Jefferies v. Ameriquest Mortg. Co.
| Decision Date | 11 February 2008 |
| Docket Number | Civil Action No. 07-0557. |
| Citation | 543 F.Supp.2d 368 |
| Parties | Nadirah J. JEFFERIES, Plaintiff, v. AMERIQUEST MORTGAGE CO., Defendant. |
| Court | U.S. District Court — Eastern District of Pennsylvania |
Matthew B. Weisberg, Rebecca Steiger, Prochniak Poet & Weisberg P.C., Morton, PA, for Plaintiff.
Sandhya M. Feltes, Kaplin Stewart, Blue Bell, PA, for Defendant.
Nadirah Jefferies brings a predatory lending lawsuit against defendant Ameriquest Mortgage Co. ("Ameriquest"), alleging various federal and state law claims.1 Jefferies brings the following claims: (1) negligence; (2) violation of the Truth in Lending Act, 15 U.S.C. § 1601 et seq.; (3) violation of the Honie Ownership and Equity Protection Act of 1994, 15 U.S.C. § 1639 et seq.; (4) violation of the Real Estate Settlement Procedures Act, 12 U.S.C. § 2601 et seq.; (5) fraud; (6) breach of contract; (7) violation of the Pennsylvania Fair Credit Extension Uniformity Act, 73 Pa. Cons.Stat. § 2270.1 et seq.; (8) violation of the Pennsylvania Unfair Trade Practices and Consumer Protection Law, 73 Pa. Cons.Stat. § 201-1 et seq.; and (9) punitive damages. On August 1, 2007, Ameriquest filed a motion for summary judgment on all of Jefferies's claims.2 For the reasons discussed below, the court will grant Ameriquest's motion in part and deny it in part.
Jefferies is the sole owner of a property located at 2004 South Opal Street, Philadelphia Pennsylvania. (Def. Statement Undisputed Facts ¶ 1; PI. Statement Undisputed Facts ¶ 1.) When Jefferies purchased the property in late 1999 or early 2000, she financed it with a mortgage through Commerce Bank. (Nadirah Jefferies Dep. 16:2-14, May 23, 2007.) The fixed interest rate on the mortgage was 9.9%, and her monthly payment was $249. (Id. at 16:21-17:8.)
In early 2005, Jefferies wanted to refinance her mortgage, so she contacted Ameriquest and spoke with David Petion at Ameriquest's Plymouth Meeting branch to discuss refinancing. (Id. at 17:21-22, 18:14-21.) Jefferies was unemployed when she applied for her loan with Ameriquest, and her sole source of income at that time was $884 in biweekly workers' compensation benefits.4 (Id. at 9:13-22, 11:16-12:1, 21:21-24.) Jefferies attempted to obtain a mortgage from other lenders at the same time, but she was not successful because of her unemployment. (Id. at 25:9-23.) When Jefferies applied for her Ameriquest loan, she had approximately $18,500 outstanding on her Commerce Bank loan. (See Def. Mot. for Summ. J. Ex. J.)
Prior to the loan closing, Jefferies spoke with Petion on the phone on a regular basis to complete the application process. (Jefferies Dep. 18:22-19:1, 21:2-8.) When applying for the loan, Jefferies explained to Petion that she was not employed and that her only income came from her workers' compensation benefits. (Id. at 21:23-22:2.) Petion did not ask Jefferies for any documents regarding her income, and he explained to Jefferies that because of the type of loan she was getting, she did not have to verify her employment. (Id. at 21:9-17, 24:10-15.)
Although Jefferies did not ask for a specific interest rate for the loan, she requested the best interest rate possible. (Id. at 22:21-23.1) Petion told Jefferies the rate would be 8.4%, and Jefferies thought this was too high. (Id. at 23:2-6.) Petion responded that six months later, after her credit was cleared, Jefferies could return to Ameriquest to obtain a lower interest rate. (Id. at 23:5-10, 24:7-9, 25:2-4.) Jefferies's final loan amount was $60,000, with a 8.4% interest rate, and her monthly payments were $457.11.5(Id. at 39:2:-40:3.)
On the day of the loan closing, January 21, 2005, Jefferies went to Ameriquest's Plymouth Meeting branch around 12:00 p.m. to meet with Petion in person for the first time. (Id. at 30:24-31:1.) During this meeting, Petion explained the loan documents to Jefferies. (Id. at 28:10-14.) Jefferies did not have any questions at that time, and she did not have any problems with anything that was in the loan documents. (Id. at 28:10-21.) Ameriquest did not allow Jefferies to sign the loan documents at the office because there were some "issues." (Id. at 27:3-7.) Jefferies did not know what these issues were, but she thought either the loan was not ready or had not been approved. (Id. at 27:3-9.) Jefferies took the documents Petion had given her home, and a notary came to her house around 8:30 p.m. that evening to sign the loan documents. (Id. at 29:6-10, 31:1-2.) The notary brought another set of loan documents for Jefferies to sign, and he told Jefferies that the documents she was going to sign were the same documents that she had gone over with Petion earlier that day. (Id. at 29:6-17.)
