Many of us heard about the issue decided by the United States Supreme court in the abortion pill case this past week but you might not be aware of what Lack of Standing means. Whatever you opinion on the FDA approval of that drug, the court rejected hearing the case citing the plaintiff doctors, who wanted the pill banned, had no standing to bring their suit. So what is “legal standing” and how does it apply to Foreclosure Defense and specifically MERS.?
What is Legal Standing?
Legal standing refers to the right of a party to bring a lawsuit to court. In foreclosure cases, it means the lender must prove they have the right to foreclose on the property. They must show they own the loan or have the authority to act on behalf of the loan owner. This seems straightforward, but it’s often complex due to the way loans are bought, sold, and transferred in the mortgage industry.
Why Legal Standing Matters
When a lender starts foreclosure proceedings, they must prove they have legal standing. If they cannot, the court should not allow them to proceed. Here are a few reasons why legal standing is critical:
1. **Preventing Fraudulent Foreclosures**: If lenders were not required to prove legal standing, it could open the door for fraud. Anyone could potentially claim the right to foreclose, putting homeowners at risk of losing their homes unfairly.
2. **Ensuring Proper Documentation**: The mortgage industry is notorious for sloppy paperwork and improper documentation. By demanding proof of legal standing, homeowners can ensure that all documents are in order and that the entity foreclosing actually has the right to do so.
3. **Maintaining Accountability**: Holding lenders accountable for proving their legal standing keeps the mortgage industry in check. It discourages reckless lending practices and encourages proper record-keeping.
Mers at the center of securitization issues
In the case of Bank of NY v. Silverberg, 86 AD 3d 274 – NY: Appellate Div., 2nd Dept. 2011 the New York State appeals court held that Mers did not, in fact, have standing to foreclose on a residential mortgage and dismissed the complaint brought by Mers in this case. The court’s opinion in this matter is instructive and is as follows:
In sum, because MERS was never the lawful holder or assignee of the notes described and identified in the consolidation agreement, the corrected assignment of mortgage is a nullity, and MERS was without authority to assign the power to foreclose to the plaintiff. Consequently, the plaintiff failed to show that it had standing to foreclose.
MERS purportedly holds approximately 60 million mortgage loans (see Michael Powell and Gretchen Morgenson, MERS? It May Have Swallowed Your Loan, New York Times, March 5, 2011), and is involved in the origination of approximately 60% of all mortgage loans in the United States (see Peterson at 1362; Kate Berry, Foreclosures Turn Up Heat on MERS, Am Banker, July 10, 2007, at 1). This Court is mindful of the impact that this decision may have on the mortgage industry in New York, and perhaps the nation. Nonetheless, the law must not yield to expediency and the convenience of lending institutions. Proper procedures must be followed to ensure the reliability of the chain of ownership, to secure the dependable transfer of property, and to assure the enforcement of the rules that govern real property.
Accordingly, the Supreme Court should have granted the defendants’ motion pursuant to CPLR 3211 (a) (3) to dismiss the complaint insofar as asserted against them for lack of standing. Thus, the order is reversed, on the law, and the motion of the 284*284 defendants Stephen Silverberg and Fredrica Silverberg pursuant to CPLR 3211 (a) (3) to dismiss the complaint insofar as asserted against them for lack of standing is granted.
Ordered that the order is reversed, on the law, with costs, and the motion of the defendants Stephen Silverberg and Fredrica Silverberg pursuant to CPLR 3211 (a) (3) to dismiss the complaint insofar as asserted against them for lack of standing is granted.
So, clearly a win for the homeowner but there are cautions associated with the “lack of standing” foreclosure defense. One is that this objection by the defendant in a foreclosure action must be made in a timely manner. This varies by state so beware, in some states you effectively waive your right to this defense if not made in your first defenses to any litigation made by a lender. That is one reason we always advise homeowners to seek professional assistance as early as possible in Foreclosure Defense cases as sometimes you get “one bite at the apple” as the saying goes.
The Role of our Foreclosure litigation team at Livinglies
We can play a crucial role in helping homeowners navigate the complexities of legal standing. Here’s how:
– **Evaluate Documentation**: we can identify flaws or gaps in the lender’s documentation.
– **Challenge the Lender’s Claims**: We can draft motions for pro se defendants or their attorney’s to review and file to dismiss the foreclosure if the lender cannot prove legal standing.
