Will the robo-signing foreclosure mess topple the housing market?

Foreclosure sign in front of a house
Foreclosure sign in front of a house

Will a paperwork snafu -- which is what lenders would like you to believe is the problem -- topple the housing market? Sadly, it very likely could.

The issue is that thousands of people lost their homes when the guy who was supposed to review and sign off on the lenders' paper case against the homeowner didn't actually do his job. Nor was the notary who was supposed to actually witness the guy's signature even in the room. Short cuts taken by overworked clerks, we're told. Fair enough, except the lenders weren't fulfilling their legal obligations to process foreclosures. When the stakes are as high as someone losing their home, maybe it isn't such a good idea to take shortcuts, you think?