The loan application Jefferies signed on January 21, 2005 states that she was employed as an interior decorator and that her income was $3500 a month. (Id. at 26:5-17, 32:17-21; Def. Mot. for Summ. J. Ex. B.) Jefferies was not, however, employed as an interior decorator when she applied for the Ameriquest loan, nor was her income $3500 a month. (Jefferies Dep. 26:18-21, 32:22-33:1.) Jefferies testified that the original loan application she went over with Petion on the day of the loan closing (the "unsigned application") did not list her employment as an interior decorator, but she was not certain if the unsigned application Petion had given her listed her monthly income as $3500.6 (Id. at 29:2-5, 33:6-8.) Jefferies never told the notary, Petion, or anyone at Ameriquest that the employment information and income listed on the signed loan application were incorrect. (Id. at 33:2-5.)
On the day of the loan closing, Jefferies also signed a Stated Income Letter, which reads:
STATED INCOME LETTER
To Whom It May Concern:
I Nadirah Jefferies make 3500 a mo. as an Interior Decorator.
s/Nadirah Jefferies 1/21/05
Borrower Date
(Def. Mot. for Summ. J. Ex. C.) The body of the letter and the signature are both handwritten. (Id.) When shown a copy of this letter, Jefferies acknowledged that her signature appeared on the bottom of the letter, but she testified that the handwriting above the signature that reads "I Nadirah Jefferies make 3500 a mo. as an Interior Decorator" is not her handwriting. (Jefferies Dep. 33:9-16, 34:16-23.) When asked to explain this discrepancy, Jefferies testified that after she left the Ameriquest office on the day of the loan closing, Petion told her that he needed her to sign a paper stating that he had gone over her employment history with her. (Id. at 35:6-9.) Petion then faxed Jefferies a blank piece of paper, which she signed. (Id. at 34:24-35:2.) Jefferies then gave the signed, but otherwise blank, piece of paper to the notary, and she never received a copy of the completed document.(Id. at 35:10-19.)
Jefferies also signed several other documents at the closing. One document was the Adjustable Rate Note. (Id. at 39:13-17; Def. Mot. for Summ. J. Ex. D.) Petion explained the terms in this document to Jefferies when she was at his office. (Jefferies Dep. 39:18-20.) The document confirmed that Jefferies was receiving a $60,000 loan from Ameriquest with an interest rate of 8.4%, her monthly payments would be $457.11, and there was a three-year prepayment penalty period. (Def. Mot. for Summ. J. Ex. D.)
Another document Jefferies signed was entitled "Final Interest Rate, Payment Due, Fees Paid, and Prepayment Charge."7 (Jefferies Dep. 41:10-14.) Jefferies did not ask any questions about the document when she signed it, and she did not verify that the document provided for a three-year prepayment penalty period. (Id. at 41:19-42:-6.)
Jefferies also signed the Important Notice to Borrowers on January 21, 2005. (Id. at 47:4-7; Def. Mot. for Summ. J. Ex. I.) This notice stated:
Oral agreements, promises or commitments to lend money, extend credit, or forebear [sic] from enforcing repayment of a debt, including promises to extend, modify, renew, or waive such debt, are not enforceable.
To protect you (Borrowers(s)) and us (Lender) from misunderstandings or disappointments, any agreements we have reached covering this loan transaction are contained in the loan documents you have signed today. Your loan documents are the complete statement of the loan agreement reached between us. Any subsequent agreement between us regarding this loan transaction must also be a signed writing to be legally enforceable.
BY SIGNING BELOW, YOU (BORROWER(S)) HEREBY ACKNOWLEDGE:
(1) You have been given an opportunity to read your loan documents, have read them, and fully understand the terms of this loan transaction; and
You have received a full and complete set of all the loan documents you have signed with this transaction, including a copy of this notice.
(Def. Mot. for Summ. J. Ex. I.) Jefferies did not read this notice before she signed it at the loan closing. (Jefferies Dep. 47:8-10.)
Additionally, Jefferies signed a Notice of Right to Cancel. (Id. at 48:6-10; Def. Mot. Summ. J. Ex. E.) Either Petion or the notary explained to Jefferies that she had three business days from January 21, 2005 to rescind her loan, but Jefferies did not attempt to rescind her loan until she filed her Complaint on January 22, 2007. (Jefferies Dep. 48:11-12, 49:21-50:1.) Furthermore, Jefferies did not send any letters to Ameriquest, and prior to filing her Complaint, she never made any written requests or complaints to Ameriquest. (Id. at 53:20-22, 55:3-6.)
The other documents Jefferies signed at the closing included the Truth in Lending Disclosure Statement, Borrower's Acknowledgment of Final Loan Terms, Settlement Statement, and Understanding Your Loan. (Id. at 43:2-6, 43:13-17, 44:13-17, 47:21-8:1.) The notary gave Jefferies a copy of all of the documents she signed. (Id. at 30:5-19.)...
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