Anyone thinking of buying a foreclosure should read this article carefully.
Assuming you are able to get title insurance when you purchase a forclosure I assume the title insurance will protect you in the situation described in the article, will it not?
It could be messy if the insurer had no precedent in this specific type case, and decided to go to court to see what happens. Otherwise, they insured, they must pay.
Safe would be to inquire about the actual title before putting up a single dime (the only logical reason for posting the article). Insist on unshakable legal verification (copies with medallion signatures or whatever), and walk away blowing a whistle if you cannot get them. Imagine going through the qualification, down payment, fees, fixing up, moving in, then getting an eviction notice, then facing down an insurer to get paid. Much simpler to be 100% you have verified the title. The greedy, unprincipled (pun), banks really messed this one up, did they not? Call me stuffy, but I bought a standard for sale (and spent hundreds on a lawyer besides to check everything) - I'm not sure I understand real estate at all so I saw no reason to go off-road with a foreclosure.
The prices are already at rock bottom, so why not buy from some guy who kept up his payments and has a clear record?
It might be informative to look at what happened back during the great depression and how investors fared after buying up real estate at rock bottom prices. If I am not mistaken, that was a period when the rich got richer and the poor became poorer, and probably the reason is that the rich could afford to put out money and then hold on to their real estate purchases for a long time. I am convinced that real estate is best viewed as a long-term investment, not all that different from the stock market. You do better when you "buy and hold," and do not panic because of short=term ups and downs and current and temporary economic conditions. It is true that some people do well buying houses at bargain prices and then fixing them up and flipping, but that strategy carries risks, just like buying and selling stocks in on a short-term basis carries risks.
Now I'm really confused. Bloomberg said "title" but the article below (talking about bankrupt lenders requesting permission to destroy mortgage documents), says differently?
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