United States District Court, D. Maryland
Lipton Hollander United States District Judge.
consumer protection action, plaintiff Tiavonde Jones has sued
Wells Fargo Bank, N.A. (“Wells Fargo” or the
“Bank”), alleging violations of the Real Estate
Settlement Procedures Act (“RESPA”), 12 U.S.C.
§§ 2601 et seq., and certain of its
implementing regulations, known as Regulation X, 12 C.F.R.
§§ 1024.1-1024.41. The suit is largely rooted in an
application for a mortgage loan modification requested by
plaintiff on or about May 24, 2017, in connection with real
property that she owns in Catonsville, Maryland. See
ECF 1 (“Complaint”). Plaintiff included numerous
exhibits with her suit. ECF 1-2.
Count I of the Complaint, Jones alleges, inter alia,
that the Bank violated RESPA, 12 U.S.C. § 2605,
“by refusing to state specifically the basis for its
denial of Ms. Jones' application in its denial letters .
. . .” ECF 1, ¶ 48; see also id.
¶¶ 42, 47. She also complains that the Bank
violated RESPA by failing “to review Plaintiff for all
loss mitigation options available to her . . . .”
Id. ¶ 4. In Count II, plaintiff asserts,
inter alia, that Wells Fargo violated RESPA by
“failing to . . . provide the name of the
owner/investor of [plaintiff's] loan within 10 business
days from [her] request . . . .” Id. ¶
seeks injunctive relief, statutory damages, and actual
damages under 12 U.S.C. § 2605(k)(1)(E) and 15 U.S.C.
§ 1641(f)(2). Id. ¶ 4. In particular, she
seeks compensation for emotional distress, attorneys'
fees, postage costs, and “lost time associated
with” the alleged discrepancy in the identification of
the owner of her loan. ECF 1, ¶¶ 44, 48, ¶ 54.
Fargo has moved to dismiss the Complaint (ECF 12), pursuant
to Fed.R.Civ.P. 12(b)(6), supported by a memorandum of law
(ECF 12-1) (collectively, the “Motion”).
Plaintiff opposes the Motion. ECF 15
(“Opposition”). The Bank has replied. ECF 16
hearing is necessary to resolve the Motion. See
Local Rule 105.6. For the reasons that follow, I shall grant
Factual and Procedural Background
is the owner of a home located in Catonsville, Maryland (the
“Property”). ECF 1, ¶ 10. On July 16, 2007,
she executed a promissory note (“Note”) and deed
of trust (“DOT”) in the amount of $526, 000.00
from the Bank for the Property (the “Mortgage” or
the “Loan”). Id.; see also Id.
relevant times, Wells Fargo has been the servicer of the
Mortgage. Id. ¶ 11. Plaintiff states,
id.: “Wells Fargo . . . acts as the mortgage
servicer on behalf of either HSBC Bank, N.A.
(‘HSBC'), as trustee for the certificate holders of
the WFALT 2007-PA5, (‘WFALT PA5') or HSBC Bank,
N.A. . . . as trustee for the certificate holders of WFALT
2007-PA3, (‘WFALT PA3').” Id.
to Jones, the Loan initially was “an interest only note
until September of 2017 at which time the payments would
include principal and interest.” Id. ¶
15. On an unspecified date, the Note was
“securitized” and “allegedly became held by
a WFALT Trust.” Id. ¶ 16. Jones states:
“Wells Fargo has claimed that two separate and distinct
parties are the owner of the subject loan.”
Id. ¶ 17. They are, id.: WFALT
2007-PA5 (“PA5”) and WFALT 2007-PA3
(“PA3”). HSBC acts as trustee for PA3 and PA5.
to plaintiff, “[e]ach securitized Trust or pool of
loans has its own unique Pooling and Servicing Agreement that
governs the servicer's requirements as to how it services
the loans in that specific pool of loans.” Id.
