Attorney Tim Cook helps Homeowner hold Bank liable for violating federal law and unwind unlawful foreclosure sale

Kohl & Cook Law Firm Attorney, Tim Cook, Obtains Liability Judgment Against National Mortgage Servicer for Its Servicing Violations

On May 5, 2017, the Southern District of Ohio rendered a precedent setting decision that held Green Tree Servicing, LLC, now known as, Ditech Financial, LLC, liable for violating both the Real Estate Settlement Procedures Act (“RESPA”), 12 U.S.C. §1601 et seq. and the Fair Debt Collection Practices Act (“FDCPA”), 15 U.S.C. §1692 et seq.

In its opinion, the Court determined that even though Ms. Washington was not named on the note, she still qualified as a borrower and was entitled to the protections described in RESPA. and that Ditech received Ms. Washington’s complete loan modification application on May 9, 2014.

Ms. Washington’s troubles with her mortgage servicer began on May 22, 2014, when Ditech moved for an order of sale on Ms. Washington’s residence. Ditech attempted to sell Ms. Washington’s home despite the fact that she was still working with the company to obtain a loan modification after the receipt of a complete loan modification application.

The Court further held, that on May 22, 2014, Ditech sent a letter that violated federal law because Ditech failed to show reasonable diligence inasmuch as it did not comply with RESPA’s requirement that a servicer “notify the borrower in writing within 5 days … after receiving the loss mitigation application that the servicer… has determined that the … application is either complete or incomplete.” 12 C.F.R. §1024.41(b)(1) and (b)(2)(i)(B).

The Court ruled that Ditech violated RESPA at 12 C.F.R. §1024.41 (c)(1)(ii) because it sent a July 3, 2014 letter more than 30 days after receipt of Ms. Washington’s complete loan modification application.

On December 17, 2014, Ditech again violated federal law by sending a letter closing out and denying Ms. Washington’s loan modification application for failing to complete Ditech’s remaining requirements when Ditech previously told Ms. Washington she had until January 3, 2015 to complete the modification process.

The Court ruled that Ditech violated federal law on October 15, 2014 and December 4, 2014 by sending letters that from the viewpoint of the least sophisticated consumer were “false, deceptive, or misleading representation[s]” concerning what Ms. Washington needed to do to obtain a loan modification, how long she had to do it, and what Ditech promised to do. These communications violated the Fair Debt Collection Practices Act (“FDCPA”) at 15 U.S.C § 1692e.

Finally, the Court ruled that Ditech violated federal law when it sold Ms. Washington’s home at a foreclosure sale in violation of RESPA at 12 C.F.R. §1024.41(g) after Ms. Washington performed on an agreement for a loan modification.

If you have experienced a loan servicer or your bank playing shell games with your loan modification application, call (614-763-5111) now and the attorneys at Kohl & Cook, Law Firm or send us a message online before it is too late.

Washington v. Green Tree Servicing LLC, S.D.Ohio No. 1:15-CV-354, 2017 WL 1857258, report and recommendation adopted, S.D.Ohio No. 1:15CV3542017 WL 2599252.