Banks are Keen to Bring Down the Public Notices Required for Foreclosures

The bankers are attempting to cut down the mandated requirement of public notices prior to foreclosing. This has drawn flak from groups of housing advocates, activists and open-government entities. The bankers think that there are too many public notices required and these are too expensive.

The legislators of Tennessee State are being pressurized by the Tennessee Bankers Association to get a bill passed that would bring the number of public notices the law mandates prior to foreclosing. The bankers are arguing that the present rule of three advertisements is too much and too expensive.

But the opponents starting from AARP to the advocates involved in cases pertaining to foreclosures are up in arms against the bill. They contend that it would remove the very few protections that the house owners have in the state as here the foreclosure process is for them dangerously simple.

Lawyer Steve Baker of Nashville who is frequently engaged by the banks to be a trustee in foreclosure cases is however opposing the bill. He said, "It’s almost like you’re squeezing the golden goose to death by slimming it down too much".

The debate is focusing on the fundamentals of foreclosure laws in Tennessee. It is one of five states where court review is not necessary for a foreclosure sale. The matter is treated like a business transaction between the bankers and the house owners.

One of the few mandates in the law is that that the lenders have to publish foreclosure notice three times in any local newspaper. Banks want to make snips to the details of the information regarding the property as put in the listings and also reduce the frequency of the insertions in the newspapers to only one.

Some of the state legislators and the banks are arguing that frequent advertisements are confusing apart from the fact that these are hardly read; all it does is add to the foreclosure expenses. Rep Jimmy Matlock of the state said, "The only people that are guaranteed to get paid are the newspapers". Matlock is the prime sponsor of the bill in the state’s House of Representatives.

Those against the bill say that the cost of advertising is negligible compared to the amount of dollars involved in the process of foreclosure. Insertions in newspapers are the only broad way that the general community can come to know of what is happening. It also attracts more bidders to the sale and the hope of getting a better price for the property.