This class action brings suit against mortgage servicer Nationstar Mortgage, LLC, which does business as Mr. Cooper. Nationstar is the successor-in-interest to a servicer called Seterus, Inc., which merged with Nationstar. When Seterus rejected loss mitigation requests, the complaint alleges, Nationstar did not fulfill the servicer’s obligations under the Real Estate Settlement Procedures Act (RESPA) and Regulation X, in that it did not provide proper notice of the borrowers’ ability to appeal negative decisions.
One of the reasons RESPA was passed was to ensure that consumers got more and timelier information about mortgage settlement processes.
Regulation X includes additional rules for the mortgage markets. Reg X came into effect in 2014, not long after the mortgage crisis and economic crash of 2008, and one of its particular interests was mortgage borrowers’ ability to apply for “loss mitigation options” or loan modifications.
Among other things, Reg X requires that mortgage servicers must generally evaluate loan modification applications within thirty days and provide a written notice on the servicer’s decision. If the servicer rejects the application, and if the complete application was presented to the servicer at least ninety days before a foreclosure sale, or during the pre-foreclosure review period, the borrower may appeal the rejection.
The notification of the rejection must include the information that the borrower has the right to appeal the rejection, along with the amount of time allowed to file the appeal and any requirements for appealing.
The plaintiff in this case, Mary Beeson, submitted an application for loan modification to Seterus when no foreclosure sale was scheduled for her home. Seterus rejected her for certain loss mitigation options in September 2018. However, the complaint alleges, Seterus “did not provide notice that [Beeson] had the right to appeal the denials or the amount of time for and any requirements for making such an appeal.”
Beeson thus did not know she could appeal the rejection.
The class for this action is all borrowers in the US (1) whose loans were serviced by Seterus, (2) who submitted complete loss mitigation applications ninety or more days before a scheduled foreclosure sale, before a foreclosure sale was scheduled, or before foreclosure proceedings were begun, (3) for whom Seterus had not previously reviewed a complete loss mitigation application, (4) to whom Seterus sent a denial of eligibility for one or more loss mitigation options, and (5) whom Nationstar did not tell about their right to appeal, the amount of time allowed for the appeal, or the requirements for it.
Article Type: LawsuitTopic: Loans
Most Recent Case Event
Nationstar, Seterus Notice of Right to Appeal Loan Modification Denials Complaint
November 1, 2021
This class action brings suit against mortgage servicer Nationstar Mortgage, LLC, which does business as Mr. Cooper. Nationstar is the successor-in-interest to a servicer called Seterus, Inc., which merged with Nationstar. When Seterus rejected loss mitigation requests, the complaint alleges, Nationstar did not fulfill the servicer’s obligations under the Real Estate Settlement Procedures Act (RESPA) and Regulation X, in that it did not provide proper notice of the borrowers’ ability to appeal negative decisions.
Nationstar, Seterus Notice of Right to Appeal Loan Modification Denials ComplaintCase Event History
Nationstar, Seterus Notice of Right to Appeal Loan Modification Denials Complaint
November 1, 2021
This class action brings suit against mortgage servicer Nationstar Mortgage, LLC, which does business as Mr. Cooper. Nationstar is the successor-in-interest to a servicer called Seterus, Inc., which merged with Nationstar. When Seterus rejected loss mitigation requests, the complaint alleges, Nationstar did not fulfill the servicer’s obligations under the Real Estate Settlement Procedures Act (RESPA) and Regulation X, in that it did not provide proper notice of the borrowers’ ability to appeal negative decisions.
Nationstar, Seterus Notice of Right to Appeal Loan Modification Denials Complaint