Category Archives: Foreclosure

Subscribe to Foreclosure RSS Feed

Ruling Eases Lenders’ Path to Deficiency Judgments in NC

Winning a deficiency judgment following foreclosure may become less costly for lenders following a May 5 ruling by the North Carolina Supreme Court in United Community Bank v. Wolfe. Reversing a previous ruling by the Court of Appeals, the Supreme Court held that a borrower may not defeat summary judgment simply by filing a sworn … Continue Reading

Recent Cases Highlight Latest Potential Foreclosure Evidentiary Pitfall

Over the last few years, financial institutions have been forced to modify their policies and procedures to ensure that they are able to demonstrate compliance with notice provisions contained in residential mortgages prior to initiating foreclosure actions. Several recent decisions have addressed the issue of whether sufficient evidence was presented to establish that the creditor … Continue Reading

A Bankruptcy Discharge Makes a Face-to-Face Meeting an Act in Futility

Just last fall, we wrote about the Eleventh Circuit’s decision in In re Failla, Case No., in our article, “The Eleventh Circuit has spoken: Debtors who surrender property must get out of the creditor’s way.” Now, it appears that the discharge of a debtor’s mortgage loan in bankruptcy has other implications as well, including eliminating … Continue Reading

Appellate Court Reverses Course on Lis Pendens Effect on Post Judgment Liens

UPDATE: On rehearing, the appellate court held that all liens placed on property between a final judgment of foreclosure and judicial sale are discharged by Florida statute. Specifically, the court recognized that the sale discharges all liens, whether recorded before final judgment or after, if the lienor does not intervene in the action within 30 days … Continue Reading

The Looming Student Debt Crackdown: Compliance and Enforcement Lessons from the Foreclosure Crisis

Given the parallels between the current student loan debt crisis (including the CFPB, Illinois and Washington’s recent lawsuits against Navient) and the foreclosure crisis of 2010-14, now is a good time to reflect on the lessons learned from past experience. From our experience negotiating comprehensive deals with regulators, advising companies on how to comply in … Continue Reading

No Free Houses—Florida Supreme Court Approves Fifth DCA’s Bartram Decision and Extension of Singleton v. Greymar

The mortgage industry scored a significant victory last week when the Florida Supreme Court released its decision in Bartram v. U.S. Bank, N.A. broadly approving of the approach taken by the Fifth District Court of Appeal and other courts in addressing the application of the statute of limitations in the context of an action for … Continue Reading

Florida Appellate Court Rules Lis Pendens Does Not Bar Post Judgment Liens

In a recent decision issued by the Fourth District Court of Appeal, the court held that while a lis pendens may discharge liens that exist prior to entry of a final judgment of foreclosure, it does not affect those that accrue after the date on which the judgment is entered. In Ober v. Town-Of-Lauderdale-By-The-Sea, the … Continue Reading

Washington Supreme Court Closes the Door on Changing the Locks

In Jordan v. Nationstar Mortgage, LLC, the Washington Supreme Court issued a stern warning to lenders seeking to change the locks on foreclosure properties. Given the significant potential liability exposure created by the opinion, foreclosing lenders should read the opinion with care and ensure their policies, procedures, and practices in that state comport with the … Continue Reading

Sixth Circuit Affirms Dismissal of $2.3 Billion FCA Case Due to Prior Public Disclosure

Last week, in U.S. ex rel. Advocates for Basic Legal Equality, Inc. (ABLE) v. U.S. Bank, the Sixth Circuit affirmed the dismissal of a False Claims Act (FCA) suit against U.S. Bank because the conduct alleged by the qui tam relator had previously been publicly disclosed in a consent order with the Office of the … Continue Reading

Antideficiency Protection Applies to Both Short Sales and Foreclosure Sales

In January, the Supreme Court of California affirmed the Court of Appeal’s application of Code of Civil Procedure section 580b and held that the statute’s antideficiency protection applies to short sales just as it does to foreclosure sales.   In Coker v. JPMorgan Chase Bank, N.A., the lienholder had begun the foreclosure process when the borrower asked the lienholder … Continue Reading

Florida Court of Appeals Finds Notice of Assignment Not Condition Precedent to Foreclosure Suit

In January, the Florida Second District Court of Appeals—addressing an issue of first impression in the Florida district courts of appeal—held that providing written notice of assignment of a note described in Fla. Stat. § 559.715 is not a condition precedent to foreclosure. In Brindise v. U.S. Bank Nat’l Assoc., the noteholder acquired borrowers’ note by … Continue Reading

Fifth Circuit Court of Appeals Clarifies Abandonment of Loan Acceleration

The Fifth Circuit Court of Appeals recently clarified how mortgage lenders and servicers can abandon a loan acceleration under Texas law. Although Texas generally requires foreclosure actions to be brought no more than four years after a loan is first accelerated, the holding in Boren v. U.S. National Bank makes clear that in certain situations … Continue Reading

