Recently I read where a judge in Suffolk County, NY judge erased a Long Island couple’s >$500k in mortgage debt admittedly to teach the originator (and/or)servicer, OneWest, a lesson.
As is too common lately, sadly, the couple had fallen behind on their mortgage due to health issues and a change in their interest rate. The bank had refused to refinance. So, after slamming the bank for its “harsh, repugnant, shocking and repulsive” acts, he issued the bombshell decision.
The mortgage is hereby cancelled, voided, nullified, set aside and is of no further force and effect.
(Side note: Doesn’t that sound like the Jackie Chiles character on Seinfeld – the parody of Johnnie Cochran?)
In watching the video on the story, it also sounds as though they may have stripped equity through a refi at some point. For some reason the news doesn’t really go into those details. But, is using our home as an ATM really our fault? (Yes, that’s snark-casm)
WTH, Your Honor?
What rule of law can he possibly cite? While I am no legal wiz, I doubt it can possibly be upheld through appeals. Or, can a judge in NY essentially give away property legally owned by someone else? Whatever the answer, for the time being he has set a precedent.
He has also set into motion an action that will require the lender/servicer to accrue massive legal fees in appeal as will others when like lawsuits begin to pop up.
Will this start a landslide of “my-lender-was-mean-to-me-because-I-couldn’t-pay” lawsuits?