4th DCA Finds Lender Did Not Violate Mortgage By Accepting Partial Payments After Sending Default Letter

The Florida 4th District Court of Appeal (DCA) reversed the trial court’s ruling in favor of borrowers after the lender accepted partial payments after default.

After sending borrowers a notice of default due to non-payment of their mortgage, the lender accepted partial payments of the amount due.

The lender sued to foreclose and the case went to trial.  At trial the judge found in favor of the borrowers, holding that because the lender accepted partial payments after the default letter, that the bank failed to comply with paragraph 22 of the mortgage requiring the default letter to state the default and amount owed.

The appellate court reversed finding that paragraph 1 of the mortgage allowed the lender to accept any partial payment without waiving any of its rights.   The Appellate Court disagreed with the trial court’s ruling that the lender failed to comply with paragraph 22 because the partial payment notices were confusing and “did not adequately inform Borrowers of the necessary steps to cure.”

The appellate court found that the lender substantially complied with the mortgage and did give the default letter which stated what the borrowers had to do to bring the loan current.

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