Lawsuit Against Loan Servicer

admin —  December 21, 2009 — 10 Comments

Barclays Capital Real Estate dba HomEq Servicing, New York, had a suit filed against them for issuing unfair loan modification agreements and providing inadequate, incompetent customer service to Ohioans who were at risk of losing their homes to foreclosure. HomEq is a participant in the federal Home Affordable Modification Program (HAMP).

According to the lawsuit filed in Montgomery County Common Pleas Court, Ohio homeowners in need of loan modifications through HomEq to save their homes from foreclosure were forced to enter into one-sided agreements. The unfair and deceptive agreements released HomEq of all liabilities and required borrowers to waive their rights to defenses and agree to pay additional fees.

Additionally, the lawsuit alleges that HomEq violated Ohio’s Consumer Sales Practices Act (CSPA) through incompetent and inefficient customer service by failing to return consumer calls or respond to repeated inquiries, losing borrowers’ documents and failing to offer timely and affordable loss mitigation options.

Today’s lawsuit seeks a permanent injunction from the continuation of unfair and deceptive loan modification practices as well as consumer restitution, civil penalties and damages.

HomEq services more than 10,000 subprime loans in Ohio and became a HAMP participant in August. According to the December Servicer Performance Report issued by the U.S. Treasury, it is one of the lowest performing servicers in terms of loan modifications initiated.

The lawsuit against HomEq marks the third filed by Ohio Attorney General Richard Cordray against a loan servicer operating in Ohio. In July, Cordray became the first state attorney general to file a lawsuit against a servicer for CSPA violations. That lawsuit, filed against Carrington Mortgage Services, is pending in the Franklin County Court of Common Pleas. Carrington recently issued its third, 60-day moratorium on home foreclosures in response to the lawsuit.

There has been ample time for loan servicers to strengthen their efforts and start making a significant difference in preventing home foreclosures,” said Ohio Attorney General Richard Cordray. “Unfortunately, many servicers have instead repeatedly chosen to aggravate the crisis through noncompliance and excuses. As I see it, for every excuse, hundreds of families become more vulnerable to losing their homes. In Ohio, we have zero tolerance for any more excuses.”

On Nov. 5, 2009, Cordray filed a lawsuit against American Home Mortgage Servicing Inc. for numerous CSPA violations including issuing unfair or deceptive loan modifications to Ohioans. The case is currently pending in Cuyahoga County Common Pleas Court.


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10 responses to Lawsuit Against Loan Servicer

  1. Stephanie Hardi n November 16, 2012 at 2:30 am

    We had very BAD dealings with Carrington MS..we lost our home to foreclosure to them because our escrow payment went up and they did not inform us that the payments went up and we were paying our required payment then we found out that we were behind do to our escrow but the bad part was we were western unioning our payments every month so we had to call them with the MTCN number and the amount during the conversations regarding the wired payments they never informed us the payments were shorting our escrow we finally received a letter on intent to foreclose I called “Mario” our customer service rep and he stated not to mind it everything was fine so again we continued to send our $578.00 monthly payments we then stated receiving calls regarding the foreclosure I asked why they then stated we were $1500.00 behind in our escrow payments I asked why we were not informed that our payments increased because our insurance went up which made our escrow go up and our payment to increase they said miscommunication..they told me to contact the escrow department and see if there was a way to extend our escrow to catch up needless to say they never returned my we asked for a modification they also told me they were not part of the Obama program and they only allow one modification that took place when they purchased our loan from our previous company First Franklin they stated our interest was to high that they could lower it so we said great but they did not inform us that they were taking our 30 note to a 50 year note we found this out the day of CLOSING..there was nothing we could we tried outside places for modifications and we were turned down because we made to much money..we tried to get them to work with us to keep our home they were RUDE and told us NO..they foreclosed on our home for less than $1000.00 in escrow payments..There was no help out there for us I emailed the president the attorney generals office and NO ONE would help us and we couldn’t afford to hire a lawyer so we were just out of our house and everything we paid on it..CARRINGTON is a joke and is a bad mortgage company

  2. Butch Johnson, J.D. May 22, 2011 at 6:18 am

    Please up date me on the present status of the pending litigation against American Home Mortgage Servicing Inc., case in Cuyahoga County Common Pleas Court in Ohio. I am still presently a (“MORTGAGOR) pending participating in a “HAMP”, here in Richland County, Columbia, South Carolina with the foregoing mortgage servicing corporation. I have had several mortgage corporations since my original mortgage corporatin 07/31/2003, (“Ameriquest”), then assigned to Citi-Mortgage. I paid approximately $40,000 for a Forebearance Agreement
    August, 2006 with $16,400 per month payments with(Citi-Mortgage) from $3,750 payments. Then March, 2007, I paid approximately $35,000 for an in house modification with Citi-Mortgage March 2007, with $5,400 per month payments. I am considering sending a “qualified written request” under the Real Estate Settlement Procedures Act, 12 U.S.C. section 2605(e). i am looking forward to hearing from you expeditiously. You can call me at 803-665-6807. Thanks very much for your cooperation and assistance in this matter.

