At the request of Washington State Attorney General Bob Ferguson, the King County Superior Court has issued a Temporary Restraining Order (TRO) requiring foreclosure trustee Cal-Western of Washington to halt its allegedly unfair and deceptive business practices.
Cal-Western is a Washington foreclosure trustee corporation with an office in Vancouver, Washington, but conducts many of its operations in southern California. Foreclosure trustees are legally required to act in good faith as neutral parties between borrowers and lenders while conducting foreclosure proceedings.
The Attorney General’s Office (AGO) alleges Cal-Western gave borrowers an incorrect phone number in their Notices of Trustee’s Sale and Foreclosure, making it difficult for borrowers, some desperate to save their homes, to contact the firm quickly without physically traveling to Vancouver.
This case comes on the heels of AGO legal action against Quality Loan Service for deceptive business practices.
“My office is sending the message for a second time: Foreclosure trustees have a duty to treat homeowners fairly under the law,” said Ferguson. “I will make sure that all parties involved in the foreclosure process, including trustees like Cal-Western, play by the rules.”
On Feb. 26, 2014, the AGO sued Quality Loan Service Corporation of Washington in King County Superior Court, obtained an Interim Agreed Order to halt certain pending foreclosures, and then negotiated a Consent Decree under which Quality Loan Service paid $275,000 and agreed to correct its allegedly unfair and deceptive practices.
Today’s TRO will place a moratorium on current Cal-Western foreclosures in Washington state and will extend through May 29, 2014.
Overview of AGO allegations
The Deed of Trust Act requires a trustee to provide its telephone number in the Notice of Trustee’s Sale—the foreclosure document that schedules the trustee’s sale. This basic requirement ensures homeowners can communicate with the trustee to ask questions, obtain quotes for last-minute payments, or request a foreclosure be postponed.
An AGO investigation found that from October 2013 to approximately March 20, 2014, Cal-Western provided an incorrect phone number in Notices of Trustee’s Sales sent to Washington homeowners. The AGO investigation found that over 70 homeowners in King County alone received incorrect notices suggesting many more homeowners were affected statewide.
In addition, the AGO investigation found that after discovering the problem in March, Cal-Western did not send the affected homeowners amended Notices of Trustee’s Sales or letters informing them of a working telephone number at which the homeowners could reach Cal-Western.
With no available website, homeowners’ only method to contact Cal-Western was to drive or fly to its Vancouver office, or send Cal-Western a letter through the U.S. Postal Service. This lack of access made it difficult or impossible for some homeowners to timely and efficiently ask questions, obtain reinstatement quotes, or request a postponement.
The AGO alleges Cal-Western’s practice of providing borrowers with an incorrect phone number was an unfair and deceptive business practice and therefore violated the Consumer Protection Act.
Lawsuit seeks restitution for consumers
The AGO is seeking:
- Restitution for homeowners whose properties have been foreclosed;
- Injunctive relief preventing Cal-Western from foreclosing pursuant to defective Notices of Trustee’s Sale;
- As much as $2,000 per violation of the Consumer Protection Act in civil penalties; and
- The state’s costs and attorneys’ fees for bringing the suit.
All homeowners who are facing foreclosure should call a certified home counselor for free help at 1.877.894.HOME (4663).
Assistant Attorney General Benjamin Roesch is lead on this case.
The AGO Complaint which was filed on May 14, 2014 can be found online.
