Federal Judge Denies Bank of America Attempt to Dismiss Culik Law Lawsuit for Wrongful Foreclosure U
In a case where Massachusetts homeowners were under consideration for a loan modification at the time they were foreclosed on, a federal court judge in Massachusetts accepted Culik Law’s argument that a mortgage servicer may be negligent if it fails to comply with the Home Affordable Modification Program. The judge’s opinion was released on December 14, 2010.
Bank of America had attempted to have the lawsuit dismissed (and did not dispute that the foreclosure violated HAMP), claiming that the law of negligence should not apply to it.
The judge rejected Bank of America’s argument, writing “Here, evidence of a violation of the HAMP Guidelines may constitute evidence of breach of a duty because the harm that the Plaintiffs allegedly incurred is of the kind that (the HAMP guidelines) were designed to prevent.”
The homeowners’ lawsuit will now be allowed to proceed, and Culik Law will be allowed to seek extensive documentation from Bank of America regarding its non-compliance with HAMP.