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How do "Lenders" transfer a Mortgage Note?

Lakeland, FL |

Let’s say Lender ‘A’ originates a loan and endorses said Note to Lender ‘B’ (at closing).
The Mortgage is assigned to MERS (also at closing).
Lender ‘B’ is acquired by Lender ‘C’ (within months of origination).
Plaintiff (in foreclosure case) is neither Lender ‘A’, ‘B’ or ‘C’.
Plaintiff produces a (alleged) copy of (an undated, blank) endorsement from Lender ‘B’ and claims to “hold” the Note and Mortgage.
Is there any way the Plaintiff can acquire rights to enforce the Note & Mortgage if there is no ‘trail’ showing a connection between Lender ‘C’ and the Plaintiff?

Attorney Answers 2


Yes, but you are leaving out a lot of information. The "alleged" copy will not due, the original has to be endorsed. If there is an endorsement in blank on the original note then the person who has physical possession of the note can enforce the note. If the note is stolen then the thief can enforce the note.
Use the following example. Say you have a 100 check made payable to you. You endorse it in blank and a thief steals it. The thief can go to the bank on which it is drawn and cash it.
There are ways to stop this but it is hard to do.
The "plaintiff" has two ways to enforce the note. If the mortgage has been assigned to the plaintiff then he can seek foreclosure through the mortgage. This is in an equity court where the plaintiff has to come into court with clean hands. Unfortunately the court ignores hands covered with grease, dirt and unmentionables. The plaintiff can also sue on the note. That is relatively simple, but all the plaintiff gets is a judgment. He then has to levy against the property.
I hope this helps and I would appreciate comments from counsel if they feel I am incorrect.

Law Office of Gerald Solomon, PA

By answering this question I am not becoming your attorney, nor am I tendering legal advice. Foreclosure cases are complex and require a full review of the facts before any attorney can answer legal questions specific to the case.

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3 lawyers agree


I agree with everything in the first answer and would only add that- sometimes the chain of ownership may not appear to be complete and may have a break in it and the lay individual wouldn't understand then how it got from b to c. Many times mortgage servicers will purchase other mortgage servicers and acquire the rights to all of the notes that were held by the servicer that has been bought. This may never show up on the note itself as an endorsement or alonge. It is, however, enforceable. Most attorneys in the industry are familiar with these transactions and can tell you if there has been a transaction that affects the note. Otherwise you can also look it up on the web, there will Be SEC filings and press releases near the time of the transaction.

The response given is not intended to create, nor does it create an ongoing duty to respond to questions. The response does not form an attorney-client relationship, nor is it intended to be anything other than the educated opinion of the author. It should not be relied upon as legal advice. The response given is based upon the limited facts provided by the person asking the question. To the extent additional or different facts exist, the response might possibly change. Attorney is licensed to practice law only in the State of Florida. To set up a free consultation, please call my office at 727-755-3476.

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