Arizona Senate Moves To Void Foreclosures With Incomplete Ownership History
In Arizona, previously-common lending practices that led to the robo-signer fiasco last fall could now lead to impossible foreclosures and voided foreclosure sales. The state Senate has passed a bill, SB 1259, requiring that lenders provide a complete list of any previous owners of a mortgage note before they can foreclose on that note[1]. Failure to do so not only sets the lender up for a lawsuit including damages and foreclosure reversal, but can also void a foreclosure sale. The bill has not yet passed the Arizona House of Representatives.
Essentially, the bill requires that before a lender forecloses, a “full chain of title for the property” must be produced and filed[2]. While Arizona is the first to set such a law in motion, similar legislation is also being considered in New York, Oregon and Virginia. Lenders would be required to list all former owners of the deed and detail how ownership was transferred from one owner to the next. Lenders who fail in this face a voided foreclosure sale and can be sued for failure to comply and forced to not only provide compensation to the foreclosed homeowner, but also pay for “other provisional remed[ies] related to the claim.”
Lenders are warning that states with this type of legislation will make lending in these areas much more difficult and that it could become difficult to even get a loan in these states. Do you think that this bill is worth it?
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[1] http://nationalmortgageprofessional.com/news23802/arizona-senate-passes-bill-would-void-foreclosures-lacking-title-history
[2] http://www.totalmortgage.com/blog/mortgage-rates/arizona-bill-would-make-it-more-difficult-to-foreclose/10452
THIS IS A VERY GOOD LAW !!! This law only restates the existing in the state. Since lenders foreclose with out a trial in AZ, homeowners have no way to force banks to follow existing laws !
The only burden on the lender is they will have to tell the truth and follow the law. Is it only us lowly citizens that must follow the law?? Banks do not have to follow the law?!? Are the banks above the law??
Lending will not be affected at all. Banks have changed their lending guidelines dramatically and have already stopped using the old way they use to create and market loans. They are just blowing smoke.
The economy in Arizona will finally start to grow again !!! And once the other states see this, they will all follow suit!!
Don’t let the banks continue to destroy our economy !!
Thank God there are still a few honest politicians left !!
This information should be readily available for anyone foreclosing on a property. I have been involved in real estate deals for a couple of decades-this will make it much easier for serious investors to have confidence when purchasing.
Is it worth it? for any honest banker/title company/realtor/investor to have transparency-isn’t the answer obvious—yes.
What is the point of this legislation? Help me understand. How could something in the title history affect how a present homeowner failed to make their payments? Just another hoop to jump through perhaps.
The point is to make sure of clean title.
let’s say someone is not paying: Can anyone come and sell the house? This bill will clear the legislative intent that you need to be the correct party.
TBTF’s are claiming property they have not lent any money on and passing bad title-bad for everyone. Realtors will still get the houses to sell-but by the party who should be selling them in the first place-saving everyone a lawsuit in the near future. it’s worth the wait.
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