Woman sues over wrongful home foreclosure
March 22, 2011 at 6:03 p.m.
Updated March 21, 2011 at 10:22 p.m.
A Victoria woman is suing BAC Home Loan Servicing over the wrongful foreclosure of her home.
Plaintiff Patricia Garcia originally filed the lawsuit in state court in February.
It was re-filed in federal court on March 18.
Garcia claims BAC, whose principal office is in Plano, committed fraud and trespassed on her homestead title when they not only wrongfully foreclosed on her house, but they also sold it to the Federal National Mortgage Association, aka "Fannie Mae."
The plaintiff purchased her Victoria homestead, whose address was not disclosed in court documents, in November 2005.
BAC was the servicer for the purchase-money mortgage held by the mortgagee, Bank of America.
In September 2009, Garcia filed for bankruptcy, however, she continued to make mortgage payments during her pending bankruptcy proceedings, said the lawsuit.
After the discharge of her bankruptcy in January 2010 and after signing a reaffirmation agreement with BAC for the mortgage on the homestead, Garcia found out that she was two months behind in her mortgage payments.
The lawsuit contends that although the plaintiff desired to catch up with her payments, an unexpected major surgery in May 2010 paired with a reduction in her hours at work, forced Garcia to fall further behind in her mortgage payments.
In August 2010, Garcia received notice that her home was scheduled for foreclosure and if she wished to reinstate her mortgage, she would have to pay BAC $4,520.58, which was comprised of $1,666.58 in just attorney's fees, said the lawsuit.
Refusing to accept partial payments, BAC, through its counsel, suggested that Garcia pursue a loan modification with BAC under the Home Affordable Modification Program (HAMP), as an alternative means to avoid a foreclosure.
After applying for the loan modification and submitting all requested documents in September 2010, Garcia claimed the defendant assured her that the foreclosure proceedings on her home would be put on hold while the modification was being considered.
However, on October 8, 2010, instead of receiving a response from the defendant on the status of her modification request, she received a notice to vacate, said the lawsuit.
To make matters worse, she learned that her home had been sold in a foreclosure auction on October 5.
A couple of weeks later, Garcia received a denial of her HAMP modification request.
In the lawsuit, Garcia claimed BAC committed fraud because they not only proceeded to foreclose upon her homestead before they evaluated her HAMP eligibility, but they were also without legal right to sell her home to Fannie Mae when it was sold, making the sale void.
Federal law prohibits mortgage servicers participating in HAMP from referring a loan for foreclosure or proceeding with a foreclosure sale on a qualifying loan until a homeowner, who has applied for a modification under HAMP, has been evaluated and, if deemed eligible, offered a trial modification, according to the lawsuit.
Garcia is seeking to set aside the foreclosure sale and quiet her title to the homestead, re-establishing her as the rightful owner of the property.
Additionally, she seeks to recover any damages that she may be entitled to as a result of BAC's premature foreclosure on her homestead.
Tony Pitts, the Austin-based attorney for the plaintiff, declined to comment.
Messages left for Charles Townsend, the Dallas-based attorney for the defendant, were not returned as of Tuesday afternoon.