Bowen v. Ditech Fin. LLC
| Decision Date | 20 September 2017 |
| Docket Number | 2:16-cv-00195-JAW |
| Parties | MARK A. BOWEN, Plaintiff, v. DITECH FINANCIAL LLC, f/d/b/a/ GREEN TREE SERVICING LLC, and FEDERAL NATIONAL MORTGAGE ASSOCIATION, Defendants. |
| Court | U.S. District Court — District of Maine |
Mark A. Bowen brings this action against the servicer and owner of his mortgage note and loan claiming that the loan servicer engaged in repeated, coercive, and harassing attempts to collect money not owed by him two months after settling previous allegations of unfair debt collection practices and one month after reinstating the modified loan. Both parties move for summary judgment on all counts. The Court grants in part and denies in part the Plaintiff's Motion for Summary Judgment (ECF No. 83). The Court grants in part and denies in part the Defendants' Motion for Summary Judgment (ECF No. 86).
On April 5, 2016, Mark A. Bowen filed a complaint in this Court against Ditech Financial LLC (Ditech), f/d/b/a Green Tree Servicing LLC (Green Tree) and the Federal National Mortgage Association (Fannie Mae). Compl. (ECF No. 1). On June 3, 2016, Ditech and Fannie Mae answered the Complaint. Defs.' Answer and Affirmative Defenses (ECF No. 11). On November 18, 2016, Mr. Bowen moved for leave to amend his Complaint due to newly discovered facts and evidence, Pl.'s Mot. for Leave to Amend Compl. at 1 (ECF No. 25), which the Court granted without objection on December 13, 2016. Order (ECF No. 28). Mr. Bowen filed the First Amended Complaint on December 14, 2016. First Am. Compl. (ECF No. 29) (Am. Compl.). The Amended Complaint contains six counts: Count I—Fraud and Fraudulent Misrepresentation; Count II—violations of the Maine Unfair Trade Practices Act (MUTPA), 5 M.R.S. §§ 205-A et seq.; Count III—violations of the Maine Fair Debt Collection Practices Act (MFDCPA), 32 M.R.S. §§ 11001 et seq.; Count IV—violations of the Fair Debt Collection Practices Act (FDCPA), 15 U.S.C. §§ 1692 et seq.; Count V—violations of the Real Estate Settlement Procedures Act (RESPA), 12 U.S.C. §§ 2601 et seq.; and Count VI—Breach of Fiduciary Duty. Id. at 19-30.
On March 10, 2017, Mr. Bowen filed a motion for summary judgment, Pl. Mark A. Bowen's Mot. for Summ. J. (ECF No. 83) (Pl.'s Mot.), with a statement of facts. Pl.'s Statement of Undisputed Material Facts (ECF No. 85) (PSMF). On March 29, 2017, the Defendants filed a response to Mr. Bowen's statement of facts, Resp. to Pl.'s Statement of Undisputed Material Facts and Additional Material Facts at 1-8 (ECF No. 95) (DRPSMF), and a set of additional material facts. Id. at 8-9 (DSAMF). The following day, the Defendants opposed Mr. Bowen's motion for summary judgment. Defs.' Opp'n to Pl. Mark A. Bowen's Mot. for Summ. J. (ECF No. 97) (Defs.' Opp'n).On April 12, 2017, Mr. Bowen replied. Pl.'s Reply to Defs.' Opp'n to Pl.'s Mot. for Summ. J. (ECF No. 101) (Pl.'s Reply).
On March 10, 2017, the Defendants filed a cross-motion for summary judgment, Defs.' Mot. for Summ. J. (ECF No. 86) (Defs.' Mot.), and the stipulated record. Joint Statement of Stipulated Facts (ECF No. 81) (Stip.). They also requested oral argument. Mot. for Oral Arg./Hr'g (ECF No. 87). On March 29, 2017, Mr. Bowen responded to the Defendants' motion for summary judgment, Pl. Mark A Bowen's Opp'n to Defs.' Mot. for Summ. J. (ECF No. 93) (Pl.'s Opp'n), and on April 12, 2017, he filed a response to the Defendants' statement of additional material facts. Pl.'s Reply to Defs.' Requests to Strike and Resps. to Defs.' Statement of Additional Material Facts (ECF No. 102) (PRDSAMF). The Defendants replied on April 12, 2017. Ditech Financial LLC and Federal National Mortgage Association's Reply Br. (ECF No. 103) (Defs.' Reply).1
On April 18, 2017, the Court granted the motion for oral argument and on September 5, 2017, held oral argument on the pending motions. Order Granting Mot. for Oral Arg. (ECF No. 105); Min. Entry (ECF No. 112).
On December 20, 2005, Mr. Bowen and his now ex-wife, Nancy E. Bowen, signed a promissory note in the principal amount of $204,422.00 payable to Bank of America, N.A. (BOA) and a mortgage granting BOA a security interest on property located at 17 Orchard Lane, Minot, Maine 04258. Stip. ¶ 1. Mr. Bowen still resides at the property. Stip. ¶ 3.
