Who Owns the Mortgage
The confusion of “Who owns the Mortgage” continues, with more and more states entering the battle against MERS. While winning the issue in many states, the battle continues. An article by Bloomberg recites a number of new counties and states that are in the battle against MERS, including all counties in Texas. Meanwhile, Kurt Pfotenhauer, former head of ALTA, has moved to MERS as Executive Vice President and Vice Chairman of the Board as shown on the MERS site.
| Kurt Pfotenhauer, Chairman | Executive Vice President and Vice Chairman | First American Title Insurance Company | Santa Ana, CA |
He has been replaced by Chris Abbinante, the new president of ALTA who formerly worked for Fidelity National.
State of Delaware Sues MERS
In a new twist, the State of Delaware is suing MERS under the Unlawful and Deceptive Trade Practices Act (UDTPA.) The suit claims that MERS has left for borrowers “no public trail by which anyone can identify the principals or verify the propriety of the (mortgage) transfer.” The private and obscure nature of their database makes it difficult for consumers “to know of or challenge inaccuracies in the MERS System” i.e. – who the heck holds the mortgage and who the heck has the right to foreclose? Read more at Delaware Online
Banks Pursue Deficiency Judgments
The American Bar Journal has a good article on banks going after borrowers for the shortages between mortgage dollars borrowed and what the homes can be sold for. Under the terms of mortgage notes, the borrower promises to repay the entire debt borrowed. But with so many houses under water, the lenders are losing money, and so they are are looking to the borrowers for the difference. Forty-one states in the US allow this. So we need to watch name searches for deficiency judgments. But will this just force more people into bankruptcy – or will they really recoup some money?
FNMA Mae has specific rules pertaining to the right to file deficiency judgments. Will they follow up?
Owners of Abstracts Unlimited Arraigned on Charges
Mary Ann Palladino-DeVito, 41, and her husband Joseph, 39, owners of the now-defunct Abstracts Unlimited, have been arraigned on charges that they embezzled more than $1 million from homeowners seeking to clear property titles. “As part of this mortgage fraud scheme, these defendants are alleged to have victimized new homeowners … by accepting payment for mortgage fees, mortgage taxes, customer fees, real property filing fees, and escrow account funds and then misappropriating the funds for their own purposes,” District Attorney Donovan said. More at SILive
Commercial Title Searches Have Many Caveats
In preparing a zoning report for a proposed ethanol plant, Chicago Title apparently missed the names of several nearby homeowners, who were therefore not served with legal notice of the planned construction. As the construction became more imminent, neighbors found out and quashed the transaction, causing Chicago Title a $48.4 million loss. See more details at Ethanol Producers magazine.
CLAYTON, Mo. (CN) – A St. Louis County jury awarded $48.4 million to an ethanol company against a title company that failed to notify property owners near a site where the ethanol company wanted to build a plant near Wichita. The award, after a 2-week trial, is the largest ever in St. Louis County Court.
Abengoa Bioenergy wanted to build a plant in Colwich, Kan. Chicago Title was supposed to notify nearby property owners in order to obtain zoning to build it, but seven property owners were left off the notification list.
After zoning was granted, the property owners found out and sued in 2008. Abengoa was forced to build a more expensive, less profitable plant in Granite City, which was finished 15 months after the first plant was supposed to be completed.
The award includes the higher cost of building the plant in Granite City, the cost of the 15-month delay and the lower revenue from the plant.
John L. Davidson, Esq.
13975 Manchester, Suite 19
Saint Louis, Missouri 63011
Is it just me, or does this seem ridiculous. Lender accidently files hundreds of satisfactions of mortgages and is allowed by the Court to file one large Public Notice in the Legal Leger to undo the hundreds of errors and reinstate the mortgages??!!. What has happened to using knowledgable and accountable staff who don’t make such mistakes. My guess is that a very inexpensive vendor manager made the error. Similar to the vendor manager who filed hundreds of mortgages in the same county, rather than filing in the county where the land was located. Well, you get what you pay for… I wonder if they will file some sort of Unsatisfaction in the Land Records to match each inadvertent satisfaction…?
A quote from the Riverhead News Legal Leger in NY:
“The plaintiff allegedly filed a numerous number of
satisfactions of mortgages with the Suffolk County Clerk and is now by this
application attempting to undo its error. The defendants number in the hundreds
and therefore service of papers on these defendants seems impractical except as
those where service pursuant to CPLR § 308 was accomplished. Therefore, it is
Ordered That the plaintiff file the above captioned action for one (1) day in
both Long Island Newsday and in a local official paper in each of the 10 Towns
of Suffolk County noticing the application to expunge the erroneously filed
satisfactions of mortgages and advising of the date and place of the hearing
before this Court on July 25, 2011 at 11:00. The plaintiff will provide proof
of filing with the Court on the date of the hearing of publication in Newsday
and one of the official town newspapers for each of the ten (10) towns of
Suffolk County on Long Island, New York…”
India Passes Legislation on Privacy Issues and Offshoring
An interesting article pertaining to the offshoring of Public records has just been written for Chief Information Officers . It appears that after 100 years of little regulation, and with a rapidly growing data entry industry, India has decided to create some protections and is finally looking at Privacy Issues and problems. Recently much of the U.S. business of data entry has been moved to Indian, the Philippines and China, where labor is less expensive. Many in the U.S. have been concerned that their private business is being spread around the globe, making them subject to more identity theft issues. The privacy laws could make it a bit more of a challenge for U.S. companies to outsource the public records used so commonly in the Title Insurance Industry. Here is an article from CIO that gives 7 tips to prepare for India’s Privacy Rules.
County Recorder Says Merging Clerk and Recorder Offices a Bad Idea
A County Recorder, Rose Bogardus, who ran for office saying a merger of the Clerk’s office with the Register of Deed’s office was a good idea, has changed her mind. Apparently after working in the office and seeing the variety of duties, she feels a merger would hurt the County. Read more at MLive.com
Ms Bogardus stated she has studied merged clerk-register offices elsewhere in Michigan and fears her office would take a backseat in a consolidation even though it provides critical services recording deeds and mortgages.
She criticized commissioners for not pushing to reduce the number of board members when the county Reapportionment Commission was considering the issue last month and said she has no personal interest in what happens because she will not run for office again after this term.
Read more at MLive.com
State Takes up Question of Mortgage Inspection Reports
The Oklahoma State Board of Licensing for Professional Engineers and Land Surveyors is considering a position statement. The Board has been reviewing ways to alleviate the public misunderstanding and misuse of Mortgage Inspection Reports. The problem originates with homeowners who receive copies of these reports at closing and then rely on them to build improvements (even though there is disclaiming language on the drawing itself.) The report appears to mislead homeowners into thinking they can rely on the information shown thereon. Read more on this at The American Surveyor
Kudos for Abstract Class
I didn't get a chance to thank you for the great learning experience on Monday and Tuesday. THANK YOU for presenting the material in such a way that even I, with little to no experience, could understand it. I appreciated the one-on-one "checks" during the breaks making sure that I was doing alright with the subjects and I definitely learned many things that will be helpful while I am still getting comfortable with my position at the County. I hope that I will be able to attend more of your seminars in the future, especially the one pertaining to legal descriptions. Thanks Again, Sam
Home Closing 101: An Educational Initiative of the American Land Title Association
