No Right to A Mortgage Modification

foreclosure defense attorneyA foreclosure proceeding was brought in Suffolk County before Supreme Court Justice Jerry Garguilo. Rivera had executed the mortgage and the personal obligation and he had failed to make his mortgage payments in a timely manner. Rivera had applied to Aurora Loan Services for a mortgage modification. They had taken the position he did not qualify for a mortgage modification.

It Is Alleged The Mortgage Company Acted in Bad Faith

Rivera brought a proceeding before Judge Garguilo claiming that Aurora Loan Services had acted in bad faith because they failed to offer him a mortgage modification or any other agreement to allow him to keep his house from being foreclosed on. It was presented to the court that Rivera was in bad health and could not appear in court. Rivera had a son-in-law by the name of Saburro. He was a loan officer. He came to court and testified Rivera was in bad health and that is why he did not appear in court. Saburro also testified Aurora Loan Services had repeatedly offered Rivera trial mortgage modifications. And at the end of each mortgage modification they would pull the rug out from under Rivera and advise him the mortgage modification was not going to be made permanent.

Judge Holds No Bad Faith

Justice Garguilo found that there were no trial mortgage modifications made. Judge Garguilo took the position the foreclosing bank has no obligation to modify a mortgage. Aurora’s failure to offer Rivera a mortgage modification was not unconscionable and it did not amount to bad faith. Aurora simply had no legal obligation to give Rivera a mortgage modification. It was a totally discretionary decision on their part. Judge Garguilo went on to state in his decision “it was clear the case was not one where a lender wrongfully accepted large sums of money and then refused home retention relief.” The court therefore ruled Aurora Loan Services did not act in bad faith because they did not provide Rivera with a mortgage modification.

helping homeowners stay in their homesElliot S. Schlissel is a foreclosure defense lawyer representing homeowners throughout the Metropolitan New York area whose homes have been foreclosed on by financial institutions.

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