Consumer complaint received 2024-02-01
Company: Specialized Loan Servicing Holdings LLC
State: IL
Product: Mortgage
Sub-product: Conventional home mortgage
Issue: Struggling to pay mortgage
Sub-issue: Trying to communicate with the company to fix an issue related to modification, forbearance, short sale, deed-in-lieu, bankruptcy, or foreclosure

Complaint:
Issue of Bad Faith and Fair Dealing -- I believe timely notifications were not made on loan transfers. Borrower continued to negotiate modifications with SLS when they did not presumably own the loan. Proving this statement with the dates of transfers : XXXX XXXX to SLS XX/XX/XXXX ; XXXX XXXX to XXXX XX/XX/XXXX ; SLS to XXXX XX/XX/XXXX ; and dates of loss mitigation letters : XX/XX/XXXX [ Exhibit XXXX ]. Notifications of these assignments were not sent to Borrower as requires by RESPA -- 12 CFR Part 1024. As a matter of law, Bank was required to send these notice [ Exhibit 7 ] was untimely. 

Notifications were not sent within 30 day and resulted in violation of RESPA requirements. Also 12 CFR 1024.33 says transferee servicer shall provide the notice of transfer to the borrower not more than 15 days after the effective date of the transfer. No such notice from XXXX was received. 

Borrower was engaged in loss mitigation with Specialized Loan Servicing during the period that they were not the owners of the mortgage which is an indication of bad faith and unfair dealing. 

If the case were valid, notification of transfers was not given, and continued negotiation with an entity not party to the loan at that time, made it impossible for the borrower to negotiate a plan to keep home or other resolution in case. Therefore, the case must be dismissed. 

Specialized Loan Servicing made incorrect transfers to where XXXX Does Not Have the Right to Foreclose Because Their Transfer of the Note is Invalid. 

In XXXX versus XXXX -- " where a promissory note goes a deed of trust must follow, the deed and a note can not be separated '' so there is no clear chain of title. 83 U.S. 271. In Bank XXXX XXXX XXXX XXXX XXXX, XXXX, XXXX IL App ( XXXX ) XXXX, the court held that in challenging a Bank 's standing, a borrower can not attack the " sufficiency '' of an assignment but is limited to asserting that an assignment is void. Assignment to XXXX occurred after the mortgage was assigned to Specialized Loan Services. XXXX XXXX XXXX made invalid assignments to Specialized Loan Servicing as recorded at the XXXX XXXX XXXX XXXX XXXX on XX/XX/XXXX document number XXXX and later made assignment same assignment to XXXX XXXX XXXX XX/XX/XXXX document number XXXX. Also, no address was recorded. Specialized Loan Servicing then made same loan assignment to MCLP on XX/XX/XXXX document number XXXX also recorded at the XXXX XXXX XXXX XXXX XXXX. XXXX XXXX XXXX XXXX XXXXXXXX XXXX XXXXXXXX, XXXX XXXX XXXX ( XXXX XXXX. XXXX ), holds that under Illinois law only the holder of a note may foreclose on property. Transferring a mortgage is not enough by itself to confer the right to foreclose upon property. The XXXX XXXX could not prove it was a note holder, and therefore it was not entitled to foreclose. ( XXXX ILCS XXXX ) Sec. XXXX. This could also constitute an unlawful clouding of title. ( a ) Any person who intentionally records or files or causes to be recorded or filed any document in the office of the recorder or registrar of titles of any county of this State that is a cloud on the title of land in this State,. 

False Certificates are Punishable. Pursuant to XXXX ILCS XXXX If any officer, clerk, secretary, cashier, or other person authorized to certify copies of any papers, entries, records or ordinances, knowingly makes a false certificate, he or she is punishable in the same manner as if he or she were guilty of perjury. ( See alsoXXXX XXXX XXXX XXXX ( b ) ) This warns against presenting false information. Since the case was not filed according to law making it an invalid filing and the case has errors in the consistent use a vital word paramount to the interpretation of the case, then this case should not continue because the outcome of the case is flawed by these errors. As a result, the case should be dismissed. ( Information access error fact : Due to an error in the Recorders office website, these transfers were not displayed by the system under certain conditions so this issue could not be raised prior to recent proceedings. [ EXHIBIT 8 ] ) Bank may try to argue that XXXX XXXX ILCS XXXX ( a ). See also XXXX XXXX, XXXX XXXX XXXX XXXX XXXX XXXX XXXX. XXXX XXXX, XXXX ( XXXX Dist. XXXX ) ( The XXXX XXXX XXXX clearly provides for substitution of parties where there has been a transfer of interest or liability occurring after the commencement of a cause or proceeding. " However, the information concerning the invalid transfers was not privy to the court. There is also an error with the Recorders office website displaying this data. ( See Exhibit XXXX ) Cloud on the Title as mortgage assignments denote violation of Uniform Deceptive Trade Practices Act XXXX ILCS XXXX ( XXXX ) passes off goods or services as those of another ; ( XXXX ) causes likelihood of confusion or of misunderstanding as to the source, sponsorship, approval, or certification of goods or services ; ( XXXX ) causes likelihood of confusion or of misunderstanding as to affiliation, connection, or association with or certification by another ; Confusion on Who is the Bank -- Proof of this is in the filing of BANK 'S MOTION TO CONSOLIDATE AND SUBSTITUTE XXXX XXXX  on XX/XX/XXXX. Bank continued to believe substitution was necessary although substitution was unknowingly granted XX/XX/XXXX. 

