Frivolous Mortgage Putback Claims May Hamper Proceedings

By Kyle Chezum Updated on 11/30/2010

11/30/2010

Investors demanding that banks buy back mortgages founded on faulty paperwork may be shooting themselves in the foot by exploiting paperwork errors.  In the wake of the foreclosure fraud scandal, some investors have made putback demands over minor typographical errors, presumably expecting that a document with any kind of error is grounds for a refund.

This likely won’t turn out to be the case.  As more and more demands are brought against banks, determining which claims are significant and which are frivolous will become that much harder and will slow the entire process down.

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