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Mealey's Mortgage Lending

  • April 15, 2024

    Alabama High Court Finds Mortgagee Necessary Party In Foreclosure, Ejection Action

    MONTGOMERY, Ala. — Finding that a mortgagee that sold a property at a foreclosure sale was a necessary and indispensable party to the subsequent buyer’s ejection action against the mortgagor, the Alabama Supreme Court on April 12 reversed a trial court’s ruling that the foreclosure sale was void and remanded for further proceedings.

  • April 12, 2024

    Borrowers File RICO, Conspiracy Class Action Against Wholesale Mortgage Lender

    DETROIT — Four homeowners allege in a class action filed in a federal court in Michigan that the nation’s largest wholesale mortgage broker, its CEO and several affiliated companies have participated in a “deliberate scheme, in coordination with a host of corrupted mortgage brokers, to cheat hundreds of thousands of borrowers out of billions of dollars in excess fees and costs that they paid to finance their homes.”

  • April 12, 2024

    Nevada High Court Affirms Preliminary Injunction Denial In Quiet Title Case

    LAS VEGAS — A Nevada trial court properly denied property owners’ request for a preliminary injunction in their quiet title action as the owners incorrectly premised their claim on Nevada Revised Statutes Section 106.240 since a 2012 judicial foreclosure action that was initiated and then dismissed by U.S. Bank National Association did not trigger Section 106.240’s 10-year time frame, the Nevada Supreme Court ruled.

  • April 10, 2024

    Judge Bars Octogenarian’s Counsel For Conduct Violations Related To Foreclosure

    ATLANTA — A Georgia federal bankruptcy judge prohibited an attorney and his firm from filing any new bankruptcy cases in that court for 12 months, making the prohibition permanent as to any bankruptcy cases paid for by third parties, finding the sanction appropriate for repeated professional conduct violations as in the instant case where the attorney filed a Chapter 13 petition on behalf of an 80-year old man to stop foreclosure of the man’s home but instead accepted fees from the prospective home purchaser.

  • April 10, 2024

    Briefing Wraps In Petition Involving Bankruptcy’s Power Over State Law Claims

    WASHINGTON, D.C. — The existence of a circuit split is undeniable in a case questioning whether state law claims are preempted based on a bankruptcy discharge, a lender says in an April 9 reply brief urging the U.S. Supreme Court to accept review and reject arguments that state law claims based on post-discharge conduct escape preemption.

  • April 08, 2024

    State Consumer Protection Claim Against Mortgage Subservicer Survives Dismissal

    NORFOLK, Va. — A couple may proceed with a fraud-based claim under the West Virginia Consumer Credit and Protection Act (WVCCPA) in a putative class complaint accusing a mortgage subservicer of overcharging interest by incorrectly applying prepayments as that state law provides “‘an avenue of relief’” based on violations of Federal National Mortgage Association (Fannie Mae) servicing guidelines, a federal judge in Virginia ruled partially denying the subservicer’s motion to dismiss.

  • April 08, 2024

    Homeowners, Lender Settle Appraisal Bias Case; Claims Against Appraiser Continue

    BALTIMORE — Homeowners have reached a settlement with a mortgage lender in a suit in a federal court in Maryland alleging that the lender and a property appraiser violated several provisions of the Fair Housing Act (FHA) and the Equal Credit Opportunity Act (ECOA) by undervaluing their home based on their race and by denying a mortgage refinancing application based on that appraisal for an undisclosed amount and a number of policy changes.

  • April 05, 2024

    6th Circuit: Original Mortgagee Had Good Cause For Refusing To Release Lien

    CINCINNATI — A Sixth Circuit U.S. Court of Appeals panel has affirmed a trial court’s summary judgment ruling for the once-primary mortgagee that refused to release the lien on a home even though the mortgage was satisfied, finding that good cause existed for the refusal as the mortgagors failed to follow the necessary steps to resolve the issue.

  • April 02, 2024

    Washington Panel Affirms Denial Of Servicer’s Motion To Vacate Quiet Title Order

    SEATTLE — On remand from the Washington Supreme Court, a state appellate panel on April 1 again affirmed a trial court’s order quieting title on a property, finding that the high court’s ruling in Copper Creek (Marysville) Homeowners Ass’n v. Kurtz is not a change in law warranting relief.

