A Virginia couple says Bank of America has been improperly rejecting mortgage modification agreements, leading in some cases to wrongful foreclosures.
Plaintiffs Stacie and Adam Rhodes say defendant Bank of America NA has been failing to honor its own mortgage modification agreements. Mortgage holders like the Rhodeses say the bank has been rejecting their initial payments under the modified agreements for petty and illegitimate reasons.
The Rhodeses say Bank of America rejected their permanent mortgage modification agreement, even though it was valid in every way. The bank allegedly rejected their further payments under the modification agreement, then foreclosed on their home in July 2017.
When the Rhodeses sent Bank of America a letter formally requesting the reason for its rejection of the modification, Bank of America responded that the modification was rejected because the notary’s printed name and signature was missing the notary’s middle initial.
Under the Federal Housing Authority’s Home Affordable Modification Program, homeowners can renegotiate their mortgage terms to make them more affordable. The modification happens in two stages. First, the lender and the homeowner enter into a three-month Trial Period Plan, during which the homeowner makes payments in the same amount as the negotiated modified payment.
If the homeowner makes those three months’ payments successfully, they advance to the second stage, in which they are offered a permanent modification.
It’s after the homeowner accepts the permanent modification and begins making the new payments that Bank of America has been improperly rejecting the modification, according to the Rhodeses.
The bank allegedly rejects modifications for what it calls “improper notarization” of the modification agreement. In some cases, the plaintiffs say Bank of America has proceeded to take even more adverse actions against the homeowner, including rejection of more payments and initiation of foreclosure.
Furthermore, in the course of some of these foreclosures, Bank of America has failed to honor the procedural requirements for foreclosing on a mortgage insured by the FHA. The Rhodeses say Bank of America has failed to offer a face-to-face meeting with the homeowner prior to initiating foreclosure.
The Rhodeses are bringing two claims for breach of contract on behalf of themselves and two proposed plaintiff Classes. They also raise several individual claims for violations of the Fair Credit Reporting Act and the Real Estate Settlement Procedures Act.
According to the plaintiffs, the bank failed to fully and properly investigate their disputes, failed to review all relevant information, posted the bank’s representations to the plaintiffs’ credit record without noting that the representations were subject to dispute, and failed to report the results of an investigation to each credit reporting agency.
For their Breach of Contract — Permanent Loan Modification claim, the Rhodeses propose to represent a Class of all U.S. residents for whom Bank of America refused to honor their loan modification agreement due to a “so-called improper notarization” within the five years prior to the filing of this action.
The proposed Class for the Breach of Contract – Deed of Trust claim would cover all persons in Virginia who held an FHA-insured mortgage on or after Oct. 5, 2012 and who were subject to a completed foreclosure while Bank of America was the beneficiary and the servicer of the deed of trust, all for a property worth more than $75,000 according to the bank’s pre-foreclosure records.
The Rhodeses seek awards of actual damages and a court order requiring Bank of America to honor Class Members’ loan modifications and to rescind any improper foreclosures that followed improper rejection of a loan modification.
Plaintiffs’ counsel are Kristi C. Kelly, Andrew J. Guzzo and Casey S. Nash of Kelly & Crandall PLC.
The Bank of America Mortgage Modification Class Action Lawsuit is Rhodes v. Bank of America NA, Case No. 3:17-cv-00678-JAG, in the U.S. District Court for the Eastern District of Virginia.
UPDATE: The Bank of America Mortgage Modification Class Action Lawsuit was dismissed on July 9, 2018. Top Class Actions will let our viewers know if a new case is filed.
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109 thoughts onBank of America Class Action: Mortgage Modifications Wrongly Rejected
Please call me about this. I lost my home in foreclosure during the 2011 or 2012 range. I went through the loan modification process for years and they told me to stop making payments at one point even though I was only a couple months behind and then I ended up losing my home. I never got any notification about any class action against Bank of America but I know that it was wrongful and they are foreclosure and I lost well over $250,000.
Where do I find out more information on any active law suits for Bank of America for foreclosure malpractices? My home was placed in foreclosure and short sale in 2015 and forced us to go in to Bankruptcy to keep them from taking the house. The irony of it is that I was employed in the past by BOA and worked on the HAMP program.
I went through same modification process and foreclosure.
