On June 30, 2005, my client took out a $104,000 loan and mortgage on his family’s home in Southwest Philadelphia. The original lender was Indy Mac Bank, a sub-prime lender, whose operations were essentially taken over by the FDIC for what many believed were shoddy lending practices. The loan carried a low interest rate for the first two months, and then increased to an exorbitant interest rate for the next 29 years and 10 months. The mortgage broker, however, told my client at closing that he would be able to refinance the loan within a matter of months. This false promise never materialized, leaving my client with a deceptive, unfair and unreasonably high interest rate for the life of the loan.
One West Bank acquired the mortgage loan, which was later serviced by Ocwen Loan Servicing. One West filed a foreclosure lawsuit, and we filed a counterclaim and cross-claim against other lenders. The bank’s attorneys and I engaged in written discovery and multiple depositions, and in the fall of 2013, the Court scheduled a series of settlement conferences. The case was scheduled for trial in March, 2014.
By the time the case would be presented for trial, however, the balance on the loan was going to be approximately $187,000, almost twice as much as the original mortgage loan. The parties, however, reached a settlement, which lowered the principal balance by nearly $100,000, to $93,000. The settlement also called for an interest rate of 2% for the first 5 years, and for the remaining 5 years at 4.35%. While the case took almost 3 years to wind its way through the court, we were able to reach a favorable result.
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.
