Chase Purchase Money Loan Deficiency Collection Class Action
Jared Banks & Landon Cowan v. JP Morgan Chase Bank, N.A.
Alameda County Superior Court
Case No. RG12614875
Mr. Levy is cocounseling a Class Action against JPMorgan Chase bank with the Housing and Economic Rights Advocates (HERA) in the California Superior Court in Alameda County (Oakland). Plaintiffs challenge Chase's practice of collecting on purchase money mortgage balances after foreclosures and short sales, as well as Chase's practice of post-foreclosure and post-short sale credit reporting purchase money mortgage balances as delinquent.
California's "anti-deficiency" law provides that purchase money mortgages are non-recourse: the borrower has no personal liability to repay a loan that is used to buy a home. The lender must recover solely out of foreclosure or short sale of the property if the borrower becomes unable to pay. Despite this "purchase money" protection, Chase has pursued purchase money borrowers personally for the collection of purchase money loan deficiencies and continues to report deficiencies to credit reporting agencies as delinquent.
This Class Action challenges Chase's practices. The Court has overruled Chase's motion to dismiss and allowed the case to go forward. The Court has recently slowed class certification filing due to pending appeals on related issues in other cases. Levy and HERA have filed Amicus (Fried of the Court) Briefs in three of these appeal cases: Coker vs. JPMorgan Chase Bank, Kuns vs. Ocwen Loan Servicing, LLC and Alborzian vs. JPMorgan Chase Bank.