PA SUPREME COURTS ALLOWS DEFAULT TO STAND AGAINST BANK OF AMERICA

September 10, 2014 By

As an update to a blog I posted in January, 2014, in which I discussed a default judgment I secured for my client against Bank of America, the Pennsylvania Supreme Court just ordered that the default judgment shall remain in place. I filed a lawsuit against Bank of America in Delaware County, PA for predatory lending and unfair trade practices. The bank failed to answer the lawsuit and I moved for a default judgment. Of course, the bank appealed, asking the trial judge to allow it to file an Answer, but the trial judge refused. The bank unsuccessfully appealed to the Superior Court and then to the Pennsylvania Supreme Court, also unsuccessfully.

This means that the case can now proceed to a jury trial to determine the amount of my clients’ monetary damages. Certain discovery issues need to be worked out; primarily I am in the process of securing testimony from a Bank of America Corporate Representative regarding the net worth of the company in 2012 and 2013.

This is because I included a claim for punitive damages, which are used to punish the defendant for wrongful conduct. One of the ways that a jury is allowed to and able to determine an appropriate dollar amount for damages is to consider the net worth of the defendant. The Bank is, of course, objecting to such an inquiry, and is not agreeing to produce such a representative; again, the trial judge will decide the scope of the deposition testimony. I am hopeful for trial in January/February 2015. I will keep you posted.

Contact the law firm of Shaffer & Gaier, LLC

We provide a free initial consultation to anyone with concerns about foreclosure or who is involved in foreclosure proceedings. To schedule an appointment, call our foreclosure hotline at 855-289-1660 or contact us online. Evening and weekend meetings can be arranged upon request. We will travel to your home if necessary to meet with you.

Filed Under: Bank of America, Current Events, Foreclosure, Foreclosure Defense, Mortgage Lending, Mortgage Modification, Mortgage Settlements Tagged With: , , , , , , , , , , , , , , ,

Favorable Settlement During Trial in Philadelphia

November 28, 2013 By

Our client had been sued by HSBC, one of the world’s largest banks (its initials stand for Hong Kong Shanghai Banking Corporation). In 2010, my client’s employer cut back on his overtime hours, and this caused a decrease in take-home pay. During the build-up to the housing bubble, HSBC acquired hundreds of thousands of U.S. mortgages from smaller lenders. Many banks got bailed out, but HSBC did not, and now claims that since it did not take any federal bailout money, it does not have to adhere to federal guidelines to modify mortgage loans, or engage in what I call reasonable settlement/resolution practices.

HSBC, therefore, demanded that the only way to reinstate my client’s delinquent loan was for the him to come up with 40% of the arrears. For homeowners that have been in foreclosure for a year or more, this often means that HSBC will not modify the mortgage unless the homeowners has tens of thousands of dollars to put down towards the new loan. In my client’s case, as in the case of most homeowners, this was not possible.

This scenario causes, in my view, more trials than are necessary since it is so difficult to settle by a loan modification. In this trial which started on November 27, 2013, the results ended favorably for my client. In this Philadelphia County case, HSBC was demanding that my client come up with over $60,000 in order to reinstate his mortgage loan (which already contained a 10.9% interest rate). My client rejected the offer, and the case proceeded to trial. Midway through the trial, HSBC made an offer to let our client remain in the home for almost another 12 months, and to waive the entire unpaid loan amount of $177,000. The case has been in litigation for nearly 3 years so this was a fantastic result for my client. The terms of the settlement were put on the record in front of the judge.

Contact Shaffer & Gaier

To set up a free initial consultation, contact our office online or call our foreclosure hotline at 855-289-1660. Or call our office location in Philadelphia at 215-751-0100, or in New Jersey at 856-429-0970.

Filed Under: Foreclosure, Foreclosure Abuses, Foreclosure Defense, Mortgage Lending, Mortgage Modification Tagged With: , , , , , , , , , ,

Philadelphia Judge Denies Bank’s Motion for Summary Judgment

April 1, 2013 By

My clients own a home in the Chestnut Hill neighborhood in Philadelphia. Their lender is Suntrust Mortgage Company, an Atlanta based lender with offices in the Southern and Eastern U.S. and in the Cayman Islands.

