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DannLaw Covid 19 Update 16–and hopefully our last

Mortgage Fraud

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The End of Covid Forbearance is here. Time to rework your loan. 

DannLaw founder Marc DannMortgage forbearance and other programs made available to homeowners during the COVID-19 pandemic are about to end. That means millions of homeowners are or will soon be pursuing loan modifications or other work out options with their lenders. Karen Ortiz, Roberto Rivera, and DannLaw’s highly experienced and knowledgeable legal staff are here to help families navigate the complicated process and select the payment structure that best meets their needs. Please contact us to arrange a no-cost, no-obligation consultation by calling 216-373-0539 or completing our contact form.

Changes at DannLaw

We are sad to announce that Attorney Whitney Horton is leaving DannLaw after being a valuable member of our team for more than seven years. If Whitney has been working on your case, a notice of substitution of counsel will be filed in the next few weeks. Whitney Kaster, who was at DannLaw before the pandemic is returning to the firm on Monday April 24. Attorney Kaster will work me and Emily White on foreclosure defense matters and with Brian Flick on Consumer Protection cases.  In addition, Amanda Severt who has been our administrative assistant has been promoted and will now work as a paralegal assigned to foreclosure cases and state court litigation.

 Student Loan Changes

The U.S. Department of Education is making changes to the Income Based Repayment program for Federal Student Loans that should enable lower income borrowers to fulfill their obligations faster and qualify for Public Service or other Loan forgiveness programs sooner. You may read about the changes here. Richard Cordray who served as Ohio Treasurer and AG before being named the first director of the Consumer Financial Protection Bureau and is now in charge of Student Loan Issues at the DOE drafted and implemented these significant improvements.  

Foreclosures Are Ramping Up 

Along with forbearance and other relief programs, foreclosure stays are ending.  That means hundreds and perhaps thousands of new judicial foreclosure actions will be filed in Ohio, New Jersey and other states. We have the experience, expertise, and knowledge needed to save your home.

Remember this important point: The filing of a foreclosure lawsuit is the beginning, not the end of the process. Please reach out to DannLaw or another attorney as soon as you know a foreclosure action has been filed against you. If you’ve been served with a foreclosure complaint you have a short time–28 Days in Ohio–to retain a lawyer and file an answer. The vast majority of people who retain us because they want to stay in their home are able to do exactly that.

In addition to defending the foreclosure action, we conduct a thorough investigation to determine if your mortgage loan servicer has followed all applicable rules and laws that govern mortgage lending. If we discover violations, we can bring and pursue claims against the mortgage company. Our foreclosure clients pay an affordable monthly payment into our trust account to cover the fees that we earn in their cases. We offer a free consultation. If you or anyone you know has been sued for foreclosure please contact us here, or call us at 216-373-0539. To schedule an appointment with me visit calendly.com/mdann.

 Regulation F Changes the Game for Debt Collectors and Consumers 

 The CFPB has enacted new strict rules that govern the manner in which debt collectors may contact you by mail, email, text, telephone or social media. You can read about the new regs here. In addition, Credit Reporting Agencies will no longer report most medical debt. This should help consumers improve their credit score. If you believe a debt collector has made a misrepresentation to you or contacted you by phone, letter, text, or email at an inappropriate time you may be entitled to financial compensation. Please feel free to contact us to discuss your situation.

 Data Breach Cases

Multiple courts have selected DannLaw to serve as Class Counsel in data breach Cases. A data breach occurs when a company fails to properly safeguard its customers’ personal information. Our legal staff devotes considerable time and resources to pursuing and securing just compensation for the inconvenience, expense, and aggravation data breach victims endure.

I have a new perspective on that today. I’ve been ensnared in multiple data breaches. Someone obtained my personal information and “took over” my bank account. I’ve spent 20 hours sorting out payments, ACHs and was forced to visit my bank three times. I have a renewed passion to ensure that companies who allow breaches to occur are held accountable for their actions.  If you are notified that your information is at risk due to a breach, contact us immediately so we can take all available legal steps to secure just compensation for you and other data breach victims.

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Wells FargoClaiming that Wells Fargo has engaged in a “…pervasive pattern and practice of placing Black Americans at a disadvantage in comparison to White Americans with respect to their applications for mortgage loans,” attorneys from DannLaw and the Zimmerman Law Offices filed a class action lawsuit against the giant bank in the United States District Court for the Eastern District of New York on Tuesday, April 6, 2022. The pleading in the case may be viewed here: Ifemoa Ebo v Wells Fargo.

Wells Fargo’s disturbing discriminatory behavior was documented in an extensive story published by Bloomberg in March. According to the report only 47% of Black homeowners who completed a refinance application with Wells Fargo in 2020 were approved, compared with 72% of White homeowners. By comparison other lenders had much smaller disparities in approval rates ranging from 7% to 12%. Bloomberg also noted that “Wells Fargo approved a greater share of applications from low-income White homeowners than all but the highest-income Black applicants, who had an approval rate about the same as White borrowers in the lowest-income bracket.”

