I rarely see anything written about the inherent unfairness of a non-judicial foreclosure. I personally believe that it is time for them to be abolished. We have all seen through MERS, Robo-signer and similar matters that lenders can and do make mistakes. Lenders can and do commit fraud.
It is inherently unfair and decidedly Un-American for a home owner to have no rights in foreclosure. I have observed that in states that have both non-judicial and judicial foreclosure that the home owner is completely unaware of what type of situation they are in. In every instance it turns out that they were in a non-judicial foreclosure scenario and there is a Power of Sale clause (has there ever NOT been a Power of Sale Clause)??
A home owner is giving up HUGE rights in a non-judicial foreclosure. In my practice, I have as many as 27 affirmative defenses to a foreclosure lawsuit and many more issues via Counter Claim. I have gotten deeds to properties from lenders free and clear of all liens as a result of lender misconduct!! You are giving up all defenses and counter claims in a non-judicial foreclosure. It is against everything that we stand for to have no rights in a legal matter – especially on our biggest asset and most dear possession.
All 50 states have judicial foreclosure…yes, ALL 50. The problem is that some also have non judicial foreclosure. Guess which one the lenders prefer?? Guess which one you are going to get if it is up to the lender??
In this day when lender errors and intentional acts are limiting the rights of home owners, it is time to eliminate non-judicial foreclosures. The stakes are too high and the home owners are giving up too many rights. It would be easy to abolish them since every state has judicial foreclosure. All that would be necessary is state-by-state legislation (note, federal government please stay out of this) that abolishes the non-judicial or Power-of-Sale foreclosures.
Paddy Deighan, J.D. PhD
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