Pending Cases and Investigations
Every day new abuses continue to abound in our consumer marketplace. We are constantly on the lookout for what the courts have termed “new schemes which the fertility of man's invention would contrive.” If you have a case or issue you would like to report, please contact us.
CashCall Predatory Lending Class Action Certified: Levy is cocounsel with the Sturdevant Law Firm in a federal class action challenging CashCall's 90+% interest loans and CashCall's collection practices. On November 15, 2011, U.S. Magistrate Judge Maria-Elena James
Class certification means that the two plaintiffs in the case with high interest loans will represent all California consumers with similar loans in the trial. Based on the two representatives’ cases, the Court will determine whether CashCall violated the rights of the entire class under California’s usury and predatory lending laws.
If the suit is successful, CashCall faces liability to refund millions of dollars borrowers paid in excessive interest. For more information, see the Yesquire Blog entry.
Chase Purchase Money Mortgage Debt Collection Class Action: Levy is cocounseling a class action with Housing and Economic Rights Advocates against Chase challenging Chase’s collection of loan balances on purchase money mortgages after foreclosures and short sales. California’s “anti-deficiency” law says that purchase money mortgages are non-recourse: the borrower does not have any personal liability to repay a loan that is used to buy a home; the lender must look recover solely from a sale of the property if the borrower fails to pay.
In a major victory for victims of the foreclosure crisis, Complex Case Judge Wynne Carvill issued a 22-page Order on November 5, 2012, completely overruling Chase’s motion to dismiss Levy’s class action lawsuit challenging Chase’s illegal post-foreclosure and post-short sale collections of home mortgages. Judge Carvill found that Chase’s letter attempting to collect purchase money mortgage balances after short sales and foreclosures violates state fair debt collection laws and that California’s purchase money anti-deficiency law applies after both short sales and foreclosures.
Auto Title Loans: Levy is cocounseling with Kemnitzer, Barron & Krieg (“KBK”) to challenge extraordinarily high interest “auto title loans.” The auto title lending industry has burgeoned since banks started cracking down on credit card and other personal lending three years ago. Auto title lenders loan money against car titles at astronomical interest rates, often over 100% per year. The loans are secured by the borrower’s car. The lenders limit the amount they lend to make sure they have substantial “equity” for repayment. As a result, most of these loans are essentially risk free to the lenders; they can repossess the car and be made whole and then some. Because the lenders prey on financially desperate borrowers who are often unable to afford the high interest rates, auto title lending frequently comes down to auto “equity stripping” and the loss of critically important family autos. Levy and KBK contend that title lending practices and interest rates violate the California Finance Lenders Law and California’s prohibitions against unconscionable loans.
HomEq Downpayment Class Action: Levy has settled a class action lawsuit against mortgage loan servicer Barclays Capital Real Estate, which was commonly known as “HomEq Servicing.” The settlement provides that for direct payments (no claims forms!) to all California HomEq home mortgage borrowers who made a downpayment for HomEq to process a loan modification, and who were then denied. Instead of returning the downpayment when the modification was denied, HomEq applied borrowers’ downpayment to their original mortgages, using the downpayment to deceptively collect money HomEq could not otherwise collect. Each qualifying borrower will receive a check for 50% the downpayment made. The average payment to each class member who made a downpayment and did not receive a loan modification is approximately $2,800. San Francisco Superior Court Judge John E. Munter granted final approval of the settlement on August 24, 2012. Please visit the class action settlement website for more information.
