Mealey's Mortgage Lending

  • May 23, 2024

    Judge: Consolidation Needed To Address Settlement In Related Mortgage Class Suits

    COLUMBUS, Ohio — In an order filed in the wake of a status hearing on a joint motion for preliminary approval of a $185 million settlement to resolve two related suits accusing Wells Fargo Bank N.A. and Wells Fargo and Co. (together, Wells Fargo) of violating state and federal law by engaging in a scheme to place borrowers into a forbearance program during the COVID-19 pandemic, a federal judge in Ohio on May 22 notified the parties that unless they filed a brief in opposition within seven days, the court “will sua sponte consolidate these cases into a single case for settlement purposes only, appoint both counsel as interim class counsel for settlement purposes only, and consider the pending motion for preliminary approval.”

  • May 22, 2024

    Judge Finds Servicers’ Conduct Falls Short Of RESPA

    CINCINNATI — A mortgage servicer failed to properly investigate borrowers’ claims about misapplied payments and fees, but even if an appropriate investigation occurred, the servicer fell short of its regulatory duty under the Real Estate Settlement Procedures Act (RESPA) by failing to fully inform the borrowers of the results, a federal judge in Ohio said in granting summary judgment to the plaintiffs in a case complicated and delayed by the coronavirus and the death of both borrowers during the litigation.

  • May 21, 2024

    Judge Preliminarily OKs $2.4 Million Settlement Of Suit Over Lender’s Data Breach

    BRIDGEPORT, Conn. — Less than three months after consolidating six lawsuits over a financial services firm’s November data breach, a Connecticut federal judge granted preliminary approval to a settlement that establishes a $2.45 million fund to settle negligence and contractual claims against the lender.

  • May 20, 2024

    Judge Denies TRO Barring Foreclosure Sale By Servicer Accused Of Violating UCL

    LOS ANGELES — A California federal judge on May 17 denied a borrower’s application for a temporary restraining order (TRO) blocking the imminent foreclosure sale of his home, finding it unlikely that he will succeed on his claims against a borrower for violating California’s unfair competition law (UCL) by allegedly misinforming him about his ability to obtain a COVID-19 forbearance plan.

  • May 16, 2024

    Split High Court Leaves Consumer Financial Protection Bureau’s Funding Untouched

    WASHINGTON, D.C. — The Consumer Financial Protection Bureau’s (CFPB) funding mechanism that permits “reasonably necessary” withdrawals from the Federal Reserve System subject to an inflation-adjusted cap complies with the U.S. Constitution’s appropriations clause, a divided U.S. Supreme Court ruled May 16.

  • May 15, 2024

    Freedom Mortgage Denied Dismissal Of CFPB’s Claims Of More Mortgage Violations

    WEST PALM BEACH, Fla. — A federal judge in Florida denied a mortgage lender’s motion to dismiss a lawsuit by the Consumer Financial Protection Bureau (CFPB) alleging that the lender has continued to violate the Home Mortgage Disclosure Act (HMDA) by failing to make the necessary changes to halt its misreporting of data regarding borrowers; the lawsuit was filed several years after a 2019 consent order under which the lender paid a civil penalty for misreporting data and agreed to fix its reporting procedures.

  • May 15, 2024

    Class Suit Claims PHH Mortgage ‘Final Letters’ Misrepresent Terms For Late Payments

    ALBANY, N.Y. — A New York homeowner has filed a consumer protection class action complaint in a New York federal court against PHH Mortgage Corp. and PHH Mortgage Services, alleging that the mortgage service company violates the Fair Debt Collection Practices Act (FDCPA) by sending “final letters” to borrowers to “scare and intimidate” them into paying off late mortgage payments sooner than allowed by law.

  • May 13, 2024

    Conn. High Court Reverses Judgment For Bank In Forced Insurance, ‘Kickbacks’ Case

    HARTFORD, Conn. — The Connecticut Supreme Court reversed a trial court’s judgment for a lender in a foreclosure case in which there were disputes over forced insurance and allegations of “kickbacks” by the insurance provider, finding that the mortgagor’s special defenses of unclean hands and breach of the implied covenant of good faith and fair dealing were improperly struck.

  • May 10, 2024

    9th Circuit Affirms Dismissal Of Borrowers’ Claims Against Loan Servicer

    PASADENA, Calif. — The Ninth Circuit U.S. Court of Appeals on May 9 affirmed a lower court’s dismissal of borrowers’ suit against their mortgage loan servicer, finding that a breach of contract claim and a claim for breach of the implied covenant of good faith and fair dealing are time-barred and that the couple failed to state claims for violations of the California unfair competition law (UCL) and Real Estate Settlement Procedures Act (RESPA).

  • May 09, 2024

    Florida Panel Reverses Prior Ruling And Affirms Foreclosure On Decedent’s Property

    WEST PALM BEACH, Fla. — A Florida appellate court on May 8 withdrew its opinion that reversed a lower court’s judgment of foreclosure on the property of a decedent who died during foreclosure proceedings without a personal representative being appointed after his death, finding that because a homestead is not considered part of the probated estate, appointing a personal representative was not required.

  • May 06, 2024

    Mortgagors Appeal Finding That Broker Price Opinion Was Not An Inspection Fee

    GREENBELT, Md. — A couple who filed a putative class complaint against their lenders over a broker price opinion (BPO) fee that appeared on their account after their mortgage was identified as being in active loss mitigation and a putative class member who attempted to intervene filed a notice of appeal on May 4 after a federal magistrate judge in Maryland granted the lenders summary judgment and ruled that the BPO fee at issue was not an inspection fee prohibited by Maryland’s usury statute.

