Countrywide Home Loans, Inc. v. Schmidt

1. BROWN, C.J.

¶ Equitable subrogation is a doctrine whereby one who has paid off another's mortgage obligation is treated as the owner of that obligation. In this case, Countrywide Home Loans, Inc. lent Gary Schmidt $360,000 secured by a home mortgage. There was a problem, though — at the time Countrywide lent Schmidt the money, the house was no longer Schmidt's to mortgage. Jeanne Mayer had contracted to buy it for $300,000 and had sued Schmidt for specific performance when he tried to back out on the deal, all before Countrywide entered the picture. Eventually, realizing that Mayer's…