Choose Your Legal Category:
- Online Law Library
- Bankruptcy Law
- Business Law
- Civil Law
- Criminal Law
- Employment Law
- Family Law
- Finance Law
- Government Law
- Immigration Law
- Insurance Law
- Intellectual Property Law
- Personal Injury Law
- Products & Services Law
- Real Estate Law
- Wills, Trusts & Estates Law
- Attorney Referral Services
- Top 10 Most Popular Articles
- Legal Dictionary
- How It Works - Clients
- Legal Center
- About LegalMatch
- Consumer Satisfaction
- Editorial Policy
- Attorneys Market Your Law Practice Attorney Login Schedule a Demo Now Did LegalMatch Call You Recently? How It Works - Attorneys Attorney Resources Attorney Success Stories Attorney Success Story Videos Compare Legal Marketing Services Cases Heatmap View Cases
- Find a Lawyer
- Legal Topics
- Real Estate Law
Mortgage Assignment Laws and Definition
(This may not be the same place you live)
What is a Mortgage Assignment?
A mortgage is a legal agreement. Under this agreement, a bank or other lending institution provides a loan to an individual seeking to finance a home purchase. The lender is referred to as a creditor. The person who finances the home owes money to the bank, and is referred to as the debtor.
To make money, the bank charges interest on the loan. To ensure the debtor pays the loan, the bank takes a security interest in what the loan is financing — the home itself. If the buyer fails to pay the loan, the bank can take the property through a foreclosure proceeding.
There are two main documents involved in a mortgage agreement. The document setting the financial terms and conditions of repayment is known as the mortgage note. The bank is the owner of the note. The note is secured by the mortgage. This means if the debtor does not make payment on the note, the bank may foreclose on the home.
The document describing the mortgaged property is called the mortgage agreement. In the mortgage agreement, the debtor agrees to make payments under the note, and agrees that if payment is not made, the bank may institute foreclosure proceedings and take the home as collateral .
An assignment of a mortgage refers to an assignment of the note and assignment of the mortgage agreement. Both the note and the mortgage can be assigned. To assign the note and mortgage is to transfer ownership of the note and mortgage. Once the note is assigned, the person to whom it is assigned, the assignee, can collect payment under the note.
Assignment of the mortgage agreement occurs when the mortgagee (the bank or lender) transfers its rights under the agreement to another party. That party is referred to as the assignee, and receives the right to enforce the agreement’s terms against the assignor, or debtor (also called the “mortgagor”).
What are the Requirements for Executing a Mortgage Assignment?
What are some of the benefits and drawbacks of mortgage assignments, are there any defenses to mortgage assignments, do i need to hire an attorney for help with a mortgage assignment.
For a mortgage to be validly assigned, the assignment document (the document formally assigning ownership from one person to another) must contain:
- The current assignor name.
- The name of the assignee.
- The current borrower or borrowers’ names.
- A description of the mortgage, including date of execution of the mortgage agreement, the amount of the loan that remains, and a reference to where the mortgage was initially recorded. A mortgage is recorded in the office of a county clerk, in an index, typically bearing a volume or page number. The reference to where the mortgage was recorded should include the date of recording, volume, page number, and county of recording.
- A description of the property. The description must be a legal description that unambiguously and completely describes the boundaries of the property.
There are several types of assignments of mortgage. These include a corrective assignment of mortgage, a corporate assignment of mortgage, and a mers assignment of mortgage. A corrective assignment corrects or amends a defect or mistake in the original assignment. A corporate assignment is an assignment of the mortgage from one corporation to another.
A mers assignment involves the Mortgage Electronic Registration System (MERS). Mortgages often designate MERS as a nominee (agent for) the lender. When the lender assigns a mortgage to MERS, MERS does not actually receive ownership of the note or mortgage agreement. Instead, MERS tracks the mortgage as the mortgage is assigned from bank to bank.
An advantage of a mortgage assignment is that the assignment permits buyers interested in purchasing a home, to do so without having to obtain a loan from a financial institution. The buyer, through an assignment from the current homeowner, assumes the rights and responsibilities under the mortgage.
A disadvantage of a mortgage assignment is the consequences of failing to record it. Under most state laws, an entity seeking to institute foreclosure proceedings must record the assignment before it can do so. If a mortgage is not recorded, the judge will dismiss the foreclosure proceeding.
Failure to observe mortgage assignment procedure can be used as a defense by a homeowner in a foreclosure proceeding. Before a bank can institute a foreclosure proceeding, the bank must record the assignment of the note. The bank must also be in actual possession of the note.
If the bank fails to “produce the note,” that is, cannot demonstrate that the note was assigned to it, the bank cannot demonstrate it owns the note. Therefore, it lacks legal standing to commence a foreclosure proceeding.
If you need help with preparing an assignment of mortgage, you should contact a mortgage lawyer . An experienced mortgage lawyer near you can assist you with preparing and recording the document.
Save Time and Money - Speak With a Lawyer Right Away
- Buy one 30-minute consultation call or subscribe for unlimited calls
- Subscription includes access to unlimited consultation calls at a reduced price
- Receive quick expert feedback or review your DIY legal documents
- Have peace of mind without a long wait or industry standard retainer
- Get the right guidance - Schedule a call with a lawyer today!
Need a Mortgage Lawyer in your Area?
- Connecticut
- Massachusetts
- Mississippi
- New Hampshire
- North Carolina
- North Dakota
- Pennsylvania
- Rhode Island
- South Carolina
- South Dakota
- West Virginia
Daniel Lebovic
Attorney & LegalMatch Legal Writer
Original Author
Jose Rivera, J.D.
Managing Editor
Preparing for Your Case
- What to Do to Have a Strong Mortgage Law Case
- Top 5 Types of Documents/Evidence to Gather for Your Mortgages Case
Related Articles
- Assumable Mortgage: Definition, Examples and Benefits
- Loan Modification Laws
- Behind on Mortgage Payments Lawyers
- Home Improvement Loan Disputes
- Reverse Mortgages for Senior Citizens
- Mortgage Settlement Scams
- Short Sale Fraud Schemes
- Deed of Trust or a Mortgage, What's the Difference?
- Owner Carryback Mortgages
- Contract for Deed Lawyers Near Me
- Mortgage Subrogation
- Property Lien Waivers and Releases
- Different Types of Promissory Notes
- Repayment Schedules for Promissory Notes
- Ft. Lauderdale Condos and Special Approval Loans
- Special Approval Loans for Miami Condos
- Removing a Lien on Property
- Mortgage Loan Fraud: Examples, Penalties and Defenses
- Subprime Mortgage Lawsuits
- Property Flipping and Mortgage Loan Fraud
- Avoid Being a Victim of Mortgage Fraud
- Second Mortgage Lawyers
- Settlement Statement Lawyers
- Loan Approval / Commitment Lawyers
- Broker Agreement Lawyers
- Truth in Lending Disclosure Statement (TILA)
- Housing and Urban Development (HUD) Info Lawyers
- Good Faith Estimate Lawyers
- Mortgage Loan Documents
Discover the Trustworthy LegalMatch Advantage
- No fee to present your case
- Choose from lawyers in your area
- A 100% confidential service
How does LegalMatch work?
Law Library Disclaimer
16 people have successfully posted their cases