Friday, November 18, 2011

Suit: Loan Servicer Used Deceptive Correspondence, Illegal Demands In Effort To Intimidate Tenants Out Of Foreclosed Homes In Violation Of Federal Law

In Brownsville, Texas, Foreclosure Buzz reports:

  • Loan servicers and their henchmen (attorneys and real estate brokers) continue to ignore the requirements of the Protecting Tenants at Foreclosure Act. Many take the position that tenants’ leases do not have to be honored, and instead only provide a 90 day notice to vacate. Some decide to advise tenants of their “rights” expressly.

  • On October 28, 2011, American Home Mortgage Servicing, Inc. (AHMSI) was sued for issuing a letter to a tenant that said as much, and refusing to change its letter in the future despite numerous requests. Without any basis in the law, AHMSI’s representatives also demand extensive documentation within a short time frame in order to get the 90 days.

  • AHMSI even said for the tenant to not be concerned with an eviction. It appears that loan servicers hope to take advantage of tenants as much as possible and hope the law is not extended past December 2014.

Texas Housing Justice League, a Texas non-profit corporation and membership organization that is operated under the Texas Non-Profit Corporation Act to serve the housing interests of low-income Texans, is a co-plaintiff in this case.(1)

For more, see AHMSI Sued for Misleading Tenants per PTAF.

For the lawsuit, see Davis v. AHMSI et al., Civil Action No. 1:11-cv-219, US District Court, S.D. Tex., Brownsville Division.

Thanks to Deontos for the heads-up on the story.

(1) According to their website, Texas Housing Justice League was formed to address housing problems associated with:

  • abusive homeowner association rules,
  • improper eminent domain efforts,
  • oppressive property tax schemes,
  • severe housing conditions,
  • predatory lending practices,
  • improper evictions,
  • illegal foreclosures,
  • lease-to-own scams,
  • defective titles from contracts for deed, and
  • a host of other housing problems.

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