Foreclosure vacated because MERS can only assign the right to record the mortgage, not too foreclose. Also, Statutory Notice of Right to Cure Infirm where it directs borrower to call to confirm pay-off amount

In this relatively straightforward foreclosure action, the Supreme Court of Maine had the occasion to address the rules on establishing standing in a mortgage foreclosure action in that state and the effect of pay-off letter that contemplates the further accrual of fees. In Bank of America, N.A. v. Greenleaf, 2014 ME 89 (S. Ct. Me. July 3, 2014) the borrower attacked the plaintiff’s standing to foreclose. Although the plaintiff adequately showed it was the holder of the note through a blank endorsement the Court held that was insufficient to give it standing. The plaintiff must also show the requisite interest in the mortgage. Whereas a plaintiff who merely holds or possesses – but does not necessarily own – the note satisfies the note portion of the standing analysis, the mortgage portion of the standing analysis requires the plaintiff to establish ownership of the mortgage. Relying on an earlier opinion that analyzed the language in the standard MERS mortgage identifying it as the mortgagee of record, the Court founds that this language grants to MERS only the right to record the mortgage as the lender’s nominee, and having only that right, MERS [did] not qualify as a mortgagee pursuant to our foreclosure statute. Thus, when MERS then assigned its interest in the mortgage to plaintiff’s predecessor, it granted only what MERS possessed – the right to record the mortgage as nominee – because MERS could not have granted to another person or entity any greater interest in the mortgage than that enjoyed by MERS. The court also deemed the foreclosure faulty because the statutorily mandated right to cure letter was incorrect. The right to cure itemized all past due amounts, including, but not limited to, reasonable interest and late charges, attorney’s fees and other reasonable fees and costs. But it also directed the borrower to contact the loan servicer to obtain an up to date figure before sending payment. Conceding that a payoff amount changes over time due to the interest accruing and attorney fees accumulating from continuing efforts to recover on the loan, the Court held that the statute effectively freezes such additions to the payoff amount during the cure period. Because the amount due as stated in the notice of default is the precise amount that the mortgagor has thirty-five days to pay in order to cure the default, the amount due is not, as the plaintiff argues, open to any further accrual during that period.

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