The U.S. Court of Appeals for the Ninth Circuit recently amended its opinion in Ho v. ReconTrust Co., maintaining and affirming its prior ruling that the trustee in a California non-judicial foreclosure did not qualify as a debt collector under the federal Fair Debt Collection Practices Act (FDCPA). The amendments to the prior ruling among other things add that a California mortgage foreclosure trustee meets the FDCPA’s exclusion from the term “debt collector” for entities whose activities are “incidental to … a bona fide escrow arrangement” at 15 U.S.C. § 1692a(6)(F). The Ninth Circuit also removed its prior discussion of…
Posts published in “Foreclosure”
The County Court of the Nineteenth Judicial Circuit in and for St. Lucie County, Florida recently dismissed a borrower’s amended complaint against a mortgage servicer alleging violations of the Florida Consumer Collection Practices Act (FCCPA) for sending mortgage statements to the borrower following involuntary dismissal, without prejudice, of a foreclosure action. In dismissing the action with prejudice, the Court held that the statements sent by the defendant mortgage servicer were not attempts to collect a debt, and therefore not actionable under the FCCPA. In addition, the Court held that the plaintiff borrower failed to state a cause of action because…
The U.S. Bankruptcy Court for the Middle District of Alabama recently held that a mortgage servicer did not violate the discharge injunction in 11 U.S.C. § 524 by sending the discharged borrowers monthly mortgage statements, delinquency notices, notices concerning hazard insurance, and a notice of intent to foreclose. Moreover, because the borrowers based their claims for violation of the federal Fair Debt Collection Practices Act, 15 U.S.C. § 1692, et seq., on the violation of the discharge injunction, the Court also dismissed their FDCPA claims with prejudice. A copy of the opinion in Golden et al v. Carrington Mortgage Services,…
The U.S. Court of Appeals for the Ninth Circuit recently affirmed the Bankruptcy Appellate Panel’s determination that a creditor’s pre-bankruptcy, non-recourse lien on two debtors’ real property is extinguished following a non-judicial foreclosure sale. A copy of the opinion in In re: Salamon is available at: Link to Opinion. In April 2009, two debtors purchased real property. Rather than fund the purchase price and pay off the two existing liens on the real property, the debtors executed a wrap-around mortgage in favor of the property seller. The debtors then funded the balance of the purchase price with a note secured…
The Appellate Court of Illinois, First District, recently held that an allonge was “affixed” to a note for purposes of the Illinois Uniform Commercial Code (UCC) when it was attached via paper clip. A copy of the opinion in Olive Portfolio Alpha, LLC v. 116 West Hubbard Street, LLC is available at: Link to Opinion. The plaintiff note owner (“assignee”) filed a mortgage foreclosure action against the defendant borrower seeking the foreclosure of a commercial property. The borrower filed a motion to dismiss for alleged lack of standing. The motion was denied in part and granted in part “as to…
The District Court of Appeal of Florida for the Fourth District recently denied a borrower’s motion for appellate attorney’s fees in a contested foreclosure, holding that the reciprocity provision of section 57.105(7), Florida Statutes, does not apply where the borrower prevails based on lack of standing, unless the plaintiff mortgagee was also the original lender. A copy of the opinion in Nationstar Mortgage LLC, etc. v. Marie Ann Glass, et al. is available at: Link to Opinion. The trial court dismissed with prejudice a mortgagee’s amended foreclosure complaint, and the plaintiff mortgagee appealed. The mortgagee voluntarily dismissed the appeal, and…
The Appellate Court of Illinois, First District, recently held that the provisions of the Illinois mortgage foreclosure statute barred the borrowers from filing a post-judgment petition to vacate the entry of a personal deficiency judgment in a foreclosure action, because the borrowers’ petition was not based upon the lack of personal jurisdiction and the borrowers’ petition did not seek relief in the form of claiming an interest in the proceeds of the sale. A copy of the opinion in BMO Harris Bank National Association v. LaRosa is available at: Link to Opinion. The borrowers defaulted on their mortgage loan resulting…
The Circuit Court of the Eleventh Judicial Circuit in and for Miami-Dade County, Florida recently dismissed a second foreclosure complaint, filed more than five years after the initial complaint and alleging the same incident of default, as barred by the statute of limitations. In so ruling, the Court also held that the borrower’s daughter and sole beneficiary to the property encumbered by a reverse mortgage had standing to assert the statute of limitations defense. A copy of the opinion in Reverse Mortgage Solutions, Inc. v. Estate of Ruby Hayes is available at: Link to Opinion. In October 2007, a borrower…
The District Court of Appeal of the State of Florida, Fourth District, recently held that a creditor may obtain a post-foreclosure deficiency judgment against a borrower when the borrower was personally served with process in the post-foreclosure deficiency action, and the fact that the foreclosure court only acquired in rem jurisdiction due to service by publication in the prior foreclosure did not matter. In addition, the Appellate Court held that section 702.06, Florida Statutes, which governs deficiency judgments, is unambiguous and allows a separate suit to recover a deficiency where the foreclosure judgment did not adjudicate a claim for a…
The Appellate Court of Illinois, First District, recently reversed a summary judgment ruling in favor of a mortgagee on its post-foreclosure forcible entry and detainer claim, finding genuine disputes as to material facts where the tenant presented evidence that she was a qualified tenant under the Chicago Protecting Tenants in Foreclosed Rental Property Ordinance, and that the mortgagee did not pay her the $10,600 relocation assistance fee required by the ordinance. A copy of the opinion in Wells Fargo Bank, N.A. v. McCondichie is available at: Link to Opinion. A mortgagee became the owner of the subject property pursuant to…
The U.S. Court of Appeals for the Second Circuit recently reinstated a complaint alleging a debt collector violated the federal Fair Debt Collection Practices Act when it sent a payoff statement containing unaccrued fees and costs without providing any information as to how those fees were calculated or any basis for those fees and costs. In so ruling, the Second Circuit was careful to note that a payoff statement may contain estimated fees and costs if the information in the statement would allow the least sophisticated consumer to determine the minimum amount she owed at the time of the notice,…
The Appellate Court of Illinois, Second District, recently held that a mortgagee with a foreclosure judgment could not collect on the deficiency against rents from other properties owned by the mortgagor, because the mortgagee’s foreclosure judgment was not superior to the prior recorded mortgages for the other properties which contained assignment-of-rent clauses, and the other mortgagees had executed forbearance agreements to enforce those assignment-of-rents clauses. A copy of the opinion in BMO Harris Bank N.A. v. Joe Contarino, Inc. is available at: Link to Opinion. In 2013, a bank, acting as the assignee of the FDIC, foreclosed on four mortgages…