This is a terrific decision of the Sixth Circuit Court of Appeals and is a very mainstream decision:
However, the facts in this case do NOT support ANY of the assertions of known fraudsters, such as Mike H. or Chris Dix (pompapah), who are seeking to swindle distressed borrowers through various debt elimination scams.
In the In Re Sutter case, the distinguishing feature is that borrowers Daniel Joseph and Sheyrl Lynn SUTTER DID NOT SIGN the original mortgage instrument which formed the basis for the claim. The Sutters were shown to have been traveling in California at the date of the execution of the note and other loan instruments. Instead of obtaining the borrower's signatures on the seemingly overlooked mortgage document, the loan originator seems to have forged the signatures of the borrowers on the mortgage instrument.
The originator almost certainly could have either compelled the borrowers to sign the mortgage or had a court reform the transaction to recognize the existence of a mortgage securing the note had this been done honestly and timely after closing (and BEFORE the SUTTERs filed Bankruptcy), absent the criminal forgery of the mortgage.
Most borrowers are NOT facing a situation where they can truthfully deny execution of the mortgage, deed of trust or other mortgage security instrument.
The case certainly serves as a reminder about the extent to which lender can and do engage in criminal forgery of documents in support of both mortgage originations as well as foreclosures.
Neither does this case stand for the proposition that notes or mortgages are routinely forged in support of foreclosure procedures. The evidence actually suggests otherwise. In the Sutter case, the forged mortgage is shown to have been dated April 8, 2004, and recorded in Lapeer County, Michigan, on May 25, 2004. The SUTTER's were traveling in California the date of the forgery. The acknowledgment of the forged instrument shows the instrument to have been executed in Michigan.
The forged assignment was recorded in Michigan before the Sutter's default, before the institution of foreclosure proceedings and most importantly before the Sutter's bankruptcy.
There have been a number of cases where borrowers in Bankruptcy have sought to avoid a mortgage or deed of trust which was not timely assigned by to the institution of Bankruptcy. In most of these cases, courts have held that as long as the mortgage and/or deed of trust was properly perfected, the failure to timely assign the mortgage or deed of trust does not result in an avoidance of the mortgage. There still remains some question about this within the context of MERS mortgages.
The Sutter decision is a thoughtful and useful decision and a good win for the Sutters. ANYONE WHO SEEKS TO CONFLATE THIS HOLDING AND USE THIS TO SUPPORT THE FALSE PREMISE UNDERLYING VARIOUS DEBT ELIMINATION SCAMS IS PROBABLY A SWINDLER!