[SK in CV]

[quote=patb]does anyone see this as important?[/quote]

Potentially. But I find it hard to believe that the courts will simply allow the voiding of tens of thousands of mortgages. I think the decision to use MERS was made in good faith, though that certainly doesn’t make it a decision that is supported by law. It does kind of follow some other court decisions finding that MERS has a standing problem. It’s a mess. I am curious whether there are states with similar laws that will follow. It is important.

It wouldn’t, by the way, void the notes, only the security interests, converting the secured notes into unsecured notes. It would stop ordinary foreclosures and probably lead to more bankruptcies. I wonder what the DC homesteading laws are like.

[SK in CV]

[quote=patb]does anyone see this as important?[/quote]

Potentially. But I find it hard to believe that the courts will simply allow the voiding of tens of thousands of mortgages. I think the decision to use MERS was made in good faith, though that certainly doesn’t make it a decision that is supported by law. It does kind of follow some other court decisions finding that MERS has a standing problem. It’s a mess. I am curious whether there are states with similar laws that will follow. It is important.

It wouldn’t, by the way, void the notes, only the security interests, converting the secured notes into unsecured notes. It would stop ordinary foreclosures and probably lead to more bankruptcies. I wonder what the DC homesteading laws are like.

[SK in CV]

[quote=patb]does anyone see this as important?[/quote]

Potentially. But I find it hard to believe that the courts will simply allow the voiding of tens of thousands of mortgages. I think the decision to use MERS was made in good faith, though that certainly doesn’t make it a decision that is supported by law. It does kind of follow some other court decisions finding that MERS has a standing problem. It’s a mess. I am curious whether there are states with similar laws that will follow. It is important.

It wouldn’t, by the way, void the notes, only the security interests, converting the secured notes into unsecured notes. It would stop ordinary foreclosures and probably lead to more bankruptcies. I wonder what the DC homesteading laws are like.

[SK in CV]

[quote=patb]does anyone see this as important?[/quote]

Potentially. But I find it hard to believe that the courts will simply allow the voiding of tens of thousands of mortgages. I think the decision to use MERS was made in good faith, though that certainly doesn’t make it a decision that is supported by law. It does kind of follow some other court decisions finding that MERS has a standing problem. It’s a mess. I am curious whether there are states with similar laws that will follow. It is important.

It wouldn’t, by the way, void the notes, only the security interests, converting the secured notes into unsecured notes. It would stop ordinary foreclosures and probably lead to more bankruptcies. I wonder what the DC homesteading laws are like.

[SK in CV]

[quote=Mooki]OK, my mom is not gifting me $25K. I loan her $25K over a few years of helping her out. This is a few thousands here and there. Some are not directly to her but checks to her realtor and persons fixing her house etc. Now she wants to pay me back the money she owes me, either from the proceeds of selling the house or through giving me part of the interest/equity of the house (since the house does not sell). How do we make it clear to the IRS it is a loan repayment and not a “gift”?[/quote]

In that case, a quit claim deed probably wouldn’t be appropriate. You are buying the house (or an interest in it) in exchange for extinguishing the debt. I don’t know about GA laws, but in CA, you would buy the property with a written contract specifying the sales price for the interest you’re buying. Make sure the contract specifies the amount of debt you’ll be assuming in addition to your payment to her. Your payment being the debt being extinguished. (A written contract is required for a sale, but not for a gift.) A grant deed would be more appropriate. It would be a reportable sale for your mother (though not necessarily taxable, she’s entitled to the primary residence exclusion if there is a gain.) The IRS won’t have any problem with it.

[SK in CV]

[quote=Mooki]OK, my mom is not gifting me $25K. I loan her $25K over a few years of helping her out. This is a few thousands here and there. Some are not directly to her but checks to her realtor and persons fixing her house etc. Now she wants to pay me back the money she owes me, either from the proceeds of selling the house or through giving me part of the interest/equity of the house (since the house does not sell). How do we make it clear to the IRS it is a loan repayment and not a “gift”?[/quote]

In that case, a quit claim deed probably wouldn’t be appropriate. You are buying the house (or an interest in it) in exchange for extinguishing the debt. I don’t know about GA laws, but in CA, you would buy the property with a written contract specifying the sales price for the interest you’re buying. Make sure the contract specifies the amount of debt you’ll be assuming in addition to your payment to her. Your payment being the debt being extinguished. (A written contract is required for a sale, but not for a gift.) A grant deed would be more appropriate. It would be a reportable sale for your mother (though not necessarily taxable, she’s entitled to the primary residence exclusion if there is a gain.) The IRS won’t have any problem with it.

