In 2017, Wells Fargo notified a Palmer homeowner that his mortgage payment was past due and foreclosure proceedings were likely to begin.
In accordance with federal law, the noticed informed the homeowner that he was “eligible for a face-to-face meeting to discuss your financial circumstances.”
Such a meeting is mandated by 24 C.F.R. Section 203.604(b) which states that
The mortgagee must have a face-to-face interview with the mortgagor, or make a reasonable effort to arrange such a meeting.
After the written notices were ignored, the bank sent an agent from National Creditors Connection, Inc. to the residence. No one answered. So the agent left a letter taped to the door informing the homeowner that he was “eligible for a face-to-face meeting to discuss your financial circumstances.”
Again, the letter elicited no response.
Eventually Wells Fargo foreclosed on the home, which is located at 51 Fuller Road in Palmer.
Well Fargo bought the house at the foreclosure auction (a common practice) and then commenced eviction proceedings against the homeowner in Housing Court.
It was not until proceedings began in Housing Court that the borrower contested the foreclosure. He argued that the foreclosure was defective because he never had a face-t0-face meeting with the bank pursuant to federal law.
The Appeals Court rejected this argument. According to the justices, the bank’s reasonable efforts to arrange such a meeting were sufficient under the federal statute:
Under HUD regulations, a face-to-face meeting is not required if . . . [a] reasonable effort to arrange a meeting is unsuccessful. In this context, the words reasonable effort to arrange a meeting” have a specific meaning. A reasonable effort to arrange a face-to- face meeting with the mortgagor shall consist at a minimum of one letter sent to the mortgagor certified by the Postal Service as having been dispatched, and shall also include at least one trip to see the mortgagor at the mortgaged property. (Citations and quotations omitted.)
To read the full opinion, click the document below.
Law Office of Justin R. McCarthy 