Mealey's Mortgage Lending : Mealey's : Legal News & Analysis

Mealey's Mortgage Lending

March 27, 2023
High Court Won’t Hear Service Member’s Appeal In SCRA Home Loan Foreclosure

WASHINGTON, D.C. — The U.S. Supreme Court on March 27 denied review of an appeal in which a service member and his wife asked the Supreme Court to determine whether a provision of the Servicemembers Civil Relief Act (SCRA) tolls the statute of limitations on a state law foreclosure action when the service member did not seek relief under the statute.
March 22, 2023
9th Circuit Will Not Rehear RESPA Class Decertification Denial Appeal

SAN FRANCISCO — A Ninth Circuit U.S. Court of Appeals panel declined to rehear its ruling reversing and remanding to federal district court a district court’s ruling denying a motion for class decertification in a long-running Real Estate Settlement Procedures Act (RESPA) class action involving captive reinsurance agreements to federal district court.
March 22, 2023
County: Argument Properly Raised For Judge To Reconsider FHA Suit Ruling

CHICAGO — A federal judge in Illinois should alter or amend his ruling excluding the testimony of a county’s expert in a Fair Housing Act (FHA) discriminatory lending lawsuit against Wells Fargo & Co. and several of its affiliates and granting summary judgment in favor of the defendants because the judge committed several errors that when viewed “individually or taken together,” show that his reasoning for excluding the testimony was erroneous under Daubert v. Merrell Dow Pharmaceuticals Inc., the county argues in a brief in reply to its motion to alter or amend.
March 21, 2023
Borrower’s Arguments In Loan Denial Suit ‘Irrelevant,’ Not New Evidence

BATON ROUGE, La. — A federal judge in Louisiana should deny a borrower’s motion for reconsideration in a lawsuit alleging that a lender violated the Equal Credit Opportunity Act (ECOA) by denying the borrower a mortgage loan based on an allegedly incomplete loan application because the borrower’s arguments in support of reconsideration are “irrelevant” and seek to have the judge reconsider “previously denied arguments,” the lender argues in an opposition brief.
March 21, 2023
Bank: Justices Should Disregard Parties’ Mischaracterization Of Appeal

WASHINGTON, D.C. — Petitioners in a substantially similar appeal currently pending in the U.S. Supreme Court have mischaracterized the record in a lawsuit against a bank stemming from its alleged failure to pay borrowers interest on their mortgage loan escrow accounts, and the Supreme Court “should not be misled” by statements made by those petitioners, the bank argues in a supplemental brief filed in the Supreme Court.
March 17, 2023
Borrower Suit Over Reverse Mortgage Foreclosure Dismissed With Prejudice

RICHMOND, Va. — A federal judge in Virginia dismissed with prejudice a borrower’s claims against her mortgage servicer stemming from a foreclosure after the borrower defaulted on a reverse mortgage after the parties agreed to a settlement.
March 16, 2023
Magistrate: Portion Of Parcel Containing Dwelling Was Part Of Reverse Mortgage

MONTGOMERY, Ala. — A reverse mortgage company is entitled to summary judgment on a homeowner’s injunctive and declaratory relief and damages claims in a lawsuit stemming from a reverse mortgage default and subsequent foreclosure sale because while a portion of the property at issue was not correctly described in the metes and bounds description in a foreclosure deed, the “record is clear, convincing, and satisfactory that the dwelling was a key component” of the reverse mortgage, a federal magistrate judge in Alabama ruled.
March 15, 2023
Rehearing Denied In Appeal Over Lien’s Superpriority Status In Foreclosure Suit

SAN JOSE, Calif. — A Ninth Circuit U.S. Court of Appeals panel on March 14 denied a homebuyer’s petition for panel rehearing in a foreclosure dispute, declining the homebuyer’s request to rehear the appeal after agreeing with a federal district court that while the trustee’s claims were time-barred under the statute of limitations, summary judgment was warranted on the homebuyer’s counterclaim to quiet title because the property was subject to the trustee’s “preserved first-position security interest.”
March 14, 2023
Maine Justices Delve Into Legislature’s Intent In Answering Warranty Question

