Nationstar Mortgage Sued For Overcharging Homeowners

  • January 19, 2017
  • Balam Letona
  • Comments Off on Nationstar Mortgage Sued For Overcharging Homeowners

Nationstar Mortgage LLC has been sued for demanding homeowners pay more than what the mortgage contract allows. The lawsuit alleges that when the homeowners did not pay the higher monthly payment Nationstar commenced a harassing and illegal debt collection and credit reporting campaign designed to pressure the homeowners into paying.

It did not start this way. In a April 2014 letter, Nationstar notified the homeowners that the interest rate on the loan would re-set in July 2014. The letter stated the new interest rate would be 2.75% requiring a $1,444.40 monthly payment. The homeowners, husband and wife, paid the new amount.

The lawsuit alleges that upon receipt of the payment Nationstar began to telephone the homeowners repeatedly, almost daily, causing their telephone to ring incessantly, stating the homeowners were delinquent and demanding a higher amount. The lawsuit alleges that Nationstar insisted that the new monthly payment was $2,560.12 and the interest rate was 4.875%. The homeowners allege the first time Nationstar informed them of the higher, incorrect amount was in July 2014 and it did so orally.

The homeowners refused to pay the higher amount and demanded an explanation. They asked how Nationstar calculated the higher interest rate and the language of the mortgage note that justified Nationstar’s calculation. The lawsuit alleges that Nationstar refused the homeowners request. Instead, Nationstar continued its collection campaign including reporting the homeowners delinquent on their credit reports. Over several months the homeowners made multiple attempts to resolve the dispute, but nothing changed. At some point, fearing they would lose their home to foreclosure the homeowners paid the higher amount.

Months later in December 2014 the homeowners again disputed with Nationstar. They again insisted on an explanation and asked that Nationstar remove any negative credit reporting information from their credit reports. The lawsuit alleges that Nationstar again refused to explain the calculation to the homeowner’s satisfaction. Nonetheless, Nationstar agreed to remove the negative information and delinquencies from their credit reports. However, Nationstar never removed the delinquencies and on the day the lawsuit was filed in 2016 the delinquencies remained.

The lawsuit alleges Nationstar violated the federal and California Fair Credit Reporting Act [15 U.S.C. 1681 et.seq., Cal. Civ. Code 1785.25(a)], the California Fair Debt Collection Practices Act [Cal. Civ. Code 1788 et.seq.,], and the Real Estate Settlement Procedures Act [12 U.S.C. 2605 et.seq.]. The case is Ritsema v. Nationstar Mortgage LLC., Case No. 16-cv-01335, filed in the Superior Court of California, County of Santa Cruz. The Law Office of Balam O. Letona, Inc., represents the homeowners.

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