On August 15, Freddie Mac issued Bulletin 2013-05, which, among other things, revises requirements relating to the SCRA and clarifies servicer responsibilities to effectively implement legal relief protections for borrowers in military service. Read more
House Bill Would Exempt Collection Attorneys Engaged in Litigation from the FDCPA
A bill that was recently introduced in the House of Representatives would exempt debt collection attorneys from the Fair Debt Collection Practices Act (FDCPA) “when taking certain actions.” The Bill, which was introduced by Rep. Ed Perlmutter (D-Colo.) and co-sponsored by Rep. Spencer Bachus (R-Ala.), is described as a technical fix that does not erode the consumer protections afforded by the FDCPA. Read more
Ohio State Spotlight Webinar FDCPA Update
Sometime in June 2012, the Sixth Circuit Court of Appeals decided that a law firm could be liable, under the Fair Debt Collection Practices Act (“FDCPA”), for stating the wrong identity of the mortgage owner in a foreclosure complaint. In effect, the Sixth Circuit held that a pre-assignment foreclosure filing could violate the FDCPA. Read more
Ohio Contemplates Sales Tax on Service Industry: How this may affect your legal bill and your business in the Buckeye State
Ohio’s Governor Kasich has proposed a two-year budget plan for Ohio that focuses on cutting income tax, while broadening the scope of the state sales tax. The proposal would impose a tax on formerly exempt services, such as accounting and legal services. Governor Kasich’s budget plan would reduce the sales tax rate from the current 5.5% to 5%, but would ultimately increase the state’s revenue from sales tax by widening the scope of taxable services. Read more
William M. LeRoy: A New PHOENIX Rises
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PERSON OF THE WEEK: By all accounts, William M. LeRoy has the right to rest on his laurels: A 23-year industry veteran and founding CEO of the American Legal & Financial Network, he is one of the most respected leaders in the mortgage banking world. But LeRoy doesn’t have time to rest on his laurels – he recently launched a new national attorney organization called The PHOENIX Group Network LLC, which serves the mortgage servicing industry. MortgageOrb spoke with LeRoy about this new undertaking and the state of mortgage servicing….”
Read More: MortgageOrb — A New Phoenix Rises
Prevailing Debt Collector Can Recover Costs in FDCPA Suit Without A Finding of Bad Faith
In what some have characterized as a defeat for the Consumer Financial Protection Bureau (CFPB), the United States Supreme Court has ruled that a prevailing defendant in a FDCPA suit can recover costs without having to show that the suit was filed in bad faith or for the purpose of harassment. This decision not only represents a rejection of the position that was taken by the CFPB and the FTC in a jointly filed amicus brief, but it should also serve to discourage frivolous nuisance suits claiming violations of the FDCPA. Read more
Mortgage foreclosure is debt collection under the FDCPA
Last June, the Sixth Circuit decided that a law firm could be liable, under the Fair Debt Collection Practices Act (“FDCPA”), for stating the wrong identity of the mortgage owner in a foreclosure complaint. In effect, the Sixth Circuit held that a pre-assignment foreclosure filing could violate the FDCPA. Earlier this month, the same court decided another case involving the application of the FDCPA to judicial foreclosure proceedings. This latest case strongly suggests that misstatements in a foreclosure complaint, and presumably other court filings, subject not only the plaintiff’s attorney to the FDCPA, but the loan servicer client as well.
Pre-assignment foreclosure filing may violate the Fair Debt Collection Practices Act
The Sixth Circuit Court of Appeals, in Wallace v. Washington Mutual, recently announced that filing a foreclosure complaint, before the note and mortgage have been transferred and assigned to the Plaintiff, may violate the Fair Debt Collection Practices Act (the “FDCPA”). More importantly, the court noted that the FDCPA may be violated even if state law permits the Plaintiff to cure a real-party in interest defect after the complaint is filed. Finally, although the defendant in this case was the law firm that represented the foreclosure plaintiff, depending on the circumstances, a servicer may be liable under the same theory that was announced by this court.
Homeowners Can Sue Over HAMP Denial
A homeowner who was denied a permanent loan modification can sue her lender for fraud and other state law claims. According to the Seventh Circuit Court of Appeals, while HAMP does not provide for a private right of action, it does not preempt valid state law claims that a borrower may otherwise be able to raise.
Cuyahoga County Requires Attorney Affidavits
I am writing to let you know that, as a consequence of the robo-signing allegations that have recently come to light, the Common Pleas Court for Cuyahoga County, Ohio is in the final stages of formulating new rules that will apply to all mortgage foreclosure cases.