Dowers v. Nationstar Mortgage LLC

Borrowers’ Fair Debt Collection Practices Act claims arising from non-judicial foreclosure actions were properly dismissed, except for claim under 15 USC § 1692f(6) for threatening foreclosure when no right to foreclose existed.  Following Ho v. ReconTrust Co. (9th Cir. 2016) 840 F.3d 618, this decision holds that a borrower failed to state FDCPA claims for violation of 15 USC §§ 1692c, 1692d or 1692e since defendants’ only acts were directed at nonjudicial foreclosure of the borrower’s deed of trust, not collection of his debt.  However, the decision reverses dismissal of the borrower’s claim under 15 USC § 1692f(6) which prohibits threatening nonjudicial foreclosure or repossession if there is no present legal right to possession of the property through enforcement of a security interest or if the debt collector has no present intention to take possession.  That single provision of the FDCPA clearly applies to steps taken toward a nonjudicial foreclosure and here the plaintiff alleged sufficient facts to state a claim under the section.  The borrower’s claims for intentional infliction of emotional distress and under Nevada’s Deceptive Trade Practices Act were properly dismissed as the complaint did not allege outrageous conduct and the Ninth Circuit predicts that the Nevada Supreme Court will hold that home loans are not “goods or services” within the meaning of the DTPA.

Ninth Circuit Court of Appeals (Gould, J.); March 31, 2017; 2017 WL 1192207

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