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Southern Points

Safely guiding you through today's changing mortgage environment

Summer, 2011 - Vol 1, Issue 3
In This Issue
Conflicting Opinions: Enforceability of Deeds
Process Management Systems: Best Practices
Tightening Title Insurance Requirements
2011 Leglislative Update
New Faces
Summer Recipe

Positive Words from Clients and Borrowers!

"We just wanted to say that all of us here are highly impressed with your company and all your staff.  We appreciate working with the friendly and knowledgeable staff members: Judy Diaz, Erica Malcom, Heidi Billington, Joshua Hopkins and Lisa Caplan.  Thank you for the great customer service!!! We will recommend your company to our friends in the industry."  - Client


If you've received great service, we'd love to hear from you!  Please email with your comments. 

Need Training?
Do you have any new staff that need training on mortgage default laws in Georgia, Tennessee or Mississippi? 

Want to update existing staff or provide more in depth information to managers?

We are happy to prepare materials and deliver learning sessions on site for you! Just email to discuss your needs. 

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Giving Back
We feel it's important to stay active in our community, as well as yours!  Here's some of the charitable efforts we've been involved in this quarter:
  • Wingspan Golf Tournament supporting Project Hope Foundation
  • Susan G. Komen 3-Day
  • University of Texas MD Cancer
  • Greenfield Hebrew Academy


Glen Headshot


Greetings. As I come to you during the summer of 2011, our industry is in the midst of one of the most turbulent times in its history. The effects of the great economic collapse of the late 2000's has brought an incredible amount of scrutiny on the mortgage default industry.


As an industry, we are under attack. Without assessing who is to blame and the merits of all this attention, I think we can all agree on at least one thing; during this critical juncture, a great deal of our resources are being diverted away from doing what we are supposed to do and what the overwhelming majority of us do best, namely resolving mortgage delinquencies.   


To that end, I bring you our latest installment of the RLSS newsletter because beyond all the audits, reform legislation and class action litigation, there still are a lot of delinquent mortgage loans that are in need of resolution. It goes without saying that in order to do an effective job managing mortgage loan delinquencies, you must stay abreast of all the latest changes. In this issue, we try to bring you the latest from the states we practice in as well as a view from where we sit. We hope that it makes your job a little easier and your day a little less stressful.  There is light at the end of the tunnel. Be well and have a great summer.


Glen D. Rubin

Managing Partner

Rubin Lublin Suarez Serrano, LLC


Keeping Up with Litigation:

Take Notice: Georgia's Conflicting Opinions on the Enforceability of Deeds

                                                   Written By: Lauren Turowetz


Two recent Georgia cases have sparked concern after the Court of Appeals issued an opinion on the issue of constructive notice that directly conflicts with a recent Supreme Court of Georgia ruling. The Court of Appeals' application of law to the facts has prompted RLSS to file an Amicus Brief with the Supreme Court of Georgia.

Just a few months ago, the Supreme Court of Georgia held that Georgia law requires properly recorded security deeds to be both notarized and witnessed (attested) in order to be properly executed for purposes of serving as constructive notice to subsequent purchasers. U.S. Bank Nat'l Ass'n v. Gordon, 2011 Ga. LEXIS 271 (Ga. Mar. 25, 2011). Under the recent Supreme Court ruling, in the absence of actual notice, a deed without a notary seal or proper attestation is not protected and renders a mortgage unsecured.  U.S. Bank, N.A. v. Gordon, 2011 Ga. LEXIS 271 (2011) involves a bankruptcy trustee who sought to set aside a security deed that was recorded but unattested.  A security deed was held to be neither properly perfected nor secured without a notary seal, and therefore cannot offer constructive notice.  For lenders this means more challenges to their secured status, especially coming from emboldened trustees in the bankruptcy court.  This decision requires documents to be properly executed in order to notify subsequent purchasers, lenders, and their closing attorneys. The Court emphasizes the harmony among the opinion, other recording statutes, and long-standing case law to substantiate their decision. Significance is also placed on the harm that bona fide purchasers and closing attorneys would experience had the case been decided alternatively, such as the increased risk of fraud and undue hardship. Id. at *6, *11.

