Observers say that non-judicial foreclosures in Oregon will resume following the Oregon Supreme Court's recent rulings in Brandrup v. ReconTrust Co. and Niday v. GMAC Mortgage.
The Oregon Court of Appeals held last year that a non-judicial foreclosure cannot occur if an assignment of the beneficial interest in the loan obligation was not recorded, putting the breaks on non-judicial foreclosures in cases in which MERS -- the system used by lenders to electronically track the transfer of beneficial interests -- was designated as beneficiary of the trust deed.
The Supreme Court earlier this month concluded in Niday that "even if MERS lacks authority to act as the trust deed's beneficiary, it may have authority to act on behalf of the beneficiary if its can demonstrate that it has an agency relationship with the beneficiary." Thus, if MERS can establish that it has such an agency relationship, lenders will again be able to take advantage of Oregon's law allowing foreclosure by a private, advertised trustee's sale rather than through a court-ordered foreclosure.
See our earlier coverage of the MERS litigation here.
