Did The Lender Have The Right To Foreclose: The Standing Issue
All legal cases begin with an injured person and a responsible party. This is true whether you are talking about a car wreck, a breach of contract, or a criminal matter. In order to seek recovery for an alleged wrong, the person filing a lawsuit must have standing to do so. This legal term of art means that the person or entity suing has the right to do so, either by being the injured party or by holding a contract or other piece of paper that gives legal rights. When determining whether a lender has standing to file a foreclosure, several factors must be present.
This issue first came to forefront of the legal landscape right here in Florida. In 2007, when foreclosure rates were at an all-time high, important information about lenders’ foreclosure practices came under heavy scrutiny. To recap, the issue was as follows:
● Evidence was uncovered showing that lenders were having employees sign affidavits to start the foreclosure process without having any actual knowledge of the loan status. This was the so called “robo signing” scandal.
● Many lenders were not actually in possession of any obligatory documents that would give them the right to enforce payment. Without a right to enforce payment, there is no right to foreclose the mortgage.
● Most foreclosing plaintiffs were merely servicing loans, and not entitled to accept payments. This was problematic because only the entity entitled to payment has the right to file a lawsuit for nonpayment.
While many lenders have changed their practices, there are still untold numbers of instances where a foreclosure is initiated by a plaintiff without the right to do so. If you have questions about whether the entity suing you for foreclosure has standing to do so, you should challenge the entire procedure. Doing so requires requesting to be shown the original note and that the plaintiff was in possession of the note prior to suing you. This process requires careful legal analysis and the assistance of a skilled legal professional.
If you are being foreclosed on and believe the case is wrongful, call our office for help. We will review the facts of your unique circumstances and develop a strategy that fits the facts. Call a Plantation, Florida debt relief attorney today for more information.