WASHINGTON — Bank of America is suing itself for foreclosure.

“It’s crazy,” housing data analyst Michael Olenick told HuffPost. “They shouldn’t be suing themselves.”

via Bank Of America Sues Itself In Unusual Foreclosure Case.

Housing Meltdown - Aftermath

More and more issues creep up in the aftermath of the great housing meltdown.  Tighter mortgage money is now followed by Title insurance companies looking for a guarantee that the title the are issuing is in fact that the lender represents it to be.  Common sense underwriting…go figure!

Fidelity National Financial Inc., the largest U.S. title insurer by market share, will require lenders to sign a warranty assuring their paperwork is sound before backing sales of foreclosed homes.

An indemnity covering “incompetent or erroneous affidavit testimony or documentation” must be signed for all foreclosure sales closing on or after Nov. 1, the Jacksonville, Florida- based company said in a memorandum to employees today. The agreement was prepared in consultation with the American Land Title Association and mortgage finance companies Fannie Mae and Freddie Mac, Fidelity National said.

“It’s just the prudent thing to do,” Peter Sadowski, executive vice president and chief legal officer for Fidelity National, said in an interview. “It is important for the servicers and the lenders to represent to us and to the people we are going to be insuring that there are no problems.”

via Fidelity National to Require Banks to Sign Foreclosure Warranty – Bloomberg.

Housing crisis continues in new ways

This mortgage mess will certainly be with us for many more years.  Not only do we have to contend with banks that still don’t want to lend, but there are many banks that are cleaning up the mess in questionable ways.  It seems that there are a lot of dishonest folks in the mortgage game and when you give them an incentive that is directly tied to their pay they tend to find a way to fudge something for their own gain.  I think that the whole idea that, in the end, someone else pays (taxpayers via Fannie and Freddie), makes it feel like a “I won’t have to deal with it when it goes bad”.

Good old accountability needs to come back into the game.  If a bad mortgage is written, someone gets in trouble or loses their job.

The cover it up, dress it up, and get rid of it mentality has to stop.

Two big mortgage lenders are reviewing foreclosures as public officials heighten pressure on the industry over allegations that they made errors in documents used to evict homeowners. GMAC Mortgage, a unit of Ally Financial Inc., said Tuesday that it has enlisted legal and accounting firms to conduct independent reviews of its foreclosure procedures in all 50 states.

GMAC has already halted foreclosures in 23 states.Separately, Wells Fargo & Co. said it would review pending foreclosures for potential defects in response to requests from lawmakers and public officials. The San Francisco-based company says it has not turned up any evidence of problems.

via GMAC, Wells Fargo to review foreclosures – Yahoo! Finance.

10% of all US homes are in foreclosure!  That is simply staggering!

US foreclosure filings will hit 3.9M in 2009, bringing the 3-year total to 10% of all US homes.

Foreclosure heat map

via Foreclosure Thursday – The Stealth Stimulus | Phil’s Stock World.