Fifth Circuit

The Fifth Circuit’s Favorite 3-Panel Foreclosure Panel Names Mortgage Servicer as “the Bank”

First, it assumes that the acceleration notice was for only the original loan amount. But the deed of trust granted the Bank authority to accelerate the sums secured by the deed of trust, which includes interest and other fees.DAVIS, HAYNES & GRAVES
Fifth Circuits Favorite Foreclosure 3-Judge Panel Opinion

DAVIS, W. EUGENE

GRAVES, JAMES E. (JR)

HAYNES, CATHARINA

Lyons v. Select Portfolio Servicing Inc., No. 18-10938 (5th Cir. Jan. 17, 2019)

For simplicity, we call the mortgagee (Deutsche Bank National Trust Company) and Select Portfolio Servicing Inc. collectively “the Bank.

The Lyonses believe the Bank abandoned acceleration because the monthly mortgage statement and reinstatement notice referenced different amounts from the original loan amount. This argument is built on two mistaken assumptions.

First, it assumes that the acceleration notice was for only the original loan amount. But the deed of trust granted the Bank authority to accelerate “the sums secured by” the deed of trust, which includes interest and other fees.

Second, it assumes that the amounts referenced in the mortgage statement and reinstatement notice were modifications to the acceleration amount. But the amounts in the mortgage statement and reinstatement notice unambiguously refer to different calculations, not the acceleration amount. The documents also explicitly state they were sent purely for informational purposes, not in an attempt to collect any debt.

The alleged conduct is thus unlike those instances when a bank explicitly stated it was abandoning acceleration or acted so inconsistently that it could be construed to have abandoned acceleration. See Pitts v. Bank of N.Y. Mellon Trust Co., N.A, No. 05-17-00859-CV, 2018 WL 6716933, at *4–6 (Tex. App.—Dallas Dec. 21, 2018, no pet. h.) (collecting cases where a bank had abandoned acceleration and concluding that sending delinquency notices that referenced foreclosure followed by subsequent notices without any mention of foreclosure created a genuine issue of material fact regarding abandonment).

The Lyonses have not alleged that the Bank sent any other letters, nor have they identified any parts of the two documents from which a court could plausibly infer abandonment.

Because the Lyonses acknowledge that all their claims depend on the Bank improperly accelerating and because we determine that acceleration was proper, the Lyonses’ claims fail.  AFFIRMED for “the Bank”.

Panel consisted of: DAVIS, HAYNES & GRAVES

Fifth Circuits Favorite Foreclosure 3-Judge Panel Opinion

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  1. Pingback: LIT Brightens the Lights to Review Judge Catharina Haynes of the Court of Appeals for the Fifth Circuit. | Laws In Texas

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Laws In Texas is a blog about the Financial Crisis and how the banks and government are colluding against the citizens and homeowners of the State of Texas and relying on a system of #FakeDocs and post-crisis legal precedents, specially created by the Court of Appeals for the Fifth Circuit to foreclose on homeowners around this great State. We are not lawyers. We do not offer legal advice. We are citizens of the State of Texas who have spent a decade in the court system in Texas and have been party to during this period to the good, the bad and the very ugly.

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