Reaffirmations and Home Loans
Posted: Wed Dec 24, 2008 8:30 pm
In the first instance, I have a letter that is sent advising Chase and
others that under California law, to offer, require or sign a
reaffirmation agreement for a residential loan would violate
California's anti-deficiency statute.
In the second instance, it is arguable, if you follow the line of
practice in which you do not sign a reaffirmation agreement, Chase
will go to court for approval. The court will enter an order
approving of the reaffirmation agreement. It is further arguable that
under the FRCP the entry of the order is equal to entry of a judgment.
Entry of the Judgment gives rise to Chase taking a personal judgment
instead of the collateral. What would follow is a complaint to quiet
title to remove the deed of trust. Take a look at the case of In re
Pajaro Dunes, and the cases that cite and follow it. Pajaro Dunes
from personal knowledge, was a case in which a partner at a firm I was
working for filed a judicial complaint for foreclosure and had a
stipulated judgment entered. The Bankruptcy Court ruled the "Security
First Rule" applied, and the deed of trust was removed. Needless to
say, the firm's carrier paid out!!
Have the client make copies of the last statement and send it along
with the payment. Do a demand under TILA and California law for a
current statement of account and Beneficiary Statement.
Judge Donovan is coming in January and Judge Jury in February, and we
should take the opportunity to solicit some feedback on the subject,
although, maybe we should just let California law play out on this one!
Happy Holidays to all. Lou Esbin
wrote:
>
> Reality check needed here, please. In today's mail, I received 11
letters from Chase Home
> Finance LLC. advising me that on various clients' Chapter 7 cases,
Chase will not send
> statements (despite my written request that it do so) or report the
status of the loans for
> credit purposes unless my clients reaffirm the debts. As far as I
am concerned, reaffirmation
> is not an option, so how are you other folks responding to this?
>
> BTW, Happy holidays!
>
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