Countrywide Home Loans, Inc. v. First National Bank of Steamboat Springs
Supreme Court of Wyoming
144 P.3d 1224 (2006)
Relevant factsFree
Countrywide (defendant) issued a refinancing loan to homeowners knowing FNB (plaintiff) held a junior mortgage on the property, and the homeowners used the refinancing proceeds to pay off a senior mortgage; when the homeowners later defaulted on FNB's junior mortgage and FNB foreclosed, Countrywide claimed its interest should take priority over FNB's by equitable subrogation, having effectively stepped into the senior lender's shoes.
IssueFree
Whether equitable subrogation applies where a financial institution extends a loan for the purpose of enabling a mortgagor to pay off an existing mortgage, knowing that a subordinate lien exists on the property.