Faulty Mortgage Docs go back to Late 1990s
as county officials review years’ worth of mortgage paperwork, in some cases combing through one page at a time, they are finding suspect signatures — either signed with the same name by dozens of different people, improperly notarized or signed without a review of the facts in the paperwork — on all sorts of mortgage documents, dating as far back as 1998, The Associated Press has found.
"Because of these bad titles, property owners can’t prove they own the properties they think they bought, and banks can’t prove they had the right to sell them," says Jeff Thigpen, the registrar of deeds in Guilford County, N.C.
Widespread robo-signing that stretches back a decade or more could create problems for homeowners. Regulators have so far not asked lenders to clean up the potentially millions of suspect documents filed in the past decade or earlier. That troubles some banking experts, including Sheila Bair, who until early July was chairwoman of the Federal Deposit Insurance Corp.
"We do not yet really know the full extent of the problem," Bair said in written remarks to the Senate Banking Committee. She and others have called for a comprehensive study on the extent of the fraudulent signatures in mortgage documents.
If documents with robo-signed signatures are challenged in court, judges could question the ownership of the properties, says Katherine Porter, a professor at University of California Irvine School of Law and an expert on consumer credit law. The consequences extend to homeowners in good standing when they try to sell.
Because, of course, we needed even more trouble with fixing the housing market and mortgage situation.
The whole piece is worth reading. The entire robo-signing situation is indicative of the rampant irresponsibility in mortgage finance that helped get us all into the current economic mess we find ourselves in.