Suntrust sued my clients in a foreclosure lawsuit in Philadelphia Court of Common Pleas. In January, Suntrust filed a motion for summary judgment, arguing to the court that a trial was not necessary because the loan documents themselves prove that the homeowners are in default. The banks frequently file these motions in which they argue that the bank should have the absolute right to foreclose. A closer inspection of the loan documents, however, established that the bank may not have properly applied the mortgage payments to the principal and interest when the payments were made. This created a question of fact because my clients’ mortgage payments conflicted with the bank’s payment ledgers.

The trial court agreed, on February 27, 2013 the judge denied the bank’s motion for summary judgment. The clients continue to reside in the home and I am awaiting notification of a trial date.

Contact Shaffer & Gaier

To set up a free initial consultation, contact our office online or call our foreclosure hotline at 855-289-1660. Or call our office location in Philadelphia at 215-751-0100, or in New Jersey at 856-429-0970.

Filed Under: Foreclosure, Foreclosure Defense Tagged With: , , , , , , , ,

Federal Court Foreclosure Practice

March 27, 2013 By

I have a case pending in Federal District Court in Philadelphia against Bank of America (the servicing bank) and HSBC (HSBC controls the trust that holds my client’s mortgage). The basis of the lawsuit is that the banks lied to my client when they told him that he should let his loan go into default if he wanted a loan modification. As crazy as this may sound, this is a technique used by the banks over that last couple of years. Of course, this sets up a homeowner for a foreclosure lawsuit. This all happened before he retained me, and as luck would have it, my client did exactly what the bank told him to do—he went into default and the bank filed a foreclosure action against him in Delaware County, Pennsylvania.

I filed a lawsuit for fraud and promissory estoppel (i.e., my client relied on the bank’s statement that he should go into default). The bank filed a motion to dismiss our lawsuit, claiming that it was not reasonable for my client to rely on such a promise.

At oral argument on February 14, 2013, it was clear that this was the first time that the Federal Court judge became aware that the bank engaged in tactics like this. Since most foreclosure-based lawsuits are filed in the state courts, this is not surprising. For a good part of the hearing, which lasted about an hour, I felt as if I was educating the Court about 1) the bank practices which led to the housing crisis and 2) the ridiculousness of the loan modification process. Instead of issuing an opinion, the judge ordered Bank of America to look into settling the entire matter, which would include withdrawing the foreclosure complaint and providing a loan modification.

Contact Shaffer & Gaier

To set up a free initial consultation, contact our office online or call our foreclosure hotline at 855-289-1660. Or call our office location in Philadelphia at 215-751-0100, or in New Jersey at 856-429-0970.

Filed Under: Foreclosure, Foreclosure Defense Tagged With: , , , , , , , ,

US Department of Justice Continues to Pursue Wells Fargo Bank

February 28, 2013 By

Wells Fargo Bank may be the largest mortgage loan originator in the country, but the Department of Justice says that Wells Fargo continues to violate the terms of a settlement reached in July, 2012. On October 9, 2012, prosecutors in New York filed a new mortgage-based civil action against Wells Fargo, seeking hundreds of millions of dollars in damages for alleged mortgage fraud violations under the False Claims Act. The action asserts that Wells Fargo engaged in a long-standing and reckless trifecta of deficient training, deficient underwriting and deficient disclosure, all while relying on the convenient back stop of government insurance. Essentially, it is claimed that Wells Fargo originated bad loans, and then relied on government insurance through the Federal Housing Administration to pay the claims when those mortgages fell into default.

Wells Fargo, however, claims that the recent action is barred because the alleged conduct was already part of the July, 2012, settlement, and Wells Fargo claims that the slate was wiped clean. In court filings on November 1, Wells Fargo asked a trial judge to declare that the government’s second lawsuit is a breach of the July, 2012, settlement terms.

Contact Shaffer & Gaier

To set up a free initial consultation, contact our office online or call our foreclosure hotline at 855-289-1660. Or call our office location in Philadelphia at 215-751-0100, or in New Jersey at 856-429-0970.

Filed Under: Foreclosure, Foreclosure Defense, Mortgage Modification Tagged With: , , , , , , , ,

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