When you and your family are faced with losing your property to foreclosure fraud, one way to fight back is to use a legal strategy called Quiet Title. No matter how many investors, lenders, or banks are involved on paper with your property,you can challenge their interest, encumbrances, and liens in the land and end the dispute once and for all. A quiet title action lawsuit brings all the paperwork concerning your property under scrutinization by a court of law.
Due to the complicated nature of mortgage securitization, sometimes transfers of mortgages are not well executed. If the paper trail associated with the mortgage sales are not recorded under the proper legal guidelines, the deed of trust and the mortgage part ways legally, making the mortgage invalid.
The first stages of building a quiet title action involve information gathering through trips to the Register of Deeds, studying cases and state law research, and determining if a loan was securitized. You and your lawyer must fact-check the property’s paper trail for signs of foreclosure fraud, invalid dates and notaries, and tampered or fabricated documents. While tracing this chain of title, if a legal break is found, a quiet title action could be quite useful as an argument in court.
If you can prove that the property’s chain of title to the lending institution in question such as a bank is indeed broken, the case has a chance of success. Banks that participate in Mortgage Electronic Registration Systems (MERS) have a high probability of broken title chains, because mortgage transferring systems such as these do not keep adequate records to maintain a proper chain of title legally. Other situations where your claim to your property could be challenged legally include property boundary disputes with neighbors, adverse possession, torrens title registration, or fraudulent passage of property from the seller to yourself.
Court cases dealing with this situation can result in very different outcomes, because laws and statutes dealing with the quiet title process are very different from state to state. Prior court rulings in the area serve as precedent when dealing with local property issues.
In a case in California, the plaintiff’s default judgement clearing his title was overturned because a California statute dictated that default judgement alone could not clear a title. The court insisted that both parties involved in the dispute had a meeting of the minds in a court of law to discuss all the claims to title.
In a similar case in Arkansas, a bankruptcy ruling invalidated a claim concerning a property involved in a defective foreclosure action. Now it is common practice in Arkansas for title companies to withhold granting title insurance directly after these types of transfers at least until the company can figure out if the homes were transferred in accordance to local statutes and laws. If you or anyone you know is having issues with foreclosure fraud or dealing with competing title claims to their property, be sure to contact a lawyer proficient in this type of property law.