BofA Hit with Fraudclosure Class Action Suit

Three fascinating Fraudclosure related items: Bank of America Sued in Class Action Over Flouting of Foreclosure Rules

Bank of America has been hit with a class action on behalf of homeowners seeking damages for alleged disregard of foreclosure process rules.

The suit, filed Wednesday in federal court in Newark, N.J., accuses Bank of America and two subsidiaries, LaSalle Bank and BAC Home Loans Servicing, of “an undisciplined rush to seize homes” through “pervasive and willful disregard of knowledge, facts and statutes.”

Bank of America has filed foreclosure proceedings on many mortgages in New Jersey without holding the necessary rights as the mortgagee or assignee at the time of foreclosure, the suit says.

“Many thousands of foreclosures are plainly void under statute and settled New Jersey case law. Many borrowers never obtain statutorily required notices, and many foreclosure suits are filed entirely based in inaccurate recitations concerning ownership of the mortgage, the note, or the assignment,” the suit says.

The putative class in the suit, Beals v. Bank of America, N.A., 10-cv-05427, consists of all named defendants in pending New Jersey foreclosure actions initiated by Bank of America or its affiliates. The complaint includes counts of common-law fraud, breach of the covenant of good faith and fair dealing and violations of the New Jersey Fair Foreclosure Act and Consumer Fraud Act.

Macro Index:

Courts are hurriedly catching up to the changes technology and financial innovation have brought to mortgage and equity law. The new rules adhere to an established legal tradition that slows the pace at which cases can be brought to trial. This is a good thing 99% of the time as civil and criminal trial processes are designed to terminate cases before they ever reach the courtroom. Trials are expensive. Settling cases before trial will save the plaintiffs, defendants and taxpayers significant sums of money. Template New York Courts First in Country to Institute Filing Requirement to Preserve Integrity of Foreclosure Process

(PDF after the jump)

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