Purchasing a home in foreclosure always requires extra due diligence, but the recent controversy over the validity of document reviews by loan servicing representatives raises additional concerns for buyers who need to be certain they are getting clear title to the property. Several big banks in September put foreclosures on hold, particularly those in the 23 states that use a judicial process that requires lenders to petition a court for permission to foreclose. The banks admitted to widespread robo-signing, through which overloaded loan servicing representatives authorized tens of thousands of court papers each month without checking the underlying documents.

The District of Columbia is a nonjudicial jurisdiction, so foreclosures there were not affected. In Maryland, foreclosures follow a judicial process, while in Virginia lenders have the option of using either the judicial or nonjudicial form.