Court Rules that a Void Loan Assignment Invalidates Nonjudicial Foreclosure
July 18, 2016
In yet another decision decided after the Supreme Court’s decision in Yvanova v. New Century Mortgage, a California Court of Appeals ruled that a borrower has standing to claim that a loan assignment is void and thus sue for wrongful foreclosure. In this case a trustee nonjudicially foreclosed on behalf of a lender that, at the time that the action was commenced, was not the assignee of the promissory note and deed of trust. Because the lender had no authority to foreclosure, the borrower suffered prejudice and may defeat foreclosure without having to tender the delinquent amounts. The case is Sciarratta v. U. S. Bank, N.A. See CBA’s Regulatory Compliance Bulletin attached. See CBA’s Regulatory Compliance Bulletin for more information.