Great question and you’re not the only one confused!
I won’t be surprised if we soon see a mandatory Federal freeze on foreclosures like Maxine Waters (D-CA), Chairwoman of the Subcommittee on Housing and Community Opportunity, suggested with legislation titled HR5679 (The Foreclosure Prevention and Sound Mortgage Servicing Act “FPMSA”). It basically outlines the fact that she believes the Banks aren’t doing their due diligence when it comes to contacting the Delinquent Borrower about attempting a Loan Modification before a Foreclosure. (Personally, I’ve found it rather difficult for most to qualify for a Loan Mod so we typically roll our work into a Short Sale.) A part of the bill that I fairly strongly disagree with is her suggestion that the Government intervene and start purchasing these properties and maintaining them as rentals for such borrowers that have taken a loss. I don’t know about ya’ll but I think we’ve written ourselves into a enough debt during this and I’d like to see regular Buyers obtaining these properties. This is an amazing time for first-time home-buyers, investors, etc. I would hate to see the rug pulled from under them because the Government is beating them out as a Buyer on a Home.
While I believe in the idea of the bill (to regulate banks more heavily so they aren’t fraudulently or illegally foreclosing on a Homeowner), I’m not sure we need to get involved to the level of (what I would see as a hindrance) to the Average Home-Buyer.
On a side note, this popped up because MERS (Mortgage Electronic Registration Systems), which was created to allow the securitizing of mortgages, started selling the notes over and over again there by creating a break in the Chain of Title. I haven’t ran into an issue with Homeowners having someone try to claim their home as their own but I can imagine how amazingly distressing that can be! I think that the Banks doing the Foreclosing and MERS need tighter regulation DEFINITELY! MERS controls 62 Million Homes! That’s a clear majority of all Foreclosures in USA. Let me know if ya’ll have any further questions regarding this. I’m sure the clear one is How the Heck Did This Happen?!