A California homeowner's battle to save his property from foreclosure has hit a significant legal roadblock. Raul Vasquez filed a complaint against National Default Servicing Corporation (NDSC), Select Portfolio Servicing, Inc. (SPS), and U.S. Bank, N.A., in the Court of Appeal of the State of California, First Appellate District, Division Three on June 21, 2024.
Raul Vasquez alleged that these entities violated the Homeowner Bill of Rights (HBOR) and the Unfair Competition Law (UCL) during the processing of his loan modification application. Vasquez's legal struggle began when he defaulted on his loan in 2008 after purchasing property in San Francisco in 2000. By 2012, SPS had taken over servicing his loan, and by 2014, NDSC recorded a notice of default. Despite submitting an application for mortgage assistance under the federal Making Home Affordable Program in October 2015, Vasquez faced continuous demands for additional documentation from SPS until April 2017.
In April 2017, NDSC recorded a notice of trustee’s sale for Vasquez's property, which was eventually sold at a foreclosure sale in May 2017 to U.S. Bank for over $1 million. In response, Vasquez filed a lawsuit alleging violations including preforeclosure contact requirements and dual tracking protections under HBOR as well as claims under UCL.
During a two-day bench trial, it was revealed that SPS repeatedly requested documentation from Vasquez to complete his loan modification application but deemed it incomplete due to missing verification of rental income among other documents. Despite multiple extensions and accommodations offered by SPS—including accepting money orders instead of bank statements—Vasquez failed to provide all necessary documents within specified timeframes.
The trial court found that because Vasquez did not submit a "complete" application as required by section 2923.6 of HBOR, he was not entitled to dual tracking protections which prevent foreclosure while a loan modification is pending. Additionally, the court concluded there was no violation of UCL since there was no predicate violation of HBOR.
Vasquez argued that SPS acted unreasonably by requiring documents he could not provide due to lacking a bank account and suggested that SPS should have accommodated him further given his efforts to obtain a loan modification. However, substantial evidence supported the court’s findings that defendants were clear about their requirements and provided reasonable opportunities for compliance.
Ultimately seeking injunctive relief and restitution under UCL along with declaratory relief pursuant to section 2924.12, Vasquez’s claims were dismissed as the court affirmed judgment in favor of NDSC and other defendants.
Representing Raul Vasquez was attorney Marc Voisenat while Patrick Pittman testified on behalf of SPS during trial proceedings overseen by Acting Presiding Judge Fujisaki along with Judges Petrou and Rodriguez under Case ID A167590.