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Volume 25 - Number 7

March 31, 2014

‘Zombie’ Foreclosures on Radar of CFPB, NY AG Schneiderman

The CFPB is beginning to look into abandoned properties and the phenomenon known as “zombie” foreclosures, a top bureau official indicated recently. “The term zombie foreclosure refers to a situation in which a borrower has moved out of a home after the lender has started a foreclosure,” according to attorney Michael Waldron, a partner and practice leader of the mortgage banking unit at Ballard Spahr. However, “because the lender did not complete the foreclosure, title was never officially transferred and remains with the borrower, who may be unaware that the foreclosure was never completed.”

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With rates higher this year, there has been talk of lenders liberalizing their underwriting standards in an effort to increase volume and make up for lower refis.

Do you think your shop will loosen standards over the coming three months?

Yes, but not by much.


Yes, by a lot.


Yes and, heck, we may even do non-QM lending.


No, not at all.


No and we may even tighten credit.