Hello. I'm defending against a second foreclosure pro se. The bank's strategy now is to argue my wife is not a borrower, thus has no standing to challenge the MERS assignment to the bank.
Does anyone have any rulings on this? My wife's father is the original borrower. After his death, he willed the house to my wife. We have been making mortgage payments since 2007, when her father died, and the bank has known since then. They did not return any payments either. Isn't she "standing in the shoes" of her father?
Also, I have a document from the bank saying her father's estate will be removed from the mortgage, and the assumption agrement will be updated to show my wife's name "on the mortgage loan." Doesn't that make her an interested party in the case? We can show MERS had no standing to assign anything to the bank, but I want to ensure we get this first item clear.
Thanks for any help.
There is a growing body of appellate law that is generally favorable to the servicers on the standing to contest the assignment issue. But not all decisions have found in favor of the lenders.
The emerging distinction is that a borrower or property owner usually has standing to attack a void assignment, but not to attack a voidable assignment.
Generally, some kinds of defects make an assignment voidable at the election of one of the parties in privity to the instrument, usually the grantor or grantee. For example, questions as to the authority of the person executing the instrument (e.g. robosigning) usually at most might render the instrument voidable and even then the lack of authority might still be corrected by a ratification.
Similarly, assertions that an instrument was procured by fraud usually would at best make the instrument subject to being voided by the defrauded party (but not the borrower).
There are still several defects which can render an assignment absolutely void. One of these would be forgery (but NOT fraud). Another would be based upon the nemo dat principle, discussed in other threads. If the grantor lacks any interest in the subject matter of the assignment, then the assignment simply cannot convey anything.
The leading case most favorable to borrowers (but NOT in respect of attacks on MERS) is:
Culhane v. Aurora Loan Services of Nebraska, 708 F. 3d 282 (1st Cir. 2013)
Note that retired U.S. Supreme Court Justice David Souter was on the panel deciding this case!
Best of luck!