Money Talks: Foreclosure Freeze
Mon, 18 Oct 2010 14:03:59 GMT —
You've seen the headlines: foreclosures frozen nationwide.
Because some bank employees have admitted to signing documents they never read.
Here's a foreclosure defense lawyer with an analogy of why that matters.
"You've got a witness to a crime who can't appear in person; they're crippled and in the hospital," said an attorney.
"So he or she signs an affidavit that says I saw Mr. Smith commit that crime.
I have personal knowledge of this.
I examined the security video at my house, and I saw Mr. Smith commit that crime.
And then, when you ask that witness about it, she says, 'I just signed that document, I didn't actually look at anything."
That's why robo-signing matters, and why foreclosures are being stopped.
You're not allowed to just rubber-stamp a lawsuit, especially one filed in court.
And according to lawyers who defend foreclosures, that's the tip of the iceberg.
"Foreclosure firms are allowed to file foreclosures by the thousands and to cut corners and to fake documents and most of the time get judgments that they're not entitled to in amounts that they're not entitled to," said an attorney.
If these lawyers are right and these problems are pervasive, it matters to all of us.
It matters to those of us not in foreclosure because this mess is going to hold back a housing recovery and with it, our entire economy.
And it certainly matters to people losing their homes, because foreclosure mistakes made by your lender could be the leverage you need to get a deal that could keep you in your house.
"If you find these fraudulent documents, you have valid defenses to your foreclosure," said an attorney, "And those can be used as an inducement to the bank to settle with you and hopefully give you a payment you can afford."
Whether you call it mistakes or fraud, just how pervasive is the problem?
In my next report, you're going to see things you won't believe, and you won't see anywhere else.
Get more information at moneytalksnews.com.