Prove that mortgage!
The thorny issue is of growing interest to New York judges — who last year faced more than 50,350 foreclosure actions, according to RealtyTrac, many of which were brought by banks that have sold or securitized the loans. Such actions make proving which entity owns the loan difficult.
That issue is key — banks that can’t prove they own a loan can’t legally foreclose. At times, lenders and law firms have been chastised for taking short cuts to gloss over the ownership issue. Complicating matters is that most delinquent homeowners battle foreclosure actions without a lawyer and get steamrolled.
But that may be changing.
On June 3, Bankruptcy Judge Allan Gropper denied a bank’s attempt to move against a homeowner because it couldn’t prove it owned a mortgage.
Five days later, Brooklyn state court Judge Wayne P. Saitta, citing a bank’s “egregious” misrepresentation, awarded a homeowner $10,000 in sanctions when the bank tried to evict knowing it didn’t own the mortgage.
As always,
Shawn