Massachusetts Courts Split Hairs On Who May Seek Stay Relief
By L. Jed Berliner, Massachusetts Bankruptcy Attorney on Apr 10, 2008 in Bankruptcy Practice and Procedure, General Bankruptcy Information, Massachusetts
When a mortgage goes unpaid, a party can seek relief from bankruptcy’s automatic stay to foreclose. A mortgage can held by a lender, administered by a servicer, and owned by a nominee commonly called MERS (Mortgage Electronic Recording Service). All three have the right to go to bankruptcy court for relief from the stay. In re Huggins, 357 B.R. 180 (Bankr. D. Mass. 2006) (if MERS), Saffran v. Novastar Mortgage, Inc., 2007 U.S. Dist. LEXIS 96306, (if lender despite MERS as nominee). Servicers have standing under the servicing agreement, although there is no published Massachusetts decision on this.
Let’s make this more complex. Money moves faster than paper in Wall Street, because it moves electronically. If the original mortgage holder received money from another to sell the mortgage but did not sign an actual mortgage assignment, can the buyer seek relief from stay to foreclose? No. In re Maisel, 378 B.R. 19 (2007).
Got this? There’s a test on it tomorrow morning.
If you liked that post, then try these...
Is The Cash Value of My Life Insurance Policy Protected If I File Bankruptcy in New York State? by Peter Orville, Attorney at Law
Will Countrywide be Able to Defend Itself Against Serious Claims that it Attempted a Fraud in the Bankruptcy Court? by Stephen Otto, Pennsylvania Bankruptcy Attorney
Bankruptcy and Divorce Obligations by L. Jed Berliner, Massachusetts Bankruptcy Attorney
You must be logged in to post a comment.