City of Chicago Seeks to Impose Transfer Taxes on Foreclosure Deeds

The City of Chicago is proposing an amendment to Section 3-33 of the Municipal Code to change the rates for assessing transfer taxes and to eliminate the exemption from taxes for foreclosure deeds. It provides that Transfers in which the deed or other instrument of transfer is issued to the…

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Creditor Cannot Use The Income From A Non-debtor Spouse To Calculate Consumer’s Income In…

The issue in Zeno v. Colonial Mortgage and Loan Corp. 08-CA-246 2008 (La. App. 5th Cir., November 25, 2008) 2008 WL 5000136 was whether, for purposes of determining if a pre-payment penalty is allowed on a HOEPA loan, 15 U.S.C. § 1639(c 12 C.F.R. § 226.32(e)(1), the creditor could use…

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Borrower Did Not Have To Prove Servicer Received The Communication To Prove Violation Of…

In McLean v. GMAC Mortgage Corp., Inc. No. 06-22795-CIV. (S.D.Fla., December 16, 2008) the court was asked to decide if two letters sent by the borrowers to the servicer complaining about an increase in the amount of their loan payment were Qualified Written Requests (QWR) under Section 6 of RESPA,…

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“Financial Assistance” Under Section 3605(b) of FHA Does Not Include Assistance For Borrowers Who…

As alluded to above, there were several issues of note in Gorham-Dimaggio v. Countrywide Home Loans, Inc. 1:08-CV-00019 (N.D.N.Y., December 17, 2008) but the FHA claim is particularly noteworthy given the increasing frequency in which we are seeing this statute used in garden variety mortgage disputes. In this case borrower…

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State Law on Bona Fide Purchaser is Not Preempted by Bankruptcy Law

In Tippett v. Coleman (In re Tippett), 542 F.3d 684 (C.A. 9, Sept. 4 2008) the debtors filed for Chapter 7 bankruptcy, but then sold their home to without telling the bankruptcy Trustee of the sale, and without telling the buyer of the bankruptcy. Although it was undisputed that the…

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Service of Notice of Rescission on Creditor Effective to Rescind the Loan Against the…

was proper even though the assignee received more than three years after the closing. In Hubbard v. Ameriquest Mortg. Co. 05-CV-389 (September 2008 N.D.Ill.,) the parties conceded that the Plaintiff was entitled to rescind the loan. However, the assignee maintained that it cannot be liable for rescission because, although the…

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MERS could be liable to class for overcharging them for foreclosure fees and costs

The Plaintiffs in Trevino v. Merscorp, Inc. — F.Supp.2d —-, Civ.Action No. 07-568, (D.Del., September 2008) brought a class action complaint against Mortgage Electronic Registration Systems, Inc. (MERS), and the loan servicer, among others, challenging MERS’s flat fee arrangement on referring foreclosure and other enforcement proceedings to attorneys. The complaint…

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Court refuses to impose liability for damages and attorney’s fees on an assignee who…

We had some good news this month though. In an issue we have been tracking because we have often advanced it – unsuccessfully – here in Illinois, (See _Payton v. New Century Mortgage Corp._, 2003 WL 22349118 (N.D.Ill.2003) and _Fairbanks Capital Corp. v. Jenkins_, 225 F.Supp.2d 910 (N.D.Ill.2002)) a District…

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Failure to advise insurer of foreclosure constituted increase in hazard allowing insurer to disallow…

A recent opinion from Tennessee that has generated some concern in the servicing industry. In US Bank, N.A. v. Tennessee Farmers Mutual Ins. Co., No. W2006-02536-COA-R3-CV (Tenn. Ct. App. Dec. 21, 2007) the bank initiated foreclosure proceedings but did not notify the insurance company. Before the foreclosure process was complete,…

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Strict compliance with Tax Code excused in late redemption of sold taxes

Attached is In Re Application of County Treasurer (Hawkeye Investment v. Lanz) 1-06-3387 (Dec. 28, 2007) which is notable for the court’s refusal to strictly apply the Tax Code in an attempt by a homeowner to redeem after the period to redeem expired. It also holds that Section 22-45 of…

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