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

Mealey's Mortgage Lending

February 15, 2024
Judge Dismisses But Leaves Room To Amend RICO Lending Case

SACRAMENTO, Calif — Conclusory allegations that lender defendants in California undertook interstate activities are insufficient, but because it appears possible that borrowers could adequately plead a Racketeer Influenced and Corrupt Organizations Act (RICO) claim, dismissal is with leave to amend, a federal judge in California said.
February 15, 2024
Panel: Reversal Of Foreclosure ‘Required’ Due To No Legal Representative Of Estate

WEST PALM BEACH, Fla. — A Florida appellate court on Feb. 14 reversed and remanded a lower court’s judgment of foreclosure on a decedent’s property, finding that because the judgment was entered “without the presence of the deceased mortgagor’s legal representative, the final summary judgment of foreclosure is a nullity.”
February 13, 2024
Rhode Island High Court: Non-Signee Listed Borrower Retained Interest In Property

PROVIDENCE, R.I. — A trial court properly granted a lender summary judgment because a daughter listed as a borrower but who did not sign a promissory note retained an interest in the property at which she lived even after the death of her father, the lone signee, the Rhode Island Supreme Court said in affirming judgment in favor of the lender.
February 12, 2024
Dismissal Recommended In Class Suit Accusing Mortgage Lender Of Restraining Trade

JACKSONVILLE, Fla. — A federal magistrate judge in Florida issued a report and recommendation stating that all claims in a putative class complaint accusing a wholesale mortgage lender of violating the Sherman Act by refusing to do business with mortgage brokers who also do business with two other lenders should be dismissed, finding in part that there was no showing that there was “harm to competition within the overall mortgage market or the wholesale retail mortgage market.”
February 08, 2024
Borrower’s Fee Claims In Foreclosure Case Deemed Duplicative Of Prior Case

SEATTLE — A federal judge in Washington dismissed the remaining claims and counterclaims by a borrower who alleges that the assignee and servicer of his mortgage violated the Washington Consumer Protection Act (WCPA) when rolling attorney fees from the borrower’s earlier Real Estate Settlement Procedures Act (RESPA) case into his loan payoff amount, finding that claims were “duplicative of relief available and properly sought” in an earlier action; the judge directed the clerk to reopen the earlier action “for that limited purpose.”
February 08, 2024
U.S. High Court Affirms: No FCRA Immunity Exists For Government Agencies

WASHINGTON, D.C. — A unanimous U.S. Supreme Court on Feb. 8 upheld an August 2022 determination by the Third Circuit U.S. Court of Appeals that the U.S. Department of Agriculture (USDA) — and any other federal agency — can be sued for supplying false information to credit reporting entities.
February 07, 2024
Servicer To U.S. Supreme Court: Borrower Can’t Enforce Bankruptcy In State Court

WASHINGTON, D.C. — The U.S. Supreme Court should accept review of a case so that it can align a Fourth Circuit U.S. Court of Appeals ruling with the holdings from other appellate courts that preclude enforcing a federal court bankruptcy injunction through state laws, a mortgage servicer tells the court in a petition for writ of certiorari.
February 06, 2024
Bank Agrees To Pay $13.5M To Resolve Redlining Claims Raised By DOJ, North Carolina

GREENSBORO, N.C. — First National Bank of Pennsylvania (FNB) has agreed to pay $13.5 million to resolve the U.S. Department of Justice (DOJ) and state of North Carolina’s allegations that it “engaged in a pattern or practice of unlawful redlining” in Black and Hispanic neighborhoods in two cities in the state, according to two proposed consent orders filed Feb. 5 in federal court.
February 05, 2024
Judge Denies Mortgage Servicer’s Motion To Dismiss Loan Modification UCL Suit

LOS ANGELES — A California federal judge granted in part and denied in part a mortgage loan servicer’s motion to dismiss a suit accusing it of improperly denying a borrower’s loan modification applications, finding that the plaintiff’s claims are not time-barred because she now alleges that she recently discovered that the servicer sent her statements with errors that contributed to the principal balance on her loan.
February 05, 2024
Pa. Superior Court Affirms Summary Judgment For PNC In Mortgage Foreclosure Suit

PHILADELPHIA — A Pennsylvania Superior Court panel in a nonprecedential decision affirmed a trial court’s summary judgment ruling for PNC Bank National Association in a mortgage foreclosure action in which the mortgagor alleged that PNC did not possess the original promissory note and summary judgment was granted while there were still “a genuine issue of material fact over the non-principal and interest damages.”
February 02, 2024
Split Maine High Court Vacates Mortgage Discharge Order In Foreclosure Suit

PORTLAND, Maine — A divided Maine Supreme Judicial Court affirmed a trial court’s ruling in a foreclosure that a default notice sent to a mortgagor was defective but vacated the portion of the judgment requiring the bank subsidiary to discharge the mortgage, citing Finch v. U.S. Bank, N.A.
January 31, 2024
Tennessee Federal Judge Approves $1.9M Redlining Settlement Between DOJ, Bank

MEMPHIS, Tenn. — A federal judge in Tennessee on Jan. 30 approved a consent order in which Patriot Bank agreed to resolve the U.S. Department of Justice’s allegations that it “engaged in a pattern or practice of unlawful redlining” by establishing a $1.3 million loan subsidy fund to increase access to mortgage, refinancing and similar services for residents of majority-Black and Hispanic neighborhoods in Memphis.
January 30, 2024
RESPA Case Against Mortgage Servicer Dismissed After Parties Reach Settlement

