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I have personal experience with this back before the 2008 crash. I owned a house along with someone else, an okay house, bought it for $115,000, held onto it f

I have personal experience with this back before the 2008 crash. I owned a house along with someone else, an okay house, bought it for $115,000, held onto it for 5 years, until it appreciated to $350,000 in those hurly-burly days. At some point, and I forgot why it came up, we needed to figure out who owned the loan. And we never did. It the morass of paper work and nearly fraudulent claims by various people who claimed to own the loan, we stopped paying on the loan. We literally had more than one company claim to own it at one point. What was weird is it was kind of a slow burn, even after we stopped paying. No one really seemed to care as much as you'd think $900 a month would make you care. In the end, we sold the house, never paid off the remaining debt, and split the cash. I told my lawyer I'd hold onto savings to cover the debt if they ever came back and could legally claim it.. It's been 11 years. Nothing yet.

user5994461 8y ago
I don't understand how is that possible to not know about a home loan. Didn't you have to open the loan when you bought the home? Don't you know what banked you dealt with?
- setr 8y ago
  the loan was presumably sold off, and then again, and again, and again... and suddenly there was divergence, and it was sold off yet some more
- dorfsmay 8y ago
  Loans and mortgages were sold by the banks to other companies: https://en.wikipedia.org/wiki/Mortgage-backed_security https://en.wikipedia.org/wiki/Mortgage-backed_security A lot of mortgages changed hands several times, the original bank who setup the mortgage would have no longer been involved at that point. That doesn't explain how OP was able to get the lien on the land title removed when they sold the house.
  - user5994461 8y ago
    It's weird to me. You need to know who to pay the mortgage to. The bank would have to notify you immediately when and whom they sell the mortgage to if they ever sell. Unless they don't notify you on purpose to continue to receive the monthly payment, while cashing out on the resale, in which case that's fraud. I can also imagine that the next buyer would try to pull the same trick. That obviously causes a problem. It seems to be what happened in the US, in which case everyone should check their mortgage to make sure who owns it.
    - blacksqr 8y ago
      You don't make payments to the lender. You make payments to a payment servicer hired by the lender. Until midway through the Obama administration, nobody had any obligation to notify you if your mortgage was bought or sold. Payment servicers had no obligation to tell you who they were forwarding your checks to. Your mortgage could be bought and sold multiple times, but as long as the same servicer was used, you'd never know (there were/are only a few big servicers). If the mortgage buyer used a different servicer, you'd get a letter from your current servicer about the new servicer you should send your checks to, but no info about who now owned your mortgage.
      - user5994461 8y ago
        Thank you very much for the explanation.
      - tgb 8y ago
        I see how that could mean that the borrower might not know who owns the loan, but surely the payment servicer knows? Would they simply not tell you, even if you asked?
        blacksqr 8y ago
        Exactly. The servicers existed to serve as a smoke screen for mortgage securitization shenanigans. The servicers sent the payments to trusts that had dubious possession of the mortgages. Trusts and banks passed ownership of mortgages amongst themselves, though tax law was supposed to prevent them from doing so. Ultimately the servicers had no more idea of who actually owned the mortgages than the homeowners.
hermitdev 8y ago
Doesn't really surprise me. Bank debt trading is messed up. Everything is mostly done by fax. Things don't happen quickly. Time is measured in months. Source: I was IT support (among other hats I wore) for the band debt team at a hedge fund for 7 years at a previous job. We held about $20B in notional debt running up to the 2008 crash. Was not a fun time to be in the industry.
- gehwartzen 8y ago
  Can confirm; my wife has worked the past five years in the foreclosure department at Suntrust Mortgage and every case she told me about took months to resolve. Finding the “true” owner of the loan routinely involved tracing the sale through 7+ other investors, each time faxing back and forth tons of documents, resulting in reams of paperwork for lawyers and courts to sift through. It’s quite a mess :/
bertjk 8y ago
That is interesting, but isn't there a point in the house selling process where they look for every party that might have an interest in the house and such? I mean I think that is part of the chunk of paperwork that realtors / title search companies or whatever do, right? What happened then?
- jcoffland 8y ago
  The paperwork that realtors and title companies do is a joke. When we bought our house I signed close to a hundred documents. Many of which were the same. Some documents were repeated 3 or 4 times. It's all a game where they try to convince you how grand and thorough and official the whole processes is. It made me realize how incompetent the banks really are.
  - oihoaihsfoiahsf 8y ago
    Well, you buy title insurance so that even if the process wasn't thorough enough you don't lose a whole bunch of money. https://en.wikipedia.org/wiki/Title_insurance https://en.wikipedia.org/wiki/Title_insurance
    - DubiousPusher 8y ago
      That's the idea but it's a lot more complicated than, I buy a title search, I buy title insurance. I'm covered 100%.
    - fredophile 8y ago
      The insurance companies aren't stupid. It's not quite as easy as just paying some money for the insurance and being done. Normally title insurance is something you pay once and it's valid as long as you continue to own the property. When I bought my current place my real estate lawyer had to do a bunch of digging because there was some ambiguity in some documents 3-4 owners back. The title insurance company would only offer insurance for 1 year if this ambiguity wasn't resolved.
  - WalterBright 8y ago
jpmattia 8y ago
> In the end, we sold the house, How did the bank lien from the mortgage get handled in the sale?
- kevmo 8y ago
  I am also interested in hearing about this. I guess they guaranteed good title, but kept money (earning enough interest?) in case the bank comes knocking?
  - iteriteratedone 8y ago
    Hes a rich fuck ... sold it to a relative. California is a shithole
  - redleggedfrog 8y ago
    Yes, I just talked to the person who I owned it with, and this is their recollection. We could transfer the title, but we were on the hook for the the mortgage. I'm pretty sure there wasn't a lien on the property. Pretty funny you mentioned the interest. In the 11 years it's been like $50.00, since I keep it in just a regular account (instead of CDs or whatever).
    - MertsA 8y ago
      >I'm pretty sure there wasn't a lien on the property Which country was this in? Banks don't typically hand people hundreds of thousands of dollars without making sure that they'll get their pound of flesh when things go south. Not having any kind of collateral is a pretty big mistake on the bank's side.
    - kevmo 8y ago
      If a bank sues you, they will be making claims for various damages. One of those damages will probably be projected interest they would have made from re-lending the money that wasn't being paid. The debt could also be subject to a state of limitations, and you could potentially be clear. If its been 11 years, I would ask a lawyer about it. You may be able to safely use the money you've left set aside.

