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Rivera v. Aurora Loan Services LLC

April 26, 2010

MARIA V. RIVERA, ET AL., PLAINTIFF,
v.
AURORA LOAN SERVICES LLC, ET AL., DEFENDANT.



The opinion of the court was delivered by: Honorable Barry Ted Moskowitz United States District Judge

ORDER GRANTING MOTIONS TO DISMISS

Defendant Aurora Loan Services LLC has filed a Motion to Dismiss for Failure to State a Cause of Action [Doc. 4]. Defendant Cal-Western Reconveyance Corporation has attempted to join in Aurora's Motion to Dismiss [Doc. 8].*fn1 For the following reasons, the Court GRANTS the Motions.

I. BACKGROUND

The following are allegations in the Complaint and not the Court's factual findings. In April 2007, Plaintiff Maria V. Rivera executed a note in favor of Uniwest Mortgage Corporation (not listed in the caption as a party to this action) in the amount of $457,000.00. As security for the note, Rivera also executed a deed of trust on her real property located at 868 Rosa Court, Escondido, California in favor of Uniwest Mortgage as beneficiary and First American Title as trustee.

In December 2008, Rivera received a notice that Defendant Cal-Western Reconveyance Corporation had been substituted as the new trustee. A week later, Cal-Western recorded a notice of default and election to sell in the Official Records of San Diego County, California.

In May 2009, Rivera executed a forbearance agreement with Defendant Aurora Loan Services LLC, the servicing agent for the loan in default. The forbearance agreement was in effect for three consecutive months, starting June 1, 2009 and ending August 31, 2009. Under the agreement, Aurora Loan Services agreed to forbear from exercising its right to start or continue foreclosure proceedings, to sell the property, and from otherwise exercising its rights under the default provisions of the note and deed of trust. But Aurora also reserved its ability to exercise its rights under those provisions if Rivera did not make scheduled payments or upon the expiration of the forbearance agreement on August 31, 2009.

Rivera has attached the forbearance agreement to the Complaint. The agreement states that Rivera has been "conditionally approved" for the forbearance agreement, and that "[y]our approval for the Special Forbearance Agreement is conditional upon Aurora verifying the information that you provided." Aurora Loan Services did not sign the copy that Plaintiffs have attached to the Complaint. Nevertheless, Plaintiffs allege in the Complaint that the "Forbearance Agreement was in effect for 3 consecutive months."

Rivera complied with the forbearance agreement and made timely payments according to its terms.

Before the forbearance agreement expired, on August 14, 2009 a real-estate agent came to Rivera's property and told Rivera that he had been assigned as the listing agent to sell Rivera's house. Alarmed, Rivera called Plaintiff George Beltran and told him what happened. Beltran then called Aurora Loan Services. Beltran spoke to someone named Melissa, who told him that the property had been foreclosed on August 13, 2009, during the term of the forbearance agreement.

After several more phone calls, on August 25, 2009 Aurora Loan Services temporarily halted the foreclosure proceedings. A representative at Aurora told Plaintiffs not to send any more payments under the forbearance agreement.

The forbearance agreement expired on August 31, 2009.

On September 3, 2009, a representative of Aurora told Plaintiffs to resubmit an application for a forbearance agreement, but this time the representative told Rivera she could use only her own income to qualify (Rivera previously used her income and her sister's income to qualify for the first forbearance agreement).

As of the filing date of the Complaint, Rivera was still in possession of her home. Plaintiffs have alleged three causes of action. First, Plaintiffs seek a declaration that Aurora "should honor the payments established in the original forbearance agreement and adhere to the original qualifying guidelines for the loan forbearance agreement." Second, Plaintiffs seek to enjoin Defendants from ...


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