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Rountree v. Nationstar Mortgage LLC

United States District Court, E.D. Michigan, Southern Division

September 11, 2017

LIN ROUNTREE, Plaintiff,
v.
NATIONSTAR MORTGAGE LLC and FEDERAL NATIONAL MORTGAGE ASSOCIATION, Defendants.

          OPINION AND ORDER GRANTING DEFENDANTS' MOTION TO DISMISS [16] AND DISMISSING THE CASE

          STEPHEN J. MURPHY, III UNITED STATES DISTRICT JUDGE.

         Plaintiff resides at 21817 Whittington, Farmington Hills, MI (the Property). Defendant Nationstar owns the mortgage on the Property and Defendant Federal National Mortgage Association (Fannie Mae) holds a sheriff's deed on the Property. Plaintiff filed an eight-count complaint and Defendants now move to dismiss it. A temporary restraining order (TRO) is currently in place, but will expire on the same day that the Court will issue this Order. For the reasons below, the Court will not further extend the TRO, but will instead grant the motion and dismiss the case.

         BACKGROUND

         Plaintiff purchased the Property in 2006 and obtained a warranty deed and a mortgage on the home. ECF 1-2; PgID 33-34. Apparently Plaintiff ran into financial difficulties and by October 2015 he was behind on two mortgage payments. ECF 18, PgID 392. Nationstar allegedly invited Plaintiff to apply for a loan modification, and on October 13, 2015, Nationstar sent him a letter that informed him he was "eligible for a Loan Modification Agreement, which [would] permanently change the terms of [his] mortgage." ECF 1-2, PgID 58. The letter stated that if Plaintiff "compli[ed] with the terms of the required Trial Period Plan, " Nationstar would modify his mortgage and might "waive all prior late charges that remain unpaid." Id. The letter instructed Plaintiff to sign and return two copies of an attached agreement by October 23, 2015 and to "[m]ake all remaining trial period payments on or before the dates they are due." Id. Plaintiff claims he returned the signed agreements on October 22, 2015 and that Nationstar confirmed receipt over the phone.

         Plaintiff avers there was a "glitch" in Nationstar's system, so around January 2016, Nationstar told him to submit updated financial information, which he claims he did. ECF 1810, PgID 474. But on February 16, 2016, Nationstar sent him another document that differed from the documents purportedly sent in October 2015. The February documents included a "Borrower Assistance Form" that directed the borrower to provide verifying financial documents "to be considered for available solutions." ECF 1-2, PgID 77. Unlike the copies of the October documents provided to the Court, the February documents are completed, signed, and dated February 21, 2016. Id. at 77-84.

         At that point, Plaintiff's version of the timeline becomes slightly unclear. From the Response brief and the affidavit upon which it relies, it seems that Plaintiff was "accepted in the Trial Payment Program ('TPP')" following his submission of the completed February documents, made three payments under the TPP that corresponded to October, November, and December 2015.[1] ECF 18, PgID 393. Nationstar[2] then directed Plaintiff to make a fourth payment and Plaintiff complied, but Nationstar rejected the payment. Id. Nationstar also "failed to execute the Loan Modification Agreement" and discussions about modifying the loan began in August 2016. Id.

         What is crystal clear is that on August 12, 2016, Nationstar sent Plaintiff a letter. It informed Plaintiff that Nationstar was unable to grant his request for assistance and specifically listed three programs for which he had been declined. ECF 1-2, PgID 86. The letter also listed possible alternatives Plaintiff might be able to pursue, including reinstatement. Id. Plaintiff claims he "attempted in good faith to implement the Loan Modification Agreement and reinstate the loan" but has been unsuccessful. ECF 18, PgID 393.

         Nationstar finally foreclosed on Plaintiff's home in January 2017 and Defendant Fannie Mae purchased the home at a sheriff's sale the next month. ECF 1-2, PgID 36-43. The redemption period would have ended on August 21, 2017, but the Court stayed the expiration date. ECF 15, 17.

         STANDARD OF REVIEW

         Federal Rule of Civil Procedure 12(b)(6) provides for dismissal of a complaint for failure to state a claim upon which relief can be granted. Fed.R.Civ.P. 12(b)(6). The Court may only grant a 12(b)(6) motion to dismiss if the allegations are not "sufficient 'to raise a right to relief above the speculative level, ' and to 'state a claim to relief that is plausible on its face.'" Hensley Mfg. v. ProPride, Inc., 579 F.3d 603, 609 (6th Cir. 2009) (quoting Bell Atl. Corp. v. Twombly, 550 U.S. 544, 555, 570 (2007)). In evaluating the motion, the Court presumes the truth of all well-pled factual assertions. Bishop v. Lucent Techs. Inc., 520 F.3d 516, 519 (6th Cir. 2008). Moreover, the Court must draw every reasonable inference in favor of the non-moving party. Dubay v. Wells, 506 F.3d 422, 427 (6th Cir. 2007). But a "pleading that offers 'labels and conclusions' or 'a formulaic recitation of the elements of a cause of action will not do.'" Ashcroft v. Iqbal, 556 U.S. 662, 678 (2009) (quoting Twombly, 550 U.S. at 555).

         DISCUSSION

         Count One - Quiet Title

         Plaintiff asserts that Defendants knew he was trying to enter into a loan modification agreement but they intentionally acted to preclude him from doing so. ECF 1-2, PgID 16-17. Consequently, the Property is currently in Fannie Mae's name. Id. In response, Defendants emphasize that quieting title is a remedy, not a stand-alone cause of action and further, Plaintiff has failed to satisfy the statutory prerequisites to quiet title. ECF 16, PgID 335-36.

         Michigan law permits "[a]ny person . . . who claims any right in, title to, equitable title to, interest in, or right to possession of land" to bring a quiet-title action "against any other person who claims or might claim any interest inconsistent with the interest claimed by the plaintiff[.]" Mich. Comp. Laws § 600.2932(1). To succeed, a plaintiff must allege "(a) the interest the plaintiff claims in the premises; (b) the interest the defendant claims in the premises; ...


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