The “robo-signing” controversy over lenders’ allegedly lax foreclosure procedures is picking up momentum, with the Office of Comptroller of the Currency ordering the nation’s largest lenders to review their foreclosure processes. The robo signature identifies a process where a signature is affixed on the default notices, or other mortgage documents without reliable means or authenticity thus accelerating the foreclosure process. This denies all the legal avenues available to a distressed homeowners. The OCC has directed Bank of America, J.P. Morgan Chase, Citibank, HSBC, PNC Bank, U.S. Bank, Wells Fargo and GMAC Mortgage to make sure they are following proper procedures. Basically, this robo controversy is alive when banks foreclosure department streamlined the foreclosure process by falsely submitting affidavits, and forged signature. Also, this included bypassing state foreclosure procedure and notice laws. The foreclosure machinery in the banks are slowing down the process of streamlining this foreclosure process of rapid home repossessions.
This would also slow down evictions sharply. The questionable foreclosure would considerably slow down if not completed halted. Also, this would slow down resolutions of short sales and outright eviction. Of course this is a mass denial of distressed homeowners rights and destroyed the homeownership values throughout USA.
It may have some better consequences as this may help somewhat recovery of the real estate market. Of course that is a far-fetched thought. Most of the states, including Nevada, are facing large number of foreclosed homes continuously coming to the market and depressing the neighborhoods. Some economist think that it may as shock therabpy. This can be a happy ending but still there is lots of confusion.
As more defaulting homeowners become aware of the lenders’ problems, they are expected to hire lawyers and challenge the proceedings against them. And if completed foreclosures were not properly done, families who bought the troubled homes could be vulnerable to claims by the former owners. This in nutshell a continuous saga of despair and hope mixed together.
Old Republic National Title already sent a bulletin to its agents NO no any insurance to policies issued by GMAC Mortgage.
GMAC has acknowledged legal missteps in processing mortgages, and JPMorgan Chase has acknowledged the possibility of missteps, and both have suspended all foreclosures in the 23 states where they need a court’s approval.
Attorneys general in half a dozen states are demanding action or opening investigations. The Treasury Department said Thursday it was asking regulators to look into “these troubling developments.”
GMAC and Chase are in trouble because, overwhelmed with foreclosures, they tried to process them as quickly and cheaply as possible, defense lawyers say. The companies say they are reviewing their procedures to take care of any violations.
The missteps stemmed from the affidavits the lenders file as they seek a quick or summary judgment in thousands of foreclosure cases. The affidavits state certain facts about the case, including the amount owed, which the signer indicates he has personal knowledge of. Without the affidavit, the lender would have to prove the facts at trial.
In depositions taken by lawyers for homeowners, executives at GMAC and Chase said they or their teams signed 10,000 or more affidavits and related documents a month. That did not give them time to review the cases.
Many necessary documents have disappeared, with defense lawyers saying the lenders often do not even have standing to foreclose.
lvattorneyma.wordpress.com 
Nevada is not one of the States where they suspended foreclosures. But nevertheless, how is this issue going to impact foreclosed and “short sale” purchases?
Robo-signing is not state specific, it is a general phenomenon in the rampant foreclosure. Still, it is developing practice which is undiscovered. Which state is the highest on the foreclosure pendulum? I still believe it is Nevada, and all those rapid signature production mills must have done something to our state? Now, Chase, GMAC and Bank of America had grudgingly acknowledged it. The following link would be an interesting reading as well. As of today, the Nevada Attorney General has requested some 23 lenders to stop all pending foreclosures in Nevada.
http://www.washingtonpost.com/wp-dyn/content/article/2010/09/22/AR2010092206650.html
I forgot to answer the second part. Many homeowners who when they see light at the end of the tunnel, definitely opt to keep their homes. This also means they can occupy the homes longer and live rent free. Again, all these are expectations which may not come true at some time.
The damages to Nevada are obvious. The extent of the damage is still not fully assessed. However, Nevada is still on top of the foreclosure list in USA.