In the wake of the foreclosure crisis that swept the nation, a new issue came about in the fall of 2010 that would impact lenders across the board and that was the robo-signing scandal. The term robo-signing can mean many different things, but collectively it means the process of mass producing false signatures and illegal execution of forged affidavits and other documentation related to mortgage foreclosure. The impact of robo-signing on a foreclosure defense case can be huge if it is discovered that the homeowner has been served with improperly executed paperwork.
In Judicial States where foreclosures are served, the lender must submit documents and a signed affidavit by the person at the bank who has reviewed and verified the documents being submitted who believes that the facts are true. It was discovered that in many cases the bank employees signing the affidavits did not personally review the documents but they signed the affidavit anyway. Many bank employees testified that they spent on average about 30 seconds on each affidavit they signed which is where the term robo-signers came from.
A foreclosure cannot be legally served to a homeowner if the foreclosure paperwork is not correct. If the lender submits an affidavit that is false, then it cannot legally take possession of the property. Unfortunately for many homeowners, lenders have foreclosed on thousands of properties illegally, but with the discovery of the robo-signing scandal, judges in judicial states are taking a much closer look at the paperwork being submitted before signing off on a foreclosure. In non-judicial states, homeowners can file a lawsuit against the bank to stop the foreclosure process.
The importance of keeping your documentation in order is crucial for cases like this. After you have hired an attorney for your foreclosure defense case, they will be able to review the documentation to see if you have been a victim of robo-signing. If this turns out to be the case, the court will, in most cases, be more than willing to call into question the banks foreclosure paperwork. This will increase your chances of winning your foreclosure defense case against your lender.