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Beverly L. Camat v. Federal National Mortgage Association; Bank of America

June 22, 2012

BEVERLY L. CAMAT,
PLAINTIFF,
v.
FEDERAL NATIONAL MORTGAGE ASSOCIATION; BANK OF AMERICA, N.A., SUCCESSOR IN MERGER TO BAC HOME LOANS SERVICING, LP, FKA COUNTRYWIDE HOME LOANS SERVICING, LP; BANK OF AMERICA, N.A.; BAC HOME LOANS SERVICING, LP.; COUNTRYWIDE HOME LOANS SERVICING, LP.; COUNTRYWIDE HOME LOANS, INC.; MORTGAGE ELECTRONIC REGISTRATION SYSTEMS, INC.; DOE DEFENDANTS 1-10, DEFENDANTS.



The opinion of the court was delivered by: Susan Oki Mollway Chief United States District Judge

ORDER DISMISSING SECOND AMENDED COMPLAINT WITH LEAVE TO AMEND

I. INTRODUCTION.

This removed action arises out of mortgage loan transactions. Plaintiff Beverly L. Camat asserts various causes of action relating to her mortgage loans and the non-judicial foreclosure of her home.*fn1 See Notice of Removal, Mar. 14, 2012, ECF No. 1.

Defendants seek dismissal of the Second Amended Complaint. See ECF No. 8. That motion is granted based on Camat's pleading deficiencies.

II. BACKGROUND.

Hoping to purchase a home in Hawaii Kai, on the island of Oahu, Hawaii, Camat contacted Countrywide Home Loans, Inc., about obtaining financing. See Second Amended Complaint for Wrongful Foreclosure and Quiet Title ¶¶ 3 and 13, Feb. 22, 2012, ECF No. 1-1. A Countrywide employee "introduced" Camat to Gilbert Borrego, a mortgage consultant with First Magnus Financial Corporation, which was apparently doing business as Charter Funding Mortgage. Id.

On May 8, 2007, Borrego prequalified Camat for loans of $769,000 and $785,100. The prequalification letters did not state any loan terms and did not promise that First Magnus would actually lend Camat money. Instead, the prequalifying letters noted that any actual loan was conditioned on, among other things, satisfaction of "underwriting criteria" and "[s]atisfactory income/asset documentation" before closing. Id.; see also Prequalifying Letters, ECF No. 1-1, PageID #s 28-29.

Camat says she relied on the prequalification letters in signing a Deposit Receipt Offer Acceptance and gave the sellers of the home she intended to purchase a nonrefundable $10,000 deposit. The purchase price of the home was $769,000. See Second Amended Complaint ¶ 14.

Camat alleges that she was "surprised" when, after she had signed the DROA, First Magnus told her the actual loan terms it was offering. Camat says she did not expect two loans totaling $769,000, or a combined monthly mortgage payment exceeding $4,000. Id. ¶ 15. Camat knew that, if she entered into those loans, her regular expenses and the monthly payments on the loans would exceed her monthly income. Id. ¶ 16. Camat alleges that she told First Magnus that she would be unable to make $4,000 monthly payments. Camat says that someone working for First Magnus told her that she would be able to refinance the loans at a lower rate in a few months. Id.

As the loan closing date approached, Camat says she was further surprised to learn that closing costs totaled $23,000. Id. ¶ 18.

On June 25, 2007, Camat closed on two loans. She executed a $615,200 note for loan number 4692521423. Id. ¶ 19; Interest-Only Period Fixed Rate Note, ECF No. 1-1, PageID #30. This note was secured by a mortgage filed in the State of Hawaii Bureau of Conveyances on June 29, 2007, as Document No. 2007-116555. See Mortgage, ECF No. 1-1, PageID #43.

The mortgage securing the $615,200 note lists First Magnus as the "Lender" and indicates that Mortgage Electronic Registration Systems, Inc. ("MERS"), "is a separate corporation that is acting solely as nominee for Lender and Lender's successors and assigns." Id., PageID #44. The mortgage states that Camat "does hereby mortgage, grant and convey to MERS (solely as nominee for [First Magnus and its] successors and assigns) and to the successors and assigns of MERS, with power of sale," the property that Camat purchased using the proceeds of the loan. Id., PageID #45. It then states that Camat understands and agrees that MERS holds only legal title to the interests granted by [Camat] in this Security Instrument, but, if necessary to comply with law or custom, MERS (as nominee for [First Magnus and its] successors and assigns) has the right: to exercise any or all of those interests, including, but not limited to, the right to foreclose and sell the Property; and to take any action required of [First Magnus] including, but not limited to, releasing and canceling this Security Instrument.

Id.

The closing instructions for the $615,200 loan indicated, "THIS IS A COUNTRYWIDE SPECIFIC PROGRAM REQUIRING OFF-SHEET PRICING." See Closing Instructions for Loan No. 4692521423, ECF No. 1-1, PageID #70.

Camat alleges that, also on June 25, 2007, she closed on a second loan. See Second Amended Complaint ¶ 19. As the parties agreed at the hearing on the present motion, the second loan was documented in a Home Equity Credit Line Agreement and Disclosure Statement for Loan No. 4079600763, with a credit limit of $115,350, that Camat signed. See ECF No. 1-1, Page ID #33. The $115,350 line of credit was secured by a mortgage filed in the State of Hawaii Bureau of Conveyances on June 29, 2007, as Document No. 2007-116556. See Mortgage, Security Agreement and Financing Statement, ECF No. 1-1, PageID #59. The mortgage lists MERS as the nominee for First Magnus. Id.

In letters dated July 11, 2007, First Magnus informed Camat that the "servicing of your mortgage, that is, the right to collect payments from you" for both loans was "being assigned, sold or transferred" to Countrywide Home Loans, Inc., effective August 1, 2007. See Notice of Assignment, Sale, or Transfer of Servicing Rights, July 11, 2007, ECF No. 1-1, PageID #74 and #75.

On or about August 21, 2007, First Magnus filed a Chapter 11 Bankruptcy Proceeding in the United States Bankruptcy Court for the District of Arizona. See ECF No. 1-1, PageId #89.

A public-access document attached to the Second Amended Complaint indicates that, as of May 30, 2008, First Magnus was in the process of dissolving. See ECF No. 1-1, PageID #92. The same document indicates that First Magnus was administratively dissolved on April 2, 2009. Id., PageID #94.

On February 27, 2009, an Assignment of Mortgage was filed in the State of Hawaii Bureau of Conveyances as Document No. 2009-030068. See ECF No. 1-1, PageID #83. Via this document, MERS, in its capacity as nominee of First Magnus, assigned the mortgage ...


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