New York Federal Court Grants Mortgage Lender’s Motion to Dismiss RESPA Claims

The United States District Court for the Eastern District of New York recently granted a lender’s motion to dismiss an action in which the borrower alleged violations of the Real Estate Settlement Procedures Act (“RESPA”) for the lender’s failure to properly respond to three qualified written requests (“QWRs”) and for improperly reporting the borrower’s credit score to reporting agencies despite having received notices of error.  See Jackson v. Caliber Home Loans, 2019 WL 3426240 (E.D.N.Y. July 30, 2019).  

Nebraska Appellate Court Holds Title Insurer Not Obligated to Indemnify Insured for Foreclosure of Excepted Mortgage, Even if Foreclosure Was Caused by Prior Owner’s Cross-Default Under Separate Loan

The Court of Appeals of Nebraska recently held that an insured owner was not entitled to coverage when a lender foreclosed on its property based on a prior mortgage that the insured had assumed and that was excepted in the policy, even if the foreclosure was initiated based on the mortgage’s cross-default provision and caused by the prior owner’s default on a separate loan not mentioned in the policy.  See Fo Ge Investments LLC v. First Am. Title, 27 Neb. App. 671 (2019). 

New York Court Holds Lender Affirmatively Revoked Debt Acceleration by Discontinuing Foreclosure Action; Borrower’s Spouse Who Did Not Sign Note Not Entitled to RPAPL 1304 Notice

The New York Supreme Court, Westchester County, recently held that a lender’s foreclosure action was not barred by the statute of limitations because the lender affirmatively revoked the acceleration of a loan by discontinuing a prior foreclosure action, and also held that the borrower’s wife, who signed the mortgage but not the note, was not entitled to a pre-foreclosure notice under RPAPL 1304.  See Deutsche Bank Nat'l Tr. Co. as Tr. for IndyMac IMJA Mortg. Loan Tr. 2007-A2, Mortg. Pass-Through Certificates Series 2007-A2 v. Weininger, 2019 WL 3884569 (N.Y. Sup. Ct. Aug. 15, 2019).

Nevada Federal Court Holds Title Insurer May Be Able to Reform Policy After Mistakenly Omitting Mortgage

The United States District Court for the District of Nevada recently denied a motion for partial summary judgment by homeowners against their title insurance company for coverage and found that the title insurance company may have a claim for reformation when it mistakenly omitted an exception for a mortgage.  See Bank of New York Mellon v. Christopher Communities at S. Highlands Golf Club Homeowners Ass’n, 2019 WL 4261854 (D. Nev. Sept. 9, 2019). 

Third Circuit Finds Debt Collector Violated FDCPA by Sending an Envelope With a QR Code That Revealed the Debtor’s Account Number When Scanned

The United States Court of Appeals for the Third Circuit recently affirmed a District Court’s decision granting a debtor’s motion for summary judgment and finding that a quick response (“QR”) code printed on the outside of an envelope that revealed the debtor’s account number when scanned violated the Fair Debt Collection Practices Act (“FDCPA”).  See DiNaples v. MRS BPO, LLC, 934 F.3d 275 (3d Cir. 2019).

N.J. Federal Court Denies Motion for Preliminary Injunction Seeking to Enforce Restrictive Covenant Prohibiting Sports Wagering, But Still Finds Covenant Likely Is Enforceable

The United States District Court for the District of New Jersey recently found that the defendant could not obtain a preliminary injunction prohibiting the plaintiff from operating a sports wagering business on the plaintiff’s property due to a restrictive covenant, but that the defendant still showed a likelihood of success on the merits.  See Cherry Hill Towne Ctr. Partners, LLC v. GS Park Racing, L.P., 2019 WL 4187836 (D.N.J. Sept. 4, 2019). 

New York Amends Confession of Judgment Statute to Prohibit Confessions Filed Against Out-of-State Debtors

On August 30, 2019, Governor Cuomo signed legislation that amended CPLR § 3218 to prevent creditors from filing confessions of judgment in New York against out-of-state debtors.  Under the prior version of the statute, a creditor could enter a confession of judgment against a debtor based upon an affidavit signed by the debtor “stating the sum for which judgment may be entered, authorizing the entry of judgment, and stating the county where the defendant resides or if he is a non-resident, the county in which entry is authorized.” 

New Jersey Appellate Court Holds Certification of Amount Due and Certification of Diligent Inquiry Sufficient to Foreclose

The New Jersey Appellate Division recently denied a homeowner’s argument that a lender’s final judgment of foreclosure submission was improper because the lender submitted certifications of amount due and of diligent inquiry, rather than affidavits.  See Wells Fargo Bank, NA, v. Owens, 2019 WL 4184096 (N.J. Super. Ct. App. Div. Sept. 4, 2019).  In the case, the lender obtained a final judgment of foreclosure and went to sale. 

Delaware Court Dismisses Bad Faith Claim Against Title Insurer and Claims Against Title Insurer’s Parent Company

A Delaware court recently dismissed a bad faith claim against a title insurance company after holding that Michigan law applied to the dispute over a property in Michigan, and that Michigan does not recognize a claim for bad faith breach of an insurance contract.  The Court further dismissed the action as against the insurer’s parent company, who was not a party to the policy.