Conversely, a case recently decided in the Georgia Court of Appeals,  3400 Partners, LLC v. Chavez, 2011 Ga. App. LEXIS 332 (Ct. App. June 15, 2011), abandons the reasoning employed in Gordon. 3400 Partners involved a materialmen's lien that was purportedly intended to encumber a 60-unit condominium building. However, when the company recorded the lien, it attached the legal description of only one unit (unit 311) to the lien. The Court of Appeals issued an opinion, based partially on private conversations between the appellant and appellee, saying that the legal description was "close enough" to serve as constructive notice to the entire building. The Court of Appeals' opinion is in contradiction with the Supreme Court opinion issued one month prior. The Georgia Court of Appeals is allowing a defective legal description to a lien to provide constructive notice less than a month after the Georgia Supreme Court found that a properly executed and recorded deed cannot offer constructive notice if it is not perfectly executed.  

3400 Partners has the potential to impact the manner in which title searches in Georgia are performed and will substantially increase the degree of difficulty involved in such searches. Since the lien was filed, over forty units have been sold or have had security deeds placed on them. In each of these instances, a title exam was done. Not once did the closing attorney believe the lien was in the seller's or lender's chain of title.  The case is pending a petition for certiorari to the Georgia Supreme Court. RLSS, which was not previously involved in the case, has filed an Amicus Brief on behalf of the innocent affected homeowners. 



Process Management Systems: Best Practices

 Written By: Victor Kang, Associate


 People at computers

As the default services industry continues to evolve and advance with technology, one of the most popular methods for communication between servicers and law firms is the use of process management systems.  One of the main benefits of process management systems is the ability to monitor and communicate the status of large volumes of files instantaneously.  As with all new forms of technology, there is often a trial and error period that can be critical in determining how well the system functions and how many efficiencies are created.  Our firm has been fortunate enough to be involved with several rollouts for clients on all of the major systems.  Below are some helpful tips that may make the transition to a new process management system smoother for a servicer from the law firm perspective.

-          One Size Doesn't Fit All - While this may seem obvious, one of the largest obstacles that is often present with rollouts is that the training materials and process steps are not customized prior to the "go-live" date.  This can create confusion for both parties as there may be requirements or processes that are deemed crucial for one servicer, but not for another.  No two servicers will use a system identically; therefore customization should be done prior to rollout to prevent confusion and delay. 

-          All Together Now - If at all possible, new systems should be implemented at the same time for all departments and users. If only certain departments are utilizing a specific process management system and other departments are on a different system, there is sure to be confusion as information may not be updated on each system.  Oftentimes, double work is occurring due to the lack of proper communication.  And, in worst case scenarios, important information may not be conveyed if the two departments are using two completely different systems. 

-          Location, Location, Location! - In all of the default services (bankruptcy, foreclosure and eviction), rules and procedures must be flexible and jurisdiction specific.  Requirements for notices and legal documents all vary greatly from jurisdiction to jurisdiction.  To be effective in managing the process, one process will not cover all of the variations from jurisdiction to jurisdiction.  Foreclosure sales, bankruptcy hearings and evictions can be unnecessarily delayed because process management systems cannot account for jurisdiction requirements. 

-          Hut, 2, 3, 4! - One of the biggest keys to making new process management systems work is for all parties involved to stay on the same page.  As default servicing grows to include more third party vendors, we all must strive to maintain consistency of use of the system.  Nothing can derail the long-term usefulness of process management systems more than users not following same protocol.  Beta testing and constant training is of the utmost importance if the system is to function as intended.   It is often painfully noticeable when new users are working in the systems as there is a lack of uniformity and consistency in how they use it.   Processes should be simple enough so that the learning curve is not too steep; if processes become too complex, nobody will be on the same page.


Tightening Title Insurance Requirements in REO

Written By: Frances Suarez McKinney, Partner


KnotWith all of the robo-signing hoopla going on in the foreclosure industry, title insurance companies have seen increased claims and issues surrounding deficiencies in the foreclosure process.  While most of those occur in states where foreclosures occur judicially, title insurance companies are tightening their requirements across the board and imposing increased due diligence from the attorneys who close the deals. 

