The United States District Court for the Southern District of Florida recently granted defendant mortgage company’s motion to dismiss plaintiff’s complaint alleging, inter alia, violations of the Real Estate Settlement Procedures Act, 12 U.S.C. §2605(k) (“RESPA”) and the Fair Debt Collection Practices Act, 15 U.S.C. §§1692e, 1692f (“FDCPA”), because she failed to provide defendants with notice of the alleged issues and an opportunity to cure, as required under the mortgage. See Sandoval v. Ronald R. Wolfe & Assocs., P.L., 2017 WL 244111 (S.D. Fla. 2017). In the case, plaintiff purchased a home in Florida through a loan from the defendant mortgage company, secured by a mortgage on the property. Plaintiff allegedly defaulted and defendant law firm initiated a foreclosure lawsuit against plaintiff. Plaintiff hired counsel to defend her in the foreclosure lawsuit, and plaintiff’s counsel mailed the mortgage company a request for information. The mortgage company, through the law firm, responded to plaintiff’s request and sent a reinstatement letter advising plaintiff that if she wished to avoid foreclosure, she must comply with the requirements for reinstatement of her loan. Included in these requirements were charges for estimated amounts to reinstate her mortgage and avoid foreclosure, which included over $1,000 in service of process costs and $250 for a future filing. Plaintiff alleges that defendants sought and collected unlawful estimated attorneys’ fees and service of process fees from plaintiff, in violation of RESPA and the FDCPA, as well as Florida state law. The mortgage company moved to dismiss.
The Court granted the mortgage company’s motion to dismiss for several reasons. Primarily, the Court agreed with defendant’s argument that plaintiff failed to allege compliance with a contractual condition precedent prior to filing the lawsuit. Specifically, the mortgage required plaintiff to give the mortgage company notice and an opportunity to cure prior to initiating any action. Therefore, all of plaintiff’s claims were fundamentally deficient due to plaintiff’s failure to comply with the necessary contractual condition precedent. The Court also found that the reinstatement letter timely provided plaintiff, in writing and in a clear and conspicuous manner, with the requested information and contact information for further inquiry, and therefore was in compliance with RESPA. Finally, the Court found that the mortgage company is not a debt collector for purposes of FDCPA liability because it is the original creditor.