user5994461 8y ago

I don't understand how is that possible to not know about a home loan. Didn't you have to open the loan when you bought the home? Don't you know what banked you dealt with?

setr 8y ago
the loan was presumably sold off, and then again, and again, and again... and suddenly there was divergence, and it was sold off yet some more
dorfsmay 8y ago
Loans and mortgages were sold by the banks to other companies: https://en.wikipedia.org/wiki/Mortgage-backed_security https://en.wikipedia.org/wiki/Mortgage-backed_security A lot of mortgages changed hands several times, the original bank who setup the mortgage would have no longer been involved at that point. That doesn't explain how OP was able to get the lien on the land title removed when they sold the house.
- user5994461 8y ago
  It's weird to me. You need to know who to pay the mortgage to. The bank would have to notify you immediately when and whom they sell the mortgage to if they ever sell. Unless they don't notify you on purpose to continue to receive the monthly payment, while cashing out on the resale, in which case that's fraud. I can also imagine that the next buyer would try to pull the same trick. That obviously causes a problem. It seems to be what happened in the US, in which case everyone should check their mortgage to make sure who owns it.
  - blacksqr 8y ago
    You don't make payments to the lender. You make payments to a payment servicer hired by the lender. Until midway through the Obama administration, nobody had any obligation to notify you if your mortgage was bought or sold. Payment servicers had no obligation to tell you who they were forwarding your checks to. Your mortgage could be bought and sold multiple times, but as long as the same servicer was used, you'd never know (there were/are only a few big servicers). If the mortgage buyer used a different servicer, you'd get a letter from your current servicer about the new servicer you should send your checks to, but no info about who now owned your mortgage.
    - user5994461 8y ago
      Thank you very much for the explanation.
    - tgb 8y ago
      I see how that could mean that the borrower might not know who owns the loan, but surely the payment servicer knows? Would they simply not tell you, even if you asked?
      - blacksqr 8y ago
        Exactly. The servicers existed to serve as a smoke screen for mortgage securitization shenanigans. The servicers sent the payments to trusts that had dubious possession of the mortgages. Trusts and banks passed ownership of mortgages amongst themselves, though tax law was supposed to prevent them from doing so. Ultimately the servicers had no more idea of who actually owned the mortgages than the homeowners.

