Can A Botched Notarized Signature On The Deed of Trust Be A Viable Foreclosure Defense? Law Offices of Kenny Tan Attorneys Diamond Bar California

Can A Botched Notarized Signature On The Deed of Trust Be A Viable Foreclosure Defense?

Posted by: Kenny Tan
October 29, 2011
Topic: Foreclosure

The recent California appellate decisions made it pretty clear that trying to stop a foreclosure based upon a procedural defect in the origination of of the loan or the foreclosure process is difficult.

If there's anyone out there who still believes that problems with MERS or botched assignment of the securitized mortgage can be weapons to stop foreclosure, I think they're either ill informed or have not been keeping up with the latest court decisions. In 2008 and 2009, there was a lot of excitement over the In Re Walker case about MERS issue and botched assignment; certainly there was cause to be excited if you're a borrower because this issue was hardly addressed in state courts. But in the last quarter there had been at least 3 decisions that touched upon these issues that came down against the borrowers. Now that's disheartening for borrowers trying to stay in their homes but its a hard cold truth.

Recently I stumbled across an issue relating to a flaw in the notarization of signatures on the deed of trust on a case involving a seller-financed purchase (which has nothing to do with securitzed mortgages or MERS) but it may be raised as a possible defense if lenders, private or institutional, try to foreclose on your property based on a defective security instrument.

I remember coming across several deeds of trust that had not been property acknowledged back in the crazy days of mid 2000s. Signatures were forged because the notary public neglected to perform their official duties or even complicit with the lenders in procuring forged signatures.

In California, it is a crime to participate in any forgery in the acknowledgment of a deed of trust. Forged deeds of trusts are void and cannot be used to foreclose on a property.

There are notaries who let others maintain control of their notary stamps to create forged documents. There are also others who would sign false affidavit attesting the witness signed the deeds of trust in their presence when in fact they had never even met the witness. This type of illegal activity was not uncommon in the mid to late 2000s.

Probably a botched notarization of a deed of trust can be used as a ground to stop a foreclosure whether or not there is actual fraud involved. All you need to prove is a flaw in the notarization process.

I had expected to receive more phone calls about this issue but I just don't hear people complaining much about it - though I know the process was pretty sloppy back then.