[SK in CV]

[quote=Mooki]OK, my mom is not gifting me $25K. I loan her $25K over a few years of helping her out. This is a few thousands here and there. Some are not directly to her but checks to her realtor and persons fixing her house etc. Now she wants to pay me back the money she owes me, either from the proceeds of selling the house or through giving me part of the interest/equity of the house (since the house does not sell). How do we make it clear to the IRS it is a loan repayment and not a “gift”?[/quote]

In that case, a quit claim deed probably wouldn’t be appropriate. You are buying the house (or an interest in it) in exchange for extinguishing the debt. I don’t know about GA laws, but in CA, you would buy the property with a written contract specifying the sales price for the interest you’re buying. Make sure the contract specifies the amount of debt you’ll be assuming in addition to your payment to her. Your payment being the debt being extinguished. (A written contract is required for a sale, but not for a gift.) A grant deed would be more appropriate. It would be a reportable sale for your mother (though not necessarily taxable, she’s entitled to the primary residence exclusion if there is a gain.) The IRS won’t have any problem with it.

[SK in CV]

[quote=Mooki]OK, my mom is not gifting me $25K. I loan her $25K over a few years of helping her out. This is a few thousands here and there. Some are not directly to her but checks to her realtor and persons fixing her house etc. Now she wants to pay me back the money she owes me, either from the proceeds of selling the house or through giving me part of the interest/equity of the house (since the house does not sell). How do we make it clear to the IRS it is a loan repayment and not a “gift”?[/quote]

In that case, a quit claim deed probably wouldn’t be appropriate. You are buying the house (or an interest in it) in exchange for extinguishing the debt. I don’t know about GA laws, but in CA, you would buy the property with a written contract specifying the sales price for the interest you’re buying. Make sure the contract specifies the amount of debt you’ll be assuming in addition to your payment to her. Your payment being the debt being extinguished. (A written contract is required for a sale, but not for a gift.) A grant deed would be more appropriate. It would be a reportable sale for your mother (though not necessarily taxable, she’s entitled to the primary residence exclusion if there is a gain.) The IRS won’t have any problem with it.

[SK in CV]

[quote=Mooki]OK, my mom is not gifting me $25K. I loan her $25K over a few years of helping her out. This is a few thousands here and there. Some are not directly to her but checks to her realtor and persons fixing her house etc. Now she wants to pay me back the money she owes me, either from the proceeds of selling the house or through giving me part of the interest/equity of the house (since the house does not sell). How do we make it clear to the IRS it is a loan repayment and not a “gift”?[/quote]

In that case, a quit claim deed probably wouldn’t be appropriate. You are buying the house (or an interest in it) in exchange for extinguishing the debt. I don’t know about GA laws, but in CA, you would buy the property with a written contract specifying the sales price for the interest you’re buying. Make sure the contract specifies the amount of debt you’ll be assuming in addition to your payment to her. Your payment being the debt being extinguished. (A written contract is required for a sale, but not for a gift.) A grant deed would be more appropriate. It would be a reportable sale for your mother (though not necessarily taxable, she’s entitled to the primary residence exclusion if there is a gain.) The IRS won’t have any problem with it.

[SK in CV]

Good catch flu.

[quote=flu][quote=joec][quote=bearishgurl][quote=joec]I’ve always wondered, are there gift taxes since the equity is worth over 13k or it’s different for real estate?[/quote]

There is no “gift” here. The equity is unrealized. Sharing title to real property with a family member in the form of a quitclaim deed is not a “gift.”

–This post should not be construed as legal advice and I am not an attorney.-[/quote]

This is still confusing to me since I’m sure giving someone stock (non-sold/unrealized gains) is definitely a gift as well as automobiles, stock options (also unrealized), a collectible collection or pretty much anything else.

Is it simply just real property then? What about investment property or business interest in properties?[/quote]

BG, are you sure this is correct, since it seems like most of the other sources indicate otherwise that quit claim deeds would trigger gifting if the value was greater than $13k?