Wells also discriminated against Blacks who applied for new mortgage loans. A review of publicly available data collected by the CFPB reveals that the bank approved applications submitted by Blacks at a rate 21% lower than those submitted by Whites. The disparity in approval rates at other lenders, including Chase, Quicken, United Wholesale Mortgage was approximately 10%.

Ms. Ebo’s case puts a face to Bloomberg’s reporting. In late 2021 she began searching for and found a new home in Brooklyn’s East Flatbush neighborhood. After signing a purchase agreement for $900,000 she submitted a mortgage loan application to Wells. At the time her credit score was approximately 800, her annual salary was $178,000, and she had no significant debt.

On November 1, 2021, Wells preapproved her for a loan of $883,698. The preapproval was set to expire on February 24, 2022. Ms. Ebo then immediately began working with the bank to secure final approval of the loan. She submitted all documentation requested by Wells, including W-2 forms, paystubs, and bank account statements in a timely fashion. On December 29, 2021, she received a “Commitment Letter” notifying her the application had been approved and advising her that she only needed to submit some additional documentation “in order to complete the final underwriting and funding of” the loan.

Things immediately went off the rails. In January and February Wells again asked for additional information much of which she had already submitted. She was also asked to provide items that were, according to the lawsuit, unnecessary, unduly burdensome, and irrelevant. For example, she was asked to explain why she made a monthly credit card payment of $290 to her own account and for a bank statement for a bank account that did not exist.

As Wells’ unnecessary and duplicative information requests continued into late February and March Ms. Ebo told the bank she was concerned her preapproval would expire before she received her loan even she was highly qualified and had supplied all documentation they had requested.

Her concern was justified. On March 22, 2022, the seller of the property cancelled the purchase contract with Ms. Ebo because Wells had not approved her financing and it was unclear if they ever would. She informed Wells of the seller’s decision that same day and accordingly, did not and never will receive the loan.

This is not the first time the lender has been accused of engaging discriminatory behavior. In 2012, the bank entered into a consent decree with the U.S. Justice Department to resolve claims it had unfairly steered Black and Hispanic borrowers into subprime mortgages and charged higher fees and interest rates than they did whites. At the time Wells paid $184 million to thousands of borrowers and agreed to adopt new compliance policies.

“Wells’ treatment of Ms. Ebo is unconscionable, illegal, but not surprising in light of the company’s history, Bloomberg’s reporting and the conversations we’ve had with others who were subjected to the bank’s outrageous practices,” DannLaw’s Javier Merino said. “Clearly, Wells has not been deterred by the laws that prohibit discrimination. Perhaps being held accountable in court will motivate them to change their ways and treat all applicants, regardless of race, equally and fairly in the future.”

The lawsuit seeks actual damages, statutory, and punitive damages, attorney fees and costs. For more information please contact Marc Dann at 330-651-3131.

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DannLaw founder Marc DannDannLaw Founder and former Ohio Attorney General Marc Dann today expressed satisfaction with the $12.9 million settlement that has been reached in the firm’s class action lawsuit against Well Fargo Bank, N.A. Judge Timothy Black of the Federal District Court for the Southern District of Ohio signed an order approving the settlement on January 25, 2022. More than 1,800 class members will receive between $1,000 and $19,000. While Wells agreed to the settlement, the company admitted to no wrongdoing in the matter.

DannLaw’s complaint in Ethan Ryder et. al. v Wells Fargo may be viewed and downloaded here1413000-1413765-wells complaint (2)

DannLaw and a number of other firms filed the suit in August 2019 on behalf of thousands of homeowners who qualified for but were not offered a home loan modification or repayment plan under the U.S. Department of Treasury’s Home Affordable Modification Program (HAMP) due to what Wells Fargo termed a “glitch” in the computer software the bank used to evaluate applications.

“In addition to being a major victory for consumers, this case underscores the importance of the fee-shifting provisions of the federal laws and regulations that govern the mortgage industry,” Dann said. “Those provisions enable us to fight for working-and middle-class families by holding big banks accountable when they act irresponsibly. Without fee shifting, clients like ours would be left with little or no recourse when lenders and servicers break the rules.”

Wells Fargo

Dann also noted that multi-million-dollar settlements strengthen consumer protection laws by deterring bad behavior in the financial services industry. “State and federal regulators simply don’t have the manpower or resources to pursue all the bad actors in the financial services sector,” Dann said. “The civil justice system empowers DannLaw and other consumer protection firms to police the industry and secure justice and just compensation for people who have been abused—no matter how many challenges we encounter or how much time and effort it takes to win.”

