In a recent court decision JERRY A. RIGGS, SR vs. AURORA LOAN SERVICES, LLC
the Fourth District Court of Appeal is telling the banks to actually prove ownership after the transfer or lose the case. This is Great News for Florida Homeowners, and shows that Defending is Better, so Don't Walk Away!
As if it's not already bad enough that the banks are struggling with loan modifications and short sales… now they perpetrating fraud!The mortgage foreclosure lawsuit revealed that banks, besides being totally unorganized, are apparently now stooping to commit fraud in order to file foreclosure actions against homeowners.
"In the instant case, the endorsement in blank is unsigned and unauthenticated, creating a genuine issue of material fact as to whether Aurora is the lawful owner and holder of the note and/or mortgage. As in
BAC Funding Consortium
, there are no supporting affidavits or deposition testimony in the record to establish that Aurora validly owns and holds the note and mortgage, no evidence of an assignment to Aurora, no proof of purchase of the debt nor any other evidence of an effective transfer."
In short order, What many homeowners don't know is the bank has to prove it has standing to bring a foreclosure action. Standing is the constitutional right for a party to appear to bring a case in court. Without standing, a party has no right to be in court. But in reality, the bank must prove that they in fact own and hold both the mortgage and promissory note, and thus have the right to foreclose.
Why is this a problem for banks? Because they are so disorganized that the documents are often lost or misplaced. An even bigger problem occurs when the original mortgage lenders sell the mortgages and notes and convert them into a securitized trust. When these mortgages are assigned to another bank or a securitized trust, the assignment of mortgage must be executed and notarized. Within these assignments, foreclosure defense attorneys are finding all kinds of problems that are leading to foreclosure cases being thrown out of court.
The Fourth District Court of Appeal, which covers South Florida,
adopted the Second District Court of Appeals ruling.
A problem found in an assignment of mortgage that was recently thrown out by the court was especially astounding. The Plaintiff, U.S. Bank, filed a foreclosure action on December 6, 2007, based on an alleged assignment of mortgage dated as of December 5, 2007.
However, during the course of the litigation, the homeowner's attorney noticed that the Notary's commission was dated to expire on May 19, 2012. Pursuant to Florida law, notary stamps are only valid for 4 years. So, the notary that signed the assignment back on December 5, 2007 could not have had a notary stamp that expired in May of 2012.
This fact was confirmed by a sworn affidavit by the Notary Bonding Company's representative, confirming that this Notary's stamp was not issued until April 2008, five months after the purported date of assignment on the mortgage.
Based on this evidence, the judge found that the assignment was "fraudulently backdated in a purposeful, intentional effort to mislead the defendant and this court."
On these grounds, the Judge found the defendant homeowner was the prevailing party because the Plaintiff lacked standing to file the lawsuit on December 6, 2007, and granted the Defendant' attorney's fees as well.
News such as this brings hope to many Florida homeowners and shows that defending a Florida foreclosure action is better than doing nothing at all. Additionally this teaches us we should never accept anything on its face and scrutinize every document produced by the banks to support their foreclosure complaint.
An argument can be made that Judges should be examining the authenticity of the documents produced by the Plaintiff before entering default and granting summary judgment against homeowners. However, in all likelihood, mistakes such as these are slipping through the cracks with the unprecedented number of foreclosure actions each judge has on their docket.
It's exactly these sort of problems that truly exemplify why it is in every Florida homeowner's best interest to defend their Florida foreclosure and not assume the court system will automatically protect their interests.