In the aftermath of Yvanova vs New Century Mortgage Corporation, in which the Supreme Court ruled on February 18, 2016 that a homeowner has standing to sue for wrongful foreclosure if the entity which holds the borrower’s loan did not acquire it legally, California homeowners and their lawyers are still waiting for the courts to set a precedent in response to this ruling.
While the Yvanova ruling allows homeowners facing foreclosure to argue their cases and former homeowners to go after monetary compensation for losing their homes, the uncertainty of how the lower courts will rule is impeding progress.
In a March 2 article by the Los Angeles Times, reporter Andrew Khouri addresses the situation, explaining how homeowners face the challenge of supporting their cases and the reluctance of the courts to be definitive in the wake of the Yvanova ruling. “Although the Supreme Court opened the courthouse doors, what success foreclosed homeowners will have once they get inside is an open question.”
In our March 22 blog, the Estavillo Law Group shared our experience with the court’s delaying tactics and their hesitancy to use Yvanova as a basis for their ruling.
Significant Response From California Court of Appeal
Earlier this month, Jason W. Estavillo appeared before the California Court of Appeal First Appellate District Division 1 to argue on behalf of his Client and against JPMorgan Chase Bank, N.A. and Deutsche Bank. The core argument of the case was that a homeowner has standing to challenge a non-judicial foreclosure before the sale takes place. While Yvanova was a post-foreclosure case, Jason argued that several of the California Supreme Court’s findings applied to both pre and post foreclosure activities.
Our client’s loan was originated by Washing Mutual Bank, F.A. in 2004. JPMorgan was claiming to have acquired Appellant’s loan after Washington Mutual Bank, Henderson, Nevada went into receivership by the FDIC in 2008. Deutsche Bank was relying upon an Assignment of Deed of Trust that was executed in 2011 by JPMorgan as a basis for their defense.
Appellant had raised specific factual allegations on why the assignment of her loan was void, however, the trial judge in Alameda County Superior Court found that Appellant did not have standing to challenge Deutsche Bank or JPMorgan rights under the Note and Deed of Trust.
As a result of the Yvanova decision, the banks and servicers are trying to focus on the California Supreme Court’s language that does not specifically address pre-foreclosure litigation, a purportedly grey area the Supreme Court is allowing the lower courts to rule on.
However, the Estavillo Law Group experienced a less hostile court, who seemed to embrace Appellant’s position that she has standing to challenge a third parties right to initiate a non-judicial foreclosure. The Court asked Respondent’s counsel, “What if a neighbor initiates a non-judicial foreclosure? Can a homeowner file a pre-emptive lawsuit?”
While we cannot speculate on how the court will rule, it appears from the questions they asked of both parties there is a possibility the courts are willing to embrace a pre-foreclosure litigation, supporting the Yvanova decision.
If you or anyone you know is facing foreclosure or has been foreclosed upon, please visit our website or contact us for more information. We are advocates for your right to keep you and your family in your home.