Maryland Legislature makes “Money Moves” against Abusive Foreclosures – Two Bills Introduced to start New Year

The Unfair Abusive Deceptive Trade Practices Statute of Limitations (HB 425)

• This legislation will ensure that homeowners who were unfairly and deceptively
  denied the opportunity to modify their mortgage loan in violation of Maryland laws, would have the right to sue their former mortgage lender for such violations.
• Last August, for example, Wells Fargo admitted publically that it conducted hundreds or thousands of foreclosures against homeowners due to its unfair evaluation of their loss mitigation applications between April 13, 2010, and Oct. 20, 2015.
• Under Maryland law the general statute of limitations limits claims in these situations to three years. In Wells Fargo’s case, most victims would be barred from even bringing the claims since they occurred more than three years before they knew about Wells Fargo’s unfair and other deceptive practice.
• This bill will expand the statute of limitations to protect homeowners and former homeowners so they may still pursue their claims in court and not be barred by the statute of limitations through no fault of their own.

Real Property- Mortgages and Deeds of Trust – Foreclosures (HB 1277)

• This legislation will reform the process of foreclosures in Maryland Court to be like every other form of civil litigation.
• Currently, the foreclosure process has a special set of rules and procedures which do not ensure that homeowners have the same rights any other defendant in a state court proceeding would have. The special set of rules are staked in favor of Wall Street mortgage actors who do not follow basic rules and do not conduct themselves fairly.
• The following states have some form of fair, judicial foreclosure where homeowners have the same rights as any other civil litigant: CA, NY, ME, ND, IA, WI, IL, IN, OH, PA, CT, NJ, FL, SC, LA, KY, NM, HI, TX, GA, VT, TN, and MN. This bill would bring Maryland in line with those states and more.
• The Maryland Constitution requires that every resident should have a remedy under the law (Md. Const. Decl. of Rts. art. 19). This bill simply focuses on residential, owner occupied homeowners to ensure their rights are protected in a fair process just like every other litigant. Just from recent history, we know the current process has been anything but fair:
  • The Office of the Comptroller of the Currency found nearly all the national banks had committed unsafe and unsound banking practices related to foreclosure and mortgage servicing.
  • 49 state Attorney Generals and the Federal Government entered into National Mortgage Settlement agreements with nearly all the national mortgage servicers and banks for unfair and deceptive practices.
  • Multiple Maryland foreclosure attorneys were caught filing falsely notarized and otherwise robo-signed affidavits in court proceedings and the Court of Appeals did not disbar any of the attorneys involves and instead just slapped them on the hand for providing manufactured testimony in court proceedings designed to jam foreclosure through as fast as they could.
  • Other mortgage actors have been caught in the last year by adding fees and costs onto mortgage borrowers’ accounts without the right to do so and then threatening and then pursuing foreclosure.

By making the foreclosure procedures just like all other civil litigation, we will avoid the lessons of the past and ensure homeowners at risk of foreclosure have equal rights and remedies to defendant against unfair or deceptive practices.