hermitdev 8y ago

Doesn't really surprise me. Bank debt trading is messed up. Everything is mostly done by fax. Things don't happen quickly. Time is measured in months. Source: I was IT support (among other hats I wore) for the band debt team at a hedge fund for 7 years at a previous job. We held about $20B in notional debt running up to the 2008 crash. Was not a fun time to be in the industry.

gehwartzen 8y ago
Can confirm; my wife has worked the past five years in the foreclosure department at Suntrust Mortgage and every case she told me about took months to resolve. Finding the “true” owner of the loan routinely involved tracing the sale through 7+ other investors, each time faxing back and forth tons of documents, resulting in reams of paperwork for lawyers and courts to sift through. It’s quite a mess :/

bertjk 8y ago

That is interesting, but isn't there a point in the house selling process where they look for every party that might have an interest in the house and such? I mean I think that is part of the chunk of paperwork that realtors / title search companies or whatever do, right? What happened then?

jcoffland 8y ago
The paperwork that realtors and title companies do is a joke. When we bought our house I signed close to a hundred documents. Many of which were the same. Some documents were repeated 3 or 4 times. It's all a game where they try to convince you how grand and thorough and official the whole processes is. It made me realize how incompetent the banks really are.
- oihoaihsfoiahsf 8y ago
  Well, you buy title insurance so that even if the process wasn't thorough enough you don't lose a whole bunch of money. https://en.wikipedia.org/wiki/Title_insurance https://en.wikipedia.org/wiki/Title_insurance
  - DubiousPusher 8y ago
    That's the idea but it's a lot more complicated than, I buy a title search, I buy title insurance. I'm covered 100%.
  - fredophile 8y ago
    The insurance companies aren't stupid. It's not quite as easy as just paying some money for the insurance and being done. Normally title insurance is something you pay once and it's valid as long as you continue to own the property. When I bought my current place my real estate lawyer had to do a bunch of digging because there was some ambiguity in some documents 3-4 owners back. The title insurance company would only offer insurance for 1 year if this ambiguity wasn't resolved.
- WalterBright 8y ago

jpmattia 8y ago

> In the end, we sold the house, How did the bank lien from the mortgage get handled in the sale?

kevmo 8y ago
I am also interested in hearing about this. I guess they guaranteed good title, but kept money (earning enough interest?) in case the bank comes knocking?
- iteriteratedone 8y ago
  Hes a rich fuck ... sold it to a relative. California is a shithole
- redleggedfrog 8y ago
  Yes, I just talked to the person who I owned it with, and this is their recollection. We could transfer the title, but we were on the hook for the the mortgage. I'm pretty sure there wasn't a lien on the property. Pretty funny you mentioned the interest. In the 11 years it's been like $50.00, since I keep it in just a regular account (instead of CDs or whatever).
  - MertsA 8y ago
    >I'm pretty sure there wasn't a lien on the property Which country was this in? Banks don't typically hand people hundreds of thousands of dollars without making sure that they'll get their pound of flesh when things go south. Not having any kind of collateral is a pretty big mistake on the bank's side.
  - kevmo 8y ago
    If a bank sues you, they will be making claims for various damages. One of those damages will probably be projected interest they would have made from re-lending the money that wasn't being paid. The debt could also be subject to a state of limitations, and you could potentially be clear. If its been 11 years, I would ask a lawyer about it. You may be able to safely use the money you've left set aside.