The Court of Appeals of Maryland, the state’s highest court, recently held that a real estate development company’s recording of a declaration for utility infrastructure expenses did not create a lien on the referenced real estate, and instead it should have followed the Maryland Contract Lien Act procedures to create a lien and establish its priority for the delinquent assessments purportedly owed by a mortgagee. A copy of the opinion in Select Portfolio Servicing, Inc. v. Saddlebrook West Utility Company, LLC is available at: Link to Opinion. A real estate development company purchased land for a 330-lot residential development and…
Posts published in “Mortgage Banking Foreclosure Law”
Mortgage Banking Foreclosure Law
The U.S. Court of Appeals for the Ninth Circuit recently held that the Federal Foreclosure Bar’s prohibition on nonconsensual foreclosure of assets of the Federal Housing Finance Agency preempted Nevada’s superpriority lien provision and invalidated a homeowners association foreclosure sale that purported to extinguish Freddie Mac’s interest in the property. A copy of the opinion in Berezovsky v. Bank of America is available at: Link to Opinion. In 2013, an investor purchased a home at a homeowners association foreclosure sale for $10,500 and recorded a deed in his name. The purchaser argued that Nevada’s superpriority lien provision, Nev. Rev. Stat. § 116.3116,…
In an unpublished ruling, the U.S. Court of Appeals for the Eleventh Circuit recently held that a mortgage servicer did not violate the federal Real Estate Settlement Procedures Act or its implementing regulation (at 12 C.F.R. § 1024.36(d)(2)(i)(A)) by failing to provide the loan owner’s phone number in response to a borrower’s request for information (“RFI”). In so ruling, the Court also held that: (1) The borrower’s allegation of having expended “certified postage costs of less than $100 for mailing” was not sufficient to meet the requirement of “actual damages” under RESPA at 12 U.S.C. § 2605; and (2) The…
The U.S. Court of Appeal for the Eighth Circuit recently affirmed a bankruptcy court’s rejection of a proof of claim filed by a creditor where the claim was based upon a debt which was time barred by the creditor’s failure to comply with the applicable state law deadline for pursuing a deficiency judgment following a non-judicial foreclosure. A copy of the opinion in Melikian Enterprises, LLLP v. McCormick is available at: Link to Opinion. The underlying debt at issue arose from a commercial loan from the creditor to a company owned by the debtors which was secured by a mortgage against…
The Appellate Court of Illinois, First District, recently reversed a trial court order granting summary judgment in favor of a mortgage servicer and against a condominium association (COA) holding that a material question of fact existed regarding whether the servicer promptly paid assessments that accrued after the foreclosure sale, as required under section 9(g)(3) of the Illinois Condominium Property Act to extinguish the COA’s lien for pre-foreclosure sale assessments. A copy of the opinion in Country Club Estates Condominium Association v. Bayview Loan Servicing, LLC is available at: Link to Opinion. In November 2014, a mortgage servicer purchased a condominium unit…
The U.S. Court of Appeals for the First Circuit recently affirmed the dismissal of a lawsuit by borrowers seeking to enjoin a mortgage foreclosure sale, holding that (a) the original lender’s nominee, MERS, could validly assign the mortgage without holding beneficial title to the underlying property and that borrowers do not have standing to challenge a mortgage assignment based on an alleged violation of a trust’s pooling and servicing agreement; and (b) the mortgage was not void under Massachusetts’s “obsolete mortgage” statute, under which a mortgage becomes obsolete and is automatically discharged five years after the expiration of the stated…
The District Court of Appeal of the State of Florida, Fifth District, recently reversed final judgment of foreclosure entered in favor of a mortgagee that omitted interest and escrow amounts due, and remanded to the trial court to modify judgment to include these amounts. In so ruling, the 5th DCA determined that the mortgagee met its burden to provide the trial court with figures necessary to calculate the interest and escrow amounts through its witnesses’ testimony and evidence. The Court further reversed the trial court’s dismissal of a homeowner’s association as a party to the foreclosure action, concluding that neither…
The U.S. Court of Appeals for the District of Columbia Circuit recently affirmed the dismissal of a borrower’s counterclaims and the entry of summary judgment in the mortgagee’s favor, holding that the borrower failed to state claims (a) for declaratory and injunctive relief for allegedly failing to properly foreclose a deed of trust; (b) for supposedly violating the federal Fair Debt Collection Practices Act (FDCPA); (c) quiet title; (d) for supposedly violating the Fair Credit Reporting Act (FCRA); and (e) civil conspiracy. In so ruling, the Court held that District of Columbia law clearly does not require mediation prior to judicial…
The U.S. Court of Appeals for the Eleventh Circuit recently affirmed a summary judgment ruling in favor of a mortgage servicer, holding that the servicer had no duty to respond to a Qualified Written Request (“QWR”) under the federal Real Estate Settlement Procedures Act (RESPA) because the borrower failed to send the QWR to the servicer’s designated address for QWR receipt. A copy of the opinion in Bivens v. Bank of America, NA is available at: Link to Opinion. A mortgage servicer sent a letter to a borrower advising that the lender transferred the servicing of the borrower’s mortgage loan to…
The Appellate Court of Illinois, Third District, recently rejected a mortgagor’s argument that the Illinois single refiling rule barred a third attempt at foreclosure where the intervening foreclosure complaint was premised upon an alleged default under a loan modification agreement. A copy of the opinion in Wells Fargo Bank, N.A. v. Norris is available at: Link to Opinion. The convoluted procedural and factual history for the mortgage loan at issue in this matter can be boiled down to the following: The defendant mortgagor (who was not a signatory to the promissory note) and his ex-spouse defaulted under the terms of…
The U.S. Court of Appeals for the Fifth Circuit recently held that debts arising from a scheme to deprive mortgagees of surplus foreclosure sale proceeds were non-dischargeable, affirming the bankruptcy court’s judgment against the debtor in consolidated adversary proceedings filed by various lenders that held first mortgage liens. A copy of the opinion in Cowin v. Countrywide Home Loans, Inc. is available at: Link to Opinion. The debtor orchestrated a mortgage fraud scheme by which a straw buyer acquired property subject to a first mortgage at a condominium association’s foreclosure sale. The buyer then entered into a “tax-transfer loan agreement”…
The U.S. Court of Appeal for the Sixth Circuit recently affirmed the dismissal of a municipality’s public nuisance claims against two different mortgage lenders for allegedly maintaining a policy of violating local and state building codes if the costs outweighed the value added to the eventual resale of foreclosed property. A copy of the opinion in City of Cincinnati v. Deutsche Bank National Trust Company is available at: Link to Opinion. The municipality brought multiple claims against the mortgage lender defendants alleging various claims concerning the maintenance and condition of REO properties. Eventually, through multiple amended pleadings, stipulations and settlements, only one…