Docstoc

Real Estate Closing Document Example

Document Sample
Real Estate Closing Document Example Powered By Docstoc
					  ACTUAL CASE: FLOW FROM REAL ESTATE CLOSING TO FORECLOSURE

               At Real Estate Closing:                                                Notes: Required documents
               Borrower signs:                     GB Company sells                   before foreclosing entity
               • Promissory Note                   Promissory Note to                 (attorney) can legally foreclose:
               promising to pay                    Nations Bank                       • Original (not copy) wet ink
               GB Company                          (Security deed should be           promissory note signed by
               • Security Deed or Deed             transferred with Note)             borrower at closing endorsed
               of Trust (deed to secure                                               (signed/notarized) in sequence
               debt)                                                                  from the mortgagee to the
                                                                                      foreclosing party. Or, absolute
                                                                                      proof of loss of note (per UCC
    America Servicing Company (owned by                 Note is bundled with          Section 3-309).
    Wells Fargo) buys Servicing Rights                  other Notes to make           • Assignments of Beneficial
    (responsible for collecting money for the           a securities package          Interest in Deed to Secure Debt
    promissory note holder.)                            Mortgage Backed               – in sequence - from mortgagee
    ASC failed to respond to borrower who               Securities (MBS’s)            to foreclosing entity
    offered full payment – rushed to                                                  • Signed and notarized Deed of
    foreclosure. Request for promissory note                                          Trust or Security Deed (with
                                                              Multiple bundles of
    (legally required by attorneys to foreclose)                                      recording information)
                                                              MBS’s are packaged
    denied.borrower.                                          into Collateralized     • Copy of modifications of the
                                                              Mortgage Obligations    Note (with recording
                                                              (CMO’s)                 information).
Fraudulent Document                                                                   • Accurate accounting of
Recorded in Cobb County:                                  CMO                         payments and charges.
Assignment of Beneficial                                                              • Security Deed or Deed of
Interest in Security Deed --                       MBS        MBS                     Trust has to have a legitimate
from MERS to Wells Fargo                                                              Power of Sale provision.
                                                   MBS        MBS                     CAUTION: Why is it the
Associate attorneys from the                                                          Borrower's right to demand proof
foreclosing law firm McCalla                                                          that the foreclosing entity is the
Raymer signed as officers of                        MBS       MBS                     legal noteholder? In the event
MERS. Also Notary did not                                           CMO’s Sold        the judge allows a "copy" to be
witness signatures. Stamp                                           to Investors      submitted, the Borrower will
dated > 4 years from date                                           and               be at risk because the original
signed.                                                             Investment        noteholder could later come
                                                                    Houses            forward demanding payment.

American Home Mortgage             Mortgage Electronic
buys Servicing Rights              Registration Systems                 Investment Houses:
(responsible for collecting        (MERS):                              Bear Stearns
money for the promissory           Electronic registry formed by        Leaman Brothers               Government
note holder.)                      heads of mortgage banking            Goldman Sachs                   Bailout
                                   industry to track ownership          Merrill Lynch
                                   and servicing rights in              Other Investors:
                                   mortgages. Avoids fees               Deutche Bank
Irwin Mortgage buys                associated w/ recording in           Groups of banks
Servicing Rights                   public registry.                     Private Individuals
(responsible for collecting
money for the promissory           MERS registers Security              Important:
note holder.)                      Deed or Deed of Trust                These Investors are
                                   (deed to secure the note)            supposed to hold the
                                   while servicing rights are           original Promissory
                                   transferred from one entity to       Note signed at closing,
                                   the other. It never legally          not a copy.
                                   holds the Promissory Note
                                   and therefore has no
                                   beneficial interest in the
                                   Note. (See Exhibit on
                                   MERS)

				
DOCUMENT INFO
Description: Real Estate Closing Document Example document sample