The Foreclosure Rate in Arizona was the Second Highest Among the States
The foreclosure rate in Arizona last January was 1:175 – ranking Arizona the second highest among the states as per RealtyTrac. Towards the close of 2010 the mega bankers had slowed down their foreclosure operations following the exposure of the robo-signing scandals. Investigations are being carried on by the authorities including the attorneys general of all 50 sates.
Arizona is poised to pass a law that will make it mandatory for lenders seeking foreclosure sale to submit documents stating in details the transfer chain with full particulars; otherwise the foreclosure would not be allowed to proceed.
The Senate Bill 1259 has passed through the Republican dominated Senate being proposed by Michele Reagan (Republican). Reagan’s lawyer Beth Findsen suggested the bill and helped to draft it. Reagan together with her husband David Gulino were facing a lawsuit filed by their servers Colonial Savings of Fort Worth, based in Texas.
The couple informed the servers that they rescinded the loan because disclosures of certain fees had not been made and that their income had been falsely inflated by the underwriter.
In response Colonial Savings wanted the court to state that the couple did not have the right to revoke the loan. Reagan and her husband then filed a suit stating that were navigated to an ARM loan that was not needed by them; moreover Colonial Savings was not telling them who owned the loan. The latter declined to comment.
Findsen said, “It makes Michele mad that the bank servers will not disclose to a borrower the true note-holders. She was taken aback that such information was not readily available”.
The bill being passed suffers from conceptual as well as technical problems. If it is passed the lenders who have not noted the assignments with the recording office of the state could be facing problems; till now it had not been compulsory as per state law.
The association of the trustees has made some suggestions regarding the bill. It wants the lenders to certify to the trustee that it has the legal standing to foreclose.
If this certification is found to be false then the lender could be facing charges of perjury. Richard Chambliss of Arizona Trustees Association in Phoenix (president) questioned if the bill intended “to punish the lenders and screw up the process or address the problem that needs to be solved?” He said, “What is it accomplishing by requiring that the history from the birth of the deed of trust to 20 assignments down the road have to be fully identified?”
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