No Servicer or Presumed Mortgage Holder was responsible for loan as the home incurred a Tax Lien on XX/XX/XXXX. XXXX XXXX XXXX purchased the taxes amid the confusion. This also supports the theory that the title is clouded and the transfers of the loan are invalid. [ Exhibit J of Motion to Dismiss ]. Again, the homeowner was not notified of transfers amid the confusion and ran the risk of losing home to a third-party superior lien. The Bank may try to use a defense for this assertion by stating that the Borrower owes $ XXXX on the taxes which would be a reasonable assertion if the loan was valid. Borrower asserts that with the aforementioned facts and knowing the original lender, XXXX XXXX XXXX does not exist as a mortgage lender. [ XXXX XXXX Is Backing Out Of The Mortgage Market - What Does It Mean For Homebuyers? XXXX XXXX XXXXXXXX XXXXXXXX last accessed XX/XX/XXXX ] This leads one to believe the loan had been discharged, illegally transferred, or left in a state of confusion with the cloud on the title. Further discovery would be required to gather more specific information concerning this. Furthermore, to preclude the argument that the Borrower is supposed to be responsible for the taxes, the current taxes due XX/XX/XXXX has already been paid by XXXX on XX/XX/XXXX. The Bank knew that the Borrower was taking responsibility of paying the taxes and also disputing their claim on the property after a Motion to Quiet Title was filed XX/XX/XXXX. Their payment is an effort to circumvent the Borrower from paying the tax. This again is another example of their effort to make it impossible to perform. Again The Impossibility of Performance doctrine excuses a contractual performance. Therefore, this case should be dismissed with prejudice. 

A Cloud of Bad Faith also is denoted by the mortgage assignments Proof of this is in the filing of BANK 'S MOTION TO CONSOLIDATE AND SUBSTITUTE XXXX XXXX  page XXXX footnote XXXX they admitted to an invalid mortgage transfer Out of an abundance of caution and in the interest of complete candor, XXXX XXXX made an invalid assignment to MCLP after it assigned its interest to Specialized Loan Servicing Also Attached Exhibits contain the Transfers in question. ; No payment of taxes. Errors exists in the transfer of the loan and note. Pursuant to 55 ILCS XXXX a fraud referral and review can be initiated. 

With the evidence presented one can conclude that there is no true owner of the transferred loan. This case should have been dismissed with prejudice. 

Invalid Calculations -The Principal Unpaid Balance is Invalid Principal Unpaid Balance changed from $ XXXX to {$210.00} k. Proof - XXXX XXXX XXXX SLS XXXX XXXX XXXX This also proves defense in previous pleadings that calculations were incorrect. If the case were valid, the loan would not be valid because of the discrepancy of the numbers. The invalid calculations have been the primary subject of dispute and it proves Borrowers claim that the calculations were invalid and have been invalid since the beginning of the case, thus making it impossible to know the true amount owed. As a result, the case should be dismissed with prejudice. 


Settlement Offers with no rights SLS did not engage in timely communication to evaluate options for a settlement or modification. Any questions concerning alternate mitigation methods were not given. They did not exhaust all mitigation methods to keep me in the home. I believe I was not properly considered for forgiving the loan due or any part of the loan due to the condition of the house. The house is full of mold and termites and should have been considered for further federal or local assitance for the Bank to recover their losses. 

Home value *House requires an estimated $ XXXX in repairs *Home has serious Termite/Carpenter ant damage and infestation *Home has Mold to unknown extent.

*Home foundation has cracks and sloping issues. Doors are misaligned. 
*Kitchen has major sloping in the floor which seems to require a new metal beam to correct. The wall behind sink has to be replaced. 
*Previous court ordered real estate agent did not want to sell home in its condition which has gotten further degraded over time. ( approx. XXXX ) *Any sale of home would be short and not bring in proceeds to pay off proposed loan amount. 