And, she asserts that, “over a number of years, ”
Wells Fargo has provided plaintiff with “contradictory
information” as to the owner of her Loan. Id.
particular, plaintiff complains that the Bank periodically
identified two different owners of her Loan: PA3 and PA5. ECF
1, ¶¶ 17, 18. Therefore, plaintiff's attorney
wrote to the Bank on or about April 5, 2017. ECF 1-2 at
43-47; ECF 1, ¶ 18. Plaintiff states that the letter
constituted both a “Notice of Error” and a
Qualified Written Request (“QWR”). ECF 1-2 at
43-47 (hereinafter, the “First QWR”); see
Id. at 43-44.
letter, plaitniff's counsel stated, inter alia,
that from April 27, 2010 through February 16, 2016,
“multiple parties have been named as the owner/investor
of [plaintiff's] loan.” Id. Counsel asked
the Bank to “provide the name of the owner/investor of
Ms. Jones' mortgage . . . .” Id. at 43-44.
Additionally, plaintiff's counsel acknowledged that
plaintiff's previous attempts to modify the Loan had been
denied by the Bank because, inter alia, plaintiff
“ha[d] exceeded modification limits.”
Id. at 44. Counsel requested additional documents
and information as to the basis for the modification denials.
Id. at 45-47.
letter dated April 24, 2017, Wells Fargo responded.
Id. ¶ 19. It advised that PA5 was the
“owner of her loan.” Id. However,
plaintiff avers that “as recently as August 17, 2017,
” Wells Fargo claimed that PA3 is the owner of the
to Jones, on September 1, 2017, her monthly Loan payment was
scheduled to increase from $3, 073.26 per month to $4, 149.56
per month. Id. ¶ 20. Concerned that she
“would not be able to afford” the higher monthly
rate (id.), Jones submitted a “complete loan
modification application” to Wells Fargo (the
“Application”) on or about May 24, 2017.
Id. ¶ 21. Notably, plaintiff had previously
obtained two other Loan Modifications - one in or about April
2010 and one in December 2015. See ECF 1-2 at 31-34
(April 2010); ECF 1-2 at 35-40 (December 31, 2015).
letter to plaintiff dated May 31, 2017 (ECF 1-2 at 2-4),
Wells Fargo informed plaintiff that it would review the
Application “to determine if [she was] eligible for
mortgage payment assistance through a loan
modification.” Id. at 2. Additionally, Wells
Fargo informed Jones that it may take “up to 30
days” for the review. Id. According to the
Letter of May 31, 2017, “at least one bankruptcy
case” had been filed in relation to the Property.
letter from the Bank to plaintiff dated June 2, 2017 (ECF 1-2
at 6-8) (the “Denial Letter”), Wells Fargo
informed plaintiff that she did not qualify for a
“Piggy-Back or Piggy-[B]ack w/ Temporary Rate
Reduction” Loan modification (hereinafter, the
“Piggy-Back Program”). Id. at 6-7. It
explained that, under the Piggy-Back Program, id. at
6, “[p]ast due payments are set aside but carried for
the life of the loan as a zero interest, zero payment balance
. . . [and become] due upon payoff of the loan or at
maturity, whichever occurs first.” Plaintiff was
advised that she did not qualify for the Piggy-Back Program
because her Loan “has already received the maximum
number of modifications allowed.” Id. at 7.
the Denial Letter provided, id.: “Once [Wells
Fargo] determined that [Jones] did not meet the
requirements” of the Piggy-Back Program, the Bank
“moved to evaluate [her] for the next available program
based on [her] information and the qualifications associated
with [her] loan.” In particular, the Bank identified
“other options, ” such as a “short sale,
” whereby Jones would list her home for sale at a price
below the amount she owed on the Property. Id.
