Banking Law

Judge Cancels $525K in Mortgage Debt, Blasts Bank’s ‘Shocking and Repulsive’ Acts


A New York judge has wiped out $525,000 in mortgage debt for a couple, saying the bank misled him about the amount at stake and refused to work with the homeowners to modify the loan.

The judge, Jeffrey Spinner, canceled the mortgage, interest and penalties after finding that the actions of the bank and its mortgage servicer were “harsh, repugnant, shocking and repulsive,” according to the New York Post, Newsday (sub. req.) and CNN. The couple had represented themselves.

The judge’s ruling leaves Diane Yano-Horoski and her husband, Greg Horoski, without any debt on their interest-only mortgage. Spinner’s “scathing” ruling blasted IndyMac Mortgage Services, a division of OneWest Bank F.S.B., according to the stories.

Skinner called OneWest Bank’s conduct “inequitable, unconscionable, vexatious and opprobrious.”

Greg Horoski was surprised by the ruling. “We never asked for this,” Horoski told the Newsday. “I was shocked, honestly. It’s not like we said, ‘Judge, please throw the loan away.’ We just wanted them [the bank] to be reasonable.”

Horoski told Newsday he and his wife were overwhelmed by the media attention and distraught over the death of their dog, who was hit by a neighbor’s car last week. “Maybe God is telling us not to be too happy about the decision,” he said.

OneWest Bank plans an appeal. “We believe the Yano-Horoski ruling, if allowed to stand, has sweeping and dangerous implications for the entire mortgage lending industry,” the bank told Newsday.

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