  • May 03, 2024

    Judge Dismisses Borrower’s RESPA Action After Parties Reach Settlement

    COEUR D’ALENE, Idaho — A federal judge in Idaho on May 2 ordered the dismissal with prejudice of a homeowner’s suit against a bank and a loan servicer alleging violations of the Real Estate Settlement Procedures Act (RESPA) after the parties filed a joint stipulation of dismissal.

  • May 02, 2024

    Borrowers’ Class Suit Alleging Lender Wrongfully Denied COVID Relief Dismissed

    PHILADELPHIA — A federal judge in Pennsylvania on May 1 dismissed without prejudice borrowers’ putative class action alleging that their lender violated state and federal statutes when it denied some borrowers COVID-19 aid and approved only a portion of the aid for others, finding that the plaintiffs failed to state a claim under the Pennsylvania Unfair Trade Practices and Consumer Protection Law (UTPCPL) or the Real Estate Settlement Procedures Act (RESPA).

  • May 02, 2024

    2nd Circuit Largely Finds Bank Can’t Bring Claims Over Mortgage-Backed Securities

    NEW YORK — A panel of the Second Circuit U.S. Court of Appeals narrowly agreed with a German banking organization that appealed multiple orders from federal judges in New York in its suit claiming that another banking organization mishandled residential mortgage-backed securities (RMBS), finding that no action clauses in agreements for the securities do not preclude the bank from filing claims.

  • April 30, 2024

    Judge Reconsiders, Reverses Dismissal Of ECOA, FHA Claims In Reverse Redlining Suit

    FLINT, Mich. — Ruling on the plaintiffs’ motion for reconsideration, a federal judge in Michigan reversed the dismissal of Fair Housing Act (FHA) and Equal Credit Opportunity Act (ECOA) claims against lenders and agents in a putative class action alleging reverse redlining.  The plaintiffs had argued that the court erred in dismissing the claims without addressing their disparate treatment claim.

  • April 29, 2024

    High Court Won’t Review Whether Bankruptcy Discharge Preempts State Law Claims

    WASHINGTON, D.C. — The U.S. Supreme Court on April 29 denied a loan servicer’s request to resolve a circuit split and decide whether the U.S. Bankruptcy Code “preempts state-law claims premised on alleged efforts to collect a debt” in violation of a bankruptcy court’s discharge injunction.

  • April 29, 2024

    Class Counsel Motions Sealed As $185M Settlement Mulled In Mortgage Suits

    COLUMBUS, Ohio — A federal magistrate judge in Ohio directed that two motions for appointment of class counsel filed in related suits accusing Wells Fargo Bank N.A. and Wells Fargo and Co. (together, Wells Fargo) of violating state and federal law by engaging in a scheme to place borrowers into a forbearance program during the COVID-19 pandemic be temporarily sealed pending resolution of the motions to seal; the order came just over a week after the plaintiffs in both cases filed a joint motion for preliminary approval of a $185 million settlement.

  • April 29, 2024

    Maryland Panel Vacates Order Denying Stay In Foreclosure Action Against Estate

    ANNAPOLIS, Md. — A Maryland appellate court vacated and remanded a lower court order denying a decedent’s estate’s motion to stay or dismiss a foreclosure action filed against it by a trust seeking to foreclose on a residential property owned by the estate, finding that the trust lacks the right to foreclose because it does not have the appropriate revolving credit license.

  • April 26, 2024

    $3.58M Settlement Granted Final Approval In Mortgage Pay-To-Pay Suit

    WASHINGTON, D.C. — A federal magistrate judge in the District of Columbia on April 25 granted final approval of a $3,587,254 class settlement to be paid by Nationstar Mortgage LLC, doing business as Mr. Cooper, to end a complaint over the company’s practice of charging mortgagors “convenience fees” to pay their mortgage over the phone.

  • April 24, 2024

    Home Buyer’s FCRA Class Suit Alleging Faulty Credit Reports Settled For $96,000

    PHOENIX — A federal judge in Arizona largely granted final approval of $96,000 class settlement agreement in a lawsuit by a home buyer accusing a credit reporting company of failing to ensure that it was providing accurate credit reports after it reported him and others as “deceased,” opining that each of the 67 class members, down from the original estimate of 91, is entitled to receive the maximum statutory amount of $1,000 but that the $24,000 remaining that the lead plaintiff sought to distribute to the class members as “additional compensatory damages” will instead go to the parties’ cy pres recipient as there was no proof of additional actual damages or an agreement for punitive damages.

  • April 23, 2024

    Homeowner Appeals Judgment For Bank In Suit Over Improperly Discharged Mortgage

    BOSTON — A homeowner on April 22 appealed to the First Circuit U.S. Court of Appeals a judgment issued in favor of a bank in the bank’s Massachusetts federal court action seeking to strike the discharge of a mortgage granted to it by the homeowners.

  • April 18, 2024

    North Carolina High Court Affirms HAMP Claims Are Time-Barred

    RALEIGH, N.C. — Homeowners were on notice of their lenders’ allegedly fraudulent scheme to delay or deny loan modifications through repeated difficulties in securing a loan modification from Bank of America under the Home Affordable Modification Program (HAMP) and when the process resulted in their homes being foreclosed upon, a divided North Carolina Supreme Court said in finding the claims time-barred.

  • 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.