Bankruptcy Courts: Foreclosing? Prove It . . .

The foreclosure mess has now entered a new phase, courtesy of the US Bankruptcy courts. The Trustees are forcing institutions to prove “they even have the right to foreclose at all.”

This is a positive development.

In my various writings on the Fraudclosure debacle, I have not suggested we want to see foreclosures of defaulted mortgagees stopped. To the contrary, Foreclosures (done right) are a necessary part of the RE unwind. My position has been very simple; Banks must follow the law, respect property rights and due process. Oh, and not commit perjury or fraud, and if they did, they must suffer criminal prosecution like any other suspected felon.

Here’s Gretchen Morgenson on the latest twist in this pathetic sage:

http://www.nytimes.com/2010/11/28/business/28gret.html?_r=1

http://www.ritholtz.com/blog/2010/11/bankruptcy-courts-forec...