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Since the ruling in In re Nazario Hernandez, et al v. Franklin Credit Mgmt. Corp., et al, 19-35719 (9th Cir. 2020), there have been several attempts to unwind the devastation that the interpretation by the Federal Courts of Edmundson v. Bank of America, 378 P.3d 272, 278 (Wash. Ct. App. 2016) created. This was nearly achieved in Brown v. Deutsch Bank N.A. (In re Plastino), Nos. 17-11760-MLB, 20-01012-MLB, 20-01013-MLB, 20 Bankr. LEXIS 3597, at *6-7 (Bankr. W.D. Wash. Dec. 29, 2020). However, the matter settled prior to a ruling on the appeal.
In Khimmat v. Weltman, Weinberg & Reis Co. LPA, the Eastern District of Pennsylvania recently held that the transmission of information to a vendor who completes a mailing is deemed a “communication” to a “person” in connection with the “collection of a debt” under section 1692c(b) of the FDCPA.
The law firm in this case, considered a debt collector in this circuit, used a third-party vendor to mail correspondence to the Borrower, which included the Borrower’s name, address, and information about the nature of the debt. The Court rejected an argument from the law firm that the mail vendor is an “agent” of the law firm, noting that the FDCPA does not explicitly carve out an exception for agents of debt collectors.
Not all circuits follow this logic in considering whether debt collectors can rely on letter vendors, so it is important to consult with legal counsel in the appropriate jurisdiction to determine whether use of these types of vendors is permissible under the FDCPA. Click here to read the full decision.
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Contact us regarding this decision or other servicing issues in Pennsylvania. PLG's Managing Attorney of Foreclosure Operations, Jacqueline F. McNally, Esq., is licensed in Pennsylvania, New Jersey, New York, Georgia, and the District of Columbia. Click the button below to connect with Jackie.
Today, the Fourth District Court of Appeal for Florida in Wells Fargo Bank, N.A. v. Tan, Case No. 4D20-613, held that Fla. Stat. 702.036 barred the Court from granting relief as it related to a Senior Mortgagee seeking to vacate a judgment that was entered against them by a Junior Mortgagee. For a little more background on this holding, “a non-party purchased the real property at issue and executed a mortgage in favor of Bear Stearns Residential Mortgage Corporation. Bear Stearns assigned the mortgage to Wells Fargo. The non-party later sold the property to Chi Peng Tan, who executed a mortgage in favor of First Magnus Financial Corporation.
First Magnus filed a foreclosure complaint against multiple defendants, including Tan and Wells Fargo. A judgment was entered that foreclosed all interests, including the interest held by Wells Fargo. The record shows that Wells Fargo recorded its mortgage before First Magnus recorded its mortgage.”
This is case is not yet final.
Skyworks, Ltd. v. Centers for Disease Control & Prevention, No. 5:20-CV-2407, 2021 WL 911720 (N.D. Ohio Mar. 10, 2021) is a case of first impression for Ohio. While the Eastern District of Texas in Terkel v. Centers for Disease Control & Prevention, 6:20-CV-00564, 2021 WL 742877 (E.D. Tex. Feb. 25, 2021), found that the CDC Order to be unconstitutional, Skyworks holds that the “Centers for Disease Control and Prevention's orders—Temporary Halt in Residential Evictions to Prevent the Further Spread of COVID-19, 85 Fed. Reg. 55,292 (Sept. 4, 2020) and Temporary Halt in Residential Evictions to Prevent the Further Spread of COVID-19, 86 Fed. Reg. 8020 (Feb. 3, 2021)—exceed the agency's statutory authority provided in Section 361 of the Public Health Service Act, 42 U.S.C. § 264(a), and the regulation at 42 C.F.R. § 70.2 promulgated pursuant to the statute, and are, therefore, invalid.” The Ohio case focuses on statutory authority, while the Texas case focuses on constitutionality.
The Supreme Court of Texas, in PNC Mortgage v. Howard, recently held that the holder of a deed of trust was entitled to foreclose through equitable subrogation, even after the four-year foreclosure statute of limitations had lapsed. Click here to read the opinion.
In 2003, the borrowers purchased a home with loans secured by two purchase-money liens on their property. Two years later, the borrowers refinanced the mortgages with a new loan and paid off the purchase-money mortgages. The note and deed of trust securing the loan were subsequently assigned to and acquired by a new lending entity (“mortgagee”).
In January 2009, the mortgagee notified the borrowers of their default and intent to accelerate the loan, and five months later, accelerated the note. Concurrently, the original lender initiated foreclosure proceedings against the borrowers despite having assigned the loan to the mortgagee, which resulted in a sale of the property.
Arkansas Court of Appeals Holds Statute of Limitation Bars Foreclosure Five (5) Years After Acceleration Unless There Is Clear Intent to Abandon the Acceleration
On September 9. 2020, in the case of Ocwen Loan Servicing, LLC v. Oden, 2020 Ark. App. 384, The Arkansas Court of Appeals clarified what is needed to abandon a prior acceleration of a loan for purposes of the statute of limitations. The Court held that the servicer must show a clear intent to abandon a prior acceleration to prevent the expiration of the limitation period.
In Oden, the borrower’s last payment was made in November 2010, and the servicer declared a default on December 2, 2010. The servicer then sent a Notice of Acceleration on March 17, 2011, after which two different non-judicial foreclosures were started then canceled. In 2015 and 2016, eight (8) separate “Delinquency Notices” were sent to the borrows that stated the number of days since the date the loan had become delinquent and the total amount necessary to bring the loan current. In 2017, the borrowers filed a declaratory judgment action claiming that foreclosure was barred by Arkansas’ five (5) year statute of limitations.
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