The Second Circuit recognized that in order to
aid mortgage servicers with the task of providing
consumers with timely information, RESPA’s
implementing regulations allow (but do not require)
servicers to establish a designated address for QWRs.
According to the Court, “[t]he nal rulemaking notice
for the operative regulation, Regulation X, explained
that if a servicer establishes a designated QWR
address, then the borrower must deliver its request
to that ofce in order for the inquiry to be a [QWR].”
The Second Circuit expressly agreed with the Tenth
Circuit in that “Regulation X’s grant of authority
to servicers to designate an exclusive address is a
permissible construction of RESPA.” Furthermore,
the Court explained that even if an employee of
CitiMortgage responded to the letters sent by Roth’s
attorney, the letters were not QWRs.
Additionally, Roth’s attorney argued that
CitiMortgage’s QWR address failed to comply with
the obligations of Regulation X in three ways. First,
Roth argued that the change in the QWR address
on the back of her mortgage statements and the
fact that other departments apparently handled her
lawyer’s letters suggested that CitiMortgage may not
have had just one exclusive QWR address as required
by Regulation X. The Court held that no authority
prevents a servicer from changing its QWR address,
and how Roth’s letters were handled was irrelevant if
the letters were not QWRs.
Second, Roth argued that the notice on the back of her
mortgage statements was not “separately delivered.”
The Court quickly dismissed this argument, holding
that 24 C.F.R. § 3500.21(e) does not prohibit a notice
of QWR address from being delivered along with
other mortgage information.
Finally, Roth argued that notice of CitiMortgage’s
QWR address was insufcient because it was
“buried in the ne print.” The Second Circuit
disagreed, however, pointing to the fact that
The Dodd-Frank Wall Street Reform and Consumer
Protection Act was enacted as a measure to promote
nancial stability and protection for consumers
through increased regulation of nearly every aspect
of the consumer nance industry. In the years
since its enactment, the Dodd-Frank Act has led to
signicant industry reforms and the promulgation of
numerous new laws and regulations. In an effort to
stay apprised of these signicant industry changes,
Burr & Forman’s Dodd-Frank Newsletter will serve
as a periodic update of recent case law, news, and
developments related to the Dodd-Frank Act.
---- RECENT CASES ----
RESPA
Roth v. CitiMortgage Inc., 13-3839-CV, 2014 WL
2853549 (2d Cir. June 24, 2014).
In
Roth v. CitiMortgage Inc.
, the Second Circuit held
that although the mortgagor’s attorney had sent
three letters to defendant CitiMortgage requesting
various mortgage related information sent by her
lawyer, the mortgagor’s RESPA claim was properly
dismissed on the basis that her lawyer’s letters were
not sent to CitiMortgage’s designated QWR address.
Accordingly, the requests were not QWRs under
RESPA and did not trigger CitiMortgage’s QWR
duties under RESPA.
In
Roth
, Defendant CitiMortgage Inc. serviced a second
residential mortgage for Plaintiff Patricia Roth. Roth
alleged, inter alia, that CitiMortgage’s responses to
request for information about her mortgage violated
RESPA. Since 2008, Roth had been in default and
made no payments on the mortgage. During 2011,
her attorney made the requests for information to
CitiMortgage that were the subject of this suit. The
district court dismissed Roth’s complaint for failure
to state a claim and, on appeal, the Second Circuit
afrmed.
JULY 2014
