The Maine Law Court’s recent decision Bank of America, N.A. v. Greenleaf, 96 A.3d 700 (Me. 2014) has drawn significant attention to the issue of a mortgagee’s standing to foreclose a mortgage it holds by assignment from Mortgage Electronic Registration Systems, Inc. (“MERS”) but Greenleaf implicates a mortgagee’s right to foreclose in more ways than one.
Significantly, the Court spoke to the contents of a notice of default and right to cure letter. 14 M.R.S. § 6111(1-A)(C) requires that the notice contain an “itemization of any other charges that must be paid in order to cure the default.” In Greenleaf, the mortgagee’s notice had set forth an itemization but in a footnote instructed the mortgagee to contact the loan servicer for an updated cure amount that incorporated additional amounts that might accrue such as attorney’s fees and taxes. Greenleaf, 96 A.3d at 712 The Court faulted the notice, finding that the “amount due as stated in [a] notice of default is the precise amount that the mortgagor has thirty-five days to pay in order to cure the default [and] not . . . subject to any further accrual during that period.” Id. at 713.
This latest directive from the Law Court provides mortgagees ample encouragement to scrutinize their notices to ensure that they strictly comply with the requirements of section 6111 by providing a specific cure amount not subject to further accrual. In complying with section 6111, however, a mortgagee should also be careful not to overlook different or more specific notice requirements set forth in the loan documents themselves. Section 6111, for example, permits notice by either certified mail, return receipt requested or by ordinary first class mail, postage prepaid but a lender’s note and mortgage may specifically require certified mail. In such cases, a mortgagee must be careful to comply with both statutory and contractual notice requirements. At times, doing so may require multiple notices. Because notice of default and right to cure is a prerequisite to foreclosure by civil action in Maine, understanding exactly what notice is required at the outset and providing such notice properly will help mortgagees minimize delay and expense in exercising their foreclosure remedy.