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Kevin Wallace v. Bank of America

August 30, 2011


The opinion of the court was delivered by: Honorable Jerome B. Simandle


SIMANDLE, District Judge:


Plaintiff, Kevin Wallace, brought this suit against Bank of America Corporation, Bank of America, N.A., BAC Home Loan Servicing (BAC), Bank of America Loans Servicing, and Bank of America Home Loans for alleged violations of the Real Estate Settlement Procedures Act (RESPA), 12 U.S.C. § 2605, breach of contract, promissory estoppel, unreasonable debt collection efforts, misrepresentation, and a violation of the New Jersey Debt Collection Act. This matter comes before the court on Defendants' unopposed motion to dismiss. [Docket Item 4.] Because, as explained in today's Opinion, Plaintiff's allegations are too ambiguous or conclusory in critical parts, the Court will dismiss these claims without prejudice (with the exception of the New Jersey Debt Collection Act, which will be dismissed with prejudice as that proposed legislation has not been passed into law).


On November 15, 2000, Plaintiff, Kevin Wallace, borrowed $286,400.00 from Commerce Bank to purchase a home in Cherry Hill, New Jersey. Compl. ¶ 14. At some point, the servicing of Plaintiff's loan was transferred to BAC, which is a wholly-owned subsidiary of Bank of America. Compl. ¶¶ 1, 14.

According to the Complaint, Plaintiff, who works as a real estate agent, experienced a period of reduced income as a result of this country's housing crisis. Compl. ¶ 15. During this period, Plaintiff's wife suffered a heart attack, which led to increased medical costs and further loss of income. Id. Consequently, Plaintiff contacted BAC in August 2009 to try to find a way to prevent a possible default and foreclosure on his home. Id. BAC informed Plaintiff that two programs existed, which, based on the information Plaintiff had given BAC over the phone, BAC believed could cut his payments in half. Compl. ¶ 16. Plaintiff alleges that he was told not to make payments until he was offered the trial modification.*fn1 Id.

Over the course of the following months, Plaintiff alleges that he spent dozens of hours attempting to navigate a dizzying corporate bureaucracy that provided conflicting instructions (including whether to continue to make payments) and gave conflicting accounts of his status in the loan modification process. In May 2010, BAC unexpectedly began foreclosure proceedings. Compl. ¶ 20. Plaintiff was told that if he did not pay his outstanding payment balance plus additional foreclosure fees, he would be foreclosed upon. Id.

BAC's runaround continued, and Plaintiff was eventually forced to send $18,926.65 to BAC in order to redeem his property. Compl. ¶ 22.

The day after sending the redemption check, Plaintiff received a letter indicating that he might qualify for a six month forbearance and to request a forbearance in writing. Compl. ¶ 23. Plaintiff immediately called BAC's attorney to stop his check while his forbearance request was being processed, but BAC refused to return the funds. Id.

In July 2010, Plaintiff was told that he was past the initial review stage of his loan modification application and would be placed in underwriting, which could take up to three months. Compl. ¶ 25. One month later, Plaintiff was told he was no longer in underwriting because he and BAC were negotiating a deed in lieu of foreclosure. Compl. ¶ 26. After making eight phone calls and speaking to sixteen different people, Plaintiff explained that this deed in lieu of foreclosure had never been negotiated or discussed with him.

Id. Eventually, he was told that he was still in underwriting. Id. In the week following this conversation, Plaintiff received paperwork indicating he had accepted the deed in lieu of foreclosure. Id. After once again making several phone calls and speaking with numerous employees at BAC, Plaintiff was able to confirm that he was still in underwriting. Id.

On October 4, 2010, Plaintiff called BAC for an update on his home loan modification. Compl. ¶ 27. BAC told Plaintiff he was still in underwriting and to call back in a couple of weeks. Id. On October 12, 2010, Plaintiff called BAC again. Compl. ¶ 28. BAC told Plaintiff he had failed to timely send in his 2008 and 2009 tax returns, and, consequently, BAC had denied his loan modification request. Id. As of the time of filing this lawsuit, Plaintiff and his wife continue to live in their home, but they receive one to three collection calls from BAC per day.

Compl. ¶ 29.

Plaintiff brings seven claims against Defendants.*fn2 Count One is a claim that BAC violated RESPA by failing to respond to Plaintiff's written correspondence. Count Two is a claim that BAC and Bank of America offered Plaintiff a loan modification which he accepted, and that those Defendants breached that agreement. Count Three does not identify a Defendant, but seeks recovery for breach of a forbearance agreement. Count Four is a claim against BAC based on BAC's alleged breach of an oral contract regarding loan modification. That Count also contends, in the alternative, that Plaintiff can recover from BAC on a theory of promissory estoppel. Count Five claims Defendant BAC's loan collection ...

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