Archive for May 14th, 2013

Pro Se Homeowner Beats Bank of America in 2DCA

First, the usual caveat.  Representing yourself in a foreclosure case is probably not a good idea.  After all, pro se homeowners often don’t know the correct procedural ways to bring their arguments.  And if you don’t bring your arguments in the correct fashion, you may waive them forever.

Ok, I know.  You’ve heard that before.  Yada, yada, yada.  Let’s get to the story.

In Hillsborough County Case No. 10-CA-20354, Bank of America declared a homeowner in default, then sued for foreclosure.  The homeowner represented himself in court, arguing, essentially, that he was not in default and that BOA had applied payments to his account improperly.  The issue?  In 2005, the homeowner made a lump-sum payment of $22,000, intending that this sum be applied against future recurring monthly payments.   But Bank of America didn’t apply the payments that way.  Instead, BOA applied the $22,000 payment towards principal, then later asserted the homeowner was in default for not making normal monthly payments.

The issue before Hillsborough Judge William Levens was a narrow one.  Was the homeowner in default, or did Bank of America apply the payments incorrectly and wrongly declare him in default?  Judge Levens ruled in favor of the homeowner, dismissing the foreclosure lawsuit.  Also, remember my recent blog on bank-induced default, where I explained that when a bank wrongly declares a homeowner in default, the remedy is to reinstate the loan, eliminating all default interest, late charges, and interest since the bank improperly declared the default?  That’s the same thing Judge Levens did here, directing the “debt be recalculated” and the “resulting/remaining loan balance [be returned] to the contracted-for monthly payment amount.”

Bank of America didn’t like this result, so it appealed to Florida’s Second District Court of Appeal.  In March, the Second District issued a PCA, affirming Judge Levens ruling.  You might not have noticed that ruling, but that’s only because the Second District did not see the need to explain itself.  Yes, the pro se homeowner wins and Bank of America loses.

Please remember the concept of bank-induced default.  It might not apply in every case, but the remedy when it does – dismissing the foreclosure case and reinstating the loan to the point in time before the default – is a good one.


Mark Stopa

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