Old mortgages rise from the dead, haunt homeowners
Source: Reuters
Old mortgages rise from the dead, haunt homeowners
By Michelle Conlin
Thu Jan 26, 2012 2:56pm EST
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More and more, homeowners say that mortgages they thought were dead and buried are springing back to life, sometimes haunting them all the way into foreclosure.
"It's the most egregious manifestation of an industry that's seriously broken," said Ira Rheingold, a lawyer who is the executive director of the National Association of Consumer Advocate.
Diane Thompson, an attorney with the National Consumer Law Center, says she has defended hundreds of foreclosure cases, and in nearly all of them, the homeowner was not in default. "The record-keeping on the part of the mortgage servicers is not to be trusted."
The problems grew from a lot of sloppy recordkeeping that began during the housing boom, when Wall Street built a quick-and-dirty back-office operation to process mortgages quickly so lenders could sell as many loans as possible. As the loans were later sold to investors, and then resold around the world, the back office system sidestepped crucial legal procedures.
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Read more: http://www.reuters.com/article/2012/01/26/us-usa-housing-mortgage-reincarnation-idUSTRE80P0SJ20120126
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