Dann praised the work of DannLaw Managing Partners Brian Flick, Dan Solar, and Javier Merino as well as the firms that co-counseled on the case. “I’m incredibly proud of our performance and our total commitment to our clients,” the former Ohio AG said. “The fact that a team of talented, tireless consumer lawyers can take on the biggest ‘white shoe’ law firms in the country and win demonstrates why the American legal system is the best in the world and why we will continue to use it to protect homeowners and consumers for years to come.”

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Ocwen logo
Ocwen/PHH: The bad guys who tried to steal Riad Ghosheh’s home. Nearly 12,000 consumers have lodged complaints about the company with the CFPB.

In 2010 Kim Naimoli of Geneva, New York who was struggling to make her mortgage payments in the wake of the 2007-2008 collapse of the housing market, applied for a loan modification under the provisions of the federal Home Affordable Modification Program (HAMP). Over the next six years Ms. Naimoli did everything right: she completed and returned forms, complied with document requests, made her house payments on time, and, in accordance with the law, filed a “Notice of Error” (NOE) when Ocwen the company that was servicing her loan made mistakes.

During that same period Ocwen, now known as PHH, did everything wrong. The company failed to register mortgage documents, refused to abide by the terms of the loan modification agreement it had approved, did not acknowledge or respond to correspondence from Ms. Naimoli or her legal counsel, began refusing to accept her mortgage payments, revoked the loan mod agreement, and rejected an NOE requesting that the firm correct its blatant errors.

In 2017 DannLaw, one of the nation’s leading consumer protection law firms, sued Ocwen/PHH on Ms. Naimoli’s behalf in the Federal District Court for the Western District of New York alleging the company had committed multiple violations of the federal Real Estate Sales Practices Act (RESPA). In April of 2020 Judge Elizabeth A. Wolford granted the company’s motion for summary judgement and dismissed the case.

DannLaw immediately appealed and, in what DannLaw founder and former Ohio Attorney General Marc Dann hailed as a major victory for homeowners, the United States Court of Appeals for the Second Circuit reversed Judge Wolford and held that Ocwen/PHH had indeed violated the law. According to Dann the decision, handed down on January 7, 2022, will have wide-ranging impact on the mortgage servicing industry because the New York City-based Second Circuit is one of the most influential courts in the federal judicial system.

The significance of the case is underscored by the fact that the judges asked the Consumer Financial Protection Bureau to a file a brief after oral argument. In the brief the CFPB essentially supported DannLaw’s position.

Javier Merino, leader of the DannLaw team that litigated the case said Ocwen/PHH never denied engaging in the conduct that nearly cost Ms. Naimoli her home. “The record is clear: the company made numerous errors, would not correct them, and then used their mistakes as justification for walking away from the loan mod they had previously approved,” he said. “Once we got them into court, they contended that because their admitted misdeeds were related to the denial of the loan mod and not mortgage servicing they weren’t covered by RESPA. Fortunately, the Second Circuit saw through that specious argument and ruled in our favor.” The decision may be viewed here.

“Ocwen/PHH is perennially ranked among the worst mortgage servicers in the U.S. so I’m certainly not surprised that their bad acts served as a catalyst for this landmark decision,” Marc Dann noted. “I find it both incredibly satisfying and ironic that the company’s persistent and willful violations of the law will strengthen and expand the protections offered by RESPA and benefit homeowners who are too often abused by the mortgage servicing industry.”

Dann said the case, which took years to move through the courts, demonstrates the importance of RESPA’s fee-shifting provisions which balance the legal playing field. “Contingency fee arrangements ensure that homeowners like Ms. Naimoli have the opportunity to seek and secure justice and receive the financial compensation they need and deserve,” he said. “They enable plaintiff’s law firms like ours to stand toe-to-toe with and defeat the white shoe law firms that represent the financial services industry case after case, year after year.”

Dann also said the case illustrates why borrowers must document in writing and preserve all communications and interactions they have with lenders. “The records Ms. Naimoli retained, including delivery receipts and originals and copies of all correspondence, allowed us to present clear and convincing evidence of Ocwen/PHH’s conduct to the Court. The value of those records and the role they played in our victory cannot be understated.”

For more information please contact Marc Dann at 216-373-0539 or email mdann@dannlaw.com

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DannLaw founder Marc DannAs the new year begins nearly all the mortgage support programs implemented in response to the Covid 19 pandemic are coming to an end. That means millions of homeowners who have taken advantage of mortgage forbearance must begin making their house payments again. Many are finding it difficult to secure permanent loan modifications or repayment plans, some are about to lose their homes because the foreclosure moratoriums imposed by the Consumer Finance Protection Bureau (CFPB) have been lifted, and others are unable to make mortgage payments  because advance Child Tax Credit payments ended abruptly  just as a new wave of COVID-19 infections began sweeping across the nation.

