Court Affirms Case Against Loan Servicer

Allison Tussey —  September 22, 2010 — Leave a comment

Barclays Capital Real Estate dba HomEq Servicing, headquartered in New York City, New York, was sued by Ohio Attorney General Richard Cordray last December 2009 for multiple alleged violations of Ohio’s Consumer Sales Practices Act (CSPA), including unfair and deceptive business practices. The just took a legal step forward with a recent decision by a state court. Montgomery County Common Pleas Judge Timothy N. O’Connell overruled HomEq‘s motion to dismiss. Therefore, the Attorney General’s case may move forward.

This ruling is the first state court decision to hold that mortgage servicers are accountable under the CSPA, serving to create a precedent in this first-of-its-kind legal strategy.

Cordray sued HomeEq  The lawsuit marked the third filed by Cordray against a loan servicer operating in Ohio. Cordray was the first state attorney general to file a lawsuit against a loan servicer for CSPA violations in the wake of the foreclosure crisis.

“This ruling takes us one step closer in our overall strategy to hold loan servicers accountable for unfair loan modifications in foreclosure cases,” said Cordray. “For too long, servicers have stood idly by, talking the talk but failing to provide any real solutions to the foreclosure crisis. Ohioans are losing their homes and servicers have aggravated the situation with noncompliance and out-right incompetence.”

Allison Tussey

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