ForeclosureForeclosure is the legal action taken to extinguish a home owner's right and interestInterest is money charged for the use of borrowed funds. Usually expressed as an interest rate, it is the percentage of the total loan charged annually for the use of the funds. in a property, so that the property can be sold in a foreclosure sale to satisfy a debt. paperwork scandals continue to rock homeowners and the housing market. The Atlanta Journal-Constitution published a story of one specific mortgageA Mortgage is a document granting a lien on a home in exchange for financing granted by a lender. The mortgage is the means by which the lender secures the loan and has the ability to foreclose on the home. loanA Loan is an amount of money that is lent to a borrower, who agrees to repay it plus interest. case today. And usual, providing personal finance advice, real estateReal Estate is land and anything permanently attached to it, such as buildings and improvements. advice and consumer advice on the Ilyce Glink Show on December 2, 2012 at 11:00am Eastern Time on WSB Radio.
We’re almost at the end of this year. I can hardly believe it. It’s December and because it’s extra warm out today, that seems even more surreal. But these are the last few weeks of 2012.
There’s an interesting story on the home page of the The Atlanta Journal-Constitution website this morning. The piece is entitled “Bank Backtracks After Improper Foreclosure,” and these kinds of stories make me want to cry.
The New York Times also ran a recent story detailing how widows are being foreclosed upon at six times the rate they were in 2007. Why are these homeowners being targeted? Mortgage loan paperwork confusion. Nothing more. Widows over the age of 50 are so much less likely to understand where the money is in their house when compared with younger women. The reason is that many of these now spouse-less homeowners left their husbands in exclusive control of the finances. They may not even be listed on the original mortgage loan paperwork. Why not? I have been fighting against this pattern in the housing market my entire career. What happens when widows outlive their husbands and they have no idea where the important papers are? The answer, in many cases, is foreclosure paperwork scandals.
But back to the Journal-Constitution piece. That’s what happened here. A paperwork error got this woman foreclosed upon though she was in the HomeSafe Program, which is part of the U.S. Treasury’s Hardest Hit Fund. They provide assistance for up to 18 months of mortgage loan payments for struggling homeowners. It’s a long sad story and is emblematic of so much that is broken still within the housing market.
Callers and I discuss the potential implications of stories like these.
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