Additionally, the Bank suggested a “deed in lieu of
foreclosure, ” advising Jones that if she chose that
option she “must agree to vacate the property within an
agreed upon time.” Id. And, Wells Fargo
informed Jones that she could appeal the Denial Letter
“within 20 calendar days.” Id.; see
also ECF 1-2 at 9 (the “Appeal Request
lawyer submitted an appeal to the Bank as to the Denial
Letter, dated June 20, 2017. ECF 1, ¶ 29; ECF 1-2 at
11-14 (the “Appeal Letter”). Counsel argued,
inter alia, that “Wells Fargo ha[d] failed to
state specifically what the program and/or investor
requirements are regarding the maximum number of allowable
modifications” on the Loan, in violation of 12 C.F.R.
§ 1024, Supp. I, § 41(d). Id. at 13.
Additionally, counsel complained that “Wells Fargo
failed to provide the number of previous modifications it
claims that Ms. Jones has had and . . . the exact number of
the allowable loan modifications under the
‘Piggy-Back' program and the investor
guidelines.” Id. According to counsel, without
this information, plaintiff could not “effectively
dispute the validity of [the Bank's] reason for a
has acknowledged that the “investor guidelines”
she demanded from Wells Fargo were “publically
available.” ECF 1-2 at 13 (citing SEC Info, Wells Fargo
Alternative Loan 2007-PA5 Trust - ‘8-K' for
10/29/07 - EX-10.1 (last visited August 16, 2018),
the “Investor Guidelines”). Her lawyer insisted
that the Investor Guidelines contain “no requirement
limiting the number of modifications available to a
borrower.” ECF 1-2 at 13; see also ECF 1,
Investor Guidelines cited at ECF 1-2 at 13 provide: “No
modification, recast, extension, or capitalization of
delinquent payments of a Mortgage Loan other than as provided
in Section 12.3.6 hereof shall be permitted with respect to a
Mortgage Loan.” See Investor Guidelines,
§ 12.3.7. Under § 12.3.6 of the Investor
Guidelines, the Bank may enter into a forbearance plan in
which the Bank “provides that the total amount owed
during such Delinquency, including costs and expenses, will
be repaid within the shortest period practicable, commencing
Appeal Letter, plaintiff's counsel also complained that
although Wells Fargo offers multiple programs, plaintiff was
only evaluated for the Piggy-Back Program. ECF 1-2 at 13.
According to plaintiff's attorney, the Bank's failure
to “identify with specificity all loss mitigation
options for which [Jones] may be eligible . . .”
constituted a RESPA violation. Id. And,
plaintiff's counsel requested additional
“information immediately” as to “all of
[the] loss mitigation options available to
Fargo wrote to plaintiff on July 11, 2017 (ECF 1-2 at 16-17),
stating that it had reviewed the Appeal Letter and had
determined that she “still do[es] not meet the
requirements for a loan modification.” Id. at
16; see ECF 1, ¶ 30. The Bank reiterated the
options previously made available to Jones, which included a
short sale or deed in lieu of foreclosure. ECF 1-2 at 16.
lawyer responded to the Bank on July 25, 2017, in
correspondence he identified as a notice of error and a QWR.
ECF 1, ¶ 32; see ECF 1-2 at 20-23
(“Second QWR”). He claimed that the Bank's
letter of July 11, 2017, “failed to adequately address
the issues raised” in the Appeal Letter. Id.
Moreover, counsel asked Wells Fargo to address the alleged
errors “immediately.” Id. at 22. And, he
“itemized” what he deemed to be the pertinent
errors, as follows, id. at 21-22:
• Wells Fargo is to provide the source of the
requirement that resulted in Wells Fargo's statement
“Your loan on the property noted above has already
received the maximum number of modifications
• If the source of this requirement is an investor
restriction and/or guideline, then Wells Fargo must provide
where that restriction and/or guideline is found, i.e. the
Pooling and Servicing Agreement.
• Wells Fargo is to provide the maximum number of loan
• Wells Fargo is to provide the date of each loan
modification it purports that Ms. Jones has obtained on the
• Wells Fargo is to provide the name, eligibility
requirements and results of “the next available
program” it claims it reviewed [as to] Ms. Jones
pursuant to Wells Fargo's letter dated June 2, 2017.
