Proper documentation is the cornerstone of real estate law. A purchase or sale dispute will often arise if improper or invalid documentation is filed, and court actions that bring the validity of documents into question can have far-reaching consequences. Readers in Worcester, Massachusetts, may have heard about how a guilty plea by the founder of DocX could affect foreclosure documents in the state. Anyone looking to address a real estate dispute should strive to understand about the importance of document validity and how the plea may affect the standing of the property in question.
The CEO and founder of DocX, a "robo-signing" company that created and signed mortgage transfer documents for large banks, pleaded guilty to a charge of conspiracy to commit mail and wire fraud late last year. The plea deal enables the court to force payment of restitution to fraud victims.
The register of deeds for the Southern District of Essex County, Massachusetts, has requested $1.3 million to help it sort and replace mortgage documents that have come into question due to the guilty plea. The district has identified 10,567 documents filed by DocX that may not be valid. These documents involve the sale or transfer of existing mortgages as well as other real estate transactions.
People around the country were negatively affected by banks employing "robo-signing" tactics to quickly process foreclosures and mortgage transfers. It is good that Essex County is doing something about it.
Source: The Salem News, "Southern register seeks $1.3M restitution," Douglas Moser, Jan. 21, 2013