Posted On: May 6, 2010
Chase Sued for Denying Foreclosure Relief
Three New York homeowners have filed suit against JP Morgan Chase, claiming that the bank illegally delayed and denied their HAMP foreclosure prevention applications.From a Crain’s New York report:
The lawsuit, which was filed in the Eastern District Federal Court in Brooklyn, claims that the bank violated the federal program that requires banks to provide permanent modifications to eligible homeowners who complete three months of trial payments and verify their income. Similar lawsuits have been filed against a number of other banks, such as Bank of America and Wells Fargo, in other states over the past year. Last month, a California couple reportedly sued Chase because it told them to stop making mortgage payments so they could qualify for loan modification. Chase then foreclosed on their home.
“Chase breached their contract,” said Carmela Huang, an attorney at the Urban Justice Center, which is representing the Queens homeowners in the case. “As far as we know, this is the first case in New York.”
Despite making timely trial modification payments two of the homeowners were denied permanent loan modifications and their homes were foreclosed, according to the lawsuit. Chase claimed that their incomes were inadequate for the permanent loan modification, but refused to specify income qualifications, said Ms. Huang.
Similar to the California case, the third plaintiff in this lawsuit is a homeowner in Fresh Meadows who claims that the bank instructed him last month to deliberately miss payments so he would be eligible for a loan modification. The homeowner had refinanced in 2005. As a result of missing two monthly payments, the homeowner now faces foreclosure. While the homeowner was placed on trial modification last year, he was denied permanent status based on the value of his house. But the bank has not disclosed the value. The Home Affordable Modification Program requires banks to offer trial modifications as long as the value of modifying the loan is more than the value of foreclosing.
If you need more information regarding Florida homeowner rights, contact our Jacksonville, Florida foreclosure law firm.
Greg Gilbert
Keith Maynard
