That the mortgage foreclosure crisis has gotten out of hand shouldn't be news to anyone at this point. Record numbers of homeowners have increasingly found themselves facing foreclosure at the hands of lender banks.
What is somewhat unique, however, is then those big banks file suit and institute foreclosure proceedings ... on themselves.
What is somewhat unique, however, is then those big banks file suit and institute foreclosure proceedings ... on themselves.
Forbes reported today that banking and mortgage-lending giant Bank of America has sued itself no less than nine times in the month of April alone, and all in a single state.
This isn't the first time this has happened, of course, as one can find reports surface every so often of a big banking and lending institution that lacks oversight of its massive paperwork filing and ends up naming itself in foreclosure pleadings.
In the current Florida case, The Huffington Post reports that Bank of America “is seeking to foreclose on a condominium and names the condo owner and Bank of America as defendants in the suit. The company is literally seeking damages from itself in order to foreclose on the condo owner.”
In response to inquiries by HuffPost, a BofA representative said, “We are servicing the first mortgage on behalf of an investor and we own the second mortgage,” Bank of America spokeswoman Jumana Bauwens told HuffPost. “Naming the second-lien holder in the suit is necessary to eliminate the junior interest.”
Lawyer and fraud expert Lynn Szymoniak thought it sounded like simple “poor lawyering” on behalf of BofA, stating “Someone was likely looking at the records to find anyone who could possibly have interest in the foreclosure suits. Bank of America probably owned the second mortgage and because they were using people who were simply filling out forms rather than using brain matter they just listed everyone including the bank itself.”
Szymoniak points to a legal maxim requiring adverse parties to a piece of litigation to be truly adverse -- a rule which might be violated in this instance.
Regardless of any technical impropriety, however, this case certainly suggests that the vast amount of paperwork required of law firms processing the innumerable foreclosures on behalf of banks and investors has become overwhelming.
While this creates inefficiencies and costs incurred on behalf of the banks and mortgage companies, as well as the service providers and law firms that support them, it also can lead to very real costs for the homeowners who find themselves facing foreclosure and having to defend these actions in court. Homeowners are already at a competitive disadvantage when dealing with multi-national banking institutions -- a true David and Goliath situation if there ever was one. And coming up with the funds to hire an attorney to fight a wrongful foreclosure can be difficult enough. Add in having to pay for your own lawyer's time to make sense of and deal with filings and pleadings filed back and forth by identical parties on opposite sides of the case, and it's no wonder the reputations of the big banks have taken a hit.
This isn't the first time this has happened, of course, as one can find reports surface every so often of a big banking and lending institution that lacks oversight of its massive paperwork filing and ends up naming itself in foreclosure pleadings.
In the current Florida case, The Huffington Post reports that Bank of America “is seeking to foreclose on a condominium and names the condo owner and Bank of America as defendants in the suit. The company is literally seeking damages from itself in order to foreclose on the condo owner.”
In response to inquiries by HuffPost, a BofA representative said, “We are servicing the first mortgage on behalf of an investor and we own the second mortgage,” Bank of America spokeswoman Jumana Bauwens told HuffPost. “Naming the second-lien holder in the suit is necessary to eliminate the junior interest.”
Lawyer and fraud expert Lynn Szymoniak thought it sounded like simple “poor lawyering” on behalf of BofA, stating “Someone was likely looking at the records to find anyone who could possibly have interest in the foreclosure suits. Bank of America probably owned the second mortgage and because they were using people who were simply filling out forms rather than using brain matter they just listed everyone including the bank itself.”
Szymoniak points to a legal maxim requiring adverse parties to a piece of litigation to be truly adverse -- a rule which might be violated in this instance.
Regardless of any technical impropriety, however, this case certainly suggests that the vast amount of paperwork required of law firms processing the innumerable foreclosures on behalf of banks and investors has become overwhelming.
While this creates inefficiencies and costs incurred on behalf of the banks and mortgage companies, as well as the service providers and law firms that support them, it also can lead to very real costs for the homeowners who find themselves facing foreclosure and having to defend these actions in court. Homeowners are already at a competitive disadvantage when dealing with multi-national banking institutions -- a true David and Goliath situation if there ever was one. And coming up with the funds to hire an attorney to fight a wrongful foreclosure can be difficult enough. Add in having to pay for your own lawyer's time to make sense of and deal with filings and pleadings filed back and forth by identical parties on opposite sides of the case, and it's no wonder the reputations of the big banks have taken a hit.
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