"Foreclosures slow as document flaws emerge"

[Bienes Raices]

http://www.nytimes.com/2010/10/01/business/01mortgage.html?hp

I don't know if they're really slowing, or if the media is trying blow this up into something bigger than it is.

[Bill Gulley]

Putting this in perspective, this issue is about state laws not being followed, where due diligence is required. SOme states, like Missouri, requires no due diligence at all, in fact, the Trustee is held harmless from his duties! Any lender can tell the trustee that a borrower is behind without proving anything. The Trustee starts the process, notice of demand, publication and then off to the courthouse for the sale. The borrower will have to get a court order to stop the process, the Trustess has no obligation to even speak to the borrower. Any claim for any unlawful foreclosure falls on the lender.

If someone is behind on the payment, they defaulted in any state! If in any state the process is accomplished illegally, what's the damage? We will see. Even if the property was given back to the borrower, they are still in default and to a greater amount now than then, they still can't pay, so they still lose the property! What's the point?

In some more liberal states, I can see some penalty, maybe based on any deficiency amounts sought by the lender, maybe for a few days of being out of the house earlier than they would have been and maybe a hassel factor.

In some states, I would imagine that the state would move in, fine the lender and keep the money for the state and the borrower would receive nothing, as is customary in Missouri. We have some real crooks in Jefferson City!