KIRSCH, J.
Lacy-McKinney claims that Taylor-Bean‘s motion for summary judgment cannot succeed because Taylor-Bean failed to comply with HUD regulations that are conditions precedent to commencing a foreclosure action. Specifically, she maintains that Taylor-Bean: (1) did not engage in loss mitigation in a timely fashion as required by 24 C.F.R. § 203.605(a); (2) did not have a face-to-face meeting or make a reasonable effort to have a face-to-face meeting “before three full monthly installments due on the [M]ortgage [were] unpaid” as required by 24 C.F.R. § 203.604(b); and (c) did not accept partial payments as required by 24 C.F.R. § 203.556. . . . Taylor-Bean responds that the regulations at issue address only the relationship between the mortgagee and the government. Taylor-Bean thus argues that summary judgment was appropriate as a matter of law because there is no basis for finding that Congress intended that these regulations be used by a mortgagor either as a private right of action or as a defense.
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The above precedents, the language of the HUD regulations, and the public policy of HUD persuade us that the HUD servicing responsibilities at issue in this case are binding conditions precedent that must be complied with before a mortgagee has the right to foreclose on a HUD property. As such, Lacy-McKinney can properly raise as an affirmative defense that Taylor-Bean failed to comply with the HUD servicing regulations prior to commencing this foreclosure action. . . . .
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Lacy-McKinney contends the trial court was precluded from entering summary judgment in favor of Taylor-Bean because there was a genuine issue of material fact as to whether Taylor-Bean complied with the requirement for a face-to-face meeting or made a reasonable effort to arrange such a meeting before three full monthly installments due on the mortgage were unpaid. Appellant’s Br. at 22 (citing 24 C.F.R. § 203.604(b)). Although Taylor-Bean claimed that it did not have an office within 200 miles of the Property, Lacy-McKinney submitted designated evidence that Taylor-Bean had an Illinois office within the 200- mile range. The parties admit that Taylor-Bean did not have a face-to-face meeting with Lacy-McKinney. However, Taylor-Bean “has not submitted evidence that it complied with the requirement to make a reasonable effort to arrange a face-to-face meeting.” Id. (citing 24 C.F.R. § 203.604(d)). [Footnote omitted.] We agree that a genuine issue of material fact remains as to whether Taylor-Bean made a reasonable effort to arrange a face-to-face meeting in compliance with 24 C.F.R. § 203.604(d). Without this proof, Taylor-Bean cannot prevail on summary judgment. The parties also disagree as to whether Taylor-Bean accepted or returned partial mortgage payments. Taylor-Bean has failed to prove that it complied with 24 C.F.R. §203.556 regarding the acceptance of partial payments. The trial court erred in granting summary judgment in favor of Taylor-Bean on its action to foreclose on Lacy-McKinney‘s HUD-insured mortgage without first determining that Taylor-Bean had complied with Subpart C—the conditions precedent to foreclosure. We reverse the trial court‘s grant of summary judgment and remand for further proceedings. [Footnote omitted.]
RILEY, J., and BAILEY, J., concur.