Wells Fargo and U.S. Bancorp have lost a major court case in Massachusetts that could have profound effects on how foreclosure cases proceed nationwide. The Supreme Judicial Court of Massachusetts voided the seizure of two homes by the banks because the banks had “failed to make the required showing that they were the holders of the mortgages at the time of foreclosure.” Associate Justice Robert Cordy declared that the banks demonstrated “utter carelessness” in documenting their rights to the properties. The short-term effects of the decision are that Mark and Tammy LaRace will be able to stay in their home, despite the fact that it was foreclosed upon in 2007, and Antonio Ibanez will have the title of his home returned to him. If the bank will not allow him to retake possession of the home, then it will have to pay him for his deed. The decision was applied retroactively, meaning thousands of homeowners could seek recovery for homes that were wrongfully foreclosed upon. Analysts worry, however, about the economic costs of the decision, suggesting that it could make selling homes more difficult.
This is one of those days I love my home state. Michael Moore was right, “stay in your homes.” Wells Fargo is probably the most abusive, racist, redlining lender. And those seeking redress of grievances? There’s a lot you can accomplish before giving up on the law.