Here are a few of the things that we have had to adjust in our procedures at REO in Georgia:

1.       Title Insurance companies are requiring that title be conveyed by Special Warranty Deed.  Conveyance by Quit Claim deed is not allowed by most companies unless special permission is obtained.

2.       An affidavit of Non-Military Status must be provided by the seller or their foreclosure attorney showing that the foreclosed borrower was not in active military status at the time of the foreclosure or that the lender obtained a waiver from the borrower during or after their service ended.

3.       The foreclosure deed must be recorded within 90 days of the foreclosure.  State law requires that the foreclosure deed be recorded within 90 days of sale and some title insurance companies take the stance that they will refuse to insure if the deed has not been filed during that time period.  Others, state that until a court has ruled on the consequences/penalties for not filing within that 90- day period that they will still continue to insure.


These are just a few of the requirements now being imposed.  Some REO closing attorneys are also more cautious and ask to examine some of the foreclosure paperwork as well, including signing authority for those executing foreclosure deeds.  The best help our "bank owned" clients can provide is to have any origination and foreclosure paperwork available for us to provide to the closing firms as needed. As issues continue to arise out of claims, I am sure more requirements will continue to be imposed by the title insurance companies.


2011 Legislative Update: Georiga & Tennessee

Written By: Heidi Billington, Associate


 Legislative Branch


The 2011 Georgia legislative session ended April 14, and although there was a lot of buzz around several bills relating to the default servicing industry only one of them actually passed this session.  The bills that did not make it through in 2011 are not dead, however, since all legislation that did not pass this session is available for consideration during the 2012 legislative session. 


SB 64 was passed into law and will become effective July 1, 2011.  This law amends O.C.G.A. 14-5-7 relating to execution of instruments effecting real property by corporations.  For deeds of conveyance or mortgages, execution by the (1) president or vice-president and the (2) secretary or assistant secretary is acceptable.  When executing a release or assignment, the corporate president, vice-president, secretary or assistant secretary must sign the instrument.  The statue allows the corporation to alter the officers who can sign through a corporate resolution.  The resolution must be attached as an exhibit to the instrument filed for record and referenced on the face of the instrument. 


We reported on the new DeKalb County Vacant Property Registration Ordinance in a prior newsletter, and subsequently, the cities of Power Springs, Loganville, and Lawrenceville as well as Fulton, Gwinnett, and Rockdale Counties have either passed or considered similar vacant property ordinances.   House Bill 110 was introduced to establish a statewide vacant property registration framework which would preempt these local ordinances.  HB 110 includes property held pursuant to judicial or non-judicial foreclosure or a deed in lieu of foreclosure in the definition of vacant property.  Registrations of vacant property must include the property address, parcel number, owner's name and contact information, the agent's name and contact information, date and/or recording information of instrument transferring ownership to owner, and a registration fee not to exceed $100.00.  If this registration information is included in the Deed Under Power or Deed In Lieu and the deed is recorded within 60 days of sale, the first registration and fee is not required.  HB 110 would require a second registration upon the first subsequent transfer of vacant property after foreclosure.  Penalties under the bill would not exceed $500.00 per month.  This bill was passed in the House on March 10, 2011 and gained a lot of traction in the Senate.  Insiders thought it would easily become law; however, disagreement as to the registration fee and penalties ultimately delayed passage.  There is a good chance that some form of HB 110 will be passed in the 2012 session.  


House Bill 237 gives District Attorneys and the State Attorney General certain investigative and subpoena powers relating to residential mortgage fraud.  HB 237 amends the definition of "mortgage lending process" to include the execution of Deeds Under Power that are recorded pursuant to foreclosure laws and the execution of assignments that are required to be recorded prior to foreclosure sale.  HB 237 was supported by the newly elected State Attorney General, Sam Oleans, and it slid through the House on March 2, 2011, with only one vote in opposition. The Senate judiciary committee reported favorably on the bill at the end of March and insiders opined that the legislation would easily become law.  Because HB 237 was tied to another unrelated bill, a filibuster ultimately killed it on the last day of the 2011 regular session.  It is very likely that this bill will be re-examined in the 2012 legislative session.  