BALTIMORE — A federal magistrate judge in Maryland on Jan. 29 dismissed borrowers’ suit against their mortgage servicer, alleging violations of the Real Estate Settlement Procedures Act (RESPA) and state law claims after being advised by the parties that they had reached a settlement.
January 26, 2024
3 Complaints Consolidated That Accuse Navy Federal Of Biased Mortgage Denials

ALEXANDRIA, Va. — A federal judge in Virginia granted two motions to consolidate three putative class complaints accusing Navy Federal Credit Union of discriminating against individuals seeking mortgages based on race, appointed interim co-lead class counsel and ordered that those attorneys should handle any settlement discussions and pleadings.
January 26, 2024
Woman’s Lending Discrimination Claims Time-Barred, Fail, Judge Says

SAN FRANCISCO — A woman’s civil rights and fair housing claims stemming from a bank’s denial of her mortgage application are time-barred under precedent establishing that the statute of limitations runs from the date of the incident, while her equal credit claim is not sufficient, a federal judge in California said in granting a motion to dismiss.
January 26, 2024
Appellees Urge 2nd Circuit To Affirm Ruling In ERISA Mortgage-Backed Securities Row

NEW YORK — Fighting arguments that a pension fund’s investment in mortgage-backed securities (MBS) made the mortgages plan assets under the Employee Retirement Income Security Act, mortgage servicers told the Second Circuit Court of Appeals that “straightforward application of the governing regulation defeats” those claims.
January 25, 2024
Decertification Denied, Class Redefined In Mortgage Case Alleging Kickbacks

BALTIMORE — A federal judge in Maryland denied a mortgage servicer’s motion to decertify a class of borrowers suing over kickbacks allegedly paid by a title company to the servicer’s employees but amended the class definition to limit it to borrowers in certain states who paid title service charges in excess of $500 plus the cost of title insurance, opining that the new definition will “ensure that the predominance and adequacy requirements of [Federal Rule of Civil Procedure 23] remain satisfied.”
January 25, 2024
Firm, Professor Back BOA’s Arguments In High Court N.Y. Escrow Law Preemption Case

WASHINGTON, D.C. — A law professor filed an amicus curiae brief in the U.S. Supreme Court on Jan. 24, joining amicus Washington Legal Foundation in supporting Bank of America N.A.’s (BOA) arguments in an appeal concerning whether the National Bank Act (NBA) preempts New York’s escrow-interest law; BOA in its brief tells the high court justices that the preemption exists as “[s]tates cannot control national-bank powers.”
January 24, 2024
Divided Maine Supreme Court Upends Foreclosure Notice Discharge Precedent

AUGUSTA, Maine — Stare decisis does not preclude revising recent opinion requiring discharge of a mortgage when a foreclosure notice included even a simple typographical error, a position that deviated from previous precedent and was not adopted by any other courts, a divided Maine Supreme Judicial Court said.
January 24, 2024
Judge Says Loan Applicants Aren’t Purchasers Under Law, Didn’t Rely On Statements

PHILADELPHIA — Mortgage applicants who received what they admit was a conditional approval are not purchasers and, therefore, are not protected by Pennsylvania’s consumer protection law and lack any evidence of reliance on misstatements about the loan that could form the basis of a fraud claim, a federal judge in Pennsylvania said in granting summary judgment.
January 22, 2024
Consolidated Mr. Cooper Data Breach Plaintiffs To Submit Proposed Deadlines

DALLAS — Eight days after 20 putative class actions over a data breach experienced by Mr. Cooper Group Inc. were consolidated in Texas federal court, the judge granted the mortgage servicer’s motion for relief from the impending deadline for it to respond to the complaint against it, directing the parties to submit an agreed-upon schedule with proposed deadlines for filing motions, an amended complaint and other items.
January 19, 2024
Ohio Appeals Panel Upholds Class Certification In Mortgage Recording Case

CINCINNATI — Certification of a class in a case seeking damages for violations of Ohio’s mortgage-recording statute that occurred allegedly in part due to the coronavirus pandemic was appropriate as the lead plaintiff and class have standing, common questions predominate and amendments to the statute that barred class recovery do not impact this class as the amendments did not take effect until two months later, an Ohio appellate panel ruled.
January 19, 2024
Tennessee Bank Agrees To Pay $1.9M To Resolve Justice Department’s Redlining Suit

MEMPHIS, Tenn. — Patriot Bank has agreed to pay $1.9 million to resolve the U.S. Department of Justice’s allegations that it “engaged in a pattern or practice of unlawful redlining” by avoiding providing mortgages services to Memphis neighborhoods that are majority Black and Hispanic, according to a consent order filed in a federal court in Tennessee.
January 17, 2024
High Court Told ‘Chaos’ Will Ensue ‘In A World Without Chevron’ Deference

WASHINGTON, D.C. — The U.S. Supreme Court was told Jan. 17 that “chaos” will ensue “in a world without Chevron” deference by government attorneys, who urged it to apply stare decisis and uphold Chevron, which is being challenged in two cases arising out of federal fishing regulations.
January 17, 2024
Hawaii Panel Allows Some Claims Against Lender’s Attorney In Reverse Mortgage Case

HONOLULU — Two borrowers suing over foreclosure proceedings involving their reverse mortgages may proceed with certain fraud and elder abuse claims against their lender’s attorney and his firm, a Hawaii appellate panel ruled, opining in part that “the litigation privilege is not an absolute bar against an action by a borrower against a foreclosing lender’s attorney arising out of the attorney’s fraud on the court in a prior foreclosure action.”