Industry NewsMortgage

Gauging real estate impacts of ‘robo signing’ scandal

Title insurers standing firm as state and federal officials turn up heat

Learn the New Luxury Playbook at Luxury Connect | October 18-19 at the Beverly Hills Hotel

The impact of decisions by three major lenders to review their foreclosure procedures in nearly two dozen states could hinge on reaction by lawmakers, and whether title insurers are willing to continue insuring title on distressed properties and bank-owned (REO) homes. GMAC Mortgage, JP Morgan Chase and Bank of America are reviewing foreclosure proceedings in 23 states where courts have jurisdiction over foreclosures, following allegations that workers processing files for the companies signed affidavits that contained information they had not personally verified. When attorneys for homeowners have challenged lenders on such procedural issues in the past, they have mostly succeeded only in delaying, rather than stopping, foreclosure proceedings. The American Land Title Association, an industry group representing title insurers, expects that in the end, the "robo signing" controversy won't have a major impact. Flaws in documentation filed in the foreclosure process s...