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?
Homeowner Forecloses Bank
Classic example of action for bad foreclosure! http://www.youtube.com/watch?v=MBuCSTFJffY
Counties Look at Lawsuits Saying they were Cheated Out of Mortgage Fees
An article from Bloomberg says that Bank of America is among a group of lenders that may face a host of lawsuits claiming that counties were cheated out of millions of dollars by MERS, a system used for more than a decade to register mortgages.
Dallas County District Attorney Craig Watkins said state attorneys general and county officials across the U.S. have expressed interest in his lawsuit against Mortgage Electronic Registration Systems Inc. and Bank of America, filed in Texas state court on Sept. 21. Dallas County could be owed as much as $100 million in filing fees, he said. Counties across the U.S. are financially strapped, and this would help bridge the gap in much needed revenues.
Mamouth US Supreme Court Case for Title Insurers
From The Supreme Court Blog comes an interesting and important title case. The case began in Cleveland and is scheduled to be argued before the U.S. Supreme Court this fall. The outcome could determine whether lawyers can file a new sort of consumer lawsuit against title companies on behalf of those who haven’t actually suffered any actual title damages or even a financial loss .
The lawsuit, First American Financial Corp. v. Edwards involves a homeowner named Edwards, who bought a house in September 2006 and paid for a title insurance policy from First American Title. A few years before that, First American had paid the firm that closed the transaction $2 million for a minority stake in the company and they made an agreement to exclusively sell First American title policies according to reports at Forbes.com. First American claimed there were no financial damages to Edwards.
However, the case appeared to violate RESPA laws, which prohibit title insurers from paying kickbacks or anything of value for referrals. The Supreme Court will review the case and its decision could mean that any violation of the RESPA law, regardless of injury or financial damages, could subject title underwriters who have practiced co-ownership with agents to enormous class action lawsuits.
Southern Title No Longer Writing Policies
Southern Title, a regional underwriter with over 500 agents is no longer writing title policies. Perhaps the nail in the coffin was the recent lawsuit.
southern-title-lawsuit was filed by United Central Bank against Southern Title Insurance Corporation as title underwriter and American National Title Company as closing agent in conjunction with a $4.205 Million first mortgage. The suit asks for a Jury Trial.
The suit alleges that both title companies were previously involved in closing other mortgages on the same property, leaving the loan in question subject to multiple existing prior liens. The plaintiffs therefore had both actual and constructive notice of intervening liens, and gave a first mortgage title policy, knowing the United Central Loan security interest was virtually worthless. When the mortgagor subsequently defaulted, United Central filed a claim under the policy with Southern Title, which, according to the complaint has not been answered with any “meaning full response.”
Plaintiff seeks “consequential, incidental and actual damages, including lost profits, interest and fees on existing indebtedness, indebtedness not covered under the title insurance policy, made on the basis of this claim, litigation expenses, attorney’s fees as well as lost profits…”
According to their press release Southern Title is no longer writing title policies and “will focus continuing efforts on the resolution of claims received on previously issued policies.”
Jeanne Johnson to Speak at National Association of Land Title Examiners and Abstractors
Press release
Jeanne Johnson will teach a “Train the Trainer” class at the NALTEA Conference (www.NALTEA.org) in Clearwater, FL on October 21st in Clearwater, FL. The class is designed to help those knowledgeable in the Title Insurance, Abstracting and Closing industries techniques in training very technical products to industry students. “To be really good in the title industry requires a tremendous amount of technical legal knowledge, as well as investigative skill” says Johnson. While some think the skills are mundane, Johnson sees those who are good at the job as title sleuths. “In this day and time, most titles are flawed, and the title abstractors and examiners are charged with a heavy responsibility to investigate and uncover the problems.”
Her Train the Trainer session will focus on making the experience of a title student interesting and fun. She says most people know more than they think they do about real estate titles. They know about real estate taxes, they know what an easement is, they recognize title ownership and mortgages, the key is to put them all together into a coherent pattern and lead them through the process of the investigation. “It’s great fun – I am proud to be a title geek!”
