Mortgage company apologizes to couple for wrongful foreclosure

by Ryan Smith19 Nov 2013

A couple wrongly threatened with foreclosure has won something very rare – an apology from the mortgage company that almost took their house.

Nationstar, the company that held their mortgage, had promised Judith and Michael McEldery a loan modification in January but failed to deliver, then sued them for default, according to a report by the Skanner News.

The trouble started when the McElderys moved into Judith’s childhood home to care for her elderly mother. The 106-year-old house was long since paid off, but needed repairs, so the McElderys took out a mortgage for the work, according to a the Skanner News. Although they originally obtained a loan from a company called World Mortgage, it was repeatedly sold, the debt rising each time.

“They said the mortgage would go up once a year,” Judith McEldery told The Skanner News. “Our mortgage was going up every ninety days.”

By the time Judith’s mother died in the summer of 2012, the mortgage was owned by Nationstar. The couple asked the company for a loan modification and was told in January of 2013 that they would be granted one upon the fulfillment of certain conditions.

“Nationstar promised Mr. McEldery over the phone and in writing that he could avoid foreclosure, stay in his home, and modify his mortgage if he provided documentation and made three payments in the amount of $1,394.76,” the couple’s lawyer wrote in court documents.

According to the Skanner News, the couple made the payments as instructed, but Nationstar claimed it didn’t receive one of them. The company filed suit against the couple – and Judith’s dead mother – for default.

That suit died in the water when the McElderys were able to prove they had sent the checks, and that Nationstar had cashed them, according to the Skanner news. The McElderys, in turn, sued Nationstar for fraud and elder abuse, and the company moved to settle.

The financial terms of the settlement weren’t disclosed – although the McElderys demanded significant relief in court filings. Whatever relief they got, however, came with something nearly unprecedented – an apology.

“Nationstar did the right thing,” the couple’s attorney, Michael Fuller, told the Skanner News. “It’s the first public apology I’ve ever seen as part of the resolution in a case like this.”


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