Loan Modification Hell Lawsuits

Last Updated Apr 26, 2011 9:14 PM EDT

Don't miss the comments: Are You In Loan Modification Hell: Join The Club, Loan Modification Hell: Income Requirements For New HAMP Rules, and Loan Modification Hell: The Horror Stories Continue.
Update #2: Today, Arizona filed suit alleging Bank of America engaged in Loan Modification Fraud.
Loan modification hell: Judging by the number of people who are contacting me, the problem is getting worse - not better.

Starting Sunday, I will be attending the Five Star Conference, in Dallas, sitting on a panel moderated by FOX News' Chris Wallace. This is a conference for lenders who service loans that are in default and the vendors that feed into that conference.

How many folks is that exactly? Try 5,000+. Yup: 5,000 lenders, servicers, and folks like Robert Klein, of Safeguard Properties, whose company does 1 million inspections of homes whose owners have either defaulted on their loans or have been foreclosed on by their lender. (I had a truly eye-opening conversation with Klein earlier this week. Bottom line: He thinks the foreclosures have devastated every corner of America and the foreclosure situation is getting worse.)

Loan Modification Hell Lawsuits

Meanwhile, I was sent this early in the morning. If you are filing a similar suit, please post a link to it here to help those who are considering the same action.
_____________________________________________________
SECOND DISTRICT COURT, STATE OF UTAH
IN AND FOR THE COUNTY OF WEBER

_____________________________________________________

JEFFREY L. SHURTLIFF, Complaint

Plaintiff.

V.

Civil No. WELLS FARGO BANK NA 100906927CN

and
FREDDIE MAC CORPORATION

Defendants. Judge : Jones

____________________________________________________

Comes now Jeffrey L. Shurtliff, complaining of the

defendants, and alleges as follows:

1. Plaintiff entered into an agreement with the Wells Fargo

to service his mortgage on his house, located at 4180W.

2475S. Ogden, Utah, on April of 2008. The loan is a Freddie Mac

loan.

2. Plaintiff notified the defendants of possible future default

of loan payments to the defendants, on October 28,

2009. Plaintiff was current with the mortgage at the

time of notifying the defendant of possible future default. The

plaintiff requested; via a telephone conversation with a

representative at Wells Fargo, entrance into the Making

Your Home Affordable Program.

3. Plaintiff was told he qualified and received the paperwork

for the Making Home Affordable Program and submitted it. The

plaintiff was put on three trial payments of $1068.40. These trail

payments were to be for December 09 , January 2010 and February

of 2010.

4. Plaintiff made all of the required payments pursuant to

the program, on time.

5. At the end of the final month of February, the

Plaintiff began to call Wells Fargo, inquiring about when the

Modification would be completed. The defendant's representative

told the plaintiff that more time was needed to complete the

process. The Plaintiff was instructed to keep on making the

$1068.40, payment.

6. On or about March 24th , 2010, the plaintiff received a

telephone call from Jeri a representative from Wells Fargo. She told

him the "Loan Modification was moving forward and that the

income looked good and no further documentation was required."

She also told the plaintiff to continue with the trial

period payment of $1068.40 for the month of April 2010.

The plaintiff heard nothing and called back at the end of April.

The plaintiff was told that he was still being considered for the

Making Home Affordable modification ; "that all was left was a

drive by appraisal." Phone calls in May were made by the

plaintiff to Wells Fargo, with representatives telling him he was

still being considered for Making Home Affordable Modification.

7. On May 30, 2010 , Wells Fargo sent a letter of Default to the

Plaintiff, stating foreclosure proceedings would start on June 29,

2010. The plaintiff was told via telephone to disregard letter.

8. On June 3, 2010 , the plaintiff received a letter from the

Wells Fargo stating the plaintiff had been turned down

for the Making Home Affordable modification loan. The plaintiff

called Wells Fargo and asked when he was turned down, because

he had talked with a representative on June 4, 2010, who had told

him "all was well;" and the representative said the plaintiff was

turned down April 21, 2010.

9. During all of the phone calls made by the Plaintiff ,

representatives were asked by the plaintiff, about foreclosure and

the delinquent amount left over by enrolling into the program.

Each time the plaintiff was assured of no foreclosure and the

amount that was delinquent, would be put on the back of the loan.

10. The plaintiff complains, the defendants intentionally made

the Making Home Affordable process go on excessively; to inflate

the delinquent balance and then foreclose on the plaintiff's house to enrich themselves. The defendants knew that the Plaintiff did

not have the $12,000 plus dollars to keep the original loan. The

Plaintiff complains the defendants have used predatory and

misleading loan practices, to rid itself of the bad loan it made with

the plaintiff and foreclose on his house.

11. The Plaintiff complains the Defendants have unjustly

enriched themselves, by creating a "balloon" payment with all late

charges and interest charges, that became due upon turn down of

the modification. The plaintiff complains this was not disclosed to

him when entering the program.

12. The Plaintiff complains he has been misled and entrapped;

by the Defendants Wells Fargo and Freddie Mac, by

the deceptive and predatory Loan Modification Process. The

Defendants had no intention of approving a loan for the plaintiff,

even though the plaintiff was current with the modified payment.

The Plaintiff complains he was current on the loan with Wells

Fargo and that Wells Fargo knew that and kept the plaintiff in the

"hamster wheel process", for over six months, to inflate the

delinquent balance. The defendants knew the Plaintiff did not

have the past due amount available to redeem his home and

continued to put the plaintiff off, in an effort to make the

delinquent amount excessive; until it was impossible for the

plaintiff to come up with the balloon payment needed, to keep the

current loan.

