Ruling Strips Lender of Its Mortgage on Property

KENTUCKY CASE LAW UPDATE
United States Bank Nat'l Ass'n v. Kinslow, 2020 Ky. App. Unpub. LEXIS 407, 2020 WL 3124443
Kinslow is an unpublished case in Kentucky, but it is significant because the ruling in the case served to strip a lender of its mortgage on the property. Bill Kinslow and his son Allen Kinslow held title to the property as joint tenants with rights of survivorship. Bill entered into a promissory note that was secured by a mortgage. Allen did not sign the promissory note or mortgage for reasons that were not explained in the case. Bill passed away and the loan went into default. The lender foreclosed on the mortgage that encumbered Bill’s ½ interest in the property. The trial court denied the foreclosure and the Court of Appeals upheld the decision. The Court of Appeals ruled that under Kentucky law regarding joint tenancy with right of survivorship, any rights the lender had in the property because of the mortgage signed by Bill were extinguished at the time of Bill's death. Therefore, the mortgagee was unenforceable – even as to Bill’s ½ interest.