Since December 20, 2005, Fannie Mae has been the owner and investor of the note and mortgage. Stip. ¶ 4. Originally, BOA was the servicer of the note and mortgage. Stip. ¶ 2. The mortgage requires BOA to maintain an escrow account topay for real estate taxes and hazard insurance. PSMF ¶ 1; DRPSMF ¶ 1;2 PSMF ¶ 2; DRPSMF ¶ 2.3
In early 2013, Mr. Bowen defaulted under the terms of the note by failing to make his monthly payments, and he requested a loan modification. Stip. ¶¶ 6-7. BOA offered Mr. Bowen a Fannie Mae Trial Period Plan (TPP). Stip. ¶ 8. The TPP required Mr. Bowen to make three payments in the amount of $928.24 on March 1, 2013, April 1, 2013, and May 1, 2013. Stip. Attach. 4 Fannie Mae Trial Period Plan at 1 (Feb. 5, 2013) (TPP). Mr. Bowen accepted the offer by making all three payments on time, and BOA sent him a Loan Modification Agreement. Stip. ¶ 9; DSAMF ¶ 5; PRDSAMF ¶ 5.4,5
BOA delivered a Loan Modification Clarity Commitment dated May 30, 2013 to Mr. Bowen. Stip. ¶ 10. The Clarity Commitment stated:
Your new loan balance is $217,698.87. To calculate this new loan balance, we added past due interest in the amount of $8,202.81 and eligible servicing expenses of $26,662.46 and taxes and insurance of $3,630.70 totaling $38,495.97 to your principal balance. Unpaid late fees are not included in this amount and will be waived when your loan modification is finalized.
Stip. Attach. 6 Loan Modification Clarity Commitment (May 30, 2013) (Clarity Commitment). BOA also issued a billing statement dated May 30, 2013 that showed that Mr. Bowen's negative escrow balance was -$3,763.20. Stip. ¶ 13; id. Attach. 8 BOA Billing Statement at 1 (May 30, 2013) (May 2013 Statement); DSAMF ¶¶ 3-4; PRDSAMF ¶¶ 3-4.6
Mr. Bowen signed the Modification Agreement on June 3, 2013 and returned it to BOA. Stip. ¶ 11. The payment schedule for the modified loan was as follows:
Stip. Attach. 5 Fannie Mae Loan Modification Agreement at 3-4 (Modification Agreement) (emphasis supplied). The Effective Date of the Modification Agreement was July 1, 2013. Id. at 3.
BOA service-transferred the loan to Ditech7 effective June 1, 2013. Stip. ¶ 12. Fannie Mae owned the loan and retained Ditech to service the loan. PSMF ¶ 3; DRPSMF ¶ 3.8 As servicer of the loan, Ditech maintained the escrow account to pay taxes and insurance on behalf of Fannie Mae. PSMF ¶ 4; DRPSMF ¶4.9 Since the date of service transfer, Ditech has paid Mr. Bowen's taxes and insurance. Stip. ¶ 68.
Ditech issued Mr. Bowen a welcome letter dated June 10, 2013 stating that Mr. Bowen had a negative escrow balance of $3,763.20 and including a payment coupon for the amount of $1,199.04. Stip. ¶¶ 14, 16; id. Attachs. 9, 11 Letter from Green Tree to Mark A. Bowen at 1 (June 10, 2013) (Welcome Letter). Ditech also issued Mr. Bowen a billing statement dated June 15, 2013 stating that Mr. Bowen had a negative escrow balance of $3,763.20 and a total payment due of $14,333.10, which included a current payment of $870.61, a past due payment of $9,576.71, and escrow due of $3,885.78. Stip. ¶ 18; id. Attach. 13 Green Tree Monthly Billing Statement (June 15, 2013) (June 2013 Statement); DSAMF ¶ 7; PRDSAMF ¶ 7.10 Ditech issued to Mr. Bowen a billing statement dated July 8, 2013 stating that Mr. Bowen had a negative escrow balance of $3,763.20 and a total payment due of $15,522.91, which included a current payment of $870.61, a past due payment of $10,447.32, and escrow due of $4,204.98. Stip. ¶ 15; id. Attach. 10 Green Tree Monthly Billing Statement (July 8, 2013) (July 2013 Statement); DSAMF ¶ 8; PRDSAMF ¶ 8.11
In January 2014, Ditech adjusted Mr. Bowen's account to reflect the terms of the Modification Agreement, including the modified agreed-upon monthly interest payment, except that Ditech only capitalized $2,646.45 of the entire negative escrow balance of $3,763.20 to the escrow account. Stip. ¶ 19. The remaining portion of the negative escrow balance, $1,246.06, remained on his account. Stip. ¶ 20.
Per the terms of the note and mortgage, if the monthly mortgage payment is not enough to cover principal, interest, and escrow, it is placed in unapplied funds until another payment is received to make up the difference. PSMF ¶ 5; DRPSMF ¶ 5.12 When such a monthly payment is not applied to the month in which it is received, the borrower is considered in default. PSMF ¶ 6; DRPSMF ¶ 6.13
On March 10, 2014, Ditech initiated a foreclosure action captioned Green Tree Servicing LLC v. Mark A. Bowen, et al., No. AUSBSC RE 2014-00044 (State of Maine Superior Court, Androscoggin). Stip. ¶ 21. On July 8, 2014, Mr. Bowen filed an amended answer to the foreclosure action and added counterclaims. Id. ¶ 22. On April 24, 2015, the parties entered into a confidential settlement agreement and release in the foreclosure action. Id. ¶ 23. Mr. Bowen subsequently signed and filed a stipulation of dismissal of the counterclaims with prejudice. Id. ¶ 24.14
Green Tree issued a reinstatement quote dated May 6, 2015 requiring a total sum of $21,056.30 in order to reinstate the loan. Stip. ¶ 25; id. Attach. 18 ...
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