Abandoned Homes In "Legal Limbo" Hinder Real Estate Recovery In Weaker Markets: Fed

Reuters reports:

• The recovery of many U.S. low income areas remains stymied as lenders decide completing some foreclosures simply isn't worth the cost, casting many properties into "legal limbo," Federal Reserve Governor Elizabeth Duke said on Wednesday. [...] "Many community organizations have been frustrated by the difficulties of working with mortgage lenders and servicers, and these problems are even more exaggerated in weaker market cities," Duke said in prepared remarks.

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• In some neighborhoods, lenders do not even complete foreclosures because the cost of the process exceeds the value of the home, Duke said. "Anecdotal evidence suggests that these 'toxic titles' have placed significant numbers of properties in a difficult state of legal limbo," she said.

For the story, see Fed's Duke: "toxic titles" foiling housing recovery.

See also, The Washington Independent: The Fed Is (Finally) Talking About Toxic Titles.