Bank can foreclose despite lost mortgage

Bank can foreclose despite lost mortgage note, judge rules
Monday, February 7, 2011
BY KATHLEEN LYNN
The Record
STAFF WRITER

A Bergen County judge has ruled that a lender can foreclose on a mortgage even if the lender doesn’t have the mortgage note because a previous lender lost it.

Bogota homeowner Janett Alvarado challenged Bank of America’s right to foreclose on her home, arguing that it did not possess the note for the $292,000 mortgage.

Bank of America acknowledged that the note was lost by the original lender, now-defunct Washington Mutual. Washington Mutual transferred the loan obligation to LaSalle Bank, which was later merged with Bank of America.

“The pivotal issue is … whether any person other than the person who lost the note can enforce a lost note,” wrote Superior Court Judge Mary F. Thurber in her recent ruling. “This court is persuaded that Bank of America, as successor to LaSalle National Bank … has the right to enforce the obligation represented by the lost note.”

To decide otherwise, Thurber wrote, would result in a “windfall” to the homeowner. “That result would not be equitable,” she wrote, pointing out that Alvarado admitted she had not paid her mortgage since 2008. Thurber also noted that Washington Mutual had signed an affidavit of lost note in July 2006.

In a statement, Bank of America said it “is pleased with the court’s ruling to permit this matter to move toward resolution.”

Alvarado’s lawyer, Joshua Denbeaux of Westwood, said he plans to appeal the ruling.

“If they don’t possess the note, the bank doesn’t have standing to foreclose,” he said. “New Jersey law says the only person who can enforce it is the person who lost it.” That would be Washington Mutual, which no longer exists.

Foreclosures hit a record 65,000 in New Jersey last year, triple the number of 2006. As the tide of foreclosures has risen nationwide, lawyers defending distressed homeowners have fought back by challenging the legal paperwork. Several big lenders, including Bank of America, suspended their foreclosure activity last fall, acknowledging irregularities including “robo-signing” — when employees signed affidavits without verifying their accuracy.

Responding to the reports of robo-signing, New Jersey Chief Justice Stuart Rabner recently ordered lenders to show that their foreclosure procedures were in order, or face a state-imposed freeze of foreclosure activity. The lenders are due in court in Trenton on March 1 in that case. http://ow.ly/3RJ6A

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5 Responses

  1. THIS SHAMFULL JUDGE THAT RUBBER STEMP
    THE PAPERS TO LET BANK OF AMERICA STEAL
    THIS HOME IS SHAMFULL,NJ PEOPLE DESERVE BETTER JUDGES THEN IGNORATE WOMEN JUDGES LIKE HER THAT DENY DUE PROCESS OF THE LAW TO POOR WOMEN

    • It is wrong when due process is not properly served equally for all which includes all homeowners male or female and banks and businesses too. Too often political expedience or ulterior motives are served over the quest for truth and fairness. To be sure it’s not a problem pertaining solely to “women judges” but all judges who sit on the bench. Like I’ve mentioned before in other posts there is plenty of blame to go around for all parties to this banking/mortgage/economic mess from the lenders, the borrowers and most critically the investment banks, the Wall Street rating companies and lets not forget our Government regulatory and oversight agencies (SEC, FED, Congressional Banking committees, FDIC, etc.). They’re all in each others pockets for their piece of the take and have yet to be held accountable. I’m all for entrepreneurialism and free enterprise but on an even playing field. ~ Larry InDeed

  2. Thank you very much for your ideas to post comments. The content was really very interesting. I am really thankful to you for providing this unique information. Please keep sharing more and more information…

    • Thank you. I will do my best as time allows. I hope to encourage critical thinking, insightful thoughts, perspectives and opinions and ultimately grasp a deeper understanding for myself through this activity.

  3. ths” so called” judge is danger to the public in nj
    she must be remove from the court for her ignorance

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