The New Jersey Supreme Court says foreclosing parties must list the lender's name and contact information in addition to a loan servicer's information to comply with New Jersey Law when giving a party notice to foreclosure.
The court issued that opinion in the US Bank v. Guillaumes case, which drew friends of the court briefs from the state's banking association and numerous financial firms that considered the processing burdens that could stem from a decision in the case.
The initial fight began when Maryse and Emilio Guillaume filed a suit to prevent a foreclosure, claiming the foreclosure violated New Jersey's Fair Foreclosure Act (N.J.S.A 2A:50-53 to -68) and the Truth in Lending Act.
The couple alleged the foreclosure filing violated state laws, specifically the FFA, by listing only the name of the loan servicer as opposed to the name of the lender on the notice of intention to foreclose.
The couple also claimed excusable neglect and the presence of a meritorious defense. US Bank won on a few issues — namely the court said the Guillaumes did not show "excusable neglect for their failure to defend the foreclosure action."
The New Jersey Supreme Court rejected the parties meritorious defense claim.
But on the issue of how the documents listed the parties, the court agreed with the Guillaumes saying New Jersey code "requires that foreclosure plaintiffs list on the notice of intention the name and address of the actual lender, in addition to contact information for any loan servicer involved in the mortgage."
The court in Guillaume did not say the failure to conform the loan documents justifies vacating the foreclosure, but the decision does impact how financial firms deal with foreclosure notices across the state.
The decision is a significant one for all lenders and servicers. Wells Fargo Home Mortgage (WFC) released a statement after the ruling."Wells Fargo supports the New Jersey Supreme Court's unanimous decision and their view of the Fair Foreclosure Act," the firm said. "Today's ruling will enhance the integrity of the state's foreclosure proceedings by empowering trial court judges to have a range of remedies to render decisions on foreclosure cases; bringing relief to the state's foreclosure caseload. Wells Fargo will continue to work with homeowners to help them avoid foreclosure."