California Real Estate Fraud Report

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04
Oct

Old Republic Stops Writing Title Policies for JP Morgan, GMAC Foreclosures

Old Republic National Title Insurance has thrown a monkey wrench into the ability of lenders to sell their foreclosures: on September 29, the company announced that it will no longer issue policies to properties that have been foreclosed by JP Morgan Chase and Ally Financial, Inc. (GMAC). Further, Old Republic will not write title on properties which have been purchased after the foreclosed properties have been listed and sold as REOs (bank-owned property).

Maryln Weiner, a title agent and real estate attorney in Boca Raton, Florida, predicted the disclosure by the two mega-lenders, as well as Bank of America, will

“set us back years.  They won’t insure it after completion after the foreclosure. I think you’re going to see actions to reopen foreclosures that already took place. This will have tremendous consequences and all title companies will do the same thing. We’ve never seen anything like this before.”

What’s even worse is that the buyers of REOs could have their ownership challenged in court by the former homeowners, who may contend the foreclosure judgment has to be set aside due to faulty documents. In that case, the new homeowners may go to the title insurer to cover their financial losses.

The financial impact on title companies, the banks and the U.S. economy is staggering: the National Association of Realtors shows that foreclosed properties make up 34% of sales across the country, up from 31% a year ago.

Read the full article in USA Today.

© Copyright 2007-2018 Monique Bryher

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The information and notices contained on The California Real Estate Fraud Report are intended to summarize recent developments in real estate fraud, mortgage fraud, short sale fraud, REO fraud, appraisal fraud, loan modification scams, loan modification fraud and other real estate related crimes occurring in Los Angeles and California. The posts on this site are presented as general research and information and are expressly not intended, and should not be regarded, as legal advice. Much of the information on this site concerns allegations made in civil lawsuits and in criminal indictments. All persons are presumed innocent until convicted of a crime. Readers who have particular questions about real estate fraud, mortgage fraud and appraisal fraud matters or who believe they require legal counsel should seek the advice of an attorney.

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