The Georgia Supreme Court held this week that the holder of a security deed need not also hold the underlying note to exercise the power of sale in accordance with the terms of the security deed. You v. JP Morgan Chase Bank, N.A., 2013 WL 2152562 (Ga. Sup. Ct. May 20, 2013).
In You, the borrowers financed the purchase of a home with a mortgage from Excel Home Loans, Inc., executing a promissory note and security deed in favor of Excel. After the initial transaction, the note was assigned to an “unidentified entity,” and the security deed was assigned to Chase Manhattan Mortgage Corporation, which, after a series of mergers, was succeeded by JPMorgan Chase Bank. The assignment of the deed explicitly granted the assignee the right to exercise all “power, options, privileges and immunities” in the security deed. In residential mortgage securitization arrangements, such assignments, split from the note, are commonplace.
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