FLORIDA SUPREME COURT REINFORCES | Key Points

1. Last month the Florida Supreme Court held the bank was entitled to foreclose its reverse mortgage despite the fact the co-mortgagor still resided at the property. WVMF Funding v. Palmero, 2021 WL 2583960 (Fla. June 24, 2021). The Court refused to deviate from its established precedent which prioritized the terms of the note in the event of a conflict between the note and mortgage.

2. The Court explained that “both the mortgage and the note expressly define[d] Mr. Palmero as the ‘Borrower’ and that “all of the other documents consistently show[ed] that the parties intended for Mr. Palmero to be the sole ‘Borrower.’” Although Mrs. Palmero signed the mortgage in the “Borrower signature block,” the location of her signature did not “make her a co-borrower” as “a matter of law.”

3. The Court reversed the Third DCA’s denial of foreclosure explaining the holding “ignore[d] not only that the mortgage expressly defines Mr. Palmero as the ‘Borrower,’ but it also ignores that this Court’s foreclosure precedent requires courts to read the mortgage together with the note it secures…” The note identified Mr. Palmero as the sole borrower – part of what was “bargained-for” by the Palmeros so they could receive a higher monthly payment – and the note terms prevailed over the mortgage. The Court quashed the Third DCA’s denial of foreclosure.

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