I mean, this seems like it would be a huge loophole if it weren’t the case. If I were rich, I could buy a $5million property in cash, add my daughter to the deed, and simply quit claim on it, and she gets the home with no estate tax implications??? That doesn’t sound right and I thought there was an IRS pub about this….
Can’t find it right now…But, here was one of many articles that described the same thing http://www.selfgrowth.com/articles/quitclaim_deed_and_mortgage_transfer.html

http://en.allexperts.com/q/Tax-Law-Questions-932/2008/5/quit-claim-deed-2.htm

Now, considering the tax implications of doing a quitclaim, well, if you sign over the deed, you’re the grantor and hence it’s your liability to pay taxes. If you quitclaim property without taking any money in return from your father, the transfer is regarded as a gift and the value of the gift will be the value of the property at the time of the transfer (here the value has appreciated). Now, if the value of the gift does not exceed the annual exclusion limit of $12000 (for 2008) per year per person then the donor (here it’s you) need not pay federal tax on the gift.

However, if the value of the gift exceeds $12000 and you have already given up $1,000,000 in gifts in total till now in your life, you’ll have to pay the federal gift tax. Otherwise you need not have any tax liability as such upon transfer of property. The total gift amount of $1,000,000 is the lifetime exemption for paying federal gift tax.

While the value of the gift at the time of transfer helps you decide whether to pay gift tax, it enables the recipient, your father, to determine if a deduction is available when he sells the property at a loss.

One thing though. I was wrong about preserving prop tax for children. While CA Prop 13 doesn’t say anything about preserving property tax when property is transferred to kids, prop 58 DOES allow one to transfer property from parent to kid without a reassessment, and prop 193 also allows transfers from grandparents to grandkids without a reassessment.[/quote]

A transfer by quit claim deed is absolutely a gift. If the equity is more than $13,000, then it is a reportable gift, and the grantor (the mother) is required to file a gift tax return. If her lifetime gifts are less than the $1,000,000 lifetime exemption, then there will be no tax to pay. It sounds as if that is the case. So there really aren’t any gift tax issues other than possibly the necessity of filing a relatively simple gift tax return.

The tax basis for the grantee is the lower of the grantors cost or current market value plus any gift taxes paid. So if mom paid more than it’s currently worth, the depreciation is still based on the lower current market value, not the higher cost. If she paid less, then the lower basis is used for depreciation purposes.

(I’ve seen the argument made that the taxable gift is the full value of the property since the debt is not legally being transferred. I think it’s a rediculous argment, but I really don’t know if it has ever been litigated. Sounds as if that still wouldn’t make it an issue based on the value of the property.

[SK in CV]

Good catch flu.

[quote=flu][quote=joec][quote=bearishgurl][quote=joec]I’ve always wondered, are there gift taxes since the equity is worth over 13k or it’s different for real estate?[/quote]

There is no “gift” here. The equity is unrealized. Sharing title to real property with a family member in the form of a quitclaim deed is not a “gift.”

–This post should not be construed as legal advice and I am not an attorney.-[/quote]

This is still confusing to me since I’m sure giving someone stock (non-sold/unrealized gains) is definitely a gift as well as automobiles, stock options (also unrealized), a collectible collection or pretty much anything else.

Is it simply just real property then? What about investment property or business interest in properties?[/quote]

BG, are you sure this is correct, since it seems like most of the other sources indicate otherwise that quit claim deeds would trigger gifting if the value was greater than $13k?

I mean, this seems like it would be a huge loophole if it weren’t the case. If I were rich, I could buy a $5million property in cash, add my daughter to the deed, and simply quit claim on it, and she gets the home with no estate tax implications??? That doesn’t sound right and I thought there was an IRS pub about this….
Can’t find it right now…But, here was one of many articles that described the same thing http://www.selfgrowth.com/articles/quitclaim_deed_and_mortgage_transfer.html

http://en.allexperts.com/q/Tax-Law-Questions-932/2008/5/quit-claim-deed-2.htm

Now, considering the tax implications of doing a quitclaim, well, if you sign over the deed, you’re the grantor and hence it’s your liability to pay taxes. If you quitclaim property without taking any money in return from your father, the transfer is regarded as a gift and the value of the gift will be the value of the property at the time of the transfer (here the value has appreciated). Now, if the value of the gift does not exceed the annual exclusion limit of $12000 (for 2008) per year per person then the donor (here it’s you) need not pay federal tax on the gift.

However, if the value of the gift exceeds $12000 and you have already given up $1,000,000 in gifts in total till now in your life, you’ll have to pay the federal gift tax. Otherwise you need not have any tax liability as such upon transfer of property. The total gift amount of $1,000,000 is the lifetime exemption for paying federal gift tax.

