title, and will have some real trouble getting their own financing or selling their houses to anyone else (another good reason for title insurance).
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p>What’s the answer for the new homeowners? Does the legislature need to act to ratify the foreclosures of the last few years? Does the AG need to take some kind of action to force the foreclosing entities to clean up their paperwork? Given the number of foreclosures, this could be a significant problem for lots of homeowners around the state. Any thought?