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Kamara v. Columbia Home Loans

July 24, 2009


The opinion of the court was delivered by: McLaughlin, J.


This action arises out of the grant of a purchase money mortgage loan by Columbia Home Loans, LLC ("Columbia") to the plaintiff on December 6, 2006. The plaintiff alleges that the defendants induced her to obtain the loan by making false promises, and that the terms of the loan as revealed at the loan closing were different from those promised. The defendants are Columbia, OceanFirst Financial Corporation ("OceanFirst"), Fidelity Borrowing, LLC ("Fidelity"), Mortgage Electronic Registration Systems, Inc. ("MERS"), EMC Mortgage Corporation ("EMC"), and Bank of America, National Association ("Bank of America").

The complaint was filed on December 24, 2008. On March 10, 2009, the plaintiff filed an amended complaint. The amended complaint alleges violations of the following statutes: (1) the Federal Truth in Lending Act ("TILA"), as amended by the Home Ownership and Equity Protection Act ("HOEPA") (Count I); (2) the Federal Real Estate Settlement Procedures Act ("RESPA") (Count II); (3) the Federal Credit Services Act (Count III); (4) the Pennsylvania Unfair Trade Practices and Consumer Protection Law ("UTPCPL") (Count IV); (5) the Federal Fair Debt Collection Practices Act ("FDCPA") (Count V); (6) the Pennsylvania Fair Credit Extension Uniformity Act ("FCEUA") (Count VI); and (7) the Federal Equal Credit Opportunity Act ("ECOA") (Count VII). Columbia, OceanFirst, MERS, EMC, and Bank of America have moved to dismiss all claims against them.*fn1 For the reasons stated herein, the Court will grant their motions.

I. Facts as Alleged in the Amended Complaint

In 2006, the plaintiff sought to purchase a home. To finance the purchase, she needed to obtain a loan. To facilitate obtaining a loan, she went to Fidelity. At Fidelity, the plaintiff dealt with an individual named "Michael." Michael promised the plaintiff that he could secure a loan for her with better rates than she would be able to find on her own. He explained that there was a mortgage program for which she had been pre-approved. Through this program, the plaintiff could obtain a loan with an 8% fixed interest rate with monthly payments of $750 for a loan of $120,000. She was also promised 100% financing with no pre-payment penalty. Am. Compl. ¶¶ 25-31.

The loan closing took place on December 6, 2006. At the closing, the plaintiff discovered that the terms of the loan being offered to her by Columbia were not what Fidelity had promised. Instead, the terms included 85% financing, monthly payments of $952, a 10% interest rate, and other allegedly unfavorable terms. She also alleges that the loan involved an undisclosed "yield spread premium." The plaintiff called Fidelity to complain, as she could not afford these terms. Id. ¶¶ 25, 39-41, 60-62.

The plaintiff alleges that Fidelity induced her to sign the loan documents by promising her that it would assist her to obtain refinancing at better terms after the closing. Based on these representations, the plaintiff signed the loan documents at the closing on December 6, 2006. Id. ¶¶ 44-45.

Approximately one month after the closing, the plaintiff called Fidelity to inquire about the status of her refinancing. At that time, she was told that it was too early to refinance and that she would have to wait until at least six months after the closing to refinance. Six months after the closing, she again called Fidelity. According to the plaintiff, Fidelity did not respond to her repeated calls and messages.

Ultimately, to save her home, the plaintiff filed for bankruptcy. Id. ¶¶ 46-49, 56.*fn2

II. Analysis

As a preliminary matter, the plaintiff concedes that she is withdrawing all claims against OceanFirst. She also concedes withdrawal of her claim under RESPA, insofar as it pertains to a "qualified written request" ("QWR"), and of her claim under HOEPA. See Pl.'s Opp. 5. Those claims are therefore dismissed.

The defendants, with the exception of Fidelity, move to dismiss the remainder of the claims against them for failure to comply with the applicable statutes of limitations and/or failure to state a claim. The Court agrees and will dismiss all claims against the moving defendants.

A. Federal Pleading Standard

The current standard for adequately pleading a claim was set out in Bell Atlantic Corp. v. Twombly, 550 U.S. 544 (2007). Under Twombly, to state a claim, a party's factual allegations must raise a right to relief above the speculative level. Phillips v. County of Allegheny, 515 F.3d 224, 232 (3d Cir. 2008) (citing Twombly, 550 U.S. at 555). The Supreme Court recently reaffirmed and clarified the Twombly standard in Ashcroft v. Iqbal, 129 S.Ct. 1937 (2009). The Iqbal Court explained that although a plaintiff is not required to make ...

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