Another issue is the case filing is invalid since XXXX XXXX did not wait the 120 days of delinquency before filing. Under federal mortgage servicing law, the servicer can not start the foreclosure process by making the first notice or filing until the loan is more than 120 days overdue on the payments. [ 12 CFR 1024.41 ( f ) ] The 120-day rule is part of Regulation X and is overseen by the Consumer Financial Protection Bureau ( CFPB ). The CFPBs authority was granted under the Dodd-Frank Act and the Real Estate Settlements Procedures Act ( RESPA ). The rule says the first notice or first filing under a state 's foreclosure law can not occur until the mortgage is more than 120 days delinquent. With the forgoing evidence, the borrower will prove that the Bank violated this rule. Payments by Borrower were made by automatic payments from the bank. To confirm this occurrence, EXHIBIT E shows some of the letters indicating the funds being returned and shown to have been returned XX/XX/XXXX and XX/XX/XXXX. Exhibit D shows continued online payment XX/XX/XXXX, XXXX precluded the possibility of preventing the Borrower from paying the loan, minimizing delinquency, and preventing default. The cause of any presumed default would have been by the actions of XXXX XXXX preventing the payments. In XXXX vs XXXX, the XXXX held that the XXXX XXXX 's findings of fact were supported by competent evidence and that as a matter of law, " A party to a contract may not complain of the nonperformance of the other party where that performance is prevented by his own actions. A party can not take advantage of a condition precedent the performance of which he has rendered impossible. A party who deliberately prevents the fulfillment of a condition on which his liability under a contract depends can not take advantage of his own conduct and claim that the failure of the fulfillment of the condition defeats his liability. Delays and nonperformance while they amount to a failure to perform are excused where performance is prevented by the other party to the contract. XXXX XXXX XXXX XXXX XXXX, XXXX XXXX XXXX. XXXX XXXX, XXXX XXXX XXXX ( XXXX XXXX. XXXX XXXX ). Based on these facts, this case should not have been allowed. Thus, this entire case was improper from its inception and should not move forward be dismissed with prejudice. 
The effect of the Banks actions resulted in preventing the Borrower from the ability to restore performance to the loan. Additionally, a defense of Impossibility of Performance is warranted. The Impossibility of Performance doctrine excuses a contractual performance when it is rendered objectively impossible to perform either by operation of law or subject matter of the contract has been destroyed. Thus, the Banks refusal to take payments destroyed the subject matter, to enable performance. See XXXX XXXX XXXX XXXX XXXX XXXX XXXX XXXX, XXXX IL XXXX, XXXX doctrine can be also applied to a circumstance if there is an unanticipated circumstance that made the contract vitality different from what should reasonable have been a within the contemplation of the parties at the time of entering the contract. ( XXXX XXXX XXXX XXXX XXXX v. luxury XXXX XXXX XXXX XXXX, No. XXXX C XXXX, XXXX XXXX XXXX ( XXXX XXXX XX/XX/XXXX ). The Borrower believed that his employment and the economic conditions would improve or stay the same. No one expected the total devastation of the economy which resulted in millions of homeowners to default on their loans because of massive layoffs and elimination of whole job categories. Millions of jobs were sent overseas too. The borrower was among those affected. Accordingly, while an occurrence may render performance of contractual duties objectively impossible, this doctrine is not meant to be used in a claim for excused performance where the occurrence was foreseeable and/or could have been guarded against in a contract. The Borrower claims that he did everything in his power to continue paying as shown in exhibits stated in 1b above to avoid such an excuse.

These proceedings have errors because the Bank confuses terms such as Default to gain advantage with court. In this case the word Default in note means Missed payment whereas Default in Law 120 days delinquent in payments ( 12 CFR 1024.41 ( f ) ).

Also note : 203.556 Return of partial payments.

( a ) For the purpose of this section, a partial payment is a payment of any amount less than the full amount due under the terms of the mortgage at the time the payment is tendered, including late charges. 

( b ) Except as provided in this section, the mortgagee shall accept any partial payment and either apply it to the mortgagor 's account or identify it with the mortgagor 's account and hold it in a trust account pending disposition. When partial payments held for disposition aggregate a full monthly installment they shall be applied to the mortgagor 's account, thus advancing the date of the oldest unpaid installment but not the date on which the account first became delinquent.

Company public response: Company has responded to the consumer and the CFPB and chooses not to provide a public response
Company response to consumer: Closed with explanation