Thursday, October 29, 2009

Mortgage debt waived after bank can't find paperwork

Mortgage debt waived after bank can't find paperwork: "Two weeks ago, a bankruptcy court in suburban New York did the formerly unthinkable: It waived a homeowner's mortgage debt after the bank trying to foreclose on the home couldn't submit any proof that it actually had a claim on the property.

According to the New York Times, when lender PHH Mortgage was asked to provide proof that it actually held the deed for the $461,263 mortgage, it couldn't give the judge any records.

Operating on the entirely reasonable principal that someone who claims to possess a piece of paper that gives them ownership to a nearly half-million dollar house should actually have that piece of paper, the judge slapped a stiff and possibly game-changing punishment on the disorganized lender."

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