Email this page Print-Friendly PDF
Print this page
Consumer Financial Services Alert
Eleventh Circuit Rejects Liability under HAMP for Loan Servicers

The Eleventh Circuit affirmed a lower court’s decision rejecting liability for servicers under the federal Home Affordable Modification Program for failing to extend a permanent loan modification. After experiencing financial difficulties, plaintiff sought and received a temporary loan modification. After approximately a year under the temporary loan modification program, the servicer notified plaintiff that it would not permanently extend the loan modification.  Plaintiff filed suit alleging the servicer failed to comply with its obligations under HAMP by declining to issue him a permanent loan modification.

In upholding the lower court’s decision, the Eleventh Circuit held that neither the Emergency Economic Stabilization Act of 2008 nor HAMP “expressly create a private right of action for borrowers against loan servicers.”  The Eleventh Circuit also held that there was no implied right of action under HAMP, using the factors articulated in Hempispherx Biopharma, Inc. v. Johannesburg Consol. Inves., 553 F.3d 1351, 1362 n. 14 (11th Cir. 2008). Click here for the opinion.

Related Practices

Consumer Financial Services

© 2016 Goodwin Procter LLP. All rights reserved. This informational piece, which may be considered advertising under the ethical rules of certain jurisdictions, is provided with the understanding that it does not constitute the rendering of legal advice or other professional advice by Goodwin Procter LLP, Goodwin Procter (UK) LLP or their attorneys. Prior results do not guarantee similar outcome.

Goodwin Procter LLP is a limited liability partnership which operates in the United States and has a principal law office located at 53 State Street, Boston, MA 02109. Goodwin Procter (UK) LLP is a separate limited liability partnership registered in England and Wales with registered number OC362294. Its registered office is at Tower 42, 25 Old Broad Street, London EC2N 1HQ. A list of the names of the members of Goodwin Procter (UK) LLP is available for inspection at the registered office. Goodwin Procter (UK) LLP is authorized and regulated by the Solicitors Regulation Authority.