PORTLAND, Maine — The Maine Supreme Court answered a question posed in a breach of warranty suit asking it to determine whether, under state law, a warranty is implied by the use of the term “Warranty Deed” in certain instances in the negative, ruling that if the Maine Legislature had intended that use of that term “alone would be sufficient to imply warranties, the definition of ‘warranty covenants’ and the forms provided” under state law “would be surplusage.”
March 14, 2023
Hawaii High Court: Wrongful Foreclosure Damages Actions Not Always Barred

HONOLULU — An action alleging wrongful judicial foreclosure that seeks only monetary damages against the foreclosing lender and not to avoid the foreclosure sale is not barred if the action was filed after the issuance of a certificate of title to the buyer at foreclosure, the Hawaii Supreme Court ruled in answering a certified question from a federal bankruptcy court in the negative.
March 13, 2023
Panel Won’t Rehear Appeal In RESPA Suit Against Loan Modification Provider

ATLANTA — Without providing further detail, an 11th Circuit U.S. Court of Appeals panel declined to rehear an appeal in a lawsuit brought by borrowers who alleged that their mortgage loan modification provider violated provisions of the Real Estate Settlement Procedures Act (RESPA).
March 09, 2023
Borrowers’ Amended Claims Against Loan Servicer Still Don’t Pass Muster

RIVERSIDE, Calif. — A federal judge in California ruled that even though borrowers have amended their claims against their mortgage loan servicer in a foreclosure dispute stemming from the servicer’s alleged failure to properly notify the borrowers that it had assumed the servicing responsibilities for their mortgage, they have still failed to state a claim for relief in making any of their claims.
March 03, 2023
Lender Waives High Court Response In SCRA Limitations Tolling Appeal

WASHINGTON, D.C. — Wells Fargo USA Holdings and once of its subsidiaries waived their right to respond to a petition for writ of certiorari filed in the U.S. Supreme Court in which a service member and his wife have asked the Supreme Court to determine whether a provision of the Servicemembers Civil Relief Act (SCRA) tolls the statute of limitations on a state law foreclosure action when the service member did not seek relief under the statute.
March 02, 2023
Lender: Issues Raised In Borrower’s Petition Do Not Support Grant Of Certiorari

WASHINGTON, D.C. — The U.S. Supreme Court should deny review of a Fourth Circuit U.S. Court of Appeals panel’s dismissal of a borrower’s appeal for lack of jurisdiction on timeliness grounds because none of the issues raised by the borrower in her petition for writ of certiorari is properly before the Supreme Court, a mortgage lender and another lender argue in an opposition brief.
March 01, 2023
Bank Enters Into Consent Order Over Alleged Mortgage Redlining Activities

COLUMBUS, Ohio — A mortgage lender accused of violating the Fair Housing Act (FHA) and the Equal Credit Opportunity Act (ECOA) by engaging in unlawful redlining through its allegedly discriminatory lending practices in majority Black and Hispanic census tracts in the Columbus, Ohio, Metropolitan Statistical Area (Columbus MSA) has agreed to undertake certain remedial efforts and make investments into its minority lending programs, according to a consent order filed in Ohio federal court on Feb. 28.
February 27, 2023
Loan Assignee Unable To Show It Had Possession Of Note At Time Of Foreclosure

HONOLULU — A Hawaii appellate court erred in affirming a state trial court’s grant of summary judgment in favor of an assignee of the mortgage loan in a foreclosure dispute because the assignee was unable, pursuant to Hawaii Supreme Court precedent, to show that it had possession of the note at the time it filed the foreclosure action, the Hawaii Supreme Court ruled in vacating the appellate court’s ruling.
February 24, 2023
ECOA’s Discrimination Prohibition Does Not Extend To Prospective Loan Applicants