  • April 02, 2024

    Antitrust Counterclaims Against Wholesale Mortgage Lender Dismissed In Contract Suit

    DETROIT — Adopting a Florida federal magistrate judge’s recommendation in The Okavage Group LLC, et al. v. United Wholesale Mortgage LLC, et al. that all claims in a putative class action antitrust complaint against a wholesale mortgage lender should be dismissed, a federal judge in Michigan has dismissed similar counterclaims against the same wholesale mortgage lender related to the same “ultimatum.”

  • April 01, 2024

    Judge Dismisses RESPA Case After Mortgage Servicer, Borrowers Reach Settlement

    FORT MYERS, Fla. — A federal judge in Florida on April 1 dismissed without prejudice borrowers’ suit claiming that their mortgage servicer violated the Real Estate Settlement Procedures Act (RESPA) by failing to timely pay their flood insurance premiums, resulting in uncovered Hurricane Ian damage to their home after the parties notified the court that they had reached a settlement.

  • March 28, 2024

    Dismissal Motion In Reverse-Mortgage Fee Class Action Denied Without Prejudice

    CENTRAL ISLIP, N.Y. — A federal judge in New York on March 27 sustained objections to a magistrate judge’s recommendation that the court should deny the dismissal motion of one of the defendants in a putative class case over fees and other charges for reverse mortgages based on the defendant’s alleged failure to comply with local rules and a prior order, but the judge adopted the recommendation to deny the motion without prejudice to renewal pending the determination of several issues in a related action.

  • March 28, 2024

    Judge: Mortgage Loan Provider’s Loss Arose From Uncovered Disciplinary Proceeding

    CHICAGO — A federal judge in Illinois granted an insurer’s motion to dismiss with prejudice a mortgage loan provider insured’s first amended complaint seeking coverage under a professional liability mortgagee's errors and omissions policy for its $1,275,000 payment arising from an investigation brought by Illinois Department of Financial and Professional Regulation (IDFPR), finding that there is no coverage because the insured’s losses both arose from an uncovered disciplinary proceeding and were uncovered fines, and a policy exclusion bars coverage.

  • March 26, 2024

    Judge Grants Preliminary Approval To Settlement For Lender’s ‘Junk Fees’

    SACRAMENTO, Calif. — A California federal judge granted a motion for preliminary approval of a settlement under which Ocwen Financial Corp. and Ocwen Loan Servicing LLC (together, Ocwen) will pay an estimated $53 million to resolve a mortgagor’s class action claims against it for charging “hidden junk fees” in violation of the Racketeer Influenced and Corrupt Organizations Act (RICO) and California’s unfair competition law (UCL).

  • March 22, 2024

    Judge: Identity Theft Victim’s Claims Against Lenders Survive Dismissal Bids

    RICHMOND, Va. — Allegations that a woman battling identify theft spent money and suffered emotional distress as a result of lenders’ incorrect reports to credit reporting agencies despite being informed of the situation create standing, a federal judge in Virginia said in denying a motion to dismiss.

  • March 21, 2024

    Mortgage Servicer Denied Judgment In RESPA Action Over Insurance Premiums

    FORT MYERS, Fla. — A federal judge in Florida on March 20 denied a mortgage servicer’s motion for judgment on the pleadings in a suit alleging that it violated the Real Estate Settlement Procedures Act (RESPA) by failing to timely pay borrowers’ flood insurance premiums, resulting in uncovered Hurricane Ian damage to their home, rejecting the servicer’s argument that RESPA does not apply because the home is not the borrowers’ primary dwelling.

  • March 21, 2024

    Judge Dismisses Foreclosure Action After Lender’s Voluntary Dismissal, Orders Service

    CENTRAL ISLIP, N.Y. — Noting that a lender failed to serve its notice of voluntary dismissal on the borrower defendant who had never appeared in the action, a federal judge in New York in a March 21 docket-only order dismissed the case and ordered the lender to serve a copy of the notice and her order to the defendant by March 25.

