From April 2010 to June 2010, 24% of homes that sold across the nation were foreclosure homes. Many of these foreclosures around the country may now be invalid due to bank paperwork problems. Because of incorrect documents, many major lenders are freezing foreclosures to review the paperwork on file.

The questionable issues are more for people who purchased their home with cash and did not bother with title insurance. There could be no clear dividing line of who has proper title in that case. Because of this lack of clarity, banks are having trouble with these types of transactions, thus they have issued moratoriums on foreclosures.

Check to make sure you have title insurance, which protects homebuyers from any claim made on the property from a previous owner after the transaction has closed. If a previous owner stakes a claim on your house and you have title insurance, the battle is between the previous owner and your title company. Typically the title company will end up settling with the evicted homeowner, not the new buyer. Experts recommend running a check every six months to check for claims if you are thinking of selling soon. If at all in doubt, call the attorney that handled your closing to discuss any problems.