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Lawsuit Against Bank of American Moves Forward

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Claims that Bank of America improperly administered the federal Home Affordable Loan Modification Program (HAMP), made by mortgagers across the country who brought the class action, will be heard in federal court.

U.S. District Judge Rya Zobel wrote that in 2008, Bank of America “accepted $15 billion … as part of the Troubled Asset Relief Program (‘TARP’). In January 2009, it accepted an additional $10 billion in TARP funds in connection with its acquisition of Merrill Lynch & Co., Inc., and a partial guarantee against losses on $118 billion in mortgage-related assets. In April 2009, it signed a contract with the U.S. Department of the Treasury agreeing to participate in HAMP, which provided BAC, as the servicing arm of Bank of America, incentive payments for granting to eligible borrowers affordable mortgage loan modifications and other alternatives to foreclosure….  As part of the program, BAC entered into a standard agreement with each plaintiff for a temporary trial modification of that plaintiff’s existing note and mortgage. Each Trial Period Plan (‘TPP’) promised that if the borrower complied with the terms of the agreement and the borrower’s [situation] remained unchanged in all material respects, then the borrower would receive a permanent modification on the same terms. BAC entered into TPP agreements with several borrowers in Massachusetts….The named plaintiffs are homeowners who signed TPPs. They contend that the TPP was a binding contract between the parties under which BAC was obligated to offer permanent loan modifications if plaintiffs complied with the TPP’s terms and conditions over a three-month trial period. Although they did fully comply and were eligible, defendants either failed to grant permanent modification or failed to give a written response to their respective applications,” Courthouse News reported.

The court ordered that of the allegations filed,

  • Breach of Contract (Count II)
  • Promissory Estoppel (Count IV)
  • Breach of the Implied Covenant of Good Faith and Fair Dealing(Counts II and VII)
  • Violations of Several State Consumer Protection Acts (Count VI)
  • Violation of the Equal Credit Opportunity Act (Count VIII)
  • Plaintiffs’ Motion for a Preliminary Injunction

 

The court ordered that the defendants’ motion to dismiss the docket, was allowed in part, and denied in part. The courts allowed counts I, III, V and VIII, and denied counts II, IV, VI and VII.  Plaintiffs’ motion for a preliminary injunction was denied.

 

 

breakinglawsuitnews.com disclaimer: This article: Lawsuit Against Bank of American Moves Forward was posted on Monday, July 18th, 2011 at 6:05 pm at breakinglawsuitnews.com and is filed under Fraud Lawsuits.

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