Tina vs. Countrywide Home Loans Pt.1

How to Fight Countrywide Loans

On October 31st, 2008 an interesting case was decided in the United States District Court for the Southern District of California. The scenario is as follows: The Tina’s fell behind on their mortgage payments and Countrywide instituted a foreclosure and trustee sale. In response to the foreclosure, they decided to take matters into their own hands.

Not only did they decide to fight back but they took an offensive role and preceded pro se against Countrywide. The Tina’s asserted four causes of action described below. Make sure you pay close attention to the forth cause of action titled, deceptive fraud and unfair business trade practices and other statutory relief.

A. Declaratory Relief

Declaratory relief results from a declaratory judgment. A declaratory judgment ( a judge’s determination) would have ascertained the rights, duties and obligations of the parties involved. The Tina’s sought relief under multiple California statutes and the Fair Debt Collection Practices Act 15 U.S.C § 1692 . But since the issues at hand are tackled in the forth cause of action the court decided not to grant declaratory relief and so the motion for Countrywide to dismiss this claim was granted. Score one for Countrywide.

B. Injunctive Relief

In this cause of action, the Tina’s asked for the court to stop the foreclosure. Unfortunately, the Tina’s were a bit late as their house was foreclosed on July 11, 2008. The Tina’s sought this injunction based upon Cal. Bus. And Prof Code § 17203 and in part on alleged violations of Cal. Civ. Code § 2924. The court decided to favor on behalf of Countrywide because the date already passed. Although, I do believe if they confronted this issue sooner, they would have been able to stay the foreclosure auction and possibly keep their home indefinitely. Score two for Countrywide.

C. Accounting Relief

The Tina’s asserted that a controversy existed to the amount of money owed by the Plaintiff to the Defendant. Since the house was sold at auction and there was no deficit, than no accounting relief was warranted. This claim was dismissed. Score three for Countrywide.

D. Deceptive Fraud and Unfair Business Trade Practices and Other Statutory Relief

Now here comes the good part. Under this claim, the Tina’s allege violations of the following:

• Breach of Fiduciary Duty and Breach of the Covenant of Good Faith and Fair Dealing
• Violations of the Truth in Lending Act (15 U.S.C. § 1601)
• Violations of the Real Estate Settlement Procedures Act (12 U.S.C. § 2601)
• Violations of the Home Ownership and Equity Protection Act of 1994 (15 U.S.C. § 1602)
• Violations of the Fair Debt Collection Practices Act (15 U.S.C. § 1692)
• Violations of the Rosenthal Act (Cal. Civ. Code § 1788)
• Violation of Cal. Civ. Code § 1632
• Violation of Cal. Civ. Code § 2924
• Violations of California's Unfair Competition Law (Cal. Bus. And Prof. Code § 17200)

The score up to this point was three for Countrywide and zero for the Tina’s. After reviewing the forth cause of action, the court also dismissed violations 1,3,4,5,6,7,8. But the score changed after reviewing violations 2 and 9 (which I highlighted in red). With respect to violation number two, Judge Jeffery T. Miller said, "Plaintiffs have therefore stated sufficient facts to claim rescission of the loan. Defendants' motion with respect to Plaintiffs' claim for rescission under TILA is denied." This means the Tina’s were one step closer to receiving all the money they paid Countrywide over the course of their loan. And with respect to violation number nine the Judge remarked, "An award of restitution is within the court's discretion."

So, the court decided to dismiss all violations accept for the two mentioned above. As a last stand Countrywide asked for a more definite statement of the claims which the Court granted. The Tina’s now have 45 days to file an amended complaint. In conclusion, these homeowners have a very good shot at defeating Countrywide. Which means you as a homeowner can too. Check back with me later and I will keep you updated on this particular case.

Written by Kevin Levonas