The First Circuit has affirmed a holding finding that no private right of action exists for homeowner-borrowers under the Home Affordable Modification Program ("HAMP"), bringing clarity on this issue to courts within the Circuit. In the underlying mater, Mackenzie v....
Mortgage
Federal Circuits Split on Required Action to Effect Rescission under Truth-in-Lending Act
The federal Circuit Courts of Appeal are split on the important question of what is required of a consumer who claims not to have received the proper disclosures from a lender and who wishes to rescind the loan within the three-year period following the closing. The...
RESPA Qualified Written Requests May Not Be Used to Create Foreclosure Defenses
The United States District Court for the District of Massachusetts has held that failure to respond to a purported Qualified Written Request, sent to a loan servicer pursuant to the Real Estate Settlement Procedures Act, 12 U.S.C. 2605 et seq. ("RESPA"), cannot serve...
Class Action Certification Denied To HAMP Plaintiffs
The United States District Court for the District of Massachusetts has denied class certification to a group of individual borrowers alleging that Bank of America mishandled their loan modification requests pursuant to the Home Affordable Modification Program. The...
Title Insurer Not Required to Defend Suit Against Validity of Underlying Debt
The Massachusetts Supreme Judicial Court has held that a title insurer has no duty to defend a bank against a third-party suit challenging the validity of the underlying debt, absent a specific provision in the title insurance policy envisioning such a claim. Deutsche...
Mortgage Holder Is Not Debt Collector Under FDCPA
The United States Bankruptcy Court for the District of Massachusetts has held that the holder of a mortgage is not a "debt collector" within the meaning of the Fair Debt Collection Practices Act ("FDCPA"), 15 U.S.C. §1692 et seq. In Re: Gill, Stephen D., et al.,...
First Circuit Upholds MERS Mortgage System Under Massachusetts Law
The First Circuit has affirmed a holding finding that the system under which mortgages are held in the name of Mortgage Electronic Registration Systems, Inc., commonly known as MERS, comports with Massachusetts law relating to mortgage transactions. In the underlying...
No Implied Covenant Before Mortgage Note Executed
Massachusetts' implied covenant of good faith and fair dealing does not apply to negotiations and contract preparations for a mortgage and accompanying promissory note, the First Circuit has held. In Latson v. Plaza Home Mortgage, Inc., the plaintiffs filed suit...
Even Technical Errors Can Invalidate Foreclosure
Even technical errors in mortgage and foreclosure documents can invalidate the foreclosure and subsequent sale of a condominium unit, according to the Massachusetts Housing Court. Following foreclosure, and purchase at the foreclosure sale by the foreclosing bank, the...
Liability for Payment of Note Required to Rescind Mortgage
A mortgagor who is not personally liable for payment of the note securing a property loan cannot rescind the loan transaction or mortgage, the United States Bankruptcy Court for the District of Massachusetts has held. In re Smith-Pena v. Wells Fargo Bank, N.A.In re...
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