Here’s some cheery news for your Sunday open house visiting! This might make you think twice about offering anything on a short sale, REO, or previous foreclosure.
By GRETCHEN MORGENSON, Published: February 15, 2012
An audit by San Francisco county officials of about 400 recent foreclosures there determined that almost all involved either legal violations or suspicious documentation, according to a report released Wednesday.
Photo, right: Phil Ting, Phil Ting, the San Francisco assessor-recorder, found widespread violations or irregularities in files of properties subject to foreclosure sales. Annie Tritt for The New York Times
Phil Ting, the San Francisco assessor-recorder, found widespread violations or irregularities in files of properties subject to foreclosure sales.
Anecdotal evidence indicating foreclosure abuse has been plentiful since the mortgage boom turned to bust in 2008. But the detailed and comprehensive nature of the San Francisco findings suggest how pervasive foreclosure irregularities may be across the nation.
The improprieties range from the basic — a failure to warn borrowers that they were in default on their loans as required by law — to the arcane. For example, transfers of many loans in the foreclosure files were made by entities that had no right to assign them and institutions took back properties in auctions even though they had not proved ownership.
Well, that’s San Francisco for you. That doesn’t mean foreclosures in the nation’s other 3140 counties and county-equivalents should have any problems at all. You see, bankers in San Francisco were so terrified of the terrible impact Prop 8 had on gay marriage and real estate values, they didn’t want to look at what they were signing. For three whole years!
Good thing the $26 billion foreclosure settlement between five huge banks and 49 state attorneys general is already signed! Who knows what kind of trouble there would be if this sort of report had been released beforehand. Why, San Francisco homeowners wouldn’t be getting their share of the $147 million (provided they managed to hold onto the house while the banks were doing everything possible to claw it away, in which case $2,000 each ought to cover it).
This is an Open Thread. Are you more or less likely to buy in San Francisco after reading this story?