I have read many of the posts in the forums relating to Title Problems in Foreclosure and found the exchange to be insightful.  I happened to get this information this morning and I believe that it contradicts some of the posts that I read earlier.

The District of Columbia has mandated that PROOF OF OWNERSHIP of the debt instrument is a prerequisite to foreclosure:  A portion of the article, which was written by Carrie Bay:

www.dsnews.com/articles/district-of-columbia-mandates-public-filing-lien-holders-for-legal-foreclosures-2010-10-28

Under District law, in contrast to the laws of many states, each deed or other document transferring a mortgage interest must be filed with the Recorder of Deeds within 30 days of execution. This requirement is not satisfied by private tracking of mortgage interests through the Mortgage Electronic Registration Systems (MERS), Attorney General Peter Nickles stressed.

MERS was created to be a paperless property registry to facilitate the quick transfer of mortgages between lenders and the inclusion of the loans in mortgage-backed securities. In certain jurisdictions, MERS has the authority to initiate foreclosures on properties listed in its registry, but in a number of cases, foreclosed homeowners have challenged the naming of the electronic system as mortgagee.

Questions surrounding the registry and assignments of noteholder ownership have garnered even more attention in recent weeks with the discovery of flawed foreclosure processing practices at a number of major servicing shops.

In a statement issued this week, District Attorney General Nickles noted that notices of foreclosure issued to defaulted homeowners requires identification of the noteholder, and he warned that when the proper recording of the deed is not followed by the foreclosing party, it is a blatant violation of the District’s Consumer Protection Procedures Act.

“A homeowner should not be misled into believing that a threatened foreclosure is supported by the District’s public records when it is not,” Nickles said.

The attorney general said he may consider bringing enforcement actions to stop foreclosure proceedings and seek restitution for consumers if foreclosures “continue to be commenced or pursued with deceptive foreclosure sale notices.”

The District of Columbia’s legislative Council is scheduled to deliberate a bill on November 2, which would mandate mediation sessions between lenders and delinquent homeowners before a foreclosure could proceed. The bill also includes language requiring lenders to rent foreclosed properties back to the borrowers on which they foreclosed.

Interestingly, I also received a copy of a bulletin from a friend who writes for FNF with new underwriting requirements for insuring property derived through Mortgage/Deed of Trust Foreclosures.  Among other things that must be acquired by the title agent from the foreclosure is file is:

A certified true copy of the deed of trust note, front and reverse sides AND original exhibited at time of settlement. It is extremely important that we be able to confirm that the foreclosing lender is the proper owner of the indebtedness secured by the Deed of Trust being foreclosed.

I am not too familier with DC having only just started to do some work in the District but I do know that they have much more stringent rules relating to foreclosures and tenants in possession, and now this. 

The statements made by Mr. Nickles fly smack in the face of the some of the others posts I read this morning as they relate to MERS.