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2 cases prompt new real estate law

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New laws designed to clarify and streamline parts of Indiana’s mortgage foreclosure process were enacted in 2012.

One change comes from Rep. Woody Burton, R-Whiteland, whose House Enrolled Act 1238 created a new section of Indiana code, “Determination of Abandonment for Property Subject to a Mortgage Foreclosure Action.” HEA 1238 took immediate effect. Another significant change comes from Sen. Joseph Zakas, R-Granger, whose Senate Enrolled Act 298 creates a new section of code negating the Supreme Court decision in Citizens Bank of New Castle v. Countrywide Home Loans, Inc. Some changes made by SEA 298 took immediate effect, and others become effective July 1.

john waller Waller

Strict foreclosure

SEA 298 creates a strict foreclosure statute, which applies to both residential and commercial foreclosures. John Waller, a partner with Wooden & McLaughlin, said that until now, courts relied on caselaw to solve disputes involving junior liens or second mortgages that were inadvertently omitted from the foreclosure process.

Waller said that when someone buys a house, he buys it with the expectation that it’s free and clear of liens, except for his own mortgage.

“That’s kind of what happens in this sheriff’s sale world. People come in to a sheriff’s sale and they think they’re buying it free and clear, that as a part of the foreclosure process, all these other liens are being flushed away,” Waller said. “Part of what this is about is what happens to the junior lien holder’s rights, and what happens to the buyer’s rights if, in fact, there’s this dangling lien out there that was missed in the foreclosure process,” Waller said.

In the Citizens case, Countrywide Home Loans, the original lien holder on a homeowner’s property, inadvertently omitted Citizens Bank of New Castle, the junior lien holder on the property, at foreclosure. Justice Frank Sullivan wrote that the two lien holders should have been given the practical equivalent of do-over – a second foreclosure in which Citizens Bank could redeem its subordinate interest in the property. That was the decision the trial court reached. But Sullivan wrote that the Supreme Court’s majority opinion “allows the omitted party to maintain its lien on the property (now owned by Fannie Mae) but provides that the omitted party’s lien is no longer subordinate to any senior lien. That is, the Court promotes the omitted party from a junior to the senior lien holder without having to pay anything to redeem its interest.”

Zakas, who is also a lawyer, took a cue from Sullivan’s dissent.

“I think Justice Sullivan kind of gave guidance on the thinking several of us had with regard to this situation,” Zakas said of title insurance companies and lawmakers.

Terry Farmer, managing partner at Bamberger Foreman Oswald & Hahn, said that he thinks title companies are overwhelmed with the volume of foreclosures, which results in more junior lien holders being missed at foreclosure.

“In this day and age, most title examiners are fairly error-prone on residential (foreclosures),” Farmer said. “You’re talking about a title search system that worked pretty efficiently when Vanderburgh County had 10 sheriff’s sales a month.”

At the March 29 Vanderburgh County monthly sheriff’s sale, 109 properties were up for bid.

Abandoned properties

Burton, who is a real estate broker, said that an increase in abandoned properties in recent years has put a strain on neighborhoods, where vacant homes attract crime and drive down property values for other properties.
 

He said the time from a lender’s initiation of foreclosure until it can access the property averages 422 days.

terry farmer Farmer

“Basically, as a realtor and a legislator on the banking committee, the last several years, we’ve been working very hard to try to fix this problem,” Burton said. “What we did is we passed a law that says there is a process with prima facie evidence to the court (to determine) that the property is abandoned.”

Burton said that under the new statute, if the court feels sufficient evidence exists to show that a property is abandoned, a post-complaint waiting period may be waived, shaving time off the overall foreclosure process.

Unanswered questions

Waller said he thinks that that the Legislature stopped short of fully clarifying one section of mortgage foreclosure law.

In Citimortgage v. Shannon Barabas, the Indiana Court of Appeals disagreed about the application of Indiana Code 32-29-83, which the majority found precluded Citimortgage’s claim on Shannon Barabas’ property because Citimortgage failed to intervene for more than a year after it first acquired interest in the property. But Judge Elaine Brown wrote in her dissent that the statute specifies that one-year period begins with the sale of the property, and the facts of the case show Citimortgage filed a motion to intervene and for relief from the amended default judgment within one year of sale.

The statute as amended by SEA 298 adds a clause that elaborates on that disputed one-year time frame, but Waller said the language that remains about a post-sale right of redemption is open to interpretation.

