Eaton – Consumer Financial Services Watch

The Massachusetts Supreme Judicial Court Issues Its Long-Anticipated Eaton Decision

Jun 28 2012

In a long-anticipated decision, the Massachusetts Supreme Judicial Court (“SJC”) ruled in Eaton v. Federal National Mortgage Ass’n, 2012 WL 2349008 (June 22, 2012) (“Eaton”) that when conducting a non-judicial foreclosure in Massachusetts, a foreclosing entity must not only hold the mortgage – it also must hold the note or be authorized to act on behalf of the note holder. But if the goal of consumer advocates was to void a large volume of foreclosures, then they failed in that goal, and Eaton should be seen as a victory for those who have foreclosed, or who are seeking to foreclose, on mortgage loans in Massachusetts. Read More

MERS and Foreclosure Law in Massachusetts: Culhane v. Aurora Loan Services

Jan 19 2012

By: Andrew C. Glass, Gregory N. Blase, Roger L. Smerage

A Massachusetts federal court recently confirmed MERS’s ability to assign mortgages under Massachusetts law and approved MERS’s practices in doing so.

In Culhane v. Aurora Loan Services, — F. Supp. 2d —-, 2011 WL 5925525 (D. Mass. Nov. 28, 2011), a borrower sued her loan servicer to prevent foreclosure. The court granted summary judgment for the servicer, addressing two principal issues. First, the court examined whether Massachusetts law requires that the same entity hold both the note and mortgage before initiating the foreclosure process. Predicting how the Massachusetts Supreme Judicial Court may rule in a pending appeal, Eaton v. Federal National Mortgage Association, SJC-11041 (argued Oct. 3, 2011), the federal court concluded that under Massachusetts law, the mortgagee must either be the noteholder, or the servicer of the noteholder acting pursuant to authority from the noteholder, to foreclose on property pursuant to the power of sale. Read More

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