A court case has brought into question the validity of title to foreclosure property, recently. Michael Shepard, board legal counsel, penned the following:
“…the validity of title to foreclosure property has come into question as a result of a case from the US Court First Circuit entitled Mark R. Thompson v JP Morgan Chase. The Case clearly calls into question the validity of title to foreclosed property. The Court ruled that the notices used by all of the banks are defective because the Court rules them as deceptive. Their decision has turned the sale of REO property upside down. If a real estate person has a client buying at a foreclosure sale or buying property from a bank that is REO, they need to advise their client to immediately contact their real estate lawyer to address the Thompson issue. What I am trying to forestall is Buyers spending money on application, appraisal or inspection when the property’s title is not marketable.
This case will be as difficult to deal with as the previous cases that we struggled with in the foreclosure market. The Title companies and the lawyers will have to address each case on a case-by-case basis as to whether or not the property is saleable.
I know all of you think I am an “old maid” because I recommend everybody buy Owner’s Title Insurance. If a person bought property and the title has come into question, an Owner’s Title Policy may very well help.
Michael J. Shepard, PC
55 Church Street
Pittsfield, MA 01201
You can read further about the Mark R. Thompson v JP Morgan Chase case here.