Family member thought she had her husband's power of attorney on mortgage, but didn't. Now the loan is in default.

Asked over 1 year ago - Riverhead, NY

My mother signed a mortgage for a hard money loan on her house, co-owned with her husband. She always handled all of his money, due to health issues, and thought she had his power of attorney. They had discussed that she did, but she did not as far as any legal documents. I don't believe the lender ever checked further than that, and she signed both their names to the loan. The hard money loan is now in foreclosure. Her husband is not looking to press charges on her, but also doesn't want to lose the house. Can the mortgage be nullified in court if he protests?

Additional information

He did not receive any of the money and was not aware of it until just recently. The money was used for a business purpose for my mother

Attorney answers (2)

  1. Richard J. Chertock


    Contributor Level 18


    Lawyers agree

    Answered . If there was no valid power of attorney in place at the time the mortgage was signed then the mortgage is invalid as it applies to your father. This can be a defense to the house being pledged as security to pay back the loan. Your mother will remain liable for the debt on the note but there will not be a security interest in the house. Your father can use this defense without prosecuting your mother however the lender can press charges for loan fraud if your mother presented them with documents purporting to be a valid power of attorney. If the lender never asked for an original power of attorney (which is unlikely) then they may be left with just a promissory note from just your mother which amounts to a personal promise to pay back money or an IOU. I suggest you consult with an attorney and bring all the loan documents with you before taking any action.

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  2. Dionna P. Reynolds

    Contributor Level 4

    Answered . I agree with Mr. Chertock. It is suggested that your family consult with an attorney as soon as possible. In a foreclosure action (a) defendant(s) only has so much time to file an answer to the action or to cite any defenses. This situation definitely calls for the advice of a licensed attorney in your state that practices foreclosure law.

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