For an institution that’s had its fair share of PR pitfalls, Bank of America certainly hasn’t been doing itself any favours lately.Now a Bloomington, Fla. couple is crying foul over the lender’s decision to sue them over a home they purchased – in full – nearly a decade before.
Barbara and Rick Borchers told Tampa Bay Online they thought it was somebody’s idea of a joke when they were served with the lawsuit.
“Everyone I tell says, ‘That’s impossible, it’s a scam, somebody is pulling your leg,'” Barbara Borchers said.
But Bank of America wasn’t kidding around. It turns out an error made by the title company the couple hired to close the sale back in 2003 was blocking it from foreclosing on the current owner.
The company had printed the incorrect legal description of the home on the deed, labelling it as a home in a different neighbourhood.
The unsettling part of the story is that the home went through four different owners and passed under the eyeballs of several real estate appraisers that never caught the error.
Typically, homeowners have title insurance to protect themselves against these kinds of mistakes. But the Borchers’ title company is out of business (go figure) which, unfortunately, means it’s their headache to deal with.
Their case underscores the ease with which homeowners can find themselves wrapped up in sticky legal situations over mortgage errors.
The Consumer Financial Protection Bureau’s guide for examiners to investigate mortgage lenders has a whole section outlined on possible mistakes made during the closing process.
It’s such a common area for costly mistakes that Your Money contributor Jason Steele said failing to review closing documents is one of the biggest mortgage snafus homeowners can make.
“It’s easy to dismiss the reams of fine print that accompany every mortgage or refinance,” Steele says. “The best practice is to ask for a copy of the closing documents in advance so that you can take as much time as you need to understand all of it, rather than try to undo what you have already signed. If you don’t have the time or have trouble understanding anything, hire a lawyer. It’s worth the money.”