Foreclosure - A Matter Of State Law - Not Federal

By Author: Nick Adama
Total Articles: 197
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The following are some miscellaneous legal issues that may affect a foreclosure case. These include the issue of putting a case into federal court from state court, as well as diversity jurisdiction. Finally, if homeowners win a case against a bank, and the case is appealed by the lender, the borrowers may be able to require the bank post a bond in order to move ahead.

Although some issues relating to a foreclosure lawsuit defense may involve federal laws, such as the Truth in Lending Act or Real Estate Settlement Procedures Act, many times federal courts do not have jurisdiction over a foreclosure or eviction case. These are matters that deal almost exclusively with state law and will more often be kept in state court.

However, some defendants to foreclosure may seek removal of a case from the federal court to the state court based on TIL or RESPA claims. In some of these instances, the argument is that the case would have been brought into the federal courts in the first place as the court of original jurisdiction over the homeowner's claims.

There is also an issue of diversity jurisdiction. In these cases, ...
... the homeowners must prove a number of circumstances to make the argument of diversity jurisdiction. These include showing that the parties to the lawsuit have diverse citizenship, as well as that the controversy is for more than $75,000. The amount of the controversy is considered to be the value of the object of the lawsuit.

In cases where the homeowners win a case against a bank, there is a good chance the lender will appeal the decision. In such situations, homeowners are well within their rights to request the court to require the bank to post a bond. In several cases, lenders have been required to do so in order to move ahead with their motions to the appellate court. This is similar to a homeowner being required to post a bond to bring an action into court to enjoin a nonjudicial foreclosure sale.

These are a few issues that some homeowners may come up against when attempting to defend their home or bring an action against the bank. In reality, they can be much more complicated than the standard foreclosure defenses, as they involve the lender's or homeowners' use of different court systems. Unfortunately, foreclosure is never as simple as homeowners would like. While these issues may be uncommon, they are not unheard of when dealing with a bank. This is, of course, one more reason that homeowners may wish to request professional foreclosure help when attempting to save a property.
Nick writes for the ForeclosureFish website and blog, which educate homeowners on how they can save their homes from foreclosure and beat the bank. The site describes nearly a dozen ways to prevent losing a home, including filing bankruptcy, loan modification, stopping a sheriff sale, and more. Visit the site today to get a free e-book explaining the basics of foreclosure and learn how to fight back against foreclosure: http://www.foreclosurefish.com/