Searching over 5,500,000 cases.


searching
Buy This Entire Record For $7.95

Download the entire decision to receive the complete text, official citation,
docket number, dissents and concurrences, and footnotes for this case.

Learn more about what you receive with purchase of this case.

Tepper v. Amos Financial, LLC

United States District Court, E.D. Pennsylvania

August 9, 2017

JAMES TEPPER and ALLISON TEPPER, Plaintiffs,
v.
AMOS FINANCIAL, LLC, Defendant.

          DECISION

          Joyner, J.

         This action, which Plaintiffs brought pursuant to the Fair Debt Collection Practices Act (“FDCPA”), 15 U.S.C. § 1692, et seq., was tried non-jury before the undersigned on April 5, 2017. The parties have submitted their proposed factual findings and legal conclusions and the matter is now ripe for adjudication. Having carefully considered all of the evidence, we now make the following:

         FINDINGS OF FACT

         1. Plaintiff James Tepper (“Mr. Tepper”) is an adult individual and citizen of the Commonwealth of Pennsylvania residing at 2111 Spring Garden Street, Philadelphia, Pennsylvania. (N.T. 4/5/17, at p. 7).

         2. Plaintiff Allison Tepper (“Ms. Tepper”) is an adult individual and citizen of the Commonwealth of Pennsylvania also residing at 2111 Spring Garden Street, Philadelphia, Pennsylvania. Ms. Tepper is married to Mr. Tepper. Id.

         3. Plaintiffs own the home at 2111 Spring Garden Street (the “Tepper Residence”). Id.

         4. Defendant Amos Financial, LLC (“Amos”) is a limited liability company existing and operating under the laws of the State of Illinois, having an office and principal place of business at 3330 Skokie Valley Road, Suite 301, Highland Park, Illinois. (Plaintiffs' Complaint (“Compl.”), Doc. No. 1, at ¶ 2; Defendant's Answer, Doc. No. 3, at ¶ 2). Amos is exclusively in the business of acquiring and servicing non-performing and semi-performing consumer and commercial loans. (N.T., 4/5/17, at p. 135). Amos first registered to do business in Pennsylvania on October 25, 2015. Pl. Ex. 31.

         5. On November 27, 2009, the Plaintiffs entered into a home equity line of credit (the “Tepper Loan”) with NOVA Bank by executing the Credit Agreement and Disclosure (the “Credit Agreement”). (Credit Agreement, Plaintiffs' Exhibit (“Pl. Ex.”) 1; Joint Pretrial Memorandum, Doc. No. 24, at pp. 1-2). The purpose of the Tepper Loan was for personal, family, and household purposes or personal investment purposes. The Tepper Loan was secured by a mortgage (the “Mortgage”) on the Tepper Residence. (Doc. No. 24, at pp. 2, 10).

         6. The Credit Agreement provides for a variable interest rate with a floor and a ceiling, based on an index published in the Wall Street Journal or, if such an index were to become unavailable, a different index chosen by NOVA Bank. Id. The Credit Agreement requires the Teppers to make minimum monthly payments in the amount of the interest accrued for each month. Id. The method of calculating minimum monthly payments under the Credit Agreement is based on the outstanding daily principal, number of days in a given month, advances made to the Plaintiffs, and payments made by the Plaintiffs. Id. If the Plaintiffs make a payment in excess of the minimum monthly payment, such excess would be applied to the Tepper Loan principal. Id. All unpaid Tepper Loan principal would have to be paid in one balloon payment upon maturity of the Tepper Loan. Id.

         7. The Credit Agreement provides for the possibility of an increase to the interest rate:

Rate Increase. In addition to our other rights during termination and acceleration, we may increase the variable ANNUAL PERCENTAGE RATE under this Agreement to 5.000 percentage points over the then applicable ANNUAL PERCENTAGE RATE. The ANNUAL PERCENTAGE RATE will not exceed the maximum rate permitted by applicable law. If we do not increase the ANNUAL PERCENTAGE RATE upon termination or acceleration of your Credit Line Account, it will continue at the variable rate in effect as of the date of termination or acceleration of your Credit Line Account.