While the value of the gift at the time of transfer helps you decide whether to pay gift tax, it enables the recipient, your father, to determine if a deduction is available when he sells the property at a loss.

One thing though. I was wrong about preserving prop tax for children. While CA Prop 13 doesn’t say anything about preserving property tax when property is transferred to kids, prop 58 DOES allow one to transfer property from parent to kid without a reassessment, and prop 193 also allows transfers from grandparents to grandkids without a reassessment.[/quote]

A transfer by quit claim deed is absolutely a gift. If the equity is more than $13,000, then it is a reportable gift, and the grantor (the mother) is required to file a gift tax return. If her lifetime gifts are less than the $1,000,000 lifetime exemption, then there will be no tax to pay. It sounds as if that is the case. So there really aren’t any gift tax issues other than possibly the necessity of filing a relatively simple gift tax return.

The tax basis for the grantee is the lower of the grantors cost or current market value plus any gift taxes paid. So if mom paid more than it’s currently worth, the depreciation is still based on the lower current market value, not the higher cost. If she paid less, then the lower basis is used for depreciation purposes.

(I’ve seen the argument made that the taxable gift is the full value of the property since the debt is not legally being transferred. I think it’s a rediculous argment, but I really don’t know if it has ever been litigated. Sounds as if that still wouldn’t make it an issue based on the value of the property.

[SK in CV]

Good catch flu.

[quote=flu][quote=joec][quote=bearishgurl][quote=joec]I’ve always wondered, are there gift taxes since the equity is worth over 13k or it’s different for real estate?[/quote]

There is no “gift” here. The equity is unrealized. Sharing title to real property with a family member in the form of a quitclaim deed is not a “gift.”

–This post should not be construed as legal advice and I am not an attorney.-[/quote]

This is still confusing to me since I’m sure giving someone stock (non-sold/unrealized gains) is definitely a gift as well as automobiles, stock options (also unrealized), a collectible collection or pretty much anything else.

Is it simply just real property then? What about investment property or business interest in properties?[/quote]

BG, are you sure this is correct, since it seems like most of the other sources indicate otherwise that quit claim deeds would trigger gifting if the value was greater than $13k?

I mean, this seems like it would be a huge loophole if it weren’t the case. If I were rich, I could buy a $5million property in cash, add my daughter to the deed, and simply quit claim on it, and she gets the home with no estate tax implications??? That doesn’t sound right and I thought there was an IRS pub about this….
Can’t find it right now…But, here was one of many articles that described the same thing http://www.selfgrowth.com/articles/quitclaim_deed_and_mortgage_transfer.html

http://en.allexperts.com/q/Tax-Law-Questions-932/2008/5/quit-claim-deed-2.htm

Now, considering the tax implications of doing a quitclaim, well, if you sign over the deed, you’re the grantor and hence it’s your liability to pay taxes. If you quitclaim property without taking any money in return from your father, the transfer is regarded as a gift and the value of the gift will be the value of the property at the time of the transfer (here the value has appreciated). Now, if the value of the gift does not exceed the annual exclusion limit of $12000 (for 2008) per year per person then the donor (here it’s you) need not pay federal tax on the gift.

However, if the value of the gift exceeds $12000 and you have already given up $1,000,000 in gifts in total till now in your life, you’ll have to pay the federal gift tax. Otherwise you need not have any tax liability as such upon transfer of property. The total gift amount of $1,000,000 is the lifetime exemption for paying federal gift tax.

While the value of the gift at the time of transfer helps you decide whether to pay gift tax, it enables the recipient, your father, to determine if a deduction is available when he sells the property at a loss.

One thing though. I was wrong about preserving prop tax for children. While CA Prop 13 doesn’t say anything about preserving property tax when property is transferred to kids, prop 58 DOES allow one to transfer property from parent to kid without a reassessment, and prop 193 also allows transfers from grandparents to grandkids without a reassessment.[/quote]

A transfer by quit claim deed is absolutely a gift. If the equity is more than $13,000, then it is a reportable gift, and the grantor (the mother) is required to file a gift tax return. If her lifetime gifts are less than the $1,000,000 lifetime exemption, then there will be no tax to pay. It sounds as if that is the case. So there really aren’t any gift tax issues other than possibly the necessity of filing a relatively simple gift tax return.

The tax basis for the grantee is the lower of the grantors cost or current market value plus any gift taxes paid. So if mom paid more than it’s currently worth, the depreciation is still based on the lower current market value, not the higher cost. If she paid less, then the lower basis is used for depreciation purposes.

