Creditors' Rights

NC: Lost Notes Find a Home in the Clerk’s Office

LNAs Can Be Used in Power of Sale Foreclosures when the Present Holder Lost the Note

In an October 2, 2018 published opinion from the North Carolina Court of Appeals, the Court confirmed that a lender who lost the original promissory note while it was in physical possession of the original note may proceed with a power of sale foreclosure proceeding before the Clerk of Court. In In re Frucella, No. COA 18-212 (October 2, 2018), the homeowners appealed the Clerk’s order authorizing a foreclosure sale for a hearing de novo before a Superior Court judge.

Timing is Everything

Appellate Court upholds dismissal of Debtor’s claims due to failure make timely payments outlined in a loan modification plan

They say that there’s a time and a place for everything in life. For a while, the North Carolina courts were having quite a time deciding when a loan modification agreement amounted to a mere offer from the lender, and when the agreement became a contract that bound both parties.

A Tough Reminder from the Court to Draft Carefully

In re: Tacket: Davidson County, North Carolina File No. 17 CVS 1059

In a small county in the Piedmont region of North Carolina (best known for arguably being the ‘Barbeque Capital of the World’), a recent ruling has some foreclosure lawyers scouring their Notice of Foreclosure Sale templates and others wondering if previous foreclosure sales could end … up in smoke.

Already Litigated: Another Failed Res Judicata Challenge to a North Carolina Foreclosure Special Proceeding

Earlier this month, the North Carolina Court of Appeals rejected a challenge to a foreclosure special proceeding based on res judicata in Roberson v. Tr. Services of Carolina, LLC, No. COA17-1152. In this decision, the Court of Appeals reaffirmed the seminal 2016 Supreme Court decision, Matter of Lucks, limiting the applicability of the doctrine in the context of non-judicial foreclosure.

Will Your Junior Lien Be Stripped?

The Fourth Circuit Court of Appeals recently ruled that the anti-modification provision of 11 USC 1322 does not prevent junior liens that are completely “underwater,” from being stripped, regardless of whether or not the creditor filed a proof of claim. In Burkhart v. Grigsby, 886 F.3d 434 (2018), the Fourth Circuit Court of Appeals held that whether or not a Chapter 13 debtor may strip off mortgage liens is decided by the application of 11 USC § 1322(b) and not 11 USC §506(d).

U.S. Bank NA v. Pinkney

North Carolina’s Supreme Court Delineates Crucial Differences Between Power of Sale Foreclosures and Judicial Foreclosures

A non-judicial foreclosure by power of sale is the more common, stream-lined method to foreclose a deed of trust in North Carolina. To allow a sale in a non-judicial foreclosure, the court must find the existence of only six factors. One of those six findings is whether there exists a “valid debt of which the party seeking to foreclose is the holder.”N.C. Gen. Stat. §45-21.16(d) (emphasis added).

Up Close - North Carolina Substitute Trustee Statute Amended

North Carolina: Amendment to the Substitute Trustee Statute
by Terry Hutchens | Hutchens Law Firm LLP – USFN Member (North Carolina, South Carolina)
and Jim Bonner | Brock & Scott, PLLC – USFN Member (North Carolina)

In response to questions concerning the recent amendment to N.C.G.S. § 45-10: Substitution of trustees in mortgages and deeds of trust, the following overview and guidance are provided.

North & South Carolina Border Dispute Resolved Again

Are the Carolinas Moving?

Although we may have thought the border between South Carolina and North Carolina was firmly established when the Province of Carolina was divided in 1729, the truth is that the line thought of as the border between the two new colonies contained numerous and substantial errors in its measurements.  These discrepancies in the border have now been resolved through cooperation of the two states by a comprehensive re-survey of the North Carolina/South Carolina boundary line.