As is now generally known, Foreclosure False Swearing in Lawsuits has caused a crisis in Mortgage Insurance and in Title Insurance both. See the many recent previous posts here in particular under the Categories of Mortgage Insurance and Title Insurance.
Apropos of proposals for Federal Immunity for Foreclosure False Swearing:
The banks and other players in the securitization industry now seem to be looking to Congress to snap its fingers to make the whole problem go away, preferably with a law that relieves them of liability for their bad behavior. But any such legislative fiat would bulldoze regions of state laws on real estate and trusts, not to mention the Uniform Commercial Code. A challenge on constitutional grounds would be inevitable.
Asking for Congress's help would also require the banks to tacitly admit that they routinely broke their own contracts and made misrepresentations to investors in their Securities and Exchange Commission filings. Would Congress dare shield them from well-deserved litigation when the banks themselves use every minor customer deviation from incomprehensible contracts as an excuse to charge a fee?
Anybody else care to answer that last question?
I will try for an answer: "Heck, yes." Expect a bill or bills to be introduced in the U.S. House of Representatives this week, tabled by the current majority, and passed by the majority to come in January, 2011.
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