(I’ve seen the argument made that the taxable gift is the full value of the property since the debt is not legally being transferred. I think it’s a rediculous argment, but I really don’t know if it has ever been litigated. Sounds as if that still wouldn’t make it an issue based on the value of the property.

[SK in CV]

Good catch flu.

[quote=flu][quote=joec][quote=bearishgurl][quote=joec]I’ve always wondered, are there gift taxes since the equity is worth over 13k or it’s different for real estate?[/quote]

There is no “gift” here. The equity is unrealized. Sharing title to real property with a family member in the form of a quitclaim deed is not a “gift.”

–This post should not be construed as legal advice and I am not an attorney.-[/quote]

This is still confusing to me since I’m sure giving someone stock (non-sold/unrealized gains) is definitely a gift as well as automobiles, stock options (also unrealized), a collectible collection or pretty much anything else.

Is it simply just real property then? What about investment property or business interest in properties?[/quote]

BG, are you sure this is correct, since it seems like most of the other sources indicate otherwise that quit claim deeds would trigger gifting if the value was greater than $13k?

I mean, this seems like it would be a huge loophole if it weren’t the case. If I were rich, I could buy a $5million property in cash, add my daughter to the deed, and simply quit claim on it, and she gets the home with no estate tax implications??? That doesn’t sound right and I thought there was an IRS pub about this….
Can’t find it right now…But, here was one of many articles that described the same thing http://www.selfgrowth.com/articles/quitclaim_deed_and_mortgage_transfer.html

http://en.allexperts.com/q/Tax-Law-Questions-932/2008/5/quit-claim-deed-2.htm

Now, considering the tax implications of doing a quitclaim, well, if you sign over the deed, you’re the grantor and hence it’s your liability to pay taxes. If you quitclaim property without taking any money in return from your father, the transfer is regarded as a gift and the value of the gift will be the value of the property at the time of the transfer (here the value has appreciated). Now, if the value of the gift does not exceed the annual exclusion limit of $12000 (for 2008) per year per person then the donor (here it’s you) need not pay federal tax on the gift.

However, if the value of the gift exceeds $12000 and you have already given up $1,000,000 in gifts in total till now in your life, you’ll have to pay the federal gift tax. Otherwise you need not have any tax liability as such upon transfer of property. The total gift amount of $1,000,000 is the lifetime exemption for paying federal gift tax.

While the value of the gift at the time of transfer helps you decide whether to pay gift tax, it enables the recipient, your father, to determine if a deduction is available when he sells the property at a loss.

One thing though. I was wrong about preserving prop tax for children. While CA Prop 13 doesn’t say anything about preserving property tax when property is transferred to kids, prop 58 DOES allow one to transfer property from parent to kid without a reassessment, and prop 193 also allows transfers from grandparents to grandkids without a reassessment.[/quote]

A transfer by quit claim deed is absolutely a gift. If the equity is more than $13,000, then it is a reportable gift, and the grantor (the mother) is required to file a gift tax return. If her lifetime gifts are less than the $1,000,000 lifetime exemption, then there will be no tax to pay. It sounds as if that is the case. So there really aren’t any gift tax issues other than possibly the necessity of filing a relatively simple gift tax return.

The tax basis for the grantee is the lower of the grantors cost or current market value plus any gift taxes paid. So if mom paid more than it’s currently worth, the depreciation is still based on the lower current market value, not the higher cost. If she paid less, then the lower basis is used for depreciation purposes.

(I’ve seen the argument made that the taxable gift is the full value of the property since the debt is not legally being transferred. I think it’s a rediculous argment, but I really don’t know if it has ever been litigated. Sounds as if that still wouldn’t make it an issue based on the value of the property.

[SK in CV]

Good catch flu.

[quote=flu][quote=joec][quote=bearishgurl][quote=joec]I’ve always wondered, are there gift taxes since the equity is worth over 13k or it’s different for real estate?[/quote]

There is no “gift” here. The equity is unrealized. Sharing title to real property with a family member in the form of a quitclaim deed is not a “gift.”

–This post should not be construed as legal advice and I am not an attorney.-[/quote]

This is still confusing to me since I’m sure giving someone stock (non-sold/unrealized gains) is definitely a gift as well as automobiles, stock options (also unrealized), a collectible collection or pretty much anything else.

