If you haven't heard of the case in Massachusetts in which two foreclosures have been overturned, one held by US Bank and the other by Wells Fargo, you should read up on it. The conclusion on Friday made by the state Supreme Court says that the aforementioned institutions could not prove they had the right to take back the properties. The ruling led to immediate wrangling on both sides of the legal isle.
Some predict that this is the beginning of something that can potentially affect hundreds of thousands of borrowers. Others argue that the case is specific to not only Massachusetts, but to the two particular cases that were tried, and that no further fallout would occur.
The center of the issue at hand is that both lenders foreclosed on properties before they had been assigned the mortgage. In both cases the assignments happened after the foreclosure was complete. What's interesting to me is that neither previous owner ever denied being late on their payments. Shouldn't that factor in somewhere before they get their house back?
I'm sure there are attorneys licking their chops and putting cases together as this is being written. It's just too big of a target to be ignored. But again, people that have followed the case through the courts insist that the ruling is a good thing. Saying it proves that servicers of mortgages that are backed by securities do have the right to foreclose and this ruling gives them a precedented outline to follow in the future.
What do you think will come of this? Is it really going to cause a national tsunami of cases or will it fizzle-out as a result of the ruling?