Wednesday, April 14, 2010

Another Couple In Foreclosure Successfully Stalls Legal Action Against Home; Lender Fails To Prove It Had Right To Foreclose

In Miami, Florida, the Daily Business Review reports:
  • Diana and John Cirigliano can’t wait to face off with Wells Fargo at a foreclosure trial. A Miami-Dade circuit court judge last month sided with them, when he ruled that the lender had failed to prove it had the right to foreclose on their Miami Beach condo.


  • The couple represents a small but growing group of home owners who are scoring victories in their fight against foreclosures. The Ciriglianos recently persuaded the court to deny their lender’s motion to sell their condo at a foreclosure auction because the lender couldn’t prove it was the true owner of the loan.(1)

  • In the on-going battle between lenders and homeowners facing foreclosure, some persistent owners are pushing to have a judge — not the lender — decide the future of their home. Their defense: Lenders are increasingly unable to show proper documents proving they have the right to seize their homes.


  • Defense lawyer Thomas Ice in West Palm Beach said he has two foreclosure suits set for trial later this month. In both cases, the home owners successfully questioned the lenders’ right to take their properties. “You should see more of them [go to trial] if they are well defended and you have a fair judge,” said Ice, with Ice Legal in West Palm Beach. "[Lenders] made enough mistakes and don’t have all the paperwork they need to properly get a summary judgment so they should be denied and go to trial.”

For more, see Mortgage Meltdown: Distressed homeowners take on lenders in court.

(1) According to the story, Wells Fargo couldn’t prove it owns the loan originally made in 2005 by now-defunct Greenpoint Mortgage Funding. Proving ownership can be difficult at a time when loans are bundled, securitized and sold multiple times to numerous investors. The loans are owned by a trust, which often hires a loan servicer to collect the mortgage payments from borrowers. When the notes were sold and resold, they were to be endorsed as part of the transfer to a new buyer, the story states. In this case, two things reportedly worked against Wells Fargo, according to the homeowners' Miami lawyer, Arturo Alfonso:

  • The loan had not yet been assigned to Wells Fargo when the lender filed suit against the couple in May 2008,
  • It failed to provide documents — called securitization agreements — that were filed with the Securities and Exchange Commission that showed who owned the note.

They couldn’t show any evidence of how the loan went from Greenpoint to Wells Fargo,” Alfonso reportedly said. “We asked for the agreements but they never gave them to us.”