Loan Modifications Loans

Loan modifications are changes made to the terms of an existing loan outside the specifications contained in the original loan agreement. In a mortgage situation, loan modifications are typically made to assist... more +
Loan modifications are changes made to the terms of an existing loan outside the specifications contained in the original loan agreement. In a mortgage situation, loan modifications are typically made to assist borrowers in meeting their obligations and avoid foreclosure. Such mortgage loan modifications may include reduction of principal amount or interest rate, lengthening of loan term, and monthly payment caps. less -
News & Analysis as of

Court Confirms Bank Can Be Held Liable for Conduct and Representations Occurring During Loan Modification Process

A California Court of Appeal recently held that a defaulting mortgagee can assert claims for breach of contract, wrongful foreclosure, unfair business practices and negligent misrepresentation against the foreclosing bank...more

U.S. District Court Reaffirms Distressed Debt Funds Not Eligible Assignees under Loan Agreement

A recent decision by the U.S. District Court for the Western District of Washington found that certain distressed debt funds were not “financial institutions” under the definition of “Eligible Assignee” in the applicable loan...more

Borrowers File Petition for Writ of Certiorari Related to Permanent Loan Modification Under HAMP

Citing a circuit split among the Seventh, Ninth and Eleventh circuits and the “great importance” of settling the question, the borrowers filed a petition writ of certiorari in the Supreme Court asking the Court to determine...more

Bifurcated Note Implementation - Looking Beyond Traditional Risk Metrics to Prevent Borrower Windfall

In the world of large loan modifications, servicers and borrowers have turned frequently in recent years to the A/B Note structure in situations where the collateral financed by a loan is valued at less than the outstanding...more

New California Court of Appeal Decision Reaffirms General Rule that Residential Lenders Owe no Duty to Borrowers, Including in the...

In a recent decision, Lueras v. BAC Home Loans Servicing, LP, 2013 Cal. App. LEXIS 886, the California Court of Appeal returned to the general rule that, absent unique circumstances giving rise to a duty of care, lenders do...more

Summary Of HUD’s LEAN 232 Program E-Mail Blast: Office Of Residential Care Facilities (ORCF), September 26, 2013

In an effort to summarize the highlights of the U.S. Department of Housing and Urban Development (HUD) LEAN E-mail Blasts that we receive, and rarely have time to review in a timely fashion, we at Pepper are providing this...more

South Carolina Supreme Court: Lenders Modifying Loans Do Not Engage in Unauthorized Law Practice

The South Carolina Supreme Court recently ruled that lender loan modifications do not constitute the unauthorized practice of law....more

"I Knew You Were Trouble": Recent Trends in Lender Liability Litigation

Lender liability claims generally arise in one of following contexts: (i) claims seeking recovery of damage or "leverage" to accept discounted payoffs; (ii) counterclaims to foreclosure/receivership/guarantor actions; or...more

Independent Foreclosure Review Settlement

On January 7, the OCC and the Fed announced a settlement with 10 mortgage servicing companies which includes cash payments to eligible borrowers and other assistance, such as loan modifications and forgiveness of deficiency...more

Massachusetts Offers Guidance On Mortgage Modifications For Non-Delinquent Borrowers And Troubled Debt Restructuring

On December 27, the Massachusetts Division of Banks issued guidance regarding the classification of the modification of a residential mortgage loan as troubled debt restructuring (TDR) when the loan is underwater. The...more

State Law Update: Michigan Excludes Certain Loans From State Mortgage Laws, Extends Loan Modification Program

On December 22, Michigan Governor Rick Snyder signed three bills—SB 1283, SB 1284, and SB 1285—to exclude from state mortgage laws, including its predatory lending law and loan originator licensing act, any loan transaction...more

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