USA Today reports that Old Republic National Title Insurance is no longer insuring titles to any property foreclosed by Chase or GMAC. Why? Because both mortgage servicers stopped foreclosure sales in 23 states because some legal filings may have not been properly verified or notarized.
Bank of America has also said it will stop foreclosures in those states.
So what are the ramifications of this? Because the legality of the process is being questioned, homeowners could try to claim they still own their home, even if someone else buys them in a foreclosure sale, Florida lawyer Mark Stopa told USA Today.
Rafael Castellanos, managing partner here at Expert Title, contributed to the article: “It is possible for a homeowner to come back and stake a claim to their property.”
But according to USA Today:
“The American Land Title Association (ALTA), which represents title insurers, says possible flaws in foreclosure documents should have little impact on buyers of foreclosure-sale homes because they can argue they bought the home in good faith and the law protects them.”
We will certainly keep our readers posted as to any developments in this undoubtedly complicated story.