Is it simply just real property then? What about investment property or business interest in properties?[/quote]

BG, are you sure this is correct, since it seems like most of the other sources indicate otherwise that quit claim deeds would trigger gifting if the value was greater than $13k?

I mean, this seems like it would be a huge loophole if it weren’t the case. If I were rich, I could buy a $5million property in cash, add my daughter to the deed, and simply quit claim on it, and she gets the home with no estate tax implications??? That doesn’t sound right and I thought there was an IRS pub about this….
Can’t find it right now…But, here was one of many articles that described the same thing http://www.selfgrowth.com/articles/quitclaim_deed_and_mortgage_transfer.html

http://en.allexperts.com/q/Tax-Law-Questions-932/2008/5/quit-claim-deed-2.htm

Now, considering the tax implications of doing a quitclaim, well, if you sign over the deed, you’re the grantor and hence it’s your liability to pay taxes. If you quitclaim property without taking any money in return from your father, the transfer is regarded as a gift and the value of the gift will be the value of the property at the time of the transfer (here the value has appreciated). Now, if the value of the gift does not exceed the annual exclusion limit of $12000 (for 2008) per year per person then the donor (here it’s you) need not pay federal tax on the gift.

However, if the value of the gift exceeds $12000 and you have already given up $1,000,000 in gifts in total till now in your life, you’ll have to pay the federal gift tax. Otherwise you need not have any tax liability as such upon transfer of property. The total gift amount of $1,000,000 is the lifetime exemption for paying federal gift tax.

While the value of the gift at the time of transfer helps you decide whether to pay gift tax, it enables the recipient, your father, to determine if a deduction is available when he sells the property at a loss.

One thing though. I was wrong about preserving prop tax for children. While CA Prop 13 doesn’t say anything about preserving property tax when property is transferred to kids, prop 58 DOES allow one to transfer property from parent to kid without a reassessment, and prop 193 also allows transfers from grandparents to grandkids without a reassessment.[/quote]

A transfer by quit claim deed is absolutely a gift. If the equity is more than $13,000, then it is a reportable gift, and the grantor (the mother) is required to file a gift tax return. If her lifetime gifts are less than the $1,000,000 lifetime exemption, then there will be no tax to pay. It sounds as if that is the case. So there really aren’t any gift tax issues other than possibly the necessity of filing a relatively simple gift tax return.

The tax basis for the grantee is the lower of the grantors cost or current market value plus any gift taxes paid. So if mom paid more than it’s currently worth, the depreciation is still based on the lower current market value, not the higher cost. If she paid less, then the lower basis is used for depreciation purposes.

(I’ve seen the argument made that the taxable gift is the full value of the property since the debt is not legally being transferred. I think it’s a rediculous argment, but I really don’t know if it has ever been litigated. Sounds as if that still wouldn’t make it an issue based on the value of the property.

[SK in CV]

I think she over-simplifies the problem and, at least in the written version, totally omits one of the key components in the process which as added greatly to the problems. The reason the note and the trust deed aren’t in the file is that after original funding, ownership of the notes (and the security instrument) have been transferred, sometimes multiple times, unually ending up in a securitized trust. That trust, is (almost always) the legal holder in due course of the note and the security instrument. MERS, as a nominee holder of the security instrument, has, overall, done a fine job of keeping track of who owns what. But the responsibility of properly endorsing and forwarding the hard copies of the notes falls to the buyers and sellers of the notes (And not MERS as far as I can tell.) It has always been in the buyers interest to make sure the proper tracking of those documents took place. The responsibility should fall on the backs of the loan servicers (which is a whole different party), but they have failed miserably.

I think she fails to really explain the dating problem with the notes comes in. What appears to have happened is that the foreclosure process is started, based on signed statements that the party foreclosing has full knowledge of the documents. The servicer then tracks down the actual notes (and trust deeds) makes sure that all endorsements are up to date, and adding missing endorsements (apparently sometimes forged, sometimes legal endorsements) but if those endorsements are dated after the foreclosure process has begun, the foreclosure may be invalid, as the foreclosing party did not have standing at the time of the filing. Under normal circumstances, refiling after all endorsements are caught up to date should remedy the situation.

I think she’s wrong on the assertion that buyers may have problems down the line with lenders suddenly appearing claiming to have a claim on the property. They can’t spontaneously own the property. And they can’t initiate foreclosure proceedings on a loan and trust deed that has already been fully reconveyed. They may have a claim against someone else in the chain, but not a subsequent buyer.

This shit is complicated.

[Author]

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