In a foreclosure action, a plaintiff generally has standing where it is both the holder or assignee of the mortgage and the holder or assignee of the underlying promissory note at the time the foreclosure action is commenced.
Sometimes, however, the mortgage may have been assigned to the foreclosing bank, but the promissory note was assigned to a different bank. In such cases, the courts generally deem that the mortgage passes with the promissory note despite the assignment into a different bank. The mortgage is deemed an inseparable incident to the note (see MERS, Inc. v. Coakley, 41 AD3d 674, 674 [2d Dept 2007]. Thus, an assignment of a mortgage without the underlying debt is a nullity ( see Deutsche Bank National Trust Co. v Barnett, 88 AD3d 636, 637 [2d Dept 2009].
Today, it is common for foreclosing plaintiffs to commence a New York Foreclosure action as trustee which was named in a pooling servicing agreement. These agreements add layers of complexity to the already complex law regarding standing. This is a separate matter that will be discussed in a future post by me. Always consult with an experienced New York foreclosure defense attorney.
Sometimes, however, the mortgage may have been assigned to the foreclosing bank, but the promissory note was assigned to a different bank. In such cases, the courts generally deem that the mortgage passes with the promissory note despite the assignment into a different bank. The mortgage is deemed an inseparable incident to the note (see MERS, Inc. v. Coakley, 41 AD3d 674, 674 [2d Dept 2007]. Thus, an assignment of a mortgage without the underlying debt is a nullity ( see Deutsche Bank National Trust Co. v Barnett, 88 AD3d 636, 637 [2d Dept 2009].
Today, it is common for foreclosing plaintiffs to commence a New York Foreclosure action as trustee which was named in a pooling servicing agreement. These agreements add layers of complexity to the already complex law regarding standing. This is a separate matter that will be discussed in a future post by me. Always consult with an experienced New York foreclosure defense attorney.
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