Foreclosure Victory Scored on Doubts Over MERS Paperwork

Foreclosure attorneys in Miami are lauding the decision of a Queens County Supreme Court Judge, who recently denied a large bank’s legal standing to bring foreclosure action against a homeowner there. hand.jpg

The reason?

Sloppy paperwork. Specifically, problems relating to the Mortgage Electronic Registration System, or MERS.

It’s the same story with countless foreclosure actions across the country, and an experienced foreclosure lawyer is key to helping you sort through the maze of paperwork to determine if, in fact, the agency filing for foreclosure on your property actually has the right to do so. Even if you are behind on your payments, it might not matter if the party filing the lawsuit isn’t able to prove that they are the holder of the deed.

This case was a two-year -old foreclosure case, brought against a male homeowner who had fallen behind on his payments. However, rather than effectuate a loan modification for the borrower, U.S. Bank pressed forward with the foreclosure suit.

What this essentially shows is that the days of simply being able to rip someone’s home out from underneath them without having the appropriate evidence of ownership are vanishing fast.

Part of what tipped the attorney off was the fact that the bank had presented late date assignments that were written and signed just days before the foreclosure action was filed.

In theory, MERS is not a bad idea because it allowed banks to more quickly process larger transactions and have an industry-wide database on which to rely. The problem was, banks have relied on it too much, in many cases failing to properly record those transactions with the local clerks of courts throughout the country. When that happened, formal paperwork got lost in the mix, so now there are many homes for which ownership is unclear.

So when a bank tries to initiate a foreclosure action but does not have a clear record of ownership, their case may be in trouble.

In this case, U.S. Bank reportedly failed to properly transfer the mortgage. The paperwork was lost. Therefore, they have no case.

Later, the homeowner was quoted by a reporter as saying all he ever wanted was a decent loan modification deal. When the bank refused, he said, he was given no choice but to battle it out in court.

Now, he is weighing his option of whether to file a lawsuit against the bank for the title on his property, which would allow him to expunge the mortgage entirely and keep the property.

These types of dismissals are becoming more and more common. That’s why it’s anticipated that more banks are going to be pushed to settle these type of cases via loan modification agreements. If the bank’s standing on the issue is especially weak, they may be willing to grant extremely favorable terms to the homeowner, assuming your attorney is aggressive enough to fight doggedly for your interests.

Call us today to learn more about how we can help you.

If you’re battling foreclosure in Miami or the surrounding areas contact Jacobs Keeley for a confidential appointment to discuss your rights. Call (305) 358-7991. Also, don’t miss Miami Foreclosure Attorney Bruce Jacobs on 880AM/the Biz, every Wednesday from 5 p.m. to 6 p.m. on “Mortgage Wars,” discussing foreclosure topics that matter to YOU.

Additional Resources:
Queens foreclosure attorney beats back US Bank and obtains dismissal, Oct. 18, 2012, By Dan Harris, Examiner.com

More Blog Entries:
Miami Mortgage Help: Obama Urges Congressional Action on Home Refinance Plan, Oct. 15, 2012, Miami Foreclosure Lawyer Blog