CHICAGO — The Consumer Financial Protection Bureau (CFPB) failed to sufficiently plead that a mortgage lender engaged in discrimination against prospective African-American mortgage borrowers by allegedly discouraging them from applying for mortgage loans in the Chicago metropolitan area because while the Equal Credit Opportunity Act (ECOA) is unambiguous in its prohibition of discrimination of “applicants” for credit, this prohibition does not pertain to “prospective applicants,” a federal judge in Chicago ruled.
February 24, 2023
Borrowers’ Petition In NBA Preemption Appeal Not Good Vehicle For Review

WASHINGTON, D.C. — The U.S. Supreme Court should deny review of a Second Circuit U.S. Court of Appeals ruling that the National Bank Act (NBA) preempts New York’s escrow-interest law because the Supreme Court has already denied certiorari on the question presented by borrowers in the instant action and because a recently filed petition in a substantially similar case is a better vehicle for addressing the issue, Bank of America NA argues in a respondent’s brief filed in the Supreme Court.
February 23, 2023
Split S.D. High Court Upholds Finding That Mortgage Was Void, Unenforceable

PIERRE, S.D. — In a split decision, the South Dakota Supreme Court found that a state trial court did not err in determining that a personal loan obtained by the trustee of a spendthrift trust was void and unenforceable because the trustee did not have the authority to obtain the personal loan and mortgage certain property belonging to the trust, even with the consent of the other trust beneficiaries.
February 22, 2023
Issue Of Lender’s Compliance With Notice Requirements Sent Back To Trial Court

PROVIDENCE, R.I. — A state trial court erred in ruling that a mortgage lender complied with the necessary notice requirements in sending a borrower a notice of foreclosure to the mortgaged property, but not the home in which she lived, because the trial court was required to resolve whether the borrower’s physical address was listed in the tax assessor’s office before issuing its ruling and failed to do so, the Rhode Island Supreme Court ruled in partially remanding a wrongful foreclose action to the trial court.
February 22, 2023
Trial Court Overstepped In Certifying Foreclosure Judgment As Appealable

MONTGOMERY, Ala. — The Alabama Supreme Court panel ruled that it lacked jurisdiction to hear an appeal in an ejectment action brought against borrowers whose home was foreclosed on after they defaulted on their mortgage loan because a state trial court exceeded its discretion when it certified its partial judgment in the lawsuit as immediately appealable.
February 21, 2023
Judgment In Foreclosure Action Was Not Sufficiently Final To Allow For Appeal

NEW YORK — A Second Circuit U.S. Court of Appeals panel found that it lacks jurisdiction to hear an appeal in a foreclosure dispute because although a federal district court issued a final judgment on some claims and severed the only other remaining claim, it also referred the action to a magistrate judge for a calculation of the amount of judgment.
February 16, 2023
Lender Off The Hook For Adding Information In Pre-Foreclosure Notice

ALBANY, N.Y. — A mortgage lender’s inclusion of additional information in a New York state law-mandated foreclosure notice sent to a borrower notifying him that he was in default and faced foreclosure was not an improper notice and did not void the foreclosure, the New York Court of Appeals ruled in overturning a state appellate court’s ruling.
February 15, 2023
Borrower: Panel Missed Key Evidence In Affirming Summary Judgment In RESPA Suit

ATLANTA — Panel rehearing is necessary in a lawsuit brought by borrowers who alleged that their mortgage loan modification provider violated provisions of the Real Estate Settlement Procedures Act (RESPA) because an 11th Circuit U.S. Court of Appeals panel “misapprehended” or “overlooked” points of fact that would have allowed it to come to a different conclusion, one of the borrowers argues in a petition for rehearing.
February 15, 2023
Loan Servicer Followed Necessary Requirements In Initiating Foreclosure

PROVIDENCE, R.I. — A Rhode Island trial court did not err in granting summary judgment in favor of a loan servicer in a mortgage foreclosure dispute with a borrower because the borrower was properly provided with notice of foreclosure counseling and the servicer’s default notice satisfies state law, the Rhode Island Supreme Court held in affirming.