Repurchase Lawsuits

06/02/2014

Flagstar Bank has been busy filing lawsuits against mortgage brokers and lenders who originated loans Flagstar has been asked to repurchase by Fannie Mae or Freddie Mac.  These cases are being filed in Oakland County Circuit Court in Michigan, even though in most instances the broker or lender is from another state and never did any business in Michigan.

Depending on the facts, it is not necessarily the case that the Oakland County Circuit Court has jurisdiction over the mortgage broker or lender.  Michigan law affords a basis for challenging the court's jurisdiction.  We have represented several out of state mortgage brokers and lenders in such cases.

Any mortgage broker or lender sued by Flagstar Bank or any other correspondent lender or wholesaler should also look into whether the statute of limitations on bringing a lawsuit has expired, such that grounds may exist to dismiss the lawsuit.  Discuss the issue with legal counsel so that it is raised at the appropriate juncture in the case.

The information you obtain at this site is not, nor is it intended to be, legal advice. You should consult an attorney for individual advice regarding your own situation. Mark K. Rabidoux is licensed to practice law only in the State of Michigan. Matters requiring the practice of law in other states will be referred to local counsel in those states. All rights reserved. You may reproduce materials available at this site for your own personal use and for non-commercial distribution. All copies must include this copyright statement.