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PHH ordered to pay homeowner $16m in fraud case

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Mortgage Professional America | 21 Jul 2014, 08:19 AM Agree 0
In one of the largest judgments of its kind in the state, PHH has been ordered to pay a California man more than $16 million for mortgage modification fraud
  • William Matz | | 21 Jul 2014, 11:16 AM Agree 0
    I just argued a case before the California Court of Appeals [Rufini v. CitiMortgage] in a similar modification misconduct matter, resulting in a reversal in favor of our client. In our case the client lost the house due to such misconduct. So he was harmed even more.

    As one of the few attorneys in the nation with extensive origination experience, I continue to be amazed at the arrogant disregard of the rules, as here. As these multimillion dollar verdicts and settlements grow, perhaps lenders and servicers will finally start to follow the rules. But it will be too late for millions who have lost their homes, many of whom could have been saved.

    In the past the courts have shown too much deference to the banks. But that is now changing as cases like this and ours begin to hold lenders responsible for their deliberate misconduct.
  • Jim in CT | | 21 Jul 2014, 11:18 AM Agree 0
    First trickle in a little stream that will become the Amazon. PHH will probably get it knocked down but no matter.
    Has anyone ever talked to a mortgage mod participant who WASN'T delayed/deceived/misdirected/"paperwork lost/wrong/expired"/told-to-skip-payments/bullied etc etc etc?
    I sure haven't.
    This litigation has a long long way to run.
  • Cheryl M | | 21 Jul 2014, 01:16 PM Agree 0
    I'm not an attorney but I did all that without an attorney or a court room. Just a MLO and a consumer advocate for my clients. With the knowledge of this industry and use of those "rules" in the end I've used the CFPB to help my customers to receive their mortgage modifications, lien releases of fraudulent second mortgages and all have stayed in their homes. My customer did not win a sum for damages; but gained $ in lien release and stayed in their home. They feel like winners and at the end of the day that's what we set out to accomplish. I do believe there is more attention to this in society today; but many (if not all) consumers do not know where to turn.
  • Banged Up | | 22 Jul 2014, 12:16 PM Agree 0
    If his damages were $16mm mine are $100mm. Citi Mortgage, servicing for NorthStar, broke every law possible. I have a detailed journal of a crystal clear process of deception. It is documented to a point their attorneys would not dare go before a judge or a jury.

    A simple term to describe our experience would be Brutal Torture. After 2 years of doing everything we were told to, they foreclosed (it was the 3rd sale date. "Oh, that's just the west coast title company, we can't stop it until the day before." 3rd time is a charm). We had been told we were approved for the modification - the terms were read to us over the phone - and we thought the guy at the door had our modification papers. He was the eviction agent.

    What can I do? Nothing. I sued, they offered a settlement stating they'd "reconsider" the modification request - no promises it would work - if we would submit to a lifetime gag order to not tell anyone about the agreement. What a position to be in: 1 week to vacate a house we built and lived in for over 25 years and had close $1mm equity or sign.

    My wife was in full time melt down, I lost 50 pounds from the raw nerve scraping stress, and the hours and hours on the phone and resending documents took a toll on my mortgage business.

    They performed a series of criminal acts and are getting away with it.

    Thanks for listening. Sorry we can't talk more - court order!

    signed, Banged Up
  • Bob K | | 29 Jul 2014, 01:54 PM Agree 0
    I had a very similar experience with PHH too. They had me make trial payments, and I even signed and notarized a real modification with fair terms. Terms I could live with.

    Then they (PHH), won't execute the modification saying that the ecrow figures have been miscalculated. Next my monthly payment goes from $1650 to 2000 and I'm told I need to send more money to cover the short of my 3 trial payments. I do. Then, while awaiting a new modification as promised, they begin foreclosure against me on a modification that they refused to execute.

    Months go by and I remain communicative and pro active and finally get a second modification. Only this one is at more than 2.5x the interest rate that I was originally offered, and pre-qualified for based on my finances. They tell me that even though I am supposed to get a 2% rate, they are giving me a 4.625% rate with NO explanation.

    I am told I can take either deal but by choosing the first deal at 2%, I owe them 7 months of payments. I can also take the second deal with only 2 months of back payments but the 4.625% rate.

    Meanwhile, I am still being foreclosed on based on not making the payments for the original and fair deal (remember PHH declined to countersign that deal).

    They have lied and failed to do what they promised me so many times I lost count. I have an impeccable paper trail as most communications were handled via email.

    I was wondering if anyone thought I had a case and/or knew of an attorney who may be open to discussing a contingency arrangement. I am in Illinois.

    Bob Koretz
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