13. The plaintiff complains the defendants representatives

knowingly misled the plaintiff at the beginning of the process into

thinking he was approved as long as he made the payments

on time and sent the required documents in. The plaintiff did

everything he was told to do, but did not receive the modification

Loan. The plaintiff sent six payments, on time to the defendants.

14. The plaintiff complains he was entrapped ,by the false

advertising on the HAMP solicitation. Plaintiff' s exhibit A.

The plaintiff complains the Statement of eligibility on the

solicitation and on the Defendants websites are fraudulent and

Predatory and misleading. The plaintiff complains the Statement

"Helping you Stay in Your Home" put him into a sense of security;

that the defendants knew was false; is false advertising and

fraudulent.

IN SUMMARY WITH MOTIONS

-----------------------------------------------------------------------

The plaintiff requested a Home Affordable Modification

Loan, from the defendant. The plaintiff was told he was qualified

by telephone on October 28, 2009. The plaintiff was current with

his payments at the time of request. The plaintiff was told as long

as he complied with making on time payments and submitting

required paperwork, that modification would become permanent in

30 to 90 days. (Referencing Freddie Mac solicitation, plaintiff's

Exhibit A.) The plaintiff made all payments on time pursuant to

the agreement, sent to him and dated October 28,2009. Plaintiff's

Exhibit B. The plaintiff was disapproved and then notified of

disapproval 42 days, after the fact. The plaintiff was told by

representatives of the defendants, that he was still being considered

for the Making Home Affordable loan, 40 days after he was turned

down. The defendants through it's representatives continued to

mislead the plaintiff ; that he was still being considered for the

Making Home Affordable Modification and that he was not going

to be foreclosed on. The defendants had the foreclosure planned in

advance of the disapproval for the Making Home Affordable

Modification. The defendants fraudulently reassured the plaintiff

he was not going to be foreclosed on and the delinquent amount

accrued, because of the trial program; would go on the back of the

loan, upon permanent Modification. The defendants have used

misleading and predatory tactics in it's dealings with the Plaintiff.

The defendants did not inform the plaintiff of disposition of the

Making Home Affordable Modification, within a reasonable time

frame. The defendants have fraudulently misled the plaintiff.

The defendants have created a "breach" of the verbal contract

made with the plaintiff on 28 ,October 2009. The Plaintiff in

"good faith", contacted the Defendants and fulfilled his part of the

agreement. The defendants have damaged the plaintiff's credit

rating, disrupted his life and have caused stress and anxiety to

come upon the plaintiff. The plaintiff has had to seek medical

attention for the stress. The defendants have used the making

Home Affordable Program to unjustly enrich themselves from the

plaintiff . The defendants have committed fraud on the plaintiff.

Defendants are helping the plaintiff out of his home, instead of

helping him stay in his home. Due to the defendants actions of

foreclosure, the plaintiff will never be able to buy a house , on

credit, in his lifetime. The defendant knew it made a bad loan to the

plaintiff in 2008. The loan was a no document loan.

Now the plaintiff is using the law to foreclose on the Plaintiff's

property, using the delinquent balance of $20,000.00, that has

inflated, since the Default Notice was sent to the plaintiff.

1. The plaintiff moves the court for an injunction against the

defendants, to cease the foreclosure process, on his home.

2. The plaintiff moves the court to order the defendants to

resume accepting the $1068.40 that was set as monthly payment by

the defendants on October 28, 2009, and honor the contract.

3. The plaintiff moves the court for the Discovery Process,

pursuant to rule 26. The plaintiff contends he brings just cause to

this court, for suit against the defendants. The defendants are

abusing a Federal program; designed to help people, for their own

gain. The plaintiff contends the Discovery Process will show the

court, a pattern of abuse of this program by the defendants.

4. The plaintiff moves the court to order the defendants to

supply the plaintiff with the original note of assignment and

current note of assignment documents on the property located at

4180W. 2475S. Ogden, Utah.

5. The Plaintiff moves the court for a punitive damage

judgment of Four Hundred Fifty Thousand Dollars,

($450,000),and or any other relief set by the Court, to be paid to

the plaintiff, by the defendants. The plaintiff has been held hostage by the defendants for almost a year. The process that was

supposed to last only 3 months, has caused the plaintiff stress and

anxiety. The defendants have caused depression to come upon the

Plaintiff. It has negatively affected the performance of the

plaintiff's business, which is the plaintiff's support for money to

pay his bills. The plaintiff is a mobile electronic servicer and the

work is very high tech. It requires much concentration and focus to

accomplish the work and it takes a cheerful person to win the jobs

from the public. The defendants have made the plaintiff feel

insecure and uncomfortable in his home, by sending agents to

observe and take pictures of the plaintiff's property. The

defendants foreclosure action has caused embarrassment to the

plaintiff. It has caused persons to call the plaintiff, at all hours

from all over the country to "short sale" his house.

6. The plaintiff moves the court to order the defendant to

delete the damaging foreclosure process from the plaintiff's credit

rating.

7. The plaintiff moves the court for the defendant to pay the

plaintiff's court costs.

Dated this _______ day of __________, 2010.

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Ilyce R. Glink is the author of several books, including 100 Questions Every First-Time Home Buyer Should Ask and Buy, Close, Move In!. She blogs about money and real estate at ThinkGlink.com and The Equifax Personal Finance Blog, and is Chief Content Strategist at RealtyJoin.com, a community for real estate investors.
  • Ilyce Glink On Twitter»

    Ilyce R. Glink is an award-winning, nationally syndicated columnist, best-selling book author, and radio talk show host who also hosts "Expert Real Estate Tips," a Internet video show. She owns ThinkGlink.com as well as Think Glink Media, a privately held company that provides consulting, content and video services to companies and non-profit organizations.

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