NJ Appeals Panel Backs Refi Lender's Priority In Default Row

Law360, New York (July 3, 2013, 3:59 PM EDT) -- A New Jersey appeals court ruled Wednesday that a junior lienholder that had extended a line of credit to a borrower cannot vault over the priority of a mortgage refinancing lender after the borrower defaulted on both funding sources, based on equitable principles.

A three-judge panel of the New Jersey Superior Court Appellate Division reversed a trial court’s decision in a foreclosure action allowing junior lienholder Sovereign Bank NA, which was assigned the mortgage on the line of credit extended by Independence Community Bank, to jump...
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