In an action arising out of a failed real estate transaction, the Superior Court of Pennsylvania vacated an order from the Court of Common Pleas denying appellant-insured’s motion for partial summary judgment and granting a cross-motion for summary judgment by appellee-title insurance company on appellant’s claims. See Michael v. Stock, 2017 PA Super 99 (Super. Ct. 2017), reargument denied (June 13, 2017).
In a decision approved for publication on July 10, 2017, New Jersey’s Appellate Division held that if a lender holds a priority lien on a property and replaces it with a new mortgage via a refinancing, that new mortgage is entitled to priority regardless of the lender’s knowledge of other encumbrances so long as the intervening lienors are not materially prejudiced. See Ocwen Loan Servs., LLC v. Quinn, 2016 WL 6156209 (N.J. Super. Ct. App. Div. Oct. 24, 2016), cert. denied, 2017 WL 658798 (N.J. Feb. 13, 2017).
In a noteworthy decision that was approved for publication on June 29, 2017, the New Jersey Chancery Division held that the appointment of a custodial receiver in a foreclosure action of a single-family home or condominium would run counter to the purpose of the Fair Foreclosure Act (“FFA”) (N.J.S.A. 2A:50-03 et seq.) and the FFA’s required notices and other procedures providing homeowners with opportunities to cure foreclosure defaults and keep their homes.
The United States District Court for the Northern District of Illinois recently dismissed an insured lender’s bad faith claim against a title insurance company and held that Exclusion 3(a) of the policy may bar the lender’s breach of contract claim. See Bank of Am., N.A. v. Chicago Title Ins. Co., 2017 WL 2215012 (N.D. Ill. May 18, 2017).
The United States District Court for the Western District of Pennsylvania recently held that a claim that a lender’s captive reinsurance arrangement violated the anti-kickback provisions of the Real Estate Settlement Procedures Act (“RESPA”) was time-barred, and that each new mortgage payment did not constitute a new, separate RESPA violation.
The Superior Court of New Jersey, Appellate Division, recently affirmed the trial court’s grant of summary judgment dismissing plaintiff’s complaint against multiple defendants, including the title agent and title insurance company, alleging fraudulent transfer of title to realty, holding that “one, who knows a deed transferring her ownership in property has been filed, but declines to repudiate that conduct and also acts to later approve the conduct and benefits from same, has ratified the conduct and loses the right to challenge the forgery.”
In a significant decision for banks and the lending industry as a whole, the United States Supreme Court recently clarified that purchasing and collecting defaulted debt does not make an entity a “debt collector” under the Fair Debt Collection Practices Act (“FDCPA”). See Henson v. Santander Consumer USA Inc., 2017 WL 2507342 (U.S. June 12, 2017). In the case, plaintiffs received and later defaulted on auto loans from CitiFinancial Auto. Santander bought the defaulted debt on these loans from CitiFinancial and attempted to collect for itself.
The United States District Court, Middle District of Florida, recently granted defendant loan servicer’s motion to dismiss plaintiff’s complaint alleging violations of the Real Estate Settlement Procedures Act, 12 U.S.C. 2601 et seq. (“RESPA”), on the ground that plaintiff failed to allege any concrete injury. Chadee v. Ocwen Loan Servicing, LLC, 2017 WL 1050386 (M.D. Fla. 2017).
In a noteworthy decision for New Jersey lenders approved for publication, the New Jersey Appellate Division recently held that a lender who simply winterizes and secures an abandoned property in foreclosure is not deemed a mortgagee in possession subject to condominium association fees. See Woodlands Cmty. Ass’n, Inc. v. Mitchell, 2017 WL 2437036 (N.J. Super. Ct. App. Div. June 6, 2017). In Mitchell, the borrower defaulted on his loan with the lender and abandoned his condominium. The lender commenced a foreclosure action and then winterized the property and changed the locks.
The United States District Court for the Eastern District of Michigan recently dismissed plaintiff debtor’s complaint seeking to have the foreclosure and sheriff’s sale set aside, on the grounds that plaintiff failed to state a wrongful foreclosure claim based on only allegations of 12 C.F.R. 1024.41(g) (“Regulation X”) violations, and holding that “to find that Plaintiff has made out a state-law wrongful foreclosure case using only allegations of Regulation X violations would amount to the creation of a hybrid remedy where neither state law nor federal law has provided for one.”