House Bill 1921 / Senate Bill 1451was signed into law by the Governor on April 25, 2011 and this new law changes the requirements surrounding the relatively new 60 day Notice of Intent to Foreclose requirements.  Enacted by into law by the legislature last year,the 60 day notice rule requires a Notice of Intent to Foreclose be sent to the borrower 60 days prior to the first legal publication.  Under the new law, effective immediately, the 60 day notice requirement is removed if the lender or trustee meets with the borrower in person 180 days prior to foreclosure publication to review the loan and discuss foreclosure issues.    It is no longer necessary to include a statement regarding the Notice of Intent to Foreclose in the Notice of Sale; however, the requirement that the statement be included in the foreclosure deed is still present.  Much to our surprise, the legislature put an end to the Notice of Intent to Foreclose altogether beginning January 2013.  Specifically, the notice will no longer be necessary for foreclosures where the first publication is on or after January 1, 2013.  With the 60 day notice requirement eliminated in 2013, the foreclosure referral to sale date timeframes will significantly decrease from approximately 90 days to 45-30 days.


HB 1920 / SB 1299 was signed by the Governor on June 16, 2011 and is effective July 1, 2011. The bill was originally introduced with a provision to decrease the number of foreclosure publications from three times to only one time and was later amended to require two publications.  This provision received a lot of heat from the local newspapers who predicated that their revenue streams would decrease and ultimately the publication language was removed before the bill's final passage in the House and Senate.  Aside from attempting to change the number of publications, the bill affects two other areas of foreclosure in Tennessee.  While case law suggested, and title companies agreed, that sale postponements were ok in Tennessee if not prohibited by the Deed of Trust; this new law actually codifies postponements under the following terms.  Unless postponements are prohibited under the Deed of Trust, a foreclosure sale may be postponed one or more times without additional newspaper publication.  The caveat is that the sale must be held within one year of the original sale date and each postponement must be announced at the date, time and location of each scheduled sale date.  In addition, if the postponement is for more than thirty days, notice of the new sale date must be mailed to the borrower no less than ten calendar days prior to the sale date.  The new law also revises the contents of the foreclosure advertisement.   Under the old law, the notice had to describe the land in "brief terms" along with the street address, if available.  Under the new law, the advertisement must contain a "concise legal description", which could be a reference to the deed book and page of the Deed of Trust that contains the complete legal description.  A common description must also be present, which means a street address and map and parcel number of the property, if available.  If a street address is not available, a subdivision, lot or tract number may be used.  The intent of this amendment is to prevent an error in the legal description from voiding a foreclosure sale.


New Faces: Jorge E. Umpierre


  And Jorge makes 21... 


Partner Jorge UmpierreJorge E. Umpierre joins Rubin Lublin Suarez Serrano, LLC as our 21st attorney and a partner in our REO Closing practice.  Having worked alongside Partners Peter Serrano and Frances Suarez McKinney in the past, Jorge's transition into the firm has been easy and smooth. 


"With the expansion of our REO practice, it was only natural to bring Jorge on," comments Managing Partner Glen Rubin.  "With over 10 years industry experience, as well as strong management skills, Jorge is a great fit for our clients." 


Jorge works in our Duluth office with Peter Serrano, and is responsible for client closings as well as assisting in office



 At home he has a lovely wife, 2 children and a dog that look forward to seeing Jorge every day.  When not at work or with his family, Jorge is an avid sports fan and is captain of his men's tennis team.  Fun Fact:  Jorge was the 2 millionth Chattanooga Lookouts fan to cross the turnstile. 


For Jorge's bio, click here.

Ice Tea, Georgia Style


1 mason jar filled with ice

3 oz Firefly Sweet Tea Vodka

1 oz Peach Liqueur

 3 oz Lemonade




Mix all ingredients and enjoy!


Mason Jar 



Stay Cool Y'all,
Lauren Fierman
Marketing Director
Rubin Lublin Suarez Serrano, LLC
3740 Davinci Court
Suite 400
Norcross, GA 30092