The California Second District Court of Appeal has affirmed a lower court’s ruling that a borrower in default cannot employ the claim that a lender lacks standing to prevent a non-judicial foreclosure sale.
In Keshtgar v. U.S. Bank, N.A., the appellate court referred to California’s non-judicial foreclosure statutes and a prior decision in Gomes v. Countrywide Home Loans, Inc. to affirm the trial court’s ruling that a defaulting borrower could not utilize a lack of standing claim to forestall a non-judicial foreclosure, even if the foreclosing entity was incorrect.
The 2011 Gomes decision held that California’s non-judicial foreclosure statutes did not provide for any finding of standing pre-foreclosure. In Keshtgar, the defaulting borrower filed a pre-foreclosure complaint saying that the assignment of his mortgage from MERS to U.S. Bank was void, but the appellate court rejected that claim as without merit, stating that, “California’s comprehensive non-judicial foreclosure scheme does not provide for preemptive action to challenge the authority of the party initiating foreclosure.”
In its Keshtgar ruling, the appeals court also concluded that, absent a showing of prejudice, a defaulting borrower cannot pursue a claim for damages after a non-judicial foreclosure sale is completed.
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