RC'53, why wouldn't a bank be able to produce an original deed? If they didn't have the original, who would have it? The county?
As a side note, has the owner of the house where you are living been paying the property taxes? What would happen if he didn't?
(Excuse my ignorance on these matters, I've never owned a house in this country.)
How are you surviving with no jobs?
The bank would not be able to produce a deed because, obvious reason: they don't have it. This is surprisingly common after the recent run up. With loans being sold so frequently and even securitized, in all the hyper-financing, banks got pretty sloppy in doing the requisite recordings, in just generally making sure their paperwork was in order. With the loans changing hands so fast and frequently, the notion of getting the deed fell by the wayside.
The same mentality perhaps as no-doc loans led to no-deed loans
This tactic of requesting the deed is actually quite effective and not all that new. Judges invariable rule against foreclosure filings if you can't produce the deed (as they should).
It's not without problems, however, as you can't exactly ever 'own' the property yourself, since the deed is lost somewhere, no one can deed it to you. Of course the county should have a recording too, but if a chain of banks haven't been doing the paperwork, that last recorded title could be from several banks ago, which could still be a bank with no valid claim (they sold it, just the bank they sold it to has no record, etc). It gets ugly. You'll never 'own,' but it's definitely free rent.
I been living in a house that the owner has not made
any mortgage payments for about a year.
To date, the bank has not sent any notice of
foreclosure. The owner says that he will challenge any
foreclosure in court asking the bank to produce the
the original property deed. Courts are ruling against
the banks if they cannot produce the original deed
to foreclose on property. The owner, including
myself, and others, have been without jobs since
last December.
My 2 cousins and their respective husbands are doing the exact same thing. Both couple had the homes, lost jobs, fell behind, etc etc. This is in Sacramento, CA, probably the worst area in California in terms of value lost. So, the banks don't want these things, they can't sell them at auction.
The bank has actually
told them to stay. It makes sense if you think about it, as they'd rather have someone living there maintaining the property than the place becoming a derelict and the county forcing them to pay to maintain the house or pay to tear it down. Having 'tenants' (in quotes because they don't pay) is better than the property being unoccupied.
They'll have to be careful though, these banks, as squatters actually do have rights, and more importantly, those living in the property and not foreclosed upon will have a
laches defense, which has worked in the past believe it or not
(*not* to be confused with statutes of limitations!)My .02