“In Indiana, before all this came down, I always relied upon the fact that the right of redemption ended upon sheriff’s sale. That was the conclusion to the foreclosure suit as well as transfer of title property,” Waller said. Without clarification, he wonders if the statute’s redemption language may be applied in a way the Legislature did not intend.

On April 13, the Indiana Supreme Court granted transfer in Citimortgage, and Waller said the high court will base its opinion on the law as it is was prior to changes made during the 2012 legislative session.

“It could use some more work, I think, and maybe the Supreme Court will clear it up for us,” he said.•

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  1. Am I the only one who sees that the City is essentially giving away the MSA site AND giving millions to build new buildings on the site when this site would be the perfect place for the Justice Complex? Across from City-County, check; keeping it centrally located, check, etc. It's my understanding that the GM site must be purchased by the City from Motors Liquidation Company. STOP WASTING WHAT WE ALREADY HAVE AND OUR TAX DOLLARS! The Ballard Administration has not been known for it's common sense...never voted for him and never will!

  2. This guy sounds like the classic molester/manipulator.

  3. Louis D. Brandeis was born in 1856. At 9 years of age it would have been 1865. The Brandeis family did not own slaves. My source Louis D. Brandeis: A Life, by Melvin L. Urofsky.

  4. My name is Matthew Lucas Major, I recently went through a jury trial in Bloomington , In. It was the week of Feb 19-21. Although I have been incarcerated since August 5, 2014. The reason I 'am writing to you sir is on the 21 of February the jury came in with a very excessive and wrongful verdict of guilty on 6 child molesting charges against my daughter who was 9 at the time I was accused. I also had 2 other Felonies one of Intimidation and 1 of Sexual Vicarious Gratification. Judge Marc Kellam on the second day of trial gave me a not guilty on those 2 felonies. The jury was sent out during that time and when brought back Judge Kellam told them to not concern themselves with the 2 Felonies that he ruled on them. They were told to not let evidence they had already heard influence there verdicts. I never in my life touched any child sexually and definitely not with my own daughter. When I was arrested Detective Shawn Karr told me I would be convicted guilty just on my daughters word even without evidence. That's just what happened. my public defender did me so wrong he never once proved to the court and jury all the lies the child told, and Jeremy Noel my public defender could of proven the lies easily. The stories in Serenity's depositions and Forensic interview changed and were not consistent as Prosecutor Darcie Fawcett claimed they were. Yet my attorney never mentioned that. The facts that the child accused me of full penetration in her vagina and rectum was proven lies. Doctor Roberta Hibbard of Riley hospital in Indianapolis confirmed Serenity's hymen intact, no scars, no tearing, no signs of rape to her. Yet my attorney didn't use that knowledge . the DNA was all in my favor. I tell you I will spend my entire life in prison going through rape and beatings etc. even Judge Kellam abused his authority by telling the jurors to listen and believe what the prosecutors side in evidence like my daughters testimony. In one interview with the detectives my daughter got flustered with her mom and said on camera " I'm saying what you told me to mom"!! Yet Mr. Noel said nor did anything to even resemble a defense attorney. Judge Kellam allowed edited version of a taped conversation between the child and her mother. Also Judge Kellam allowed the Prosecutor too bring in to my case a knife found under my seat, the knife wasn't part of my case. She was allowed by my attorney and the judge to put a huge picture of it on the screen and huge picture of my naked privates in a full courtroom and open court. Ms. Fawcett says to jury see how easy Mr. Major could reach the knife and cut his Childs throat. Even though I had no weapons charge against these cases. This gave the jurors prejudice thought against me thinking I threatened her with that knife and how scared she would of been knowing i could get it and kill her. On my sentencing court March 19, 2014 my public defender told Judge Kellam he wish to resign from being my attorney and wished for the court to give me outside council to file a error to trial or appeal. We were denied. Now after openly knowing my public defender don't want to represent me he has to. Well when as parents we make our kids clean a room when they really don't wish to, well the child will but don't mean she will do a good job, that's where I'm at with Mr. Noel. please dont ignore mine and my families pleas for your help . we have all the legal proof you could need to prove Im innocent. Please dont make my spend years in prison innocent when you can fix this wrong. Im not saying Im a perfect man or that I was a perfect dad to my 2 children none of us are. Ive made some bad choices in life and I paid for them. But I didnt ever touch or rape my daughter . I love my children with all my heart. And now through needing attention and a ex-wife who told my granny several times she wish she could put me in prison