  • March 19, 2024

    After Texas High Court Rescission Ruling, 5th Circuit Affirms Ruling For Lender

    NEW ORLEANS — Citing the Texas Supreme Court’s February ruling in answer to a certified question that a mortgage lender may simultaneously rescind a prior loan acceleration and re-accelerate a loan, the Fifth Circuit U.S. Court of Appeals on March 18 affirmed a lower court’s grant of summary judgment to a lender and servicer in a mortgage foreclosure suit.

  • March 19, 2024

    CFPB, FTC As Amici: Fees For Expedited Mortgage Payments Barred By FDCPA

    ATLANTA — Convenience fees charged to borrowers who choose to make mortgage payments by phone or online are prohibited by the Fair Debt Collection Practices Act (FDCPA) where the fee is not expressly authorized by the agreement creating the debt, the Consumer Financial Protection Bureau (CFPB) and the Federal Trade Commission (FTC) argue in an amicus curiae brief filed in the 11th Circuit U.S. Court of Appeals supporting arguments by two borrowers against overturning a trial court’s judgment in their favor as to unlawful debt collection practice.

  • March 19, 2024

    Class Definitions In RESPA, FCRA Suit Deemed Not So Deficient To Require Striking

    PHILADELPHIA — Calling class definitions “‘more of an art than a science,’” a federal judge in Pennsylvania denied a mortgage servicer’s motion to strike class allegations in a lawsuit accusing it of ignoring Real Estate Settlement Procedures Act (RESPA) requests and providing inaccurate information to credit reporting agencies (CRAs) after determining that two classes proposed by the borrower bringing the claims are “not so clearly deficient that no class could ever be certified.”

  • March 18, 2024

    Suit Against Loan Servicer Dismissed After Settlement Of Late Payment Notation Row

    TACOMA, Wash. — A federal judge in Washington on March 15 dismissed with prejudice a man’s claims that the servicer of a property loan taken out in his name failed to properly investigate his disputes concerning late payments and provided “incomplete” or “misleading” information to credit reporting agencies when the servicer failed to include a notation with the report of the late payments that the loan had been the responsibility of his ex-wife pursuant to their divorce decree, after the parties notified the court that they had reached a settlement.

  • March 14, 2024

    Bank And Creditor Amici: Bankruptcy Court Sole Arbiter Of Injunction Violation

    WASHINGTON, D.C. — Four amici curiae involved in the banking and credit industry told the U.S. Supreme Court that a ruling allowing a mortgagor to pursue state court remedies for alleged violation of a bankruptcy injunction would create chaos in the industry and that the bankruptcy court is the best place to pursue such actions.

  • March 12, 2024

    5th Circuit Revives Subsequent Owner’s Quiet Title Action Against Loan Servicer

    NEW ORLEANS  — The subsequent owner of a condo has sufficiently pleaded facts allowing a court to infer that the statute of limitations for foreclosure has run, the Fifth Circuit U.S. Court of Appeals found, reversing a lower court’s dismissal of the owner’s quiet title action against the servicer of a loan on the property taken out by a prior owner.

  • March 11, 2024

    9th Circuit: Fraud, Negligence Claims May Be Timely In Loan Payoff Confusion Case

    SAN FRANCISCO — A mortgagor may proceed with claims for fraudulent omission and negligence against a loan servicer whom he alleges told him a loan was discharged due to a regulatory settlement and then later came back to collect on the loan, a Ninth Circuit U.S. Court of Appeals panel ruled, partially reversing dismissal of the claims without leave to amend due to the statute of limitations after finding that those two claims may be timely.

  • March 08, 2024

    Expert On Credit Reports, Credit Scores Can Testify, Arizona Federal Judge Says

    PHOENIX — An expert retained by a credit reporting agency can testify in a suit filed by a couple alleging that the agency wrongfully reported a foreclosure on their home in violation of the Fair Credit Reporting Act (FCRA), an Arizona federal judge ruled, rejected the couple’s argument that his testimony was inadmissible under Daubert v. Merrell Dow Pharmaceuticals Inc.