Foreclosure Freeze Fix? Property Title Warranties

Despite all of the sensational headlines calling for a national foreclosure freeze, the best solution to the fiasco is more centralized than many politicians would have you believe. After all, only one small industry is at the center of the robo-signing foreclosure conundrum that's currently gripping the housing market: Property title companies. Make title companies right, and the problem will fade away.

A quick recap: Recent reports suggest that the Mortgage Electronic Registration Systems (MERS), a computerized database that contains all current property title information, had some procedural flaws when recording and establishing the accurate chain of title on some properties.Since 1997, MERS has registered over 65 million properties.

Some attorneys and elected officials allege MERS (and the banks they represent) bypassed local recording requirements and prohibited borrowers from knowing who really owned their mortgage. Because of this procedural defect in establishing a proper chain of title, any subsequent actions like foreclosure would be initiated using "fraudulent" documents and thus should be thrown out -- hence the calls for a foreclosure freeze.

I believe this is all, in a word, hogwash.