Mortgage follows Note, No Assignment of Mortgage Required to Foreclose

11/11/2011 10:05 AM | Anonymous

Another Case law update from Paul Minoff at McGlinchey Stafford PLLC

In the further chipping away of the "lack of standing" defense frequently asserted by foreclosure defense counsel, earlier today the Florida Second District Court of Appeal followed the now extensive line of Fourth DCA cases establishing that standing to foreclose will exist without an assignment (or even when the assignment was not signed until after the lawsuit was filed) so long as the foreclosing entity can establish that it holds the note via an endorsement or allonge.  In this case, the court rejected Ice Legal's (the firm that brought us the term "robo-signing") position that standing did not exist, holding that the plaintiff (Bay Loan Servicing) obtained "equitable standing" to foreclose the property based upon the allonge to the note, and that "equitable ownership" of the mortgage also passed to Bayview because the mortgage followed the note. 

Despite this victory, the court ended up reversing the summary judgment in favor of Bayview because Bayview failed to overcome the defendant's lack of proper notice affirmative defense.  In that regard, Bayview did not submit a copy of the default letter required under paragraph 22 of the mortgage in support of its motion for summary judgment.  This case is a stark reminder that when an affirmative defense is raised, it must be responded to and overcome; if not, the judgment is subject to reversal. 

[Ed -- this kind of ruling means we as title examiners have little ability to determine whether the proper party is actually foreclosing beyond the presumption that the court did a proper verification]

A copy of the case can be found here 

Thanks Paul!!

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