About a month or so ago, news came down about a California Appeals Court decision where the court recognized that a mortgage company/bank suing for foreclosure could not produce the note and had used robo-signing on documents.
The court lambasted the bank and awarded considerable damages to the former homeowners – the house had been foreclosed on years earlier and sold.
The decision set off a barrage of Internet invective and off the wall speculation – i.e., use this case as a template, end up with a free house.
There’s a lot wrong with this. First, maybe foremost, the decision in this case is based solely on on the facts of the case. It’s not your Starbucks card, it’s not transferable. Second, this decision represents years of litigation and immense legal fees.
Then there’s the free house. You know, scare off the mortgage company, make them so flummoxed by the legal brilliance you’ve taken from your careful reading of the California decision and stop them in their tracks.
Perfect, right? Well, perfect only in the sense that you and your family and your descendants want to live in the house forever. Because ,that’s what you’re signing up for.
I’ve heard of someone in Central Connecticut who has, indeed, pulled this off. Has so intimidated the mortgage company and mortgage company lawyers that they defaulted on his case and walked away.
He got his house. In name only. What he doesn’t have and never will have is a clear title. He does not pay a mortgage, he does pay property taxes. He cannot do any of the things people with clear title can do – sell, refinance, nothing.
The free house isn’t really free. It’s a ticking time bomb and it’s an anchor … unless they are willing to walk away from it. Then it’s the neighbors’ problem.