---

Homeowner Keeps Home After Lender Failed To Prove Ownership

---

Oct 27^th, 2009

 

If your lender is foreclosing on your home, they cannot legally proceed if they are unable to prove ownership claims in the presence of a legal court. How is this possible?

 

During the housing boom, many of these loans were bundled into complex mortgage-back-securities and sold to world-wide investors through Wall Street. These investors bought the mortgage-backed-securities betting that U.S. housing will continue to prosper in hopes of earning favorable returns. This of course was the contrary as we are witnessing today. Many of these complex mortgage-backed-securities contained notes showing a trail of ownership but were poorly maintained. This added to the problems of ownership verification.

 

In early October 2009, The New York Times reported that Judge Robert D. Drain of White Plains NY, made more than $460,000 worth of mortgage debt disappear on a delinquent borrower’s property after PHH Mortgage failed to its claim to the property.

 

Based on actual court records, the unnamed homeowner had reportedly bought the home in 2001 with a mortgage loan from Wells Fargo. In 2005, she refinanced the loan with Mortgage World Bankers Inc. She later was delinquent on mortgage payments and through a lawyer, filed for Chapter 13 bankruptcy in an attempt to avoid losing her home.

 

PHH Mortgage later in March, filed a proof of claim to the debt indicating $461,263 including more than $30,000 worth of past due payments. The homeowner’s lawyer countered by requesting for a loan modification and when the bank delayed its response, the lawyer ultimately asked for a proof of claim.

 

Judge D. Drain eventually ruled the debt to be expunged after PHH Mortgage failed to prove that it was assigned the mortgage. PHH Mortgage could not prove its claim to the satisfaction of the judge.

 

PHH appealed the case but a lingering problem remains for the homeowner if she plans to sell her home. Without a clear title, this is not at all possible. There needs to be an amended plan or a lawsuit to obtain a clear title. Inevitably, both parties will be strapped in months of court hearings in order to clear this.

 

It will be interesting to see if the White Plains case becomes commonplace with courts all over the country. It just shows that the hard tactics mortgage companies use to prove ownership may not carry any weight if there is lack of evidence.

 

If it is not in print, you can’t evict or foreclose someone’s home.

 

 

Comments

News Archive

Implications Of A Loan Modification - October 15th 2009

41 Suspects Arrested For Mortgage Fraud - October 15th 2009

Bridge Loans Coming Soon For Unemployed Homeowners - October 14th 2009

Government Modification Program Inadequate And Calls For An Upgrade - October 9th 2009

Freddie Mac Offers Door To Door Help On Your Modification - September 29th 2009

Federal Housing Administration (FHA) Running Out Of Money - September 18th 2009

Good Time To Refinance With Government Program - September 15th 2009

Selling Your Home And Tips For The First Time Homebuyer - September 14th 2009

How To Keep Your Home If You Lose Your Job - August 28th 2009

Citigroup Performing Well In Foreclosure Prevention - August 25th 2009

Foreclosure Rescue Scams Preying On Homeowners - August 17th 2009

Deutsche Bank Estimates 48% of U.S Homeowners Underwater By 2011 - August 11th 2009

Loan Modification Progress Report Card - August 5th 2009

How Bad Are Foreclosures In Your City? - July 30th 2009

Rep. Barney Frank Threatens Banks To Stop Foreclosure Or Else? - July 28th 2009

U.S Government Wants 500,000 Trial Modifications By Nov 1st - July 28th 2009

Subprime Brokers Involved In Loan Modification Scam - July 21st 2009

'Walk-Away' Survey Shows 26% of Defaults Are Intentional - July 21st 2009

'Own-To-Rent' The New Emerging Mortgage Plan - July 17th 2009

Tools To Help Homeowners Save Big In Property Taxes - July 16th 2009

Lawmakers Dissapointed With Foreclosure Help Programs - July 16th 2009

New Jersey Attorney General Goes After Mortgage Scams - July 15th 2009

Watch Out For Some Misleading Reverse Mortgage Advertisements - July 6th 2009

Chase And Bank of America To Experience 2nd Wave of Foreclosures - July 6th 2009

Obama Extends Mortgage Refinancing Program, Raising New Limit To 125% - July 1st 2009

Paper Avalanche, Lack of Trained Staff Add Obstacles To Loan Modification Program - June 29th 2009

Government Loan Modification And Refinance Program Shows Substantial Progress - June 18th 2009

Luring First Time Homebuyers, Tips To Beat The Competition And Sell Your Home - June 15th 2009

Bank Of America has modified 50,000 loans in Countrywide settlement - May 26th 2009