Toxic Titles | D.C.’s foreclosure investigation freezes home sales for months

D.C.’s foreclosure investigation freezes home sales for months

Sales of foreclosed houses in the District ground to a halt for months as the city’s investigation into the foreclosure process scared away title insurers who didn’t want the risk associated with the property.

And although the D.C. Office of the Attorney General is now sorting out the confusion, the stalemate has left some prospective homebuyers embittered and frustrated. “For lack of better words I’m in limbo until this gets straightened out,” said Kevin, who declined to give his last name because he is still trying to buy the home.

He has been living in a hotel since he moved to the region for a job three months ago. “I can’t place the blame on the title insurers,” Kevin added.

“It used to be a risk-free type of insurance — now everyone’s make claims against the title.”

Todd Ewing, president of Federal Title & Escrow Co., said the attorney general’s investigation into the filing process behind D.C. foreclosures led insurance underwriters to believe the risk of insuring the title on a foreclosed home would be too high.

“Quite frankly we’re just turning away that business,” Ewing said. “The requirements and the extent of work that has to be done to insure title is beyond what we can profit out of the transaction.”

Read more at the Washington Examiner…


3 Responses to “Toxic Titles | D.C.’s foreclosure investigation freezes home sales for months”
  1. l vent says:

    Why don’t they just come out with the truth. The only one most likely with a clear title to the properties is the owner’s who’s paid off deed has been stamped and recorded paid in full since origination and also has the mortgage and note stamped and recorded paid as well. No doubt there was probably never and assignment made to the deed which makes the mortgage and note not only unsecured but makes the banks UNABLE TO LEGALLY FORECLOSE . It is time to put a NATIONWIDE MORATORIUM ON ALL FRAUDCLOSURES AND GIVE THE HO– USES BACK TO THE PEOPLE WHO OWN THEM. It is time to stop ALL FRAUDCLOSURES AND FRAUDCLOSURE SALES. The only one with a CLEAR INSURED TITLE IS THE OWNER. Come on Washington, the jig has been up for a long time REGARDING FORECLOSUREGATE. None of this debt was EVER SECURITIZED. All of the FRAUD needs to stop now before things get any more out of hand than they already are.

  2. John R. says:

    Just being a good citizen here… I Googled “mortgage title insurance (my city and state) and grabbed their email addresses and sent them a copy of this page. Wouldn’t want them insuring “Toxic Titles”! Probably wouldn’t hurt if others did it too. It is, after all, the civic minded right thing to do!

  3. Michael says:

    Title insurance .. no risk.

    This article makes me wonder why borrowers were forced to purchase title insurance while investors weren’t? Why not buy title insurance for all the titles those MBS/CDO’s were supposed to have. Especially since the homes were supposed to be covered by borrowers these policies would have been really cheap; almost negligible. But they skipped it, unless they did and I never heard of it. Almost like the title insurers knew that insuring baskets, with investors that had the deep pockets to pursue real claims, could cost them a fortune eventually.

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