When someone decides to “strategically default” on the mortgage and allow the mortgage company to foreclose on their home; I always counsel the client to stay in the home until the Sheriff’s Sale has been confirmed. The homeowner maintains all rights and obligations of the home until the deed is transferred to the new owner. The following story illustrates why I counsel my clients to stay in their home until the end.
An Ohio judge has ordered Fannie Mae to pay restitution to neighbors living near a foreclosed home after finding the mortgage giant guilty of housing code violations.
Judge Raymond Pianka of Cleveland’s Municipal Housing Court is holding a hearing on Thursday to determine whether neighbors suffered economic losses because of the home in disrepair, National Public Radio reports. He is also pursuing the same, “somewhat radical judicial tactic” in the case of a Utah company that owns a condemned home in the city, the story says.
Critics say court-ordered restitution in foreclosure cases could scare off much needed investors. The Cleveland Plain Dealer also criticized the idea in an editorial that said the judge “risks overstepping the bounds of impartiality.” Cleveland housing officials should instead use their “enforcement teeth” to “hold foreclosure carpetbaggers accountable,” the editorial says.
Lawyers for Fannie Mae say there is a question of whether it owned the property at the time of the code violations.
