Debtor sued Flagstar FSB for dual tracking his loan modification. The Court considered two of the several grounds he raised in his complaint: (1) violation of RESPA and (2) violation of the automatic stay.
After the Debtor’s wife had serious medical issues, the Debtor could not make his regular mortgage payments. The Debtor called Flagstar and an agent of the bank encouraged him to request a mortgage loan modification. The Debtor submitted the request for mortgage assistance along with some of the required documentation.
Flagstar sent the Debtor several letters informing him that it needed more documents. It also sent him a letter stating that his loan was in default.
A month later, Flagstar sent the Debtor a letter advising him that his modification packet was complete and that it would take 30 days for the bank to determine his eligibility for loss mitigation.
This letter also stated that Flagstar would not commence a foreclosure action during this time, until (1) the bank completes its evaluation; (2) the bank sends the Debtor a written notice on his request for assistance; and (3) the Debtor is allowed to respond to such notice.