Normally, defaulting on a mortgage doesn't result in the borrower retaining ownership of his or her home, but that's exactly what happened for a New Jersey man.
Normally, defaulting on a mortgage doesn't result in the borrower retaining ownership of his or her home, but that's exactly what happened for a New Jersey man.
Gordon Washington was able to beat out a foreclosure after claiming that his creditors, Specialized Loan Servicing LLC and Bank of New York Mellon, had failed to file the appropriate foreclosure complaint within a six-year statute of limitations. According to court documents, the statute began when Washington stopped making payments in mid-2007.
The Record reported that Washington bought the 4,000-square-foot home on Walnut Street in February 2007 for $650,000, with $130,000 down and a 30-year, adjustable-rate mortgage for $520,000. Washington only made a few $4,165-a-month mortgage payments before defaulting.
Judge Michael B. Kaplan ruled in Washington’s favor, though not without reluctance. “The debtor retains the property, free of any claim of the defendants. The court will proceed to gargle in an effort to remove the lingering bad taste," said Kaplan in The Record's article.
It is not known if Specialized Loan Servicing LLC and The Bank of New York Mellon will file an appeal of the court’s decision. The foreclosure complaint filed by the creditors was dismissed last year for lack of prosecution, according to NorthNewJersey.com.
During the first three months of this year, 8.1% of all mortgaged homes in New Jersey were underwater. The state had the highest rate of mortgage delinquencies in the United States during the first quarter of 2014, according to the Mortgage Bankers Association.
According to Montclair, New Jersey, lawyer Margaret Jurow, this case appears to be the first of its kind in the state. Jurow, who represents New Jersey homeowners facing foreclosure, said usually the best thing her clients can hope for is to receive a lower payment on their loan.
Washington filed for bankruptcy protection from creditors on March 12 of this year, according to reports.
Gordon Washington was able to beat out a foreclosure after claiming that his creditors, Specialized Loan Servicing LLC and Bank of New York Mellon, had failed to file the appropriate foreclosure complaint within a six-year statute of limitations. According to court documents, the statute began when Washington stopped making payments in mid-2007.
The Record reported that Washington bought the 4,000-square-foot home on Walnut Street in February 2007 for $650,000, with $130,000 down and a 30-year, adjustable-rate mortgage for $520,000. Washington only made a few $4,165-a-month mortgage payments before defaulting.
Judge Michael B. Kaplan ruled in Washington’s favor, though not without reluctance. “The debtor retains the property, free of any claim of the defendants. The court will proceed to gargle in an effort to remove the lingering bad taste," said Kaplan in The Record's article.
It is not known if Specialized Loan Servicing LLC and The Bank of New York Mellon will file an appeal of the court’s decision. The foreclosure complaint filed by the creditors was dismissed last year for lack of prosecution, according to NorthNewJersey.com.
During the first three months of this year, 8.1% of all mortgaged homes in New Jersey were underwater. The state had the highest rate of mortgage delinquencies in the United States during the first quarter of 2014, according to the Mortgage Bankers Association.
According to Montclair, New Jersey, lawyer Margaret Jurow, this case appears to be the first of its kind in the state. Jurow, who represents New Jersey homeowners facing foreclosure, said usually the best thing her clients can hope for is to receive a lower payment on their loan.
Washington filed for bankruptcy protection from creditors on March 12 of this year, according to reports.
