Friday, June 3, 2011

Banks Hit Foreclosure Hurdle

California, North Carolina, Alabama, Florida, Maine, New York, New Jersey, Texas, Massachusetts and others have raised questions about whether banks properly demonstrated ownership.

In some cases, borrowers are showing courts that banks failed to properly assign ownership of mortgages after they were pooled into mortgage-backed securities. In other cases, borrowers say that lenders backdated or fabricated documents to fix those errors.

Attorneys for borrowers reject the view that they are using arcane legal rules to secure free houses for clients who aren't paying their bills