Kenneth and Gertrude Reusser in 2001 obtained a $860,000 loan, secured by a deed of trust on their home, from Long Beach Mortgage Company. Five months later the Reussers stopped making payments. Long Beach Mortgage assigned its interest in April 2003 to Wachovia Bank, which gave the Reussers notice that it intended to foreclose on the property through Washington Mutual Bank, its loan servicing institution.
The Reussers declared bankruptcy on August 27, 2003, which automatically stayed the foreclosure sale under 11 U.S.C. §362(a)(3). Washington Mutual, however, obtained a bankruptcy court order granting relief from the stay, thereby allowing the foreclosure sale to proceed.
