Tuesday, August 17, 2010

Banks: Foreclosure ruling flawed - BostonHerald.com

APPEALS??? Banks: Foreclosure ruling flawed - BostonHerald.com: "The Ibanez case centers on how lenders often sell mortgages over and over again these days.

A bank that gives you a mortgage will typically sell the loan to Wall Street, which packages it with hundreds of others to create a mortgage-backed bond. This bond then trades over and over again like shares of stock.

However, Long ruled that state laws dating back decades still require firms to file paperwork every time a mortgage changes hands.

Wells Fargo and U.S. Bank scoffed at that idea in their SJC brief.

“(The judge) erroneously rejected decades-long industry practice of recording (mortgage-transfer documents only) after a foreclosure sale,” the banks’ lawyers wrote. “This industry practice (has) been in place for at least the past 20 years in Massachusetts.”

But a lawyer for one of the homeowners involved in the case said industry customs don’t determine what’s legal."

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