New Hampshire District Court holds that a mortgagor, who is not indebted on the note, lacks standing to assert claims under RESPA

On August 11, 2015 the U.S. District Court for the District of New Hampshire in Sharp v. Deutsche Bank National Trust Company, No. 14-cv-369 (D.N.H. Aug. 11, 2015) rejected the Plaintiff’s request to amend his complaint to add a count alleging a violation of RESPA based on its inadequate responses to his request for information (12 C.F.R. § 1024.36) and notice of error. (12 C.F.R. § 1024.35). Although plaintiff and his father were both mortgagors on the mortgage document, the promissory note identified plaintiff’s father as the sole borrower for the loan. After plaintiff’s father died and plaintiff defaulted on the mortgage, plaintiff sought to enjoin the bank’s subsequent foreclosure proceedings. Recognizing that the section of RESPA where the relevant provisions are found describes the duties that mortgage loan servicers owe to borrowers, it also noted that the statute and the regulations say nothing about duties owed to mortgagors. The court determined that plaintiff lacked standing to assert his RESPA claims because the RESPA provisions at issue only applied to borrowers, not mortgagors. The court also rejected plaintiff’s argument that his status as the successor-in-interest to his father under 12 C.F.R. § 1024.38 established the requisite standing. The court confirmed that plaintiff was protected by 12 C.F.R. § 1024.38, but pointed to the CFPB’s official interpretation of 12 C.F.R. § 1024.38 to find that no private right of action existed to enforce the rule. So while plaintiff is protected by § 1024.38(b)(iv), he has no private right of action against defendants to enforce that rule. Moreover, his status as a successor in interest for the purposes of § 1024.38 does not make him a borrower for the purposes of §§ 1024.35 and 1024.36.

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