Mortgage assignments still in the news

For 300 years or so, mortgage assignments were fairly innocuous documents but they have been much in the news lately, both because of the "robo-signing" controversy and because of challenges to MERS (Mortgage Electronic Registration System, Inc.).  Recent stories about both caught my attention.

First was a story from a CBS affiliate in Atlanta on efforts bu local housing activists to have those who robo-signed documents criminally prosecuted.  The segment, available online here, included an interview with our own Essex South Register of Deeds John O'Brien who had this to say:

John O'Brien, Register of Deeds for the Southern Essex District in suburban Boston, has uncovered 38,000 fraudulent documents that have been recorded in his office. O'Brien said an outside audit revealed only 16 percent of the assignments in his registry are legitimate. 

"Totally fraudulent. The signatures are fraudulent and the information in some of the documents are fraudulent and they knew this. The banks knew this and the attorneys who processed this know it," O'Brien said. 

O'Brien found many different robosigners penned the same name.

"I can't look people in the eye and tell them who owns their mortgage because their mortgage has been sold so many times," O'Brien said.

"I am someone doing his job and I suspect the people of your state want your register of deeds to do their job," O'Brien said.  

On the MERS front, a US District Court judge in Oregon granted a motion to dismiss a civil complaint brought by a home owner who sought to have his mortgage declared void because the mortgage was held by MERS while the underlying promissory note had been negotiated to another entity without a traditional assignment of mortgage being involved.  The full decision in the case, Oliver v. Delta Financial Liquidating Trust, is available here. 

The effect of foreclosures on neighboring property

What happens to the value of other nearby houses when a property goes into foreclosure?  That's a question investigated by four economists from the Federal Reserve Bank of Boston in a recently released paper.  A story in this morning's Globe brought my attention to the study which can be found in its entirety on the Boston Fed's website.  Since the folks who wrote this are all Ph.D.s in economics, there are many formulas that I don't understand but the Abstract, which I've set out below sets out the findings in pretty clear terms:

In a recent set of influential papers, researchers have argued that residential mortgage
foreclosures reduce the sale prices of nearby properties. We revisit this issue using a more
robust identification strategy combined with new data that contain information on the
location of properties secured by seriously delinquent mortgages and information on the
condition of foreclosed properties We find that while properties in virtually all stages of
distress have statistically significant, negative effects on nearby home values, the magnitudes
are economically small, peak before the distressed properties complete the foreclosure
process, and go to zero about a year after the bank sells the property to a new homeowner.
The estimates are very sensitive to the condition of the distressed property, with a positive
correlation existing between house price growth and foreclosed properties identified as
being in “above average” condition. We argue that the most plausible explanation for these
results is an externality resulting from reduced investment by owners of distressed property.
Our analysis shows that policies that slow the transition from delinquency to foreclosure
likely exacerbate the negative effect of mortgage distress on house prices.

How to REALLY improve the iPhone

I'm really not that excited about the new iPhone 5 Apple is expected to unveil tomorrow. Why? I have owned three iPhones over the past few years and truthfully, not much has changed from the first generation phone to the latest.
Yeah, I heard...the new one might have a bigger display screen and be a little thinner...Wow (sarcasm)

Come on, its time for Apple to really innovate. If I was Apple CEO, Tim Cook I would! In fact here are some of the improvements I would like to see in the new iPhone 5:

I'd like the new iPhone to be equipped with a Taste Bud Assistant. Visualize this...you order a hamburg at Sal's Greeze Spoon. You point your iPhone at your hamburg, snap a picture and the Taste Bud Assistant tells you whether you need to add salt.... Now that's an improvement.

And I'd like the new iPhone to be equipped with a Huddle Includer. Here is how it would work...Say you're watching the Patriots and Brady throws a perfect pass to Wes Welker who drops it (again)...the team huddles, you point your phone at the huddle and shazam, you can hear every word the players say privately...Are you_____ kidding me, Wes. How did you drop that one? I can't _____throw the ball catch it too. Now that's an improvement.


And, I'd like my iPhone to have a Fact Checker. Let's say you are talking to a friend and well, you're not really sure if what he is saying is true...you turn on the Fact Checker and if your friend starts stretching the truth the iPhone buzzes and the automated voices belts out... "liar, liar, liar". Now that's an improvement.

And lastly the new Apple iPhone 5 should be Transformable...I mean, it should be able to take on different shapes. You know, like those Transformer toys kids play with. I carry my iPhone in my shirt pocket. I hate it...so here is what I'm thinking, wouldn't it be great if you could bend and twist your iPhone and shape it into a pair of sunglasses. Then the phone rings and you quickly bend and twist it back into a phone! Now that's an improvement.

If Apple intended to make any of these improvements I would be excited about tomorrow's release of the new iPhone 5...but I doubt it.

Property Sales

A For Sale sign recently appeared in front of a house in my neighborhood and within a few days a "sold" label was added.  I understand that within five days of the house hitting the market, there had been three offers of at least the asking price.  I've heard similar anecdotes from others.  All this is an indicator that the real estate market might be perking up notwithstanding a recent rise in new foreclosures.

To get a better view of what's going on with home sales, I scrolled through the 181 deeds for property in Lowell that have been recorded from August 1st until today.  Here's the breakdown: 100 of the 181 were arms length sales between unrelated parties; 44 involved inter-family transfers for no consideration; 31 involved sales of previously foreclosed properties by banks to third parties; and 6 involved some other type of transaction, typically a business-to-business swap for no consideration.

In the past when I've done this kind of query, the ratio of sales for consideration to sales for no consideration has been closer to one to one.  For the past five weeks, the percentage of arms length sales is up considerably which corroborates the view that housing is picking up a bit.

Register of Deeds election results

There will be some changes in the ranks of the state's registers of deeds come January.  All 21 positions are on the ballot this fall.  Some are running for re-election unopposed but there are three open seats in which nominees were selected yesterday plus  two incumbents lost.  Here are the results of these contested races, all from the Democratic Primary. 

Middlesex South - Incumbent Gene Brune did not seek re-election:
 

Maria Curtatone - 13,908 - 24%
Maryann Heuston - 12,644 - 22%
Thomas Concannon - 9,587 - 17%
Robert Antonelli - 8,923 - 16%
Frank Ciano - 7,494 - 13%
Tiziano Doto - 4,786 - 8%

Hampshire - Interim Register Pat Plaza, who took over when Marianne Donahue retired, did not see election:

 

Mary Olberding - 4,669 - 37%
Bonnie MacCracken - 4,349 - 34%
Timothy O'Leary - 3,619 - 29%

Berkshire Middle - First term incumbent Andrea Nucifuro ran for Congress (losing to Richard Neal):

Patsy Harris - 6,693 - 61%
Jody Phillips - 2,446 - 22%
Scott Pignatelli - 1,832 - 17%

Franklin - First term incumbent Joe Gochinski lost in his re-election effort:

Scott Cote - 5,662 - 68%
Joseph Gochinski - 2,646 - 32%

Essex North - First term incumbent Bob Kelley lost in his re-election effort:

Paul Iannuccillo - 4,675 - 57%
Robert Kelley - 3,499 - 43%

Most of these races and a few others that had no primary opposition will be contested in November, either with Republican candidates or unenrolleds or both.