A decade-long foreclosure and one judge's self-reversal that couldn't survive the ten-day clock
A South Carolina appeals court has reversed a trial judge who stripped a noteholder of the interest and fees its loan documents required.
In a decision filed on August 12, 2026, the South Carolina Court of Appeals reversed and remanded a foreclosure case that had dragged on for more than a decade.
The trouble started in 2011, when a company called 50 by 50 REO moved to foreclose after the borrower defaulted on an adjustable-rate note with a $212,000 principal, secured by a mortgage on a North Charleston property. From there the note and mortgage passed through a string of hands, and the named plaintiff was substituted several times before the case reached U.S. Bank Trust N.A., as trustee for Waterfall Victoria Grantor Trust II, Series G.
The part that matters for servicers came in November 2022. The Dorchester County master-in-equity granted Waterfall summary judgment, agreeing it held the note and mortgage and could foreclose. Yet he denied it any interest on the unpaid balance, plus escrow charges, corporate advances, and attorney's fees. Months later, on his own initiative, he moved to scrap that order entirely, citing a "peculiar disconnect" in the assignment record tied to the original lender's 2007 bankruptcy.
The appeals court said that reversal was barred. A South Carolina judge can revisit his own order for only ten days; after that, it becomes final. No motion had sought the relief the master delivered, so his attempt to undo the ruling was a nullity.
The court was just as firm on who held what. Whoever holds the note holds the mortgage behind it, because transferring the note carries the mortgage along. The original lender's bankruptcy did not sever that tie.
On interest, the reasoning was short. The note fixed a yearly rate of 10.450%, and both a Waterfall witness and the borrower testified the rate held steady throughout the default. Courts cannot rewrite a rate the contract states plainly.
The noteholder still drew a caution. The court observed that Waterfall and its predecessors dragged the case out by repeatedly transferring the note, switching plaintiffs and counsel, and missing discovery deadlines, until interest outgrew the principal and more than doubled the payoff. On remand, the trial court may weigh how much delay the lender's side caused. Even so, gutting the contract to reward a defaulting borrower went too far.
The judges also reversed an order forcing Waterfall to return $19,183.89 in fire-insurance proceeds to the borrower, sending that question back to the record.
