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Foreclosure Changes Insurable Interest from Borrower to Lender\\nPost 4787\\nIn this contested residential mortgage foreclosure, defendants Mitchell \\nand Deanna Minchello appealed from the entry of summary judgment. \\nDefendants contended that plaintiff violated the covenant of good faith \\nand fair dealing by "refusing to disburse defendants\' insurance proceeds\\n and forcing defendants\' home to remain in disrepair" and that the trial\\n court applied an improper standard.\\n\\nIn Wilmington Savings Fund Society, FSB, d/b/a Christiana Trust, as \\nowner trustee of the Residential Credit Opportunities Trust V v. \\nMitchell Minchello and Deanna Minchello, and J Hofert Company, FIA Card \\nServices NA, Schumann Hanlon LLC, Discover Bank, Vanz LLC-December 10 \\nSeries01, Mri-West Morris Associates, and State Of New Jersey, No. \\nA-3522-21, Superior Court of New Jersey, Appellate Division (December 8,\\n 2023) the issues were resolved.\\n\\nFACTS\\n\\nThe essential facts were undisputed. Defendants borrowed $522,000 in \\nJanuary 2007, secured by a thirty-year purchase money mortgage on their \\nhome in Mt. Arlington. Defendants stopped making their loan payments in \\n2010, and in 2012 they stopped paying the taxes and insurance on the \\nproperty. In 2014 the lenders asserted its rights by suing for \\nforeclosure in March 2015.\\n\\nDefendants filed a bankruptcy petition under Chapter 13. The following \\nday, December 7, defendant Deanna Minchello drove her car into \\ndefendants\' home, resulting in structural damage. The only insurance was\\n forced placed insurance in the name of the lender.\\n\\nANALYSIS\\n\\nThe trial judge granted plaintiff\'s motion for summary judgment. The \\njudge found no dispute over the validity of the note and mortgage, \\ndefendants\' default in 2010 and plaintiff\'s standing to foreclose the \\nmortgage. Whether the lender allowed the insurance money to go to repair\\n the structure was irrelevant since the foreclosure put the insurable \\ninterest in the lender and the lender was the only person insured.\\n\\nAlthough the procedural history is long and complicated with the \\nparties\' appendices exceeding 800 pages, the legal issues are \\nstraightforward, and the Court of Appeals had no hesitation in holding \\nplaintiff established its entitlement to both summary judgment.\\n\\nCONCLUSION\\n\\nThe trial court\'s orders that plaintiff established its right to \\nforeclose the mortgage, that defendants did not succeed in establishing \\nplaintiff should be barred from asserting that equitable remedy, and \\nthat final judgment of foreclosure was properly entered against \\ndefendants.\\n\\nZALMA OPINION\\n\\nWhen borrowers fail to pay mortgage payments, insurance premiums and \\ntaxes they have no insurance in their name, only the insurance acquired \\nby the lender to protect its interests. The lendER can apply the \\ninsurance to repair or simply apply it to reduce the debt. It took some \\nunmitigated gall to sue the lenders in this after defaulting in every \\nobligation owed by a property owner that pledged the property as \\nsecurity for the loan. The court found it necessary to read and analyze \\nall 800 pages and still found the trial court\'s judgment in favor of the\\n lender to be appropriate. Why the court did not sanction the borrowers \\nand their attorneys is confusing to me.\\n\\n(c) 2023 Barry Zalma & ClaimSchool, Inc.\\n\\nPlease tell your friends and colleagues about this blog and the videos \\nand let them subscribe to the blog and the videos.\\n\\nSubscribe to my substack at \\nhttps://barryzalma.substack.com/publish/post/107007808\\n\\n\\nGo to Newsbreak.com\\xa0 https://www.newsbreak.com/@c/1653419?s=01\\n\\n\\nFollow me on LinkedIn: \\nwww.linkedin.com/comm/mynetwork/discovery-see-all?usecase=PEOPLE_FOLLOWS&followMember=barry-zalma-esq-cfe-a6b5257\\n\\n\\n\\n