Ohio Northern District Foreclosure Dismissals

The U.S.District Court for Northeast Ohio back on October 31st. held that mortgage lenders could not foreclose on properties it does not have proof of ownership on., a ruling that some say could complicate things for the already troubled mortgage industry.

The case, originally separately filed foreclosure actions addressed collectively by Judge Christopher Boyko, looked at some supposed practices of lending institutes, including their rush to foreclose on a property, obtain a default judgment, and then sit on the deed avoiding the responsibility of maintaining that property. (Decision)

Boyko wrote “The Court is obligated to carefully scrutinize all filings & pleading in foreclosure actions since the unique nature of real property requires contracts & transactions concerning real property to be in writing. Ohio law holds that when a mortgage is assigned, moreover, the assignment is subject to the recording requirements of RC §5301.25 . Thus, with regards to real property, before an entity assigned an interest in that property would be entitled to receive a distribution from the sale of that property, their interest therein must have been recorded in accordance with Ohio law …… In each of the (cases herein), the named Plaintiff alleges it is the holder and owner of the Note and Mortgage. However, the attached Note and Mortgage identify the mortgagee and promise as the original lending institution—one other than the named Plaintiff”