California Real Estate Fraud Report

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12
Sep

OneWest Bank Coughs Out 7-Figure Settlement for Dual-Tracking in San Luis Obispo Foreclosure Lawsuit

A San Luis Obispo County couple who sued OneWest Bank, IndyMac Mortgage Services, U.S. Bank and GSR Loan Mortgage Trust has received a million-dollar-plus settlement and title to two of their houses that were foreclosed.

The case brought by Greg Rigali and Irene Rigali of Shell Beach could embolden other homeowners who have lost their homes to foreclosure to sue banks for the common practice of “dual tracking.” Dual tracking occurs when banks pursue foreclosure against homeowners in default while at the same time giving those homeowners the false belief they are working with them.

At the time their two homes were foreclosed the Rigalis thought they were negotiating with OneWest Bank to obtain mortgage modifications.

Rik Tozzi, an Alabama attorney, arrived in San Luis Obispo last May for a hearing on a motion to grant summary judgment to OneWest Bank. Instead of walking away with a win for his client, he listened as San Luis Obispo Superior Court Judge Charles S. Crandall said that the Rigalis had shown enough evidence to substantiate their claims of fraud, wrongful foreclosure, unfair business practices, quiet title, and intentional infliction of emotional distress to allow their case to go before a jury trial.

OneWest, which quickly settled, had picked up the original loan modification negotiations begun by IndyMac before it collapsed and was acquired by Steve Mnuchin and his investors for a steal at $1.55 billion. IndyMac had invited the Rigalis to modify the mortgages on both homes, including suspending or reducing their payments. OneWest sent a letter that included the following solicitation:

“Because you are a valued customer, we want to help you stay in your home. Reduce your monthly payment of principal and interest and bring your loan current.”  And “we propose to permanently modify your mortgage, bring past-due payments current, and provide you with an affordable monthly payment.”

But while the Rigalis were making payments in accordance with a June 2009 agreement with OneWest Bank, another division in the bank was beginning foreclosure, hence the dual tracking.

In July 2009, OneWest Bank assigned the Rigali’s trust deed to U.S. Bank, which foreclosed on their beach house property two months later, in September. The Rigalis then sued.

Greg and Irene Rigali were represented by attorneys Maria L. Hutkin and Jude J. Basile.

Read the original article in CalCoastNews.

© Copyright 2007-2017 Monique Bryher

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