Here's a tidbit from a new post at my favorite source (bobswen's, too) for financial news and analysis, Naked Capitalism. For me, Yves Smith is an especially inportant source for what's happening in the bank foreclosure swamp, and has been VERY well-read by congressional staffers charged with educumacatin' our usually clueless congresscritters about things their frequent lunch buddy lobbyists weren't telling them the truth about.
Now the judges across America are beginning to look under those big rocks (ones with MERS, BofA, Chase, USBank, etc chiseled on them), and they're not at all happy about what they're seeing. Here's the most recent, from here in Oregon (and covered by the Oregonian, much to my shock and delight):
Oregon judges have delivered a series of setbacks to servicers and securitization trusts. A recent decision, Hooker v. Northwest Trustee Services, ruled that assignments of the beneficial interest (as in, transfers of the note) needed to be recorded. That makes any foreclosure in the name of the mortgage registry MERS a non-starter, since MERS was never and could never be the holder of the beneficial interest. This will have little impact going forward, since MERS has instructed servicers to stop foreclosing in its name, but there are plenty of foreclosures in the pipeline that were initiated in the name of MERS.
The latest move is that Judge Grand reversed a foreclosure sale due to the failure of the parties representing the lender to satisfy the requirements of Oregon’s recording statute. To put it mildly, foreclosure actions are seldom reversed. The decision is terse but it has wideranging ramifications. The Oregonian (warning: pdf) provided a good write-up of the case.
An extract from the article:
A Columbia County judge has blocked U.S. Bank from evicting a Vernonia woman whose home it purchased in foreclosure, concluding in a case with far-reaching implications that her lenders had not properly recorded mortgage documents.
Last week’s action appears to be the first in which an Oregon judge has halted an eviction and declared a foreclosure sale void after the fact. The ruling, if it stands, raises questions about the validity of other recent foreclosures in the state and could create serious problems for lenders and title companies, as well as for buyers of such properties…
A U.S. Bank spokeswoman said the bank would cease further eviction action and assess its “appropriate next steps.”
Gee, ya think maybe the appropriate steps might include doing what the law and their own trust agreements require be done?
Something truly noteworthy about this action is that the bank involved had purchased a woman's home in a foreclosure sale and the judge voided the sale because the foreclosing entity couldn't provide documentation proving it had the right to foreclose, much less sell the property. Legal beagles out there no doubt know that voiding the sale is something that is almost never done.