– **Provide Litigation support**: We assist pro se litigants and attorney’s on foreclosure defenses through through our services which include document reviews, forensic audits, case analysis, expert affidavits and testimony services as well as consultations.
Conclusion
Legal standing is just one of the powerful defenses that can be used for homeowners facing foreclosure. By understanding all defenses and utilizing then effectively, homeowners can protect their rights and potentially save their homes. While the process can be challenging, especially against well-resourced lenders, demanding proper documentation, scrutinizing the chain of title, and seeking legal assistance can make a significant difference.
Homeowners should never feel powerless. Challenging the lender’s legal standing can level the playing field and ensure that only those with the legitimate right to foreclose can proceed. It’s about holding the mortgage industry accountable and safeguarding the rights of homeowners.
Thanks for following us! Lance Denha esq.
Need help in assessing your case? Does your attorney need our help? Use our services to help guide you through the process early enough to avoid mistakes that can cost you your home in an illegal foreclosure action. Call our office today at 844.478.6774 to inquire if we can help. You can also submit a case statement here and get a complimentary recommendation as to your best course of action.
FORECLOSURE DEFENSE IS NOT SIMPLE. THERE IS NO GUARANTEE OF A FAVORABLE RESULT. Yes, you DO need a lawyer.
3 thoughts on “Lack of Standing Defense in Foreclosure”
Thank you Lance for continuing Neil’s advocacy
& legacy . There’s a big silent majority out there in all 50 States that surely benefits from his contri – butions in the website .. and now you & your team
continuing it is “ AWESOME “ . Thank you as I’m one of them who have benefited from it .
Miami Dade County I properly placed a $65,000 property tax lien on my property in Hialeah. 6023 NW 201 Terr. 33015 alleging I do not live here for the past 10 years and removing my homestead exception. In the mean time, PHH mortgage servicer allegedly sent a $65,000 payment to the Miami Dade Tax Collector and doubled up my mortgage payment from $2,200.00 to almost $4,400.00 since January, 24.
I have made “every’’ single mortgage payment since its origination, however, I was unable to make the $4,400.00 payment and I continued to send the $2,220.00 every month. I applied with several institutions have my mortgage re-financed and lo and behold I was told my credit was ‘’ruined’’ because I was in ‘’default’’ of my PHH mortgage payments so I was denied my applications for mortgage refinance, reverse mortgage and a line of credit. Now I come to find out that Miami Dade returned the $65,0000 check to PHH. I asked them to fix my three credit reporting agencies credit rating and they have so far refused.
I need help.
Mr. Jorge Porter
Hi Jorge, I have been following Neil for many years and miss him everyday. I can tell you I know people who file law suits in regard to credit reporting. No one can report you to the credit bureau’s without noticing you first. The three bureaus cannot put any negative report against you without noticing you first to confirm the claims are true. Of course this is never followed, which is a violation of the FDCPA. Write to each credit bureau and tell them to remove any and all derogatory information from your report, as they cannot and did not verify it was actually you and your debt. They can’t verify anything… not even bankruptcy’s. I have a friend in CA who files federal cases and wins every time on this stuff. He’s won over 60 cases. Every time a debt collector calls you without your consent.. its $1,000 fine.. there are many ways to beat these guys.. but start by sending them notice to remove all negative reporting as they did not follow the rules of the Fair Debt Collection Practices Act. Read up on it as much as you can.. it’s not complicated and very helpful to know.
Another thing everyone needs to know.. the banks are not involved in foreclosures. It’s the Federal Reserve and treasury of NY.. under the Maiden Lane l, ll, lll. trust. IRS and AG’s around the country have confirmed this information. This trust is not registered with the SEC and is operating illegally and is treason against the American people. I am suing the law firms involved with my foreclosure and I am demanding their agency relationship be exposed. They don’t work for the banks, they work for the government. The banks can’t collect, they were paid in full from selling the paper. There is no debt for banks to collect, so the government is filing forged documents and notaries to steal millions of homeowners properties. Right now I have these law firms nervous and they haven’t filed any eviction.. I sent them an email detailing who they work for and none of the three law firms disputed it. They went silent. I’ll be filing a motion to show authority in the next 2 weeks. If they can’t show they work for the banks, then everything they submit is fraud and hearsay.