Joining Multiple Plaintiffs to Fight Wrongful Lender Actions
Many homeowners feel personally responsible for their inability to pay their home mortgages, to get a loan modification or to resolve a problem with their lender. In fact, these homeowners are actually the victims of corporate actions by lenders that have destroyed the security of millions of families. If you are the victim of an action by your lender that affected you and others in a similar way, you may be eligible to join a mass joinder lawsuit.
Based on Lender Action
A joinder case must be based an action or series of actions by one defendant that damages many plaintiffs in a similar way. An example of this is a scheme by Mortgage servicers to name a shell company called Mortgage Electronic Registration Systems Inc. (“MERS”) as a beneficiary on your mortgage or Deed of Trust. Mortgage servicers have been creating MERS mortgages since the 1990s so that now approximately sixty percent (60%) of all mortgages and Deeds of Trust name MERS as a beneficiary.
You may have stopped paying your mortgage because an employee of your lender lied to you on the phone and told you that stopping payments was the only way to get a loan modification; you weren’t aware that person got a bonus for lying. Maybe another employee said you were “in review” for a loan modification when the servicing rights to your loan had already been switched to a new lender, which you did not realize until months later. You were probably extremely frustrated when the person helping with your modification was switched every three months so that you had to start all over again without realizing your lender has an automated system to do this. When these things happened, you knew they were wrong, but you didn’t know they were happening on a mass scale to millions of people at the same time they were happening to you. These are the types of lender actions on which we base mass joinder actions.
The California permissive joinder statute (Rule 20) is similar to the federal statute, which allows plaintiffs to join in one action if they assert a right to relief that arises out of “the same transaction, occurrence or series of occurrences” and there is “a question of law or fact common to all plaintiffs” that arises in the action.
What Is the Difference Between a Mass Joinder and a Class-Action Lawsuit?
A class action is different than a mass joinder lawsuit because it requires the class to be certified by the court and a law firm that will work on a contingency basis. Class actions are usually handled by large firms that can carry the costs of the lawsuit and reap the big rewards when the case settles. In class actions, attorneys’ fees are the first thing paid.
In a mass joinder lawsuit under Rule 20, clients all pay a reduced litigation fee and a modest monthly retainer to maintain their lawsuit. The only additional attorney fees collected are a portion of each client’s cash settlement if damages are received. If a client receives a loan modification as settlement of their action, they pay nothing additional to their attorneys.
In a mass joinder case, plaintiffs have many different stories of the way the lenders’ actions affected them, but the action for which the lender is being sued must be the same for everyone. If the court finds for the plaintiffs and agrees that the lender’s actions were wrongful, then individual facts and damages will be considered.
Mass Joinder Scams
You may have gotten a flyer in the mail from one of the many firms doing “mass tort” lawsuits. The fliers promise specific results such as principal reductions and lower interest rates. They promise damages for “predatory” lending and that they can “stop foreclosure” with a mass tort lawsuit. When you call the number on the flier, you are encouraged to “sign up” for the lawsuit based on an interview with a salesman. These salesmen make promises and give advice, which is called practicing law without a license and is forbidden by the California Bar Association. It may be months before you speak to an attorney, or you may never speak to one.
Despite the existence of scams, joinder actions can greatly benefit homeowners who hire a qualified attorney. Often, a lawsuit can cost too much for a homeowner already struggling to pay a mortgage or stop a foreclosure. A mass joinder case lets multiple plaintiffs join together to sue their lender, allowing the attorney to take on cases at a reduced fee so that everyone gets a day in court. Because of the complicated procedures involved with joinder cases, plaintiffs must absolutely engage experienced wrongful foreclosure attorneys to represent them. Even convincing a judge that plaintiffs should be properly joined requires strategic legal skills.
What to Look for When Choosing a Mass Joinder Lawyer
Like all foreclosure lawsuits, a mass joinder case is fact-specific, but a mass joinder case focuses on a specific action of the defendant. If you decide to join one of these lawsuits, you should know the action for which the lender is being sued. Some common actions of your lender appropriate for mass joinder may be:
- Corporate policy to fraudulently record assignments of mortgages years after they have actually been sold creating void assignments. See Glaski v. Bank of America, 218 Cal. App 4th 1079 (Cal App. 5th Dist. 2013)
- Corporate policy providing bonuses to employees to trick borrowers into foreclosure. Business and Professions Code §17200
- Corporate policy requiring employees to lie to borrowers about loan modification or be fired. Business and Professions Code §17200
- Corporate policy to transfer away millions of servicing rights while borrowers are in the middle of a modification. Business and Professions Code §17200
- Corporate policy to switch borrowers to a different loan modification specialist every three months so that they have to begin the process again with a new person. Business and Professions Code §17200
Homeowners should take the following steps when choosing an attorney for a mass joinder lawsuit:
- Choose an attorney licensed in your state.
- Check with the state bar association for disciplinary actions against the lawyer.
- Speak with the lawyer directly to learn more about the individual’s experience.
- Obtain an evaluation of your case to determine if joinder is right for you.
- Ask what action by the lender is common to all plaintiffs and on what basis they are qualifying you for the mass-joinder case.
Contact a Skilled Law Firm for Personalized Assistance
When you attempt to fight back against the big lenders, your choice of an attorney is critical. At Advocate Legal, our lawyers have years of experience in individual and mass joinder litigation and other real estate matters. To schedule an evaluation of your case, contact us online.