Look for her at the conference.
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
PRIA Promises Sparks at Industry Gathering
press release
9/6/2011
The Property Records Industry Association (PRIA) will host its Annual Conference in San Antonio, Texas, on September 24-27, at the Hotel Contessa.
On Saturday afternoon, September 24, PRIA will offer a pre-conference workshop on “GIS, The Integration of Land Records with GIS.” This program is designed to attract a local audience of recorders, clerks and GIS professionals to learn more about the efficiencies that are attainable by overlaying the GIS and Land Records systems within county governments. Attendees will learn about what an integration of systems entails, including workflows, data sharing and records improvements. This session is hosted by PRIA’s GIS Workgroup, chaired by Diane Swoboda Peterson, real estate/recorder deputy, Woodbury County, Iowa; and Peirce Eichelberger, ILS, Silver Spring, Md. Brent Jones, Esri’s manager of surveying, cadastral and land records, will be part of the presentation team.
A much anticipated highlight of this annual gathering will kick off on Sunday morning, September 25, with a three-hour, general session focusing on “MERS – a 360° View.” This panel discussion will be moderated by Mark Monacelli, recorder, St. Louis County, Minn.; and Richard Bramhall, senior vice president, Business Control Executive, Bank of America Home Loans. The panel will include Bill Beckmann, CEO of MERSCORP Inc. and its subsidiary, Mortgage Electronic Registration Systems Inc. (MERS); Marjorie Bardwell, senior staff underwriting counsel, Fidelity National Title Insurance; and Jeff Thigpen, register of deeds, Guilford County, N.C. A representative of the lending industry has also been invited to participate.
Recognizing that the scope of the land records industry extends far beyond the activities in the county recorders offices, PRIA reaches out to all industry partners to facilitate understanding and effect solutions to problems that touch the entire industry. Key among these allied interfaces is the title and lending industries, as well as MERS.
The Q&A promises to be interactive and lively with the prospect for future discussion and planning scheduled for the PRIA 2012 Winter Symposium in March. The overall conference program also includes a general session on indexing practices in the recorder’s office, consolidation of recorders’ offices, a GIS general session and a roundtable discussion on eRecording and how to achieve widespread acceptance and implementation of the PRIA/MISMO standards.
PRIA committees and workgroups will have two opportunities for working sessions during the conference with the XML Standards and Business and Technical Requirements workgroups of the Technology Committee both meeting, along with the GIS workgroup; Archival, Backup and Disaster Recovery workgroup; Uniform Numbering System workgroup; Redaction Best Practices; Notary Re-write and PREP all holding sessions in a concurrent format.
With early registration figures showing a lot of interest in this year’s conference Co-Chairs Dallas County Clerk, John Warren, and Tarrant County Clerk, Mary Louise Garcia speculate, “Here in Texas everything is always bigger, so it’s no surprise our attendance is projected to be the highest in three years. Attendees should get ready for a Texas-style welcome at the Meet ‘N’ Greet on Saturday evening following the GIS Pre-conference Workshop.”
Registration materials and hotel reservation access can be found on the PRIA website. For questions, contact the PRIA offices at 919.459.2081 or Email coordinator@pria.us.
About PRIA
The Property Records Industry Association brings together government and business experts to build consensus, establish best practices and drive efficiency and effectiveness throughout the industry. For more information on PRIA, vi. sit www.pria.us
LA Court Makes Good Call on Title Policy Coverage
The Louisiana Court made a good call in MGD Partners vs. First American Title, when MGD sued for bad title when the Parrish refused to issue building permits for a new subdivision of homes. Apparently the site had previously been used as a bombing range in WWII. Read the Case at LEGAL
Update on Minesota Foreclosures
Here is a very interesting report by the Minnesota Homeownership Center on Minnesota foreclosures, detailing the history of foreclosures by County over the last two years. It also has a map showing foreclosure rates by County. The goal is to get help to homeowners in foreclosure where it is most needed. See the report for solid information as to the marketplace in Minnesota.
Home Closing 101: An Educational Initiative of the American Land Title Association