August 10, 2017, plaintiff filed a complaint with the
Consumer Financial Protection Bureau (“CFPB”).
ECF 1, ¶ 33. She provides no additional information as
to her CFPB complaint.
Fargo sent a letter to plaintiffs counsel, dated August 17,
2017 (ECF 1-2 at 25-26), in which it responded to the Second
QWR. See also ECF 1, ¶¶ 34, 35. The Bank
stated, inter alia, that it was reviewing “the
investor guidelines, ” the “[n]umber of allowable
modifications” for plaintiffs account, her
“[previously completed modifications, ” and other
“Note holder information.” ECF 1-2 at 25. In
addition, the Bank indicated that it would provide a complete
response by August 24, 2017. Id. But, it also
provided “an update” as to the concerns voiced by
plaintiff. Id. In particular, the Bank stated that
it was “unable to provide” the “investor
guidelines” because the Bank had determined that the
guidelines are “confidential privileged and/or
proprietary information of Wells Fargo.” Id.
Further, the Bank stated that it was the
“servicer” of plaintiff's Loan, on behalf of
“owner/assignee” PA3. Id. at 26; see
also ECF 1, ¶ 35.
letter from the Bank to plaintiff's attorney dated August
21, 2017 (ECF 1-2 at 29-30) (the “Final Review
Letter”), Wells Fargo stated that it had finished
researching plaintiff's concerns. Id. at 29;
see ECF 1, ¶ 36. It identified plaintiff's
Loan as “an asset-backed security that is secured by a
mortgage, or more commonly a collection (‘pool') of
mortgages.” ECF 1-2 at 29. The Bank explained,
id.: “These mortgages are sold to a group of
individuals (a government agency or investment bank) that
‘securitizes' or packages the loans together into a
security that can be sold to investors.”
to the Bank, “[t]here are many workout limitations
associated with this type of loan, ” including,
inter alia, that the Bank cannot “set aside or
forgive any portion of the principal balance”; it
cannot “increase the principal balance of the
loan”; it cannot “permanently reduce the mortgage
interest rate . . . .” Id. Moreover, the Bank
stated that the Loan was not eligible for the Home Affordable
Modification Program (“HAMP”). Id. In
addition, the Bank reiterated that it was “unable to
provide” plaintiff with a copy of the “investor
import, the Bank stated that it was bound by
“[f]requency limitations (Per investor guidelines, the
account is eligible after five years have passed since the
most recent completed modification)[.]” Id. As
to the number of allowable modifications for plaintiff's
Loan, the Bank stated that “there isn't a specific
number of modifications the account is allowed.”
Id. at 30. Rather, it said that plaintiff's Loan
“can qualify for an additional modification once every
five years has passed since the previous modification
finalized.” Id. According to the Bank,
plaintiff's most recent “modification was completed
on January 14, 2016.” Id. Accordingly,
plaintiff was deemed ineligible for a Loan modification with
respect to the Application she filed on May 24, 2017 (ECF 1,
¶ 21). See ECF 1-2 at 30.
the Bank stated that “there are a few workout options
for which [plaintiff's] account could qualify, ”
including “up to 12 past due payments to be combined
into a ‘piggy-back.'” Id. at 29.
Additionally, the Bank stated that plaintiff's Loan could
qualify for a “[t]emporary rate reduction” or a
“[r]epayment plan[.]” Id. However, the
Bank stated that it was unable to “provide specifics
for which options the account may qualify because if [an
account] is found outside the guidelines, the review is
complete.” Id. at 30.
to plaintiff, “Wells Fargo has demonstrated a pattern
and practice of violating federal servicing laws as they
relate to loan modifications.” ECF 1, ¶ 12. She
also maintains that between July 2014 and September 2017, the
Bank provided contradictory information as ...