  3. Butch Johnson May 22, 2011 at 6:02 am

    Please keep me up-dated on American Home Mortgage Servicing Inc.,Case pending in Cuyahoga County Common Pleas Court in Ohio. I am presently a mortgagor participate in a pending HAMP here in Richland County, Columbia, S.C., with the foregoing Mortgage Company.

  4. has anyone successfully beat them at their deceptive game and if so how.

  5. We sought out a modification after loss of income thru American Home Mortgage Servicing. WE paid the monthly amount we were told by the negotiator every month on time. We never received any statements for nine months, finally got an new modification loan, had it notarized, received copy back signed by them with an amount slightly lower than we were paying, and now they say we are over a twelve hundred dollars in the rears in escrow. Our taxes and insurance have not changed, the three trail months, which I still don’t fully understand where that monies has gone, should have kept our escrow current. We missed one payment last November which the negotiator told us to not pay, so how are we so far in rears. We paid the additional monies every month and they are threatening to foreclose on us. They said we only paid 1268 dollar in Oct but our cashed check shows 1309. They are taking out corporate advances of 20 to 40 dollars, which I have no idea what these are for. I need to know what is going on with this. Please keep me informed. I want these predators stopped. What a disgrace to the people.

  6. Here is my bank’s response to my efforts to save my home from foreclosure and my requests that they answer my questions about the new loan documents they were insisting I sign:

    “I am the person that is taking hours out of my day to explain this to you, some appreciation and cooperation for that would be nice…” Marco Padilla, Century Bank, Santa Fe, NM

  7. We were told by Carrington Mortgage to leave our house after we attempted to begin repaying our loan. They told us they were not part of the Obama mortgage relief program and did not have to work with us- only get out. My wife and I were both verbally assaulted by the representatve from Carrington Mortgage calling us various names even that I was a bad husband and father then hung up the phone and refusing to discuss our palns for making good on the loan which was 5 months late due to umemployment from the weak economy. When I did go back to work they refused to accept the thousands of dollars we sent and credit our account and would not return the money. We were just again told to get out.
    Before we were able to move out all our possessions they put locks on the doors and placed “NO Trespassing” signs everywhere . They refused to offer a cash for keys request from our attorney even though we planned to move out. They are offering us one hour to retreive out possessions on their schedule,typically while we are at work.
    The neighbors are extremely angry at us as the mortgage company has let the landscaping died and the beautiful neighborhod has a blemish on the street. We are embarassed to have left this on our friends and neighbors. Carrington and Atlantic Pacific will not work with us on anything and have not for months.
    This is bad for the country and the housing market after the government offered mortgage help to our citizens and a these big corporation who were bailed out with our tax dollars will not work with the unfortunate victims of the recession.
    We were never late on any payments over a twelve year period and that does not matter when the economy gets bad. We even were stuck with an interest only loan for two and a half years where they made nothing but profit and we received nothing in return. That loan increased our monthly payments by hundreds of dollars after a promise of lowering the monthly charge, but they would not do anything to change it back saying they are not responsible for the previous loan companys deals,and that was our all they would offer on a loan restructuring and modification.
    The federal government needs to look into the behavior of these mortgage companies nationwide not just Ohio.

  8. I have had doubts about the practices of Carrington Mortgage Services since New Century Mortgage folded and sold our paper to them. We were about to lose our home due to a work injury, and CMS balked at giving us a refinance but gave us a modification. All past due amounts and our escrow were to be included in the modification we got. After we started receiving statements, our escrow was NOT included and for one year now, although we are including the contracted amount to Carrington each month, the past due escrow has continued to grow. Now they have sent us an “INtent to Foreclose” letter. Can your firm help us with this? My home phone number is 281-592-4249.

    Thank you.
    Jody and Kendall King

  9. We need help like this in Los Angeles. These comments about Homeq are to familiar.

    Families are seeking assistance and Homeq are seeking evictions.

  10. Butch Johnson, J.D. December 22, 2009 at 7:29 am

    Please keep me up-dated on American Home Mortgage Servicing Inc.,Case pending in Cuyahoga County Common Pleas Court in Ohio. I am presently a mortgagee participate in a pending HAMP here in Richland County, Columbia, S.C., with the foregoing Mortgage Company.

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