Barney v. Bank of America (In re Gifford)

Barney v. Bank of America (In re Gifford), Case No. 15-8097 (10th Cir. June 3, 2016) (unpublished)
The transfer of an interest in a mortgage is merely an assignment from one creditor to another—not a transfer of the debtor’s property or an obligation incurred by the debtor.
Procedural context:
Appeal from the 10th Circuit BAP’s decision affirming the bankruptcy court’s granting of Bank of America’s (“BOA”) summary judgment motion thereby precluding the trustee from avoiding BOA’s mortgage on debtor’s property. The 10th Circuit affirmed. Since the BAP is a subordinate tribunal, the 10th Circuit looks only to the bankruptcy court’s decision. Reviewed de novo.
Three years prior to filing bankruptcy, debtor executed a note and mortgage in favor of Jackson State Bank and Trust (“JSB”) for the purchase of real property in Wyoming. Countrywide Home Loans, Inc. (“Countrywide”) was assigned the servicing rights and the mortgage was assigned to MERS and although the assignment did not identify MERS as agent or nominee, MERS acted as agent or nominee. The assignment to MERS was recorded. JSB transferred the note to Countrywide who was also a member of MERS and under Wyoming law, the mortgage follows the note and Countrywide became the beneficial holder of the mortgage. Countrywide then merged with the BOA and Countrywide’s servicing arm became BAC Home Loans Servicing, LP (“BAC). MERS assigned the mortgage to BAC, which assignment was recorded and about two months later, debtor filed bankruptcy. BAC subsequently merged with BOA. The trustee sought to avoid BOA’s mortgage under §§ 547 and 544.
Birscoe, Lucero, Phillips

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