Hagens Berman Files Class-Action Suit Against Aurora Loan Services LLC

Hagens Berman Files Class-Action Suit Against Aurora Loan Services LLC

Hagens Berman Files Class-Action Suit Against Aurora Loan Services LLC


SAN JOSE, Calif., Aug. 20 /PRNewswire/ — A group of homeowners today filed a class-action lawsuit against Aurora Loan Services LLC, claiming the mortgage company duped them into paying tens of thousands of dollars each to have troubled mortgages reviewed by the company with promises of loan modifications, only to have their property foreclosed with little or no notice.

The suit states that Aurora reaped more than $100 million in what the court documents call “illicit profits” from the alleged scheme.

Filed in the U.S. District Court for the Northern District of California in San Jose, the suit seeks to represent homeowners who paid the Littleton, Colo.-based company money in exchange for the company’s help in ‘curing’ delinquent home mortgages.

In exchange for between three and six large monthly payments, Aurora said it would halt the foreclosure process and work with homeowners to restructure, modify or resell the loan, allowing homeowners a chance to keep their homes, the suit states.

“We intend to prove that Aurora’s workout plan was nothing more than a cynical ploy to take advantage of homeowners desperate to hold on to their homes,” said Steve Berman, managing partner of Seattle-based Hagens Berman Sobol Shapiro LLP and the attorney representing the proposed class.

The suit contends that, after a period of months, Aurora foreclosed on the homes without giving the borrowers any notice that their requests for loan modification were denied and without allowing borrowers access to any method for ending their loan deficiency, despite the provisions of the workout agreements.

The suit states that the workout agreements provided for four methods for ending loan deficiency: bringing the loan current, refinancing with another lender, modification of the terms of the loan at the discretion of Aurora and another workout option at the company’s discretion.

“The past three years have been tough enough on homeowners without them having to worry about being preyed upon by unscrupulous loan services,” Berman said.

The complaint outlines the stories of two married couples who engaged Aurora in an attempt to forestall foreclosure. The first couple, from San Jose, refinanced their home with a mortgage company in early 2006. Two years later, the couple suffered economic setbacks in the form of poorly performing investments and a temporary loss of work. In late 2009, the couple contacted Aurora and signed one of the so-called workout agreements.

Over the next several months, the couple paid a total of $33,500 in return for Aurora’s promise to work on modifying the terms of the loan, among other possible outcomes. In May 2010, the family was served with a Notice to Vacate, indicating their home had been sold in foreclosure. The family had received no prior notice that the foreclosure process had been completed. In addition, Aurora did not notify the family that it had been denied a loan modification, according to the complaint.

In another instance, a second San Jose couple refinanced their home in mid-2007. Two years later, the couple suffered financial hardship as a result of an illness and the death of a parent, which led to increased expenses and loss of income. In early 2009, the couple contacted Aurora and signed one of the company’s workout agreements, the complaint alleges.

Over the next several months, the family paid a total of $23,700 in return for Aurora’s promise to work on modifying the terms of their loan. Like the first couple, the family was served with a Notice to Vacate in late June 2010, signaling their home had been sold in foreclosure. The family was not told prior to receiving the notice that the foreclosure process on their home had begun, according to the complaint.

“We’ve heard of cases like this a lot over the last few years,” Berman said. “We’d like to bring struggling homeowners some sense of relief.”

The complaint, which can be found at www.hbsslaw.com/cases-and-investigations/aurora, accuses Aurora of negligent misrepresentation, unjust enrichment, breach of the implied covenant of good faith and fair dealing, violation of the California Unfair Business Practices Act and other violations of California law.

Hagens Berman believes the workout agreements were fraudulent in nature and seeks to have the agreements declared void. The firm also seeks an injunction against Aurora forbidding the company from continued offering of its deceptive workout agreements, restitution to be determined at trial, damages to be determined at trial and trial and attorneys’ fees.

If you entered into a so-called workout agreement with Aurora, you are encouraged to join this case.

About Hagens Berman

Seattle-based Hagens Berman Sobol Shapiro LLP is a consumer-rights class-action law firm with offices in San Francisco, Chicago, Boston, Los Angeles, Phoenix and Washington, D.C. Founded in 1993, HBSS continues to successfully fight for consumer rights in large, complex litigation. More about the law firm and its successes can be found at www.hbsslaw.com.

Contact: Mark Firmani, Firmani + Associates Inc., 206.443.9357 or mark@firmani.com

SOURCE Hagens Berman Sobol Shapiro LLP

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One Response to “Hagens Berman Files Class-Action Suit Against Aurora Loan Services LLC”

  1. Ronald Williams says:

    I am Ron Williams, the plaintiff in pro per against JP Morgan Chase Bank, a law firm and two individuals. USDC Nev. #2:10-cv-00118-PMP-PAL. Now on appeal under 10-16102. After reading Aloua v. Aurora Loan Services my faith in the justice system has been restored. The well reasoned decision that resolved the defendant’s motion shows that there is some integrity in our system. Our federal judge, apparently overly influenced by the pretigious Chase Bank, laid seize on our rights to prosecute our case in court. If you review our record you will see that the judge leaned over backwards to the point of falling on his bank to relieve Chase Bank and a local law firm from liability of our suit. Cutting to the chase, the judge declared that the note and trust deed naming Washington Mutual as beneficiary could be enforced by Chase Bank. There are no documents in the Record showing Chase Bank as being the transferee of any documents having to do with out note: assignments – whether servicer rights or any other legal or beneficial interests. The case was dismissed under 12(b)(6) after the Judge made findings in the defendants’ favor regarding standing to foreclose on our note. Again, there are no documents in the Record whatsoever that includes Chase and anything having to do with our note and trust deed. Motions were left not resolved when the judge dismissed our case. A particular false document that had been published by the defendants and presented as evidence in the Case was allowed to stand without comment from the judge. The illegality of the document was handled by the judge simply ignoring its presence and the fraudulent purpose it had been interposed by the defendants in the case. Our Case commenced prior to fraud and foreclosures on the part of major banks became popular. It was filed during Jan 2009.

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