Foreclosure actions on more than 80 percent of residential mortgages in San Francisco have some sort of error that is a legal violation, according to the city's Assessor-Recorder.
The errors vary, but a majority are paperwork problems. These types of errors are not criminal, as they are typically oversights, according to the report.
However, the problems suggest that the state's regulations on residential real estate may need a serious overhaul. The issues were discovered after consumers who were near foreclosure came to the Assessor-Recorder when attempting to refinance their home loan, as they needed the property records.
"When it became clear that property records were severely undermined, a red flag was raised," said Phil Ting, Assessor-Recorder for San Francisco. "Those records are supposed to be filed with this office and many were simply missing or had serious inconsistencies."
The issue may be present in more places than just San Francisco. The significant percentage of properties with errors reinforces the need for lenders to rely on thorough title searches and title insurance.