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Judges find mortgage company not culpably negligent

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In a dispute over which mortgage has priority in a foreclosure action, the Indiana Court of Appeals affirmed summary judgment for the senior mortgage holder. The judges found the doctrine of equitable subrogation applies.

Ronnie and Debora Brand obtained a mortgage for more than $107,000 with Meridian Group Mortgage Corp. and a second mortgage for a $25,000 home equity line of credit with Finance Center Federal Credit Union in 2002. The Brands later refinanced with First Republic Mortgage Corp., which paid off both Meridian Group and Finance Center. The First Republic mortgage was later assigned to GMAC Mortgage.

Finance Center never released the mortgage because the Brands did not send notice requesting release of the lien. The line of credit was left open and the company later advanced more money to the Brands. When GMAC attempted to foreclose on the real estate, Finance Center argued that its mortgage should be first in priority.

Both companies filed for summary judgment, and the trial court granted partial summary judgment to GMAC, finding it should have priority and Finance Center would be the junior lienholder.

Finance Center argued that GMAC isn’t entitled to first lien pursuant to the doctrine of equitable subrogation because GMAC was culpably negligent by not obtaining a release of the Finance Center mortgage. The appellate court cited JPMorgan Chase Bank v. Howell, 883 N.E.2d 106 (Ind. Ct. App. 2007), a case involving a similar dispute in which the judges found no culpable negligence in the refinancing lender’s failure to ensure that it had properly paid off the junior line of credit.

Any negligence in GMAC’s failure didn’t prejudice Finance Center because the Finance Center mortgage was always junior to the senior Meridian Group mortgage, which was fully satisfied with the loan proceeds from the GMAC refinancing, wrote Judge Nancy Vaidik in Finance Center Federal Credit Union v. Ronnie D. Brand, Debora J. Brand and GMAC Mortgage, LLC, No. 49A02-1111-MF-1089. Allowing GMAC to step into the shoes of the Meridian Group mortgage will leave Finance Center in the same junior position.

 

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  1. Indianapolis employers harassment among minorities AFRICAN Americans needs to be discussed the metro Indianapolis area is horrible when it comes to harassing African American employees especially in the local healthcare facilities. Racially profiling in the workplace is an major issue. Please make it better because I'm many civil rights leaders would come here and justify that Indiana is a state the WORKS only applies to Caucasian Americans especially in Hamilton county. Indiana targets African Americans in the workplace so when governor pence is trying to convince people to vote for him this would be awesome publicity for the Presidency Elections.

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  4. I wonder if $10 diversions for failure to wear seat belts are considered moral turpitude in federal immigration law like they are under Indiana law? Anyone know?

  5. What a fine article, thank you! I can testify firsthand and by detailed legal reports (at end of this note) as to the dire consequences of rejecting this truth from the fine article above: "The inclusion and expansion of this right [to jury] in Indiana’s Constitution is a clear reflection of our state’s intention to emphasize the importance of every Hoosier’s right to make their case in front of a jury of their peers." Over $20? Every Hoosier? Well then how about when your very vocation is on the line? How about instead of a jury of peers, one faces a bevy of political appointees, mini-czars, who care less about due process of the law than the real czars did? Instead of trial by jury, trial by ideological ordeal run by Orwellian agents? Well that is built into more than a few administrative law committees of the Ind S.Ct., and it is now being weaponized, as is revealed in articles posted at this ezine, to root out post moderns heresies like refusal to stand and pledge allegiance to all things politically correct. My career was burned at the stake for not so saluting, but I think I was just one of the early logs. Due, at least in part, to the removal of the jury from bar admission and bar discipline cases, many more fires will soon be lit. Perhaps one awaits you, dear heretic? Oh, at that Ind. article 12 plank about a remedy at law for every damage done ... ah, well, the founders evidently meant only for those damages done not by the government itself, rabid statists that they were. (Yes, that was sarcasm.) My written reports available here: Denied petition for cert (this time around): http://tinyurl.com/zdmawmw Denied petition for cert (from the 2009 denial and five year banishment): http://tinyurl.com/zcypybh Related, not written by me: Amicus brief: http://tinyurl.com/hvh7qgp

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