We were foreclosed on twice in 2010 by BoA. Both were rescinded. But BoA added erroneous Foreclosure fees and property inspection fees to our escrow account. And we had a trial period plan, made the payments plus more but BoA applied our payment to the escrow account and said we were over 12 months past due and didn’t qualify for a loan modification. We sent in RMA applications and docs over 4 dozens times from 2010 to 2017! And the escrow balance kept going up with property inspection fees and late fees and forced lender placed insurance! Our application was lost or was missing a page, or the notary didn’t write something on the right line, or our credit score was too low – only derogatory thing on our credit were the 2 rescinded foreclosures! We had over 26 account managers in 7 years! They cancelled our home owners insurance 3 times! They cancelled our Homestead! They lied on documents submitted to the county tax assessor’s office! In 2017 they transferred servicing of our loan. New servicer plays the same games that BoA played. They foreclosed Dec 2018. Our attorney got a TRO and filed in federal court. Case was dismissed in Oct 2019!!! Foreclosure was not rescinded, no attempt by attorney! HELP! We are still living in home, but fear eviction can happen soon!
BOA is a real piece of work to say the least. Bottom line..they foreclosed on us, much like the others have said. They kept saying, they didn’t recieve our paperwork, that we kept overnighting by FedX (7 times) Each time was something different. A page was missing, They couldn’t read one of the copies, it wasn’t signed, etc. Then the final denial was that our paperwork wasn’t submitted in time! Lying bunch of theives!
They are the biggest LYING SCUMBAGS !! Did the same thing to us over and over tried fighting them in court for years but at the end we sadly lost Our home! I wish you the best of luck! They are the DEVIL!
2015/2016 … July 2015 We were approaching 2 months behind on our home loan. Bank of America contacted me and suggested doing a modification. I had thought about taking out a 401k loan and getting caught up but when they suggested doing a modification that sounded better to me. They said they would send a modification packet in the mail and I needed to send copies of all current monthly bills, and proof of income. Answer all questions on the form, and fax everything back to the modification department. Every other week I would get correspondence phone calls stating they did not receive income information, or current bills or something might have been missing on the form. The mortgage payment began 2 months behind and I sent in our payment. About a week later I noticed that that payment amount was back in our checking account. I contacted the modification representative asking her why my payment was not accepted and was deposited back in my checking account. She said well well while you are in the modification process, we do not accept any payments. I said in that case let’s get on with this so we can get the modification over with. Every two weeks there was another excuse. She would come up with something missing, something incorrect, you need to fax this again, that again, an excuse every other week. Finally I get a notice in the mail saying that your home has been placed in the foreclosure process. I get on the phone and contact the modification representative and at this point I’m very upset. I told her I think I see what’s going on here. On one side of the office you tell us we are helping you with a modification. On the other side of the office the foreclosure process begins, and your whole goal is to take our home. She assures me that is not at all what is going on. She then precedes to explain to me that the modification form that was in the initial packet I received a few months prior, they no longer use. She says she will send me another packet and I will have to resend everything all over again!!! At this point I am furious and wind up sending everything again, this time going to the local Bank of America branch and faxing everything all at once. A few days later I get a letter in the mail telling me that I have a sale date that has been given for my home to be sold on the courthouse steps. This one’s up being on the 27th of December. I then contact my attorney which he contacted the Bank of America attorney to have them postpone the sale date. The sale date was postponed till January 3rd. This gave us three weeks to frantically paint fix up and list the home to sell and quickly find a buyer before it’s sold on the courthouse steps. We were hoping to sell the home and get as much equity out of the home paying off Bank of America. We sold our 2004 suburban to pay for paint and building materials to spruce up the house to sell. we quickly listed the home and within three days we had a buyer that was interested. They were leery of signing a contract when they heard it was going to sell on the courthouse steps. our attorney contacted the Bank of America attorney telling him we had a buyer for the home and would be paying off Bank of America in full.. he replied saying everyone has gone for the holiday and there is no one to take care of this at the moment.Everyone returned to work at Bank of America on January 2nd, but of course no one was able to be reached that could help me. the next day on January 3rd my attorney attempted to put a restraining order on Bank of America so my house would not sell on the courthouse steps. He tried to intervene but it was too late, the house sold. We had buyers interested that were willing to pay $134,900. The pay off for Bank of America was $101,000. Our house was sold on the courthouse steps for $82,200. So not only did we lose our home and all the equity, we also lost our 2004 Chevy Suburban.
I was denied and my home was foreclosed on. I don’t understand how they get away with this.