Patrick Stump and Daryl Hall (music starts at 3:05):
Simply Red with the Harold Melvin and the Blue Notes classic:
Guess what? When you buy a foreclosed property from Wells Fargo, you may not have a clear title. Wheee!
Now specifically, the potential problem with the deal is the bank in many states will at best be giving the buyer a “quitclaim” deed (the addendum finesses this in paragraph 18, that the buyer only gets a “special/limited warranty deed. As the lawyer who took a dim view of this addendum put it, “This is like the ‘Special Olympics,’ not like ‘You are my special someone’.” That means the bank is merely transferring whatever it interest it has.)
But per the AFX article above, the bank may own nothing .It may have foreclosed without having a clear enforceable right to the property (this is the basis of the burgeoning number of cases where borrowers are successfully challenging the bank/servicer’s right to foreclose, because it cannot prove it actually owns the note, which is the IOU between the borrower and the lender; if you don’t own the note, in 45 states, you have no right to enforce the lien on the property).
Now this little problem can be solved by title insurance, right? Well, guess what, some title insurers have exited the business, some others are starting to write policies with meaningful exceptions when they can’t go to the courthouse and find a clear chain of title. Oh, and Wells is trying to steer you towards their title insurer. What do you think the odds are that their title insurance policy doesn’t have exceptions?
So what is the risk? The lawyer explains:
The typical (unsophisticated) buyer thinks that because they have a lawyer at closing (no matter whose lawyer it is), a title policy, etc…….that they are all safe and sound. They struggle through one of these REO transactions for a month or two, finally get in the house, something bad goes wrong, and they find out that 1) the title policy won’t cover them and 2) the land isn’t unique (see the nasty provision in paragraph 27 on “specific performance”), so a refund is all you get – and you are out on your ear. Hopefully, with a refund – and that may be the best outcome. But if somebody comes in, and voids a foreclosure, your title policy doesn’t pay – Wells Fargo has clearly disclosed that this was a foreclosure, so you only got what they had (nothing), and you have no recourse, no insurance, and guess what, an unsecured loan for half a million bucks.
Given how many sales will be done out of REO, and the rising number of problems surfacing with making sure that mortgage securitizations took all the steps to become the real party of interest in a particular property, it is only a matter of time before we see some blowups of the sort the attorney was worried about, of a buyer shelling out hard dollars for a house, or taking a big mortgage, and winding up with nothing. And a few incidents like that getting the press they deserve will put a pall on REO sales.
Think the risk isn’t real? Then why has Wells bothered to insist that REO buyers sign a new type of addendum, when it has been selling REO for decades? This effort to shift all title risks on to the buyer is a tacit admission of problems. And look at the document itself. The buyer has to initial it in eight places as well as sign it. That’s a clear statement of Wells’ intent to shift the risk to the buyer.
I just found out that one of my oldest friends is having a malignant tumor removed from her brain Wednesday. (Parietal lobe, it’s affecting speech, writing, typing, spelling. “YOU would hate this,” she wrote me.)
Please send prayers, good thoughts, shamanic healings, spells, magic pixie dust and whatever else you can think of her way. A world without her in it would really suck.
If you were a Satanist who already sold your soul to the devil, and you wanted to work your way into the United States Congress to do his bidding, wouldn’t it be a devilishly clever idea to throw people off the trail by saying you “used” to be a witch? Because of course people would “assume” (and you know what they say about “assume”) you’d found Jesus and were washed in the blood of the Lamb — but what if you were, you know, literally washed in the blood of the lamb…. on a Satanic altar?
This would surely explain a lot. After all, she had no luck in her previous runs for office — yet she suddenly knocks out a popular, long-time incumbent. They say it was the success of the Tea Party — but what if she sold her soul to Satan? After all, once you’ve invited the devil into your soul, does he ever really leave?
I’m not one to spread political gossip, of course, but someone did tell me he went through her campaign finance reports and there was apparently a big fat check to Hogwarts. Tuition? I’m just sayin’.
Does she float? Because if she floats, that means she’s made of wood… and you know what that means!