Struggling homeowners seeking relief from banks and other lenders on their mortgages have too often been plunged into a bureaucratic nightmare.
Particularly mind boggling are mortgage servicers who plunge ahead with foreclosure filings, and then, when called on it my activist groups, say they have no power to stop the proceedings since they don’t own the real estate!
Now it appears the legal system may slam the brakes on this runaway corporate train wreck.
The cases in question, from Springfield, deal with a practice that apparently has been common by some lenders – pushing ahead with foreclosure proceedings and lining up formal proof of ownership later.
Of course, this comes in the context of the financial practices common during the housing bubble, in which mortgages were bundled together, securitized and sold off to investors. When the boom went bust and the foreclosure epidemic erupted, untangling who the actual owners are has in many cases required some intensive financial plumbing.
Justice Keith Long is reportedly ready to issue a decision on the issue, one that may call into question thousands of foreclosures in with “late filed’’ ownership records.
That’s probably not good news for the recovering housing market, potentially throwing a monkey wrench into the sales and pending sales of foreclosed properties across the state.
But it does give lenders, especially those who have used all sorts of bureaucratic mumbo jumbo to stymie homeowners fighting foreclosure, a taste of their own medicine.
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