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Stoler v. Pennymac Loan Services, LLC

United States District Court, S.D. West Virginia, Charleston

October 11, 2019

JESSICA A. STOLER, Plaintiff,
v.
PENNYMAC LOAN SERVICES, LLC, Defendant.

          MEMORANDUM OPINION AND ORDER

          John T. Copenhaver, Jr., Judge

         Pending is defendant PennyMac Loan Services, LLC's (“PennyMac”) motion for summary judgment, filed August22, 2019. The plaintiff, Jessica A. Stoler, filed a response, to which the defendant has replied.

         I. Background

         This case involves the plaintiff's April 2014 $109, 693.00 mortgage loan, provided under United States Department of Agriculture's (“USDA”) Single Family Housing Guaranteed Loan Program and serviced by defendant PennyMac. Compl. at ¶¶ 4, 6.

         In February 2017, plaintiff experienced a hardship that made it difficult for her to afford her monthly loan payments. Compl. at ¶ 7. On March 1, 2017, plaintiff submitted a loss mitigation application to PennyMac. Mot. Summary Judgment, “ECF # 50, ” ¶ 9. The court notes that a loss mitigation application “means an oral or written request for a loss mitigation option, ” which is “an alternative to foreclosure.” 12 C.F.R. § 1024.31. When an applicant submits a loss mitigation application, the servicer must determine whether the applicant qualifies for a loan modification to help the applicant bring the account current. See ECF # 50, Ex. B-1, 6. On April 7, 2017, PennyMac sent plaintiff a letter denying plaintiff's loss mitigation application. Id. at ¶ 10.

         In May 2017, plaintiff's situation worsened when she lost her job; she again submitted a loss mitigation application to PennyMac on June 8, 2017. Compl. at ¶ 9; ECF # 50 at ¶ 11. On June 30, 2017, PennyMac provided plaintiff with a forbearance plan from July 2017 to December 2017, reducing monthly payments from $704.95 to $411.73. ECF # 50, Ex. A-7.

         In November 2017, plaintiff became unable to make her forbearance payments because her unemployment income expired. ECF # 50, Ex. D, 24. She then attempted without success to contact PennyMac several times over a six-week period to inquire about permanent modification of her loan. Plaintiff's Mem. In Opposition, “ECF # 53, ” Ex. B, 25-27. PennyMac attempted to call plaintiff four times in November 2017 to discuss plaintiff's employment status and the November 2017 monthly payment. ECF # 50 at ¶ 14. Plaintiff failed to make the forbearance payments for November and December 2017. ECF # 50 at ¶ 13.

         On December 5, 2017, PennyMac denied plaintiff's request for a further forbearance plan because plaintiff defaulted on the current forbearance plan. ECF # 50, Ex. A-9. On December 20, 2017, plaintiff spoke with a PennyMac representative about getting a hold on her foreclosure status and receiving another loan modification. ECF # 53, Ex. F, 3-4. The PennyMac representative informed plaintiff that her account reflects an “active foreclosure” and that a foreclosure date could be “assigned at any time.” ECF # 50, Ex B-1, 2. The representative also informed plaintiff that the foreclosure process would not be suspended until the loss mitigation application was “awaiting decision” by PennyMac. ECF # 50, Ex B-2, 4-5.

         On December 21, 2017, PennyMac sent plaintiff a letter indicating that plaintiff had called PennyMac the previous day to start another loss mitigation application process. ECF # 50, Ex. A-10. PennyMac also enclosed a blank loss mitigation application. Id. The letter stated that PennyMac would “continue to accept documentation to complete this application up until 1/20/2018. . . . If your application is denied, we will continue to accept good faith applications up until 37 days before a scheduled sale date.” Id.

         Plaintiff sent the loss mitigation application on December 29, 2017. ECF # 50 at ¶ 20. On January 3, 2018, Seneca Trustees, Inc. notified plaintiff that a trustee's sale of her property was scheduled for January 30, 2018. ECF # 50, Ex. A-11. PennyMac received the plaintiff's loss mitigation application on January 8, 2018. ECF # 50 at ¶ 20. On January 10, 2018, PennyMac sent plaintiff a letter denying plaintiff's loss mitigation application because “the investor guideline prohibits the modification of a loan when the borrower requests the modification within 37 days of the foreclosure sale date.” ECF #50, Ex. A-13.

         On January 25, 2018, plaintiff contacted PennyMac, notifying it of alleged servicing violations and requesting that future communications be directed to plaintiff's counsel. ECF # 50, Ex. A-15. After receiving this letter, PennyMac sent plaintiff written communications and contacted her by telephone. ECF # 50 at ¶ 27; ECF # 53, Ex. L.

         Since plaintiff's last payment under the forbearance plan in October 2017 to now, two years later, plaintiff has made two monthly payments of $705.00, the regular amount due, and two token payments of $20.00 while continuing to occupy the property. ECF # 50 at ¶ 29-30.

         Plaintiff filed this action in the Circuit Court of Kanawha County on May 2, 2018, bringing claims for violations of the West Virginia Consumer Credit Protection Act (“WVCCPA”) (Count I), negligence (Count II), tortious interference with contract (Count III), and estoppel (Count IV).

         PennyMac removed the action to this court on June 1, 2018, pursuant to the court's diversity jurisdiction. The ...


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