         (Pl. Ex. 1).

         8. The Credit Agreement makes multiple references to “periodic statements” and “statement cycle.” (Doc. No. 24, at pp. 2, 10). For example, with regard to checks provided to the Plaintiffs by NOVA Bank under the Credit Agreement, and the Plaintiffs' use of such checks, the Credit Agreement states: “We may choose not to return NOVA BANK Credit Line Checks along with your periodic statements; however, your use of each NOVA BANK Credit Line Check will be reflected on your periodic statement as a credit advance.” Id. With regard to calculating finance charges, which are the minimum monthly payments under the Credit Agreement, the Credit Agreement provides the following method:

A daily FINANCE CHARGE will be imposed on all credit advances made under your Credit Line imposed from the date of each credit advance based on the “average daily balance” method. To get the average daily balance, we take the beginning balance of your Credit Line Account each day, add any new advances and subtract any payments or credits and any unpaid FINANCE CHARGES. This gives us a daily balance. Then, we add up all the daily balances for the statement cycle and divide the total by the number of days in the statement cycle. This gives us the “average daily balance.”

(Doc. No. 24, at pp. 2-3, 10). The Credit Agreement specifically provides that “your [the Plaintiffs'] most current periodic statement is the best evidence of your [the Plaintiffs'] obligation to pay.” Id.

         9. The Plaintiffs began receiving monthly statements from NOVA Bank after the execution of the Credit Agreement. (N.T. 4/5/17, at p. 12). The monthly statements sent by NOVA Bank to the Plaintiffs provided the details regarding the Tepper Loan, such as the principal amount of the Tepper Loan, the minimum monthly payment due, the interest rate used to calculate the minimum monthly payment, the changes to the interest rate during the month, the number of days during which the applicable interest rate was used to calculate the minimum monthly payment, any amounts past due, and any late charges. See id. at pp. 12-13; Pl. Ex. 8.

         10. During the time period when NOVA Bank serviced the Tepper Loan, the minimum monthly payments differed from month to month. (N.T. 4/5/17, at p. 18). Plaintiffs sometimes made monthly payment in an amount greater than the minimum monthly payment. Id.; Pl. Ex. 7. Pursuant to the Credit Agreement, the amounts of the monthly payments made by the Teppers in excess of the minimum monthly payment amounts were applied to the Tepper Loan principal.

         11. On October 26, 2012, the Pennsylvania Department of Banking and Securities closed NOVA Bank, and the Federal Deposit Insurance Corporation (“FDIC”) was appointed as receiver for NOVA Bank. (Doc. No. 24, at pp. 3, 11).

         12. After NOVA Bank's closure, the Plaintiffs stopped receiving monthly statements regarding the Tepper Loan. (N.T. 4/5/17, at p. 14).

         13. FDIC sent the Plaintiffs two letters informing them of NOVA Bank's closure, FDIC's role as receiver, and FDIC's intention to market and sell all of NOVA Bank's assets, including the Tepper Loan. Id. at pp. 19-20; Pl. Exs. 9-10.

         14. Sometime after being contacted by FDIC, Mr. Tepper mailed a check to FDIC for the amount of the last monthly payment sent to NOVA Bank. (N.T., 4/5/17, at pp. 23-25). That check was neither cashed nor returned. Id. at p. 24.

         15. In lieu of sending further payments, Plaintiffs thereafter waited for their next periodic statement, which Mr. Tepper believed would be forthcoming from whatever bank acquired the Tepper Loan out of the FDIC receivership. Id.

         16. On January 16, 2013, FDIC declared the Tepper Loan to be in default. Pl. Ex. 11. FDIC sent Mr. Tepper a letter informing him that the Tepper Loan was in default. Id.

         17. On March 28, 2013, Amos purchased the Tepper Loan by exercising a Bill of Sale for a loan package containing the Tepper Loan. See Pl. Exs. 4-5. The Mortgage securing the Tepper Loan was likewise assigned by FDIC to Amos. See Pl. Ex. 6; Doc. No. 24, at pp. 4, 11.