to get me out of their lives. Well my ex finally accomplished her goal. Sad part is she is destroying our daughter with all this horrific lies and things she taught my daughter to say. My daughter will need therapist to ever hope for a chance of a normal life after what she had done to her by her mom and their side of the family. My daughter told everyone even on stand she had a dream months before i supposedly molested her in this dream I was molesting her and when I finally did it matched her dream perfectly. She admitted to watching movies about little girls being molested and watching U-Tube videos about child molesting all before it happened supposedly to her. Doesn't that sound very unusual that a non molested 9 yr old would need to know so much about being molested? The only reason I could think a 9 year old would need so much information is to be prepared to know what to say and be able to say how it felt what took place etc.. So when questioned by authorities she would be prepared. And there again sir if a parent is pre grooming a 9 year old child she would need intimate details . Like telling her daughter about a couple moles on my private area. The child admitted to sneaking my cell and looking many many times at nudes of me and my girlfriend even one where my penis was entering my girlfriends vagina. In that picture my moles are obvious. Yet when prosecutor showed everyone in court my privates and pictures of the moles she said the only way the child would know about them is if she saw them for herself. My attorney once again said nothing about the pictures my child saw. Or could a ex-wife be able to describe my moles to help her case against getting rid of me? I beg you help me. This is my very existence. Ive lost everything , a good job, a wonderful girlfriend, my freedom, but worse thing Ive lost is my children. They were my reason to get up every morning and strive to be better. The wonderful bond I had with my Serenity is gone. After this I would be afraid to even hug her for fear of what next can they do to me. I'm not afraid to tell you I sit here in this cell and try to hold back my tears. Everyone knows you cant show weakness in prison. My life has already been threatened here at Wabash Valley Prison. After only 3 days of arrival. I was tricked into signing a waiver now Im in G Block General Population with 6 child molesting felony charges. Mrs. Hart as a 18 year old I almost died hooked to machines in hospital almost 1 month and now I know that fear was childish compared to this . I cant help but put emotions in this, after all Mrs. Hart Im human and God help Me I never been more afraid in my life. I didnt hurt my little girl I didnt touch her sexually. As much as it shreds me and fills my mind what Im facing I worry more about my mom and granny because of their great love for me mam they are suffering so deeply. I aint done this things but my loved ones suffering right along beside me and If you take my case you will be in essence freeing them also. I sent momma this letter and asked her to email it to you. I'm scared I have been done so unjustly by our legal system and I need you to fix this and give me freedom. I ask you please don't just ignore my pleas. Here in America its nice to be able to trust our legal justice system, well they destroyed my and my loved ones trust in our justice system . And I'm trusting in You !!! My entire family is suffering this nightmare with me. My 77 year old granny had a stroke and isn't doing so well. My single mother that raised 3 kids alone is dying from Lupus and since my arrest has stayed so sick and weary. Our lives torn to peices by a government I was taught I could trust in. my momma has tried so many innocent project and wrongfully accused and cant get anywhere. please please help me. A quote from the late Nelson Mandela: To be free is not merely to cast off ones chains, But to live in a way that respects and enhances The Freedom Of Others. I have Faith in you and your clinic to cast my chains off and give me freedom I do deserve as a wrongfully accused Man, son, brother, father, friend. Matthew Major DOC# 246179 Cause # : 53c02-1308-FA-000779 God Bless you. Please contact me with your decision so I know you made a life changing decision for me , just please at least write me so I know you care enough about your citizens to respond to cries for your help. You can speak openly with my mother Charlotte Spain (828) 476-0406: 71 Lakeview Dr. Canton, NC 28716 Thank You Matthew Major I know yall get thousands of request and inmates claiming innocence, and each person who are innocent deserve to have organizations like yours willing to fight for them and I give yall so much Thanks and I thank God everyday yall are out there caring enough to help free the innocents. Since discovering firsthand how easily lives and families can be destroyed by Poor Defense attorneys not doing their job . And Prosecutors allowed to do as they please in court

  5. Frankly, it is tragic that you are even considering going to an expensive, unaccredited "law school." It is extremely difficult to get a job with a degree from a real school. If you are going to make the investment of time, money, and tears into law school, it should not be to a place that won't actually enable you to practice law when you graduate.

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