Transfers By Mortgagee And Mortgager

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Transfers by Mortgagee and mortgager

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all parties to mortgage or deed of trust may transfer their inert. TEh note and mortgage must pass to the same person for the transfer to be complete

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Transfer of mortgage without note

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some states hold that the transfer of morgue automatically transfer the note as well unless the morgaeee transferor expressly reserves the right to the note. In these staes the transferee of morgue can then file an equitable action and compel a transfer of the note as well. Toerh staes hold that because the notice is the principal evidence of debt, a trader or the mrogae without notice i void.

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Transfer of note without note

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th emote can be transferred without the mortgage but the mortgage will automatically follow the note, unessl transfer expressly receives the right to the mortgage No sep writing in necessary

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Methods of transferring the note

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a. either enduring it and levering it to the transferee or by a serrate document of assignment. Only if the endorsement and delivery method is used cab the transferee become a holder in due corse. To be holder in due course of the note there are requirement to be met
a. the note must be negitoanbl in form
b. be endorsed and signed
c. deliverd
d. take it in good faith and pay notice

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Benefits of Holder in Due corse

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not subject ott personal defenses but only to legal defenses.

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Payment to original mortgagee after transfer of note

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if the original mortgagee transfer possession of negotiable instrument any payment by the mortgagor to that mortgaee will not count. The older can sill deman payment even if the mrogaor lacked notice of transfer. However, if the the original morgaee transfers possession of nonnegotiable note the mortgagors pyement to him is effective agist the transferee until the mortgagor receives notice of transfer.

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Transfer by Mortgagor

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assumption if the grantee sign an assumption he becomes primarily liane to the lender, while the original mortgagor is seoncdarlily liabesly as surety. If no assumption is signed the grate is not liable. If not paid the it'll foreclosure.

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Due on sale clauses

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will allow lenderot demand full payment of the loan if the mortgagor transfer any interest without lenders concede.

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Defenses to Mortgage

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defenses of obligation are defenses agisat an action of the morgue. A mortgagees right to foreclose is precluded by discharge of mortgage dig pyemet of debt secured, merger of the legal and equable interest or morgues acceptance of deed in lieu of foreclosure tendered by mortgagor.

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possession before foreclosure

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the mortgagee can foreclose on mortgage. A mortgage may wish to take possession or bing rescuing rents before foreclosure.

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Foreclosure and theories of title

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can take possession in foreclosure depending of theory of title
a. lien theory - the mortgagee is considered the holder of security invest and the mortgagor is deemed th owner of land until foreclosure. The mortgagee may not have possession before foreclosure
b. title theory - letatl title in the mortgage - the mortgagee may deman possesion at anytime
c. intermediate theory- a few staes that follow the intermediate theory- legal title is nthe mortgagee when there is a default. Can demand possession when there is default.

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morgagor consent and abandonment

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can take posse ion if there is consent or abandons, most will not to valid liability

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Receivership

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most mortgagees attempt to intercept the rent before foreclosure by getting a recover appointed for rental property. The court will allow if a. date is occurring 2. the value of prop is inadequate to secure the debt 3. mortgagor is insolvent.

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Foreclosure

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most states will only allow a judicial sale, and someiwll allow power of sale.

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Redemption

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eat any time prior to the foreclosure sale the mortgagor may redeem the prop by paying account due or in acceleration clsue the full note. (half the state allow for redemption after foreclosure sale)

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Priorities

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a mortgages priority is usually determined by the time it was placed of the property. Foreclusre does not destroy any interest serio to the interest vein foreclose. IT generally destroy all junior but fiarue to include junio interest hold in foreclosure preserves the parties invest.