There has been a widely followed case reported last week where a Suffolk County Judge, Jeffrey Spinner, erased a $525,000 mortgage by the same California bank that bought IndyMac from FDIC after it went under.
Its also about pushing literacy to the limit so I’ll provide the definitions of two of the words in the headline I had never heard of before and had no idea what they meant:
Apparently the judge grew tired of the bank’s tactics and wiped out the mortgage – the bank is
involved in a similar case in California, where it’s trying to foreclose on an 89-year-old woman, despite two court orders telling it to stop.
I think its a bit early to get overly excited for the homeowner if you did when reading about this case since there is an appeal process. The stakes are huge and I would think a full court press by the lender will be in order.
Plus, I assume this ruling simply disconnects the debt with from the property so it can’t be foreclosed, but the liability still exists, but without the house as collateral. Not sure about this legal point though.
Ali Rogers over at CBS MoneyWatch in her must-read “Ask The Agent” column does a nice job on this ruling and provides more background about the bank.