Showing 39 posts in Mortgage.

Inspection by HUD's Inspector General of FHA Mortgage Servicers' Websites Reveals Incomplete, Inconsistent, and Unclear CARES Act Forbearance Information

May 6, 2020 by Dana B. Briganti, Vaishali S. Rao

The U.S. Department of Housing and Urban Development's (HUD) Office of Inspector General issued a COVID-19 bulletin for homeowners that revealed the HUD has been monitoring what readily accessible information FHA mortgage servicers are providing to borrowers on their websites. The Federal Housing Administration (FHA) has already provided guidance to FHA servicers regarding implementation of the CARES Act as it pertains to provisions related to forbearance. However, HUD's Inspector General warned in the bulletin that its review of the top 30 FHA servicers' websites revealed "incomplete, inconsistent, dated, and unclear guidance" to borrowers in connection with their forbearance options under the CARES Act. More ›

Stepping Beyond the CARES Act: Massachusetts Expands Forbearance and Issues Sweeping Moratorium on Foreclosures and Evictions during COVID-19 Emergency

April 21, 2020 by Maura K. McKelvey

On April 20, 2020, Massachusetts Governor Charlie Baker signed H.4647 into law. The law establishes a moratorium on foreclosures and evictions for 120 days from the date of the enactment, or 45 days after the COVID-19 Emergency Order is lifted, whichever is sooner, and also extends forbearance to any borrower who requests it due to COVID-19. The law allows the Governor to expand the foreclosure moratorium for a further 90 days, so long as it does not exceed the 45 day limit after the COVID-19 Emergency Order is lifted. More ›

Legal Guidance Watch: Second Circuit Nostra Sponte Certifies a Series of Mortgage Lender Compliance Questions to New York Court of Appeals

March 2, 2020 by Fernando C. Rivera-Maissonet

The Second Circuit recently certified two questions to the New York Court of Appeals regarding the requisite proof needed for borrowers to dispute the lender's compliance with New York Real Property Procedures and Acts ("RPAPL") § 1304 and the required filings under RPAPL § 1306 for a multi-borrower mortgage loan. The New York Court of Appeals has not yet ruled on these statutes and the requisite proof needed to comply with them. A decision on these issues could greatly impact the mortgage industry, given the impact of these statutes on mortgage foreclosure proceedings. More ›

New York's Highest Court to Determine Whether Voluntary Discontinuance Revokes Acceleration of Debt

September 17, 2019 by Fernando C. Rivera-Maissonet

We previously discussed the State of New York's Appellate Division for the Second Judicial Department's holding that a lender's voluntary discontinuance of a judicial foreclosure action by itself, whether by court order or stipulation of the parties, is insufficient to evidence a lender's intent to revoke the acceleration of the entire mortgage debt. Now, the legal landscape in New York might drastically change given the Court of Appeals' grant of leave to appeal in Freedom v Engel. More ›

First Circuit Reverses Course in Closely-Watched Pre-Foreclosure Notice Decision, Defers to Massachusetts Supreme Judicial Court

July 30, 2019 by Samuel C. Bodurtha

Earlier this year, Hinshaw reported on a decision by the First Circuit Court of Appeals which invalidated a Massachusetts foreclosure based on the Court's determination that the mortgage loan servicer's notice of default included additional language which did not strictly comply with Paragraph 22 of the mortgage. In the wake of that decision, the servicer filed a petition for rehearing on several grounds, but primarily because the Code of Massachusetts Regulations required use of what the Court had characterized as additional language. The banking community also filed several amicus briefs in support of Chase's petition. More ›

Minnesota Decision Marks Growing Split Among Federal Circuits Regarding FCRA Liability for Failure to Mark a Tradeline as Disputed

June 27, 2019 by Hinshaw & Culbertson LLP

A recent Minnesota federal court decision (Hrebal v. Nationstar Mortg. LLC) joined a growing number of courts across the country in finding that a creditor's failure to mark a tradeline as disputed can violate the Fair Credit Reporting Act (FCRA) without a consumer having to prove that a reasonable investigation could have uncovered an actual inaccuracy. This trend has created a split between courts in the Fourth, Eighth, and Eleventh Circuits and the First, Fifth, Seventh, and Ninth Circuits. More ›

A Reminder for Borrowers: Post-Discharge Communications by Creditor Must Coerce or Harass in Order to Violate Bankruptcy Law

June 6, 2019 by Samuel C. Bodurtha

In Kirby v. 21 Mortg. Corp., the First Circuit Bankruptcy Appellate Panel examined the Kirbys' claim that the 19 written communications they received from their mortgage holder following their Chapter 7 discharge violated the Bankruptcy Code 524(a)(2)'s injunction. The Kirbys further claimed bankruptcy discharge violations arising from their mortgage holder's delivery of an escrow account disclosure, short sale letter, cash-for-keys letter, and right to cure notice for a total of 26 post-discharge bankruptcy communications. Below, we take a closer look at the decision and its comprehensive review of bankruptcy discharge law along with the process for determining whether a post-discharge correspondence violates the bankruptcy code's injunction. More ›

SCOTUS Determines Foreclosure Firm is Not a Debt Collector Under the FDCPA's Primary Definition

March 22, 2019 by Maura K. McKelvey

Less than three months after hearing oral arguments in Obduskey v. McCarthy & Holthus LLP, Case No. 17-1307, the United States Supreme Court held, in a 9-0 decision, that a business engaged in nonjudicial foreclosure proceedings is not a "debt collector" under the Fair Debt Collection Practices Act (FDCPA, "the Act"), except for the limited prohibitions set forth in 1692(f)(6). The decision provides helpful guidance to law firms and loan servicers who pursue nonjudicial foreclosures. More ›

First Circuit Concludes that "Potentially Deceptive" Language Added to Default Notice May Void Foreclosure Sale in Massachusetts

February 13, 2019 by Hinshaw & Culbertson LLP

In Thompson v. JPMorgan Chase Bank, the First Circuit Court of Appeals held a foreclosure was potentially void where terms in the lender's default notice arguably conflicted with terms in Paragraph 19 of the Mortgage. Although Chase's notice of default provided the Thompsons with the disclosures required under Paragraph 22 of the Mortgage, Chase's default notice further stated that the Thompsons "could still avoid foreclosure by paying the total past-due amount before a foreclosure sale takes place." The First Circuit interpreted this additional language as potentially misleading, because advising borrowers that they could make payment up to the time of the foreclosure sale differed from the Mortgage's Paragraph 19, which only allowed a reinstatement payment five days before the sale of the Property. More ›

SCOTUS to Decide Whether Non-Judicial Mortgage Foreclosures are Subject to the FDCPA

January 8, 2019 by Maura K. McKelvey

For mortgage servicers and foreclosure firms, yesterday's oral argument before the Supreme Court in Obduskey v. McCarthy & Holthus LLP, U.S. Supreme Court, 17-1307 and the upcoming decision, could be a game changer. At issue: a split in the federal circuits over whether the non-judicial foreclosure of a mortgage constitutes debt collection, as defined by the Fair Debt Collection Practices Act. More ›

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