Posted on 10/05/2010 6:32:41 AM PDT by Pearls Before Swine
It looks like a lot of people are going to be living payment free until this mess is cleared up, and it may go Federal, as each state has its own real estate recording laws. This is an incredible mess.
In a related piece of news, I read that a number of title insurance companies will not write insurance for properties written on any homes purchased in foreclosure.
Legal eagles: I was wondering what happens if someone lives in a home, doesn't pay the mortgage, and also doesn't pay RE taxes. Normally if you don't pay RE taxes, the town forecloses, kicks you out, and auctions the property. Can they do that if the title isn't clear?
Normally if you don’t pay RE taxes,...
In Texas if you are over 65 and you do not pay your property tax, Texas cannot take your property.
The tax accrues with interest until you die or sell the property.
This tidbit came out in a meeting from an appraisal representative of TX at a community meeting.
JPMorgan and another bank REALLY f**ked up on their paperwork. I wonder how many foreclosures have been completed by banks who don’t even own the property.
I know a guy here that got his house free and clear by order of the bankruptcy judge. B of A could not show it held the mortgage. The guy just handed $300K. I wonder if the IRS will tax him on it and start the process all over again.
There has been more than paperwork screw ups.....try outright fraud
Of course what this will ultimately achieve is that homeowners will continue to live in the home, yet make no payments probably for years.
How much $$$ will this put into the economy? Living mortgage free will allow that homeowner to use the money for living high on the hog.
The banks will be the ones who get screwed, although - they already have been to the public trough numerous times in this and the last administration.
Halting foreclosures here and there, because of faulty paperwork, is step one.
Step two is Barack Hussein buying votes with tax money by bailing out some of the foreclosed, using the pervasiveness of faulty paperwork as his excuse for his vote-buying.
Can they do that if the title isn’t clear?
Good question. I think that you get a clear title once it goes through the tax foreclosure sale but again I’m not positive of that.
Moral hazard - people will be more tempted to not live up to their obligations...
and, in the future, who in their right mind would lend mortgage money to anyone who just might not EVER be collectible?
Halt foreclosures, Jail the lenders, Zeroize all debts, Cut taxes, Stop government spending, Issue a gold-based currency.
I really wanted a home on the lake but I knew I couldn’t afford it. Now I’m kicking myself for being stupid enough to act responsibly, I could be fishing now.
Halt foreclosures, Jail the lenders, Zeroize all debts, Cut taxes, Stop government spending, Issue a gold-based currency.
You can't be serious. Foreclosures need to be straightened out, and nobody loves lenders.... but zero all debts? What about personal responsibility?
I wouldn't say that he was handed 300 large. He got a place to live, but he won't be able to convert that to cash.
Not when there's a possibility that the true mortgage holder may swoop down at any time in the future.
Or bank one could sell your mortgage to bank 2, and you end up like this guy:
SAN ANTONIO — A man is in danger of losing his home, after his house was mistakenly valued at more than 10 times its worth.
Roque De Leon says he paid $30,000 in mortgage payments since he bought the home back in 2002. Now, the bank is foreclosing on the house.
“His house is about to be auctioned off tomorrow at the courthouse,” explained De Leon’s friend, Jorge Ramirez.
The west side home is on W. Laurel Street near Culebra. “This house, in this neighborhood… it’s very obvious, it’s not worth $350,000,” commented Ramirez.
According to the Bexar Appraisal District, De Leon’s home is worth less than $30,000.
“The bank made a mistake,” De Leon said, between tears. According to De Leon, after Washington Mutual sold his mortgage to Chase Bank in 2008, his $35,000 loan turned into a $350,000 nightmare. “Chase started rejecting my $350/month payments, and demanded $2,000 per month,” explained De Leon.
“I don’t know if I would call it computer error or language barrier,” said Ramirez, who is trying to help his friend sort out the mess. “He’s afraid he’s going to lose his house, and if we don’t do anything about it, he’ll be out in the street,” said Ramirez.
De Leon’s lawyer is advising him to file for bankruptcy, in order to stop the bank’s collection efforts. “Because of the mistake that [the bank] made, they’re going to ruin his credit,” commented Ramirez. “He won’t be able to buy anything.”
News 4 WOAI made several calls to Chase Bank. Monday, they got back to us with this statement:
“We have corrected the insurance coverage and apologized to the customer. The sale [of the home] has been postponed so we can explore all options with the customer.”
There are plenty of regional/local banks and credit unions that made mortgage loans to creditworthy buyers with down payments, and held the loans themselves. By and large they are doing ok.
It's the international investment banks that bought big bowls of mortgage souffles that are in trouble.
Or rather, it's us taxpayers who in trouble, since it's the big banks who have the Bush/Paulson/Obama/Geithner blackmail photos stashed away.
This is a disaster for the RE market. Unless a way can be found to clear the defaulted debt, the market won’t rebound because of the foreclosure overhang.
I agree, although I heard one opinion that this would temporarily boost prices, because it would remove foreclosure inventory, or at least slow its entry, from the market. A different interpretation of supply--available supply versus impending supply.
Maryland is poised to do the same thing
The people who will be living payment free will end up owning those homes with debt forgiveness and maybe even cash in their pockets- in lieu of class action “damages”
my prediction
meanwhile good point- who WILL pay the property taxes and homeowner’s association bills etc? Once a deadbeat....errr...poor hapless victim of evil banks... gets a free house, will he/she EVER pay another bill or assessment due on that property? Just TRY to evic’ me sucka.
Apparently honest stooges will get jacked to pull the load.
All Hail obama! mmm mm mm
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