Debtors filed a Chapter 7 Bankruptcy and received their Discharge in 2012. On Schedule D they listed both BONY and Saxon as creditors holding a security interest in the Property with Saxon being owed $338,000.00 and BONY being owed $0. Saxon apparently serviced the loan held by BONY. The Debtors did not reaffirm the debt secured by the Property.
Shortly after the Court granted the Debtors a Discharge, Saxon sent the Debtors a notice advising them that the servicing of their mortgage would be transferred from Saxon to Ocwen. The Debtors continued to receive monthly statements from their mortgage servicer indicating their mortgage was past due. The mortgage on their home was eventually foreclosed in 2013. The Debtors received several additional communications from the mortgage servicer in 2014. The Debtors reopened their bankruptcy case in 2015 and filed this adversary proceeding against Saxon Mortgage Services, Inc. (“Saxon”), Ocwen Loan Servicing, LLC (“Ocwen”) and others.
From April 12, 2012, through December 17, 2013, Ocwen sent the Debtors 21 monthly statements indicating their mortgage with BONY was past due. The statements were nearly identical, except the total amount due increased from $140,574.80 on the first statement to $199,872.83 on the last statement. Each statement listed a “Current Amount Due,” which consisted of principal, interest, and escrow for the current month and ranged from $2,745.91 on the first statement to $2,745.92 on the last statement. Each statement also listed “Past Due Amounts DUE IMMEDIATELY.” Each statement also contained a detachable payment coupon that listed the “AMOUNT DUE” as the total amount due consisting of both the current amount due and the past amount due, which ranged from $140,574.80 to $199,872.83, as noted above.
Each of the statements contained bankruptcy disclaimer language on the front in a section labeled, “Important Messages,” which provided:
If you are currently in bankruptcy or if you have filed for bankruptcy since obtaining this loan, please read the bankruptcy information provided on the back of this statement.
On the back of the statement, in a section labeled, “IMPORTANT BANKRUPTCY INFORMATION,” it provided:
If you or your account are subject to a pending bankruptcy or the obligation referenced in this statement has been discharged in bankruptcy, this statement is for informational purposes only and is not an attempt to collect a debt.
If you have questions regarding this statement, or do not want Ocwen to send you monthly statements in the future, please contact us at 1-888-554-6599. Bankruptcy payments from the Trustee should be mailed to Ocwen Loan Servicing, LLC, P.O. Box 24781, West Palm Beach, FL 33416-4781.
See, e.g., Ex. 15. The monthly statements further noted in the “Important Messages” section that “Our records indicate that your loan is in foreclosure. Accordingly, this statement may be for informational purposes only.”
One of the Debtors, the wife, called Ocwen about these post-discharge demands; an Ocwen agent told her to not worry about them. She testified that it was upsetting to receive these statements each month since Ocwen had “no right” to send them these bills. She stated that she was constantly worried whether Ocwen would come after them for money, including the difference between what was owed and what Ocwen might receive at a foreclosure sale. At trial, the wife indicated that she never read the bankruptcy disclaimer language contained in the statements, focusing instead on the amounts set forth in the statements.
For reasons that are not clear from the record, the Property was not foreclosed on April 10, 2013. Instead, Ocwen continued to send the Debtors monthly statements showing more than $148,000.00 “past due” as well as letters indicating it “may not be too late to save [their home],” and notices advising the Debtors of an interest rate/payment change. The wife testified that she was worried that Ocwen would come after them for the money listed in the statements. She indicated her husband was just as upset as she was by the statements.
The Debtors received several additional communications from Ocwen after the foreclosure sale. Specifically, the Debtors received a letter from Ocwen dated September 9, 2014, notifying them that a relationship manager had been assigned to them and would be “assisting in identifying solutions for their mortgage.” The letter expressly stated that “[t]his communication is from a debt collector attempting to collect a debt.”
On October 16, 2014, Ocwen sent the Debtors an annual escrow account disclosure statement detailing actual and scheduled activity in the Debtors’ escrow account between October 2008 and November 2014. Ex. 55. This statement also indicated that “[t]his communication is from a debt collector attempting to collect a debt.” The statement also included an “Escrow Shortage Payment” coupon seeking a payment of $2,435.66 from the Debtors.
On June 8, 2016, the Court granted in part and denied in part the Debtors’ motion for summary judgment, ruling specifically that the letters and statements sent between September 9, 2014, and December 23, 2014, described above, “violated the discharge injunction of 11 U.S.C. § 524(a)(2) and did not fall within the safe harbor provision of 11 U.S.C. § 524(j) as these actions all occurred after the mortgage on the Debtors’ residence was foreclosed on December 16, 2013.”
The Court held a trial on March 9, 2017, in order to determine whether any other actions by Ocwen and BONY violated the discharge injunction and whether the Debtors are entitled to damages.
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