Proving Standing to Foreclose a Florida Mortgage

Proving standing to foreclose on a mortgage in Florida is difficult because of the complexities of securitization. Many mortgages were sold to trusts and pooled with other mortgages to be sold to investors. The trusts are governed by pooling and servicing agreements, and there are different entities involved such as trustees, servicers, and custodians. Despite these complexities, the courts still expect the lender to prove it has the right to foreclose by presenting admissible evidence that it holds the note or has the rights of a holder under the law. Many lenders have failed to do so, leading to complications in foreclosure cases. Commercial paper, like a promissory note secured by a mortgage on land, can be transferred to someone else. When this happens, the new owner usually puts their name on the note, and sometimes also on the mortgage. It’s important for the new owner to do this before trying to foreclose on the property, because they need to show they have the right to do so. If the new owner doesn’t put their name on the mortgage, they can still enforce the note, but it’s better to have everything in order. So, if you’re buying a mortgage, make sure to get everything officially transferred to you. If a lender wants to take legal action to get back the money owed on a loan, they need to show the original promissory note or mortgage. If they can’t find the original note, they have to prove that they have the right to enforce the note under Florida law. This means they have to show that they were entitled to enforce the note when it went missing, that it wasn’t lost because it was taken from them, and that they can’t get it back because it was destroyed or someone else has it. The lender also has to prove the terms of the note and their right to enforce it. If they can do all of this, the court may let them go ahead with their case. If the lender is the one who started the loan and their name is on the note and mortgage, all they have to do is show the original note or give a statement saying they have it. This is allowed under Florida law. If the bank suing you has the right to do so, they will have proof in the form of the original loan note with their name on it or a document showing that the loan was assigned to them. If the bank’s name has changed, they need to prove they are the same bank with a different name or have the right to sue because they acquired the loan. If they can’t prove this, they may not have the right to sue you. MERS Loans: When you get a mortgage, it might be assigned to MERS, a company that keeps track of who owns the loan. This means the loan can be bought and sold without a lot of paperwork. MERS can also bring a foreclosure case in court if needed.

Securitized Mortgage Trust: If your loan is part of a trust, the trustee can sue to foreclose on the property. If the loan servicer is suing on behalf of the trust, they need to show they have the right to do so. If the loan note is left blank, the servicer just needs to have the original note. If the note is assigned to the trust, the servicer needs to prove they have the right to sue for the trust. One Florida court allowed a company to sue to collect a mortgage and foreclose on a property on behalf of the owners. Two other cases also supported the idea that a company acting as an agent for the real owner can bring a foreclosure action. Another case said that if a company is authorized by the real owner, it can sue in its own name. These cases show that a company, acting as an agent, can have the right to foreclose on a mortgage. The trust, as the note holder, is the real party in interest and should be the named plaintiff in a foreclosure case. The servicer, if identified, acts on behalf of the trustee. The servicer’s authority can be proven with specific allegations in the complaint or referencing the servicing agreement. Courts in Florida require lenders to prove they have the right to foreclose, especially with securitized mortgages. It’s important for lenders to carefully review the loan documents and chain of title to establish standing in a verified complaint and avoid standing defenses. Additional evidence, such as affidavits or deposition testimony, can help resolve standing challenges if they arise. These court cases in Florida show that mortgage lenders have to provide proper evidence before they can take someone’s home. If a lender can’t prove they have the right to foreclose on a mortgage, the court will rule in the homeowner’s favor. So, it’s important for lenders to follow the rules and have the right paperwork. These are cases from Florida courts dealing with mortgage and loan issues. They talk about the importance of having the original documents when proving a case in court. In some cases, not having the original documents led to the decisions being reversed or sent back for more evidence. The law in Florida says that original documents, like promissory notes, need to be used as evidence in court. Essentially, there have been changes to the law in Florida about what happens when a mortgage note is lost. The changes were made to address a court case where the lender didn’t actually have the note in their possession. The law now allows for someone who the note has been assigned to, even if it’s lost, to still have the right to foreclose on the mortgage. This also applies to cases involving the Mortgage Electronic Registration System. This passage contains references to various statutes and court cases in Florida related to trust law and standing to sue. It also mentions a lawyer who specializes in intellectual property litigation. The passage was written with input from other people and is submitted on behalf of a section of the Florida Bar. “To teach its members about doing their job well, helping the public, and making the law better.”

Source: https://www.floridabar.org/the-florida-bar-journal/proving-standing-to-foreclose-a-florida-mortgage/