Bulletin: GA2012007

Date:
August 24, 2012
To:
All Georgia Issuing Offices
RE:
Reese v. Provident Funding Associates, LLP

In Reese v. Provident Funding Associates, LLP (2012 Ga. App. LEXIS 666, 2012 Fulton County D. Rep. 2374; Decided June 12, 2012), the Georgia Court of Appeals held that the foreclosure was invalid because the notice of default did not include information on the “secured creditor” in violation of O.C.G.A. 44-14-162.2 nor did the notice comply with the terms of the security deed.  In June of 2002, Izell and Raven Reese gave a security deed to Provident.  After funding, Provident sold the loan to Resident Funding Company LLC.  Provident continued to service the loan for Resident.  Upon default, the first notice sent to the debtor identified Provident as the holder of the note and security deed.  The second notice identified Provident as the “lender” not the “servicer”.  There was no mention of Resident in either notice.  The Court concluded that the statute requires the notice of default to properly identify the “secured creditor” and reflect that the notice is being sent by the “secured creditor” or by an “entity with authority on behalf of the secured creditor.”

COMPANY POLICY:  As a reminder, Issuing Agents must verify that the current assignment into the foreclosing lender is filed for record prior to the time of sale or no later than the date of the sale of the property at auction. Issuing Agents must also be satisfied that any prior assignments constitutes an uninterrupted chain of ownership from the first mortgagee to the last assignee. Any error or inconsistency in the security deed, assignments and deed under power on the record may require review of the foreclosure ad and all notices prior to insuring a purchaser at foreclosure sale or a conveyance subsequent to foreclosure.

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