Banks Are Being Questioned the Right to Sue Foreclosure Victims
Banks are being more and more questioned about their right to sue foreclosure victims because of lack of proper documents. The real estate law prevalent in Ohio states clearly that any person bringing a foreclosure suit must at the very onset attach all the relevant documents showing that the plaintiff has the right to collect. At the least some explanation has to be given for not having the documents right then. If this is not done then the judge has the right to dismiss the case summarily.
Federal bankruptcy judge Samuel L. Bufford together with former judge R. Glen Ayers has recently written an article pointing out that the Uniform Commercial Code that has been introduced in each state is very vague. The article read, “Enforcement of a note always requires that the person seeking to collect show that it is the holder. A holder is an entity that has acquired the note either as the original payor or transfer by endorsement of order paper or physical possession of bearer paper.”
Dennis Harrington of Southeastern Ohio Legal Services in Marietta said that somebody trying to take foreclosure action without papers is like someone attempting to encash blank cheque. He asked, “If you have a check that’s not made out to you, what gives you the right to go to court and demand that the people pay?”
He and his lawyer colleague Peggy Lee said that SEOL is representing people with low income involved in civil cases. They have been lately seeing a rise in foreclosure suits in which this particular issue is repeatedly coming up. The last few years of insanity in the market has resulted in this mayhem that has ultimately caused the nation to slump into recession.
Another related article in the New York Times highlighted that during the time of the housing boom, millions of mortgages were make into parcels, sliced and sold to investors across the world. These securitized trusts were sold repeatedly causing chaos. Lee says that three out of every four cases she handles raises this point about original papers and documentation to establish the plaintiffs right to sue. At the time of selling and re-selling the mortgages the forms were not properly filled up. The concerned parties were in such a hurry that they neglected this important point. Sometimes even computerized records cannot be shown.
It seems that the banks were so busy making money that they did not give priority to the task of keeping track of the loans that were changing hands.
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