Court orders more proceedings in foreclosure action

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An Elkhart County man successfully convinced the Indiana Court of Appeals to reverse the denial of his motion to set aside default judgment in a foreclosure action. The man argued he relied on information from the bank that he could proceed with a short sale and the foreclosure proceeding would be put on hold.

Bank of America N.A. attempted to foreclose on Michael H. Kretschmer’s property in Elkhart County in 2012. When Kretschmer didn’t reply to the complaint, the trial court awarded default judgment to the bank. When Kretschmer learned of the judgment, he filed a motion to set it aside, alleging that Bank of America had agreed to a short sale of the real estate. He said he spoke with someone in the bank’s counsel’s office who told him, “not to worry about anything and to continue with the short sale.” Based on that conversation, Kretschmer did not hire an attorney or appear in court.

The matter went to a settlement conference, in which the parties agreed to stay the foreclosure pending Kretschmer’s submission of a possible short sale offer and the bank’s review of the offer. But the bank claimed it never received any offers and the trial court later ruled in favor of the bank on Kretschmer’s motion to set aside the default judgment.

But the trial court erred by denying his motion, the Court of Appeals ruled Thursday in Michael H. Kretschmer v. Bank of America, N.A., 20A05-1312-MF-600. The judges found that his failure to timely answer BANA’s complaint was the result of excusable neglect under Trial Rule 60(B)(1) and (3) due to the information provided by the bank’s counsel’s office.

Kretschmer claimed that he presented two short sale offers to the bank, but the bank failed to consider the offers. If true, these allegations could show that the bank engaged in contractual sabotage or other acts of bad faith, the appeals court held.

“If Kretschmer’s assertions that BANA promised to allow him more time to attempt to obtain an acceptable short sale offer are credited, then it was incumbent upon BANA to give due consideration to any short sale offers Kretschmer submitted for approval. Finally, we observe that Ind. Code § 24-4.4-2-201 provides in part that a creditor who fails to respond to a short sale offer may be liable in an action under 12 U.S.C. 2605(f), and the fact that Kretschmer may be entitled to damages under certain circumstances supports the conclusion that, if the case were tried on the merits, a different result may be reached,” Judge Elaine Brown wrote.

The case is remanded for further proceedings.


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  1. Especially I would like to see all the republican voting patriotic good ole boys to stop and understand that the wars they have been volunteering for all along (especially the past decade at least) have not been for God & Jesus etc no far from it unless you think George Washington's face on the US dollar is god (and we know many do). When I saw the movie about Chris Kyle, I thought wow how many Hoosiers are just like this guy, out there taking orders to do the nasty on the designated bad guys, sometimes bleeding and dying, sometimes just serving and coming home to defend a system that really just views them as reliable cannon fodder. Maybe if the Christians of the red states would stop volunteering for the imperial legions and begin collecting welfare instead of working their butts off, there would be a change in attitude from the haughty professorial overlords that tell us when democracy is allowed and when it isn't. To come home from guarding the borders of the sandbox just to hear if they want the government to protect this country's borders then they are racists and bigots. Well maybe the professorial overlords should gird their own loins for war and fight their own battles in the sandbox. We can see what kind of system this really is from lawsuits like this and we can understand who it really serves. NOT US.... I mean what are all you Hoosiers waving the flag for, the right of the president to start wars of aggression to benefit the Saudis, the right of gay marriage, the right for illegal immigrants to invade our country, and the right of the ACLU to sue over displays of Baby Jesus? The right of the 1 percenters to get richer, the right of zombie banks to use taxpayer money to stay out of bankruptcy? The right of Congress to start a pissing match that could end in WWIII in Ukraine? None of that crud benefits us. We should be like the Amish. You don't have to go far from this farcical lawsuit to find the wise ones, they're in the buggies in the streets not far away....

  2. Moreover, we all know that the well heeled ACLU has a litigation strategy of outspending their adversaries. And, with the help of the legal system well trained in secularism, on top of the genuinely and admittedly secular 1st amendment, they have the strategic high ground. Maybe Christians should begin like the Amish to withdraw their services from the state and the public and become themselves a "people who shall dwell alone" and foster their own kind and let the other individuals and money interests fight it out endlessly in court. I mean, if "the people" don't see how little the state serves their interests, putting Mammon first at nearly every turn, then maybe it is time they wake up and smell the coffee. Maybe all the displays of religiosity by American poohbahs on down the decades have been a mask of piety that concealed their own materialistic inclinations. I know a lot of patriotic Christians don't like that notion but I entertain it more and more all the time.

  3. If I were a judge (and I am not just a humble citizen) I would be inclined to make a finding that there was no real controversy and dismiss them. Do we allow a lawsuit every time someone's feelings are hurt now? It's preposterous. The 1st amendment has become a sword in the hands of those who actually want to suppress religious liberty according to their own backers' conception of how it will serve their own private interests. The state has a duty of impartiality to all citizens to spend its judicial resources wisely and flush these idiotic suits over Nativity Scenes down the toilet where they belong... however as Christians we should welcome them as they are the very sort of persecution that separates the sheep from the wolves.

  4. What about the single mothers trying to protect their children from mentally abusive grandparents who hide who they truly are behind mounds and years of medication and have mentally abused their own children to the point of one being in jail and the other was on drugs. What about trying to keep those children from being subjected to the same abuse they were as a child? I can understand in the instance about the parent losing their right and the grandparent having raised the child previously! But not all circumstances grant this being OKAY! some of us parents are trying to protect our children and yes it is our God given right to make those decisions for our children as adults!! This is not just black and white and I will fight every ounce of this to get denied

  5. Mr Smith the theory of Christian persecution in Indiana has been run by the Indiana Supreme Court and soundly rejected there is no such thing according to those who rule over us. it is a thought crime to think otherwise.