Let me tell you a story.
My friend was current on his mortgage. Always paid it, often over paid.
One day his Mom called and said that his house was up for auction on the courthouse steps for “non payment of loan”. My friend had the check stubs.
Seems that the title was sold to three (3) different firms. All thought they had bought the loan, two of which were not getting paid and tried to foreclose.
Oh, and the company my friend was paying the loan to? Didn’t
Have the loan. Hadn’t for three years by that point.
It took him 18 months and thousands of dollars to get sorted out, and he is still worried that the title is clouded. During the court case, no one was able to actual figure out who had the actual loan.
That happens more than you might think...
Here’s a case where BOA forclosed on a house that was bought with cash and never had a mortgage:
Reverse Foreclosure: Man Seizes Bank of America’s Assets -
http://www.consumerismcommentary.com/reverse-foreclosure-man-seizes-bank-of-americas-assets/