Oral Modification of Mortgage Not Permitted by Florida Court of Appeals

This week, the Florida Fourth District Court of Appeals held that Florida’s Statute of Frauds precludes oral modification of a mortgage and that the judicial doctrine of promissory estoppel may not be used to circumvent the application of the Statute of Frauds. In Ocwen Loan Servicing, LLC v. Jean Marie Delvar, the noteholding servicer brought … Continue Reading

There Are Limits: Florida First District Court of Appeal Upholds Discovery Limitations

In CQB, 2010, LLC v. Bank of New York Mellon, the Florida First District Court of Appeal provides guidance on discovery limitations in foreclosure actions.  In CQB, the petitioner, the defendant in a foreclosure proceeding, sought certiorari review of a trial court’s order that did not grant all of the petitioner’s discovery requests. In the … Continue Reading

Washington Supreme Court Clarifies Mandatory Mediation Program Exemption – Holders Score a Washington Victory

The servicer community recently scored an important victory in an opinion issued by the en banc Washington Supreme Court. The decision—Brown v. Wash. State Dep’t. of Commerce, —clarifies the scope of the small lender exemption to the Washington Foreclosure Fairness Act (FFA) mandatory mediation program (codified at RCW 61.24.166). Further supplementing the victory, the Court … Continue Reading

FHA Withdraws Proposed Rule Establishing Insurance Claim Deadline

Recently, the Federal Housing Administration (FHA) withdrew part of a proposed rule that sought to establish a maximum time period within which an FHA approved mortgagee must file a claim with FHA for insurance benefits. The decision came in response to public comments expressing concern over the proposed rule’s implementation, which many agreed would ultimately … Continue Reading

Fifth Circuit Court of Appeals Upholds MERS’ Authority to Assign Mortgages

The Fifth Circuit Court of Appeals recently handed Mortgage Electronic Registration Systems, Inc. (MERS) another victory against challenges to MERS’ authority to assign a mortgage. In Ferguson v. Bank of New York Mellon, the Fifth Circuit ultimately held that MERS was a proper beneficiary of the subject deed of trust and, therefore, had the right … Continue Reading

Eleventh Circuit Allows Miami’s Claims under the Fair Housing Act to Move Forward

The Eleventh Circuit Court of Appeals recently reversed a lower court ruling that dismissed discriminatory lending claims against Wells Fargo & Co., Bank of America Corp. and Citigroup Inc., all brought by the City of Miami. The City of Miami alleges in each of the three lawsuits that the companies engaged in a decade of … Continue Reading

Finally, a SOL Decision Focused On Unjust Enrichment and Inequitable Results

This week, the First District Court of Appeals joined the Fourth District Court of Appeals in holding that Florida’s five-year statute of limitation (SOL), under Fla. Stat. § 95.11(2)(c), did not bar the lender’s second foreclosure action. In Nationstar Mortgage, LLC v. Brown, decided on August 24, 2015, the First District Court held that the lender’s … Continue Reading

Florida Courts Continue to Take the Wind Out of Foreclosure Defense Attorneys’ Sails

In late July, another Florida appellate court took a sizable chunk out of foreclosure defense attorneys’ litigation playbook, holding that substantial compliance, rather than strict compliance, is the prevailing standard to be used by courts when assessing whether a mortgage loan servicer complied with the pre-foreclosure requirements found in Paragraph 22 of most residential mortgages. … Continue Reading

North Carolina Governor Signs HB 174/Session Law 178 into Law – Altering Foreclosure Rights & Remedies in the Landlord-Tenant Context

North Carolina Governor Pat McCrory signed HB 174/Session Law 178 into law on August 5, modifying several requirements to the foreclosure process in the landlord-tenant context. Of particular importance, the bill amended the Homebuyer Protection Act and enhanced certain protections and notice requirements for tenants of real properties in foreclosure. Specifically, the bill added the … Continue Reading

FHA Proposes 3-Month Limit for Lender Claims to File Single Family Insurance Claims

The Federal Housing Administration (FHA) recently announced a proposed rule change that would establish a deadline for lenders to file insurance claims and modify its current policy for reimbursements when foreclosure and claim filing deadlines are missed. Current regulations do not establish a deadline by which lenders and servicers must file claims for FHA mortgage … Continue Reading

Nevada HOA Foreclosures Cannot Extinguish Deeds of Trust Held by Fannie Mae, Holds U.S. District Court

Yesterday, the U.S. District Court for the District of Nevada issued an important ruling concerning the litigation over whether homeowners’ association foreclosures under Nevada’s super-priority lien statute (NRS 116.3116) can extinguish first deeds of trust when the underlying indebtedness is owned by a Government-Sponsored Enterprise (GSE) like Federal National Mortgage Association (Fannie Mae) or Federal … Continue Reading
LexBlog