Maginnis Howard is currently investigating complaints of unlawful acts committed by Seterus, Inc. in connection with the collection of mortgage payments. Our firm has filed a class action in North Carolina regarding debt letters that misrepresent Seterus’ true intentions. We have alleged a violation of the federal Fair Debt Collection Practices Act and the North Carolina Collection Agency Act. That class action lawsuit is pending in the United States Federal District Court for the Middle District of North Carolina and seeks to represent all of Seterus’ customers who received a threat to foreclose from Seterus.
Seterus is a mortgage company servicing Fannie Mae mortgages that is owned by IBM. Some of the mortgages that are acquired by Seterus can be very old and have unique terms and conditions in their deed of trust that need to be followed by the mortgage servicer. We do not believe that Seterus – or many other mortgage servicers – ever review your mortgage loans or deeds of trusts prior to attempting to collect mortgage payments. Because these mortgage servicers do not review your important documents, they can easily run afoul of state or federal debt collection laws.
For example, Seterus utilizes a “suspense account” in collecting on debt. If someone does not make what they allege to be a full and complete mortgage payment, Seterus applies your funds in a suspense account instead of applying the mortgage payments to the loan. Seterus’ use of a suspense account may be in direct contravention of your deed of trust. If a mortgage servicer has placed your hard-earned money in a suspense account, contact our firm today to discuss your rights.
Another practice Seterus utilizes is aggressive threats to “accelerate” its customers mortgage loans. If Seterus accelerates a mortgage loan, it means the borrower is required to pay off the loan immediately. A typical default and acceleration letter of Seterus states: “If full payment of the default amount is not received by us in the form of a certified check, cashier’s check, or money order, on or before the Expiration Date, we will accelerate the maturity date of your loan and upon such acceleration the ENTIRE indebtedness of the loan, including principal, accrued interest, and all other sums due therein, shall, at once and without further notice, become immediately due and payable.”
Seterus’ use of acceleration and foreclosure threats may violate the Fair Debt Collection Practices Act and North Carolina Collection Agency Act. The FDCPA states that a debt collector may not use any false, deceptive, or misleading representation or means in the collection of a consumers’ debt. Seterus, sends these collection letters to scare its customers into making mortgage payments. Mortgage servicers want to avoid accelerating and foreclosing on a persons house – not from any sense of good will, but because it would cost them a lot of time and money. Ultimately, Seterus threatens to accelerate and foreclose because it is aware of how terrified its customers are of this result.
If you believe you have been treated unfairly or unlawfully through use of a suspense account, threats of foreclosure or acceleration, or any other reason, contact our firm today for a free consultation. We represent consumers mistreated by mortgage servicers on a contingency basis and will provide a free case evaluation for any Seterus customer. The consumer protection lawyers at Maginnis Howard can be reached at (919) 526-0450 or through our confidential contact page.