In the bankruptcy case of (Wahl, David W. Jr. and Marlaina A.; In re (Rieser, Trustee, v. Fifth Third Mortgage Corp.)) the bankruptcy court ruled that a mortgage is not effective if the borrower's signature is not acknowledged by the notary.
The details of the bankruptcy case:
In 2007, the debtors acquired title to land by quitclaim deed. The defendant financed the debtors' purchase of the land. While both debtors signed the mortgage, the acknowledgment clause referenced only the debtor-wife as having signed the mortgage before the notary. The bankruptcy court ruled that the trustee could avoid the mortgage as to the debtor-husband's undivided one-half interest in the property because his signature was not acknowledged by the notary as required by state law.
In this particular bankruptcy case a mortgage document was not properly "perfected" before the law and became ineffective. In other words, the creditor could not enforce the mortgage against the person whose signature was not acknowledged by the notary. Many debtors would be surprised to find that mortgage companies sometimes fail to comply with the law when creating mortgage documents. Many of these "errors" negatively impact the debtor and should be challenged. When filing bankruptcy, mention to your bankruptcy attorney any irregularities you find in your creditor agreements, they could be costing you money.