NJ Appeals Court Calls BofA On Carpet For Pulling Rug Out From Under Homeowner By Initiating Foreclosure Despite Prompt Payment History On Loan Mod

In Jefferson County, New Jersey, the Daily Record reports:

• Saying Bank of America tried to “pull the rug out from under” a Jefferson Township homeowner, a state appeals court Thursday enforced a loan modification plan that will let the homeowner keep the mortgage on the almost $600,000 house she bought in 2007.
  
  
• The appellate panel went so far as to say Bank of America’s tactics bordered on “unconscionability” in its dealings with Sylvia T. Ficco.

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• In its appeal, the bank claimed the loan modification was not enforceable because “there was never a meeting of the minds” since its March 2010 letter was sent in error. The bank also argued that the trial period offer was conditional and that Ficco was never offered a permanent loan modification.
  
  
• The appeals court disagreed, saying the bank was bound to fulfill an offer that Ficco accepted and she reasonably relied on the bank’s urging to make regular mortgage payments.
  
  
• In a footnote, the court said it was puzzled why a mortgage company would choose to continue foreclosure proceedings “against a debtor who, unlike many, is actually paying her mortgage.”
  
  
• “Finally, we observe that inducing debtors to continue making mortgage payments over an extended period of time, on the promise of a loan modification, only to eventually pull the rug out from under them when they are unable to satisfy criteria beyond prompt continuing payment of the mortgage, borders on unconscionability,” the appeals court said.

For more, see Appeals court upholds Jefferson woman's deal.

For the ruling, see BAC Home Loan Servicing, L.P. v. Ficco, Docket No. A-4756-10T4 (App. Div. June 21, 2012) (unpublished). (If link expires, try here).