Jose v. Wells Fargo Bank, N.A. (Lawyers Weekly No. 11-089-16)
NOTICE: All slip opinions and orders are subject to formal revision and are superseded by the advance sheets and bound volumes of the Official Reports. If you find a typographical error or other formal error, please notify the Reporter of Decisions, Supreme Judicial Court, John Adams Courthouse, 1 Pemberton Square, Suite 2500, Boston, MA, 02108-1750; (617) 557-1030; SJCReporter@sjc.state.ma.us 15-P-835 Appeals Court TOMAS JOSE vs. WELLS FARGO BANK, N.A. No. 15-P-835. Essex. May 6, 2016. – July 22, 2016. Present: Cohen, Green, & Hanlon, JJ. Mortgage, Foreclosure. Real Property, Mortgage. Administrative Law, Agency’s interpretation of regulation. Civil action commenced in the Superior Court Department on March 5, 2012. The case was heard by Thomas Drechsler, J., on a motion for summary judgment. Thomas J. Gleason for the plaintiff. David Fialkow for the defendant. GREEN, J. Regulations promulgated by the Federal Department of Housing and Urban Development (HUD) require a mortgage lender to conduct a face-to-face meeting with defaulting borrowers before foreclosing on certain federally insured mortgages. The defendant, Wells Fargo Bank, N.A., (Wells Fargo), acknowledges that failure to comply with those regulations may serve as a basis to invalidate its foreclosure of the mortgage it held on the plaintiff’s property, but asserts that it qualifies for an exemption. We conclude that Wells Fargo does not qualify for the exemption from the face-to-face meeting requirement, and reverse so much of the judgment as dismissed that part of the plaintiff’s complaint. Background. On March 28, 2005, the plaintiff, Tomas Jose, executed a promissory note in the amount of $ 440,002 to refinance a prior mortgage loan on 499 Boston Street in Lynn (property). To secure the note, Jose granted a mortgage (mortgage) to Mortgage Electronic Registration Systems, Inc. (MERS), solely as nominee for the lender and the lender’s successors and assigns. The mortgage was insured by the Federal Housing Administration, and incorporated applicable HUD regulations by reference. More specifically, under par. 9(d) of the mortgage, acceleration or foreclosure of the mortgage is not authorized “if not permitted by regulations of the [HUD] Secretary.” On February 4, 2009, MERS assigned the mortgage to Wells Fargo. At all relevant times, Wells Fargo serviced Jose’s mortgage loan. Wells Fargo does not maintain a servicing branch within 200 miles of the property. However, Wells Fargo does maintain deposit and home loan origination branch offices within 200 miles of the property. Wells Fargo never scheduled or conducted a face-to-face meeting with Jose to discuss an alternative to foreclosure. Despite the absence of a face-to-face meeting, however, Wells Fargo and Jose entered into several forbearance agreements and three permanent modifications. Jose breached each […]