         18. At the time of the purchase, Amos considered the Tepper Loan to be in default. (Doc. No. 24, p. at 19).

         19. By letter dated March 28, 2013, FDIC informed Mr. Tepper that the service of the Tepper Loan was being transferred from FDIC as Receiver for NOVA Bank to Amos effective April 12, 2013. Id. at 27; Pl. Ex. 12 (the “FDIC Assignment Letter”). The FDIC Assignment Letter provided contact information for Amos and instructed that all payments on the Tepper Loan would need to be sent to Amos. Pl. Ex. 12.

         20. No information regarding principal, accrued interest, or applicable interest rate was provided in the FDIC Assignment Letter. See Pl. Ex. 12.

         21. On June 5, 2013, Amos sent a letter to the Plaintiffs (the “First Amos Letter”), wherein Amos provided the following information regarding the Tepper Loan:

The records of [NOVA] Bank indicate that you executed and delivered to the Bank a Credit Agreement and Disclosure (the “Credit Agreement”) dated November 27, 2009, in the principal amount of $150, 000.00 (the “Loan”) Amos Financial LLC is now the owner and holder of the Credit Agreement and the Loan, also identified by the Loan Number 75000710-6. . . .
Your loan is presently past due. Pursuant to the terms of the Credit Agreement your regular monthly payment is equal to amount of your accrued finance charges. As of May 10, 2013, your loan had $3, 897.25 in accrued finance charges. The amount necessary bring [sic] your loan current through May 10, 2013 is $3, 897.25. This amount does not include the next regularly scheduled monthly payment of $573.73 which is due on June 10, 2013. Thereafter your regular monthly payments will be due on the 10th of each month. Please continue to make regular monthly payments of $573.73 until you are notified by us that the interest rate and the amount of your regular monthly payments have changed.

(Pl. Ex. 13) (emphasis in original).

         22. On July 24, 2013, Amos sent another letter (the “Second Amos Letter”), wherein Amos provided only the following information regarding the Tepper Loan:

In a letter dated June 5, 2013 you received notice that your account was delinquent and that you were required to pay $3, 897.25 to bring your account current through 5/10/13. We never received the payment of $3, 897.25. We also have not received your monthly payments of $573.73 that were due on June 10, 2013, and July 10, 2013. Your failure to pay the Credit Agreement within its terms constitutes a default under the Credit Agreement and Loan Documents. In order to bring your account current though July 10, 2013, you need to mail us a check for $5, 044.71. If you fail to bring your account current within 30 days of the date of this letter, we will declare your loan to be in default. If we declare a default, then your interest rate under the loan will increase by an additional 5% to 9.49% pursuant to the terms of the Credit Agreement, and we reserve the right to exercise any other remedies under the terms of the Credit Agreement or applicable law. We urge you to give this matter your immediate attention. Please contact us at your earliest convenience to let us know when we will receive payment and the amount you will be sending.

(Pl. Ex. 14) (emphasis in original).

         23. On September 20, 2013, Amos sent yet another letter to the Plaintiffs (the “Third Amos Letter”), wherein Amos provided the following information regarding the Tepper Loan:

The records of [NOVA] Bank indicate that you executed and delivered to the Bank a Credit Agreement and Disclosure (the “Credit Agreement”) dated November 27, 2009, with a revolving credit line in the principal amount of $150, 000.00 (the “Credit Line”). Amos Financial LLC is now the owner and holder of the Credit Agreement and the Credit Line, also identified by the Loan Number 75000710-6. . . .
In a letter dated July 24, 2013 you received notice from Amos Financial LLC that if you failed to bring your account current within 30 days, that Amos Financial LLC would declare your loan to be in default, and that your interest rate under the loan would increase by an additional 5% to 9.49% pursuant to the terms of the Credit Agreement. Your failure to pay the Credit Agreement within its terms constitutes a default under the Credit Agreement, the Credit Line and the Loan Documents. You are hereby notified that Amos Financial LLC has declared your loan to ...

Buy This Entire Record For $7.95

Download the entire decision to receive the complete text, official citation,
docket number, dissents and concurrences, and footnotes for this case.

Learn more about what you receive with purchase of this case.