The mortgage and foreclosure experts at DannLaw are already helping hundreds of homeowners deal with the challenges we described above. If you or someone you know is leaving forbearance, attempting to negotiate a loan modification with a lender, facing foreclosure, or having difficulty making mortgage payments please contact us at once to arrange a no-cost, no-obligation consultation.

It is important to contact experienced attorneys like the members of the DannLaw legal team because loan mods and foreclosure proceedings are extremely complicated areas of the law. Last week Whitney Horton, Brian Flick, Dan Solar and I shared our expertise and strategies with more than 200 lawyers from across the U.S. As we prepared our presentation, we identified numerous problems borrowers are confronting as they deal with lenders and servicers:

  1. OH Foreclosure TimelineMortgage loan servicers often provide inaccurate and/or incomplete information about the loss mitigation options available to borrowers leaving forbearance or seeking loan modifications.
  2. The CFPB has developed and implemented specific rules and procedures designed to protect homeowners with federally-backed loans, i.e. those issued by the FHA, VA, USDA or owned by Freddie Mac or Fannie Mae, who are exiting forbearance. Unfortunately, some servicers are ignoring the rules and pushing borrowers to accept options that offer less favorable terms or are easier for the lender to implement. This deplorable practice puts borrowers at risk of entering into a repayment plan that isn’t right for them.
  3. Servicers may seek exceptions to the above-mentioned rules in certain circumstances.
  4. Servicers are misrepresenting the rights of borrowers whose FHA, VA, USDA, Fannie Mae or Freddie Mac loans have been sold to new, private investors.
  5. The incompetence of mortgage company staff combined with the mail delivery problems that are plaguing the U.S. Postal Service have caused some borrowers to miss first payment deadlines established under reinstatement or loan modification agreements through no fault of their own.
  6. Some mortgage servicers are adding unjustified/unwarranted fees and charges to mortgage loan balances.
  7. People attempting to contact servicers by phone are placed on hold for hours. When they do manage to speak to a staff member, they often receive inconsistent or incorrect information.
  8. Mortgage companies are not completing their work within the 30-day time limit established under the CFPB rules.
  9. Mortgage companies have initiated foreclosures against borrowers in violation of Federal Dual Tracking prohibitions.

While the CFPB offers extensive online resources, borrowers who attempt to deal with servicers on their own are at a serious disadvantage. Accepting the wrong loan modification or repayment plan could put your home and your family’s financial future at risk. Fortunately, you don’t have to go it alone: the experienced attorneys at DannLaw are here to help.

Whether you are ready to exit forbearance or are now facing foreclosure, we are just a phone call or email away. To arrange a free consultation call 216-373-0539 or complete and submit our contact form.

Stay well, stay safe, and Happy New Year to you and yours.

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Atty. Andrew Wolf AnnouncementDannLaw founder and former Ohio Attorney General Marc Dann announced today that Attorney Andrew Wolf of North Brunswick, New Jersey has become an “Of Counsel” member of DannLaw’s Consumer Protection and Class Action Litigation Practice groups. Wolf, who has earned a reputation as one of the nation’s most effective consumer advocates will be based in DannLaw’s New Jersey/New York office.

“Andrew Wolf’s impressive level of experience, skill, and knowledge will significantly enhance our ability to both fight for middle and working-class families and to handle the influx of cases that will be generated in the coming months as millions of Americans exit mortgage forbearance and the federal foreclosure moratorium sunsets,” Dann said. “We could not have picked a better time to add a talented attorney with Andy’s level of expertise in individual and class action consumer protection law to our outstanding team.”

Wolf, who has resolved hundreds of individual consumer protection cases and been named Class Counsel in more than 135 state and federal class actions since entering private practice 24 years ago, said he eagerly seized the opportunity to join the team of attorneys that has pioneered the use of the nation’s most complex laws to secure justice for consumers and hold corporate wrongdoers accountable for their actions.

“When I opened my first office in 1997, I wrote down a simple mission statement – I am going to be a consumer protection attorney whose goal is to help as many people as possible who have been ripped off or taken advantage of in some way,” Wolf said. “I knew that if I did that I would make a decent living. After accomplishing that goal for 24 years and helping tens of thousands of consumers along the way, my new goal is to continue doing that good work at DannLaw.”

“Our familiarity with and respect for Andrew’s body of work along with the synergies that existed between our two firms served as the catalyst for the discussions that resulted in our teaming up,” Dann said. “I’m confident our new relationship will benefit Andrew, DannLaw, and our existing and future clients while causing nothing but headaches for unscrupulous lenders, scam artists, and corporate miscreants of all types. Andrew and I wouldn’t have it any other way.”

Andrew Wolf’s biography may be viewed here.