The opinion of the court was delivered by: Garland E. Burrell, Jr. Senior United States District Judge
ORDER GRANTING IN PART AND DENYING IN PART DEFENDANTS' MOTION TO DISMISS AND REMANDING STATE CLAIMS
Defendants move under Federal Rule of Civil Procedure ("Rule") 12(b)(6) for dismissal with prejudice of Plaintiff's Verified First Amended Complaint ("FAC"). (Defs.' Not. of Mot. and Mot. to Dismiss FAC ("Defs.' Mot."), ECF No. 12.) Plaintiff opposes the motion. (Pl.'s Opp'n to Defs.' Mot. ("Pl.'s Opp'n"), ECF No. 13.) Plaintiff alleges the following claims in the Verified FAC: fraud in the origination of the loan, wrongful foreclosure, violation of California Civil Code § 2923.6, violation of the Real Estate Settlement Procedures Act ("RESPA"), breach of contract, breach of the covenant of good faith and fair dealing, violation of the Truth in Lending Act ("TILA"), rescission, predatory lending (violation of California Business & Professions Code § 17200), Unfair and Deceptive Business Act Practices ("UDAP"), negligence, declaratory relief, and quiet title. (FAC ¶¶ 57--254.)
Decision on Defendants' Rule 12(b)(6) dismissal motion requires determination of "whether the complaint's factual allegations, together with all reasonable inferences, state a plausible claim for relief." Cafasso, U.S. ex rel. v. Gen. Dynamics C4 Sys., 637 F.3d 1047, 1054 (9th Cir. 2011) (citing Ashcroft v. Iqbal, 556 U.S. 662, 678-79 (2009)). "A claim has facial plausibility when the plaintiff pleads factual content that allows the court to draw the reasonable inference that the defendant is liable for the misconduct alleged." Iqbal, 556 U.S. at 678 (citing Bell Atl. Corp. v. Twombly, 550 U.S. 544, 556 (2007)).
When determining the sufficiency of a claim, "[w]e accept factual allegations in the complaint as true and construe the pleadings in the light most favorable to the non-moving party[; however, this tenet does not apply to] . . . legal conclusions . . . cast in the form of factual allegations." Fayer v. Vaughn, 649 F.3d 1061, 1064 (9th Cir. 2011) (citation omitted) (internal quotation marks omitted). "Therefore, conclusory allegations of law and unwarranted inferences are insufficient to defeat a motion to dismiss." Id. (citation omitted) (internal quotation marks omitted); see also Iqbal, 556 U.S. at 678 (quoting Twombly, 550 U.S. at 555) (stating "[a] pleading that offers 'labels and conclusions' or 'a formulaic recitation of the elements of a cause of action will not do'").
"On or about November 11, 2006, Plaintiff obtained an Option Adjustable Rate Mortgage, OPTION ARM, from COUNTRYWIDE, secured by a Deed of Trust, in the amount of $420,000.00 for her primary residence ["Subject Property"]. . . ." (FAC ¶ 18.) "In or around early November 2006, Plaintiff was contacted by telephone, by an Agent for COUNTRYWIDE, Silver Tree Lending Funding ("Agent"), for the purpose of obtaining the loan to purchase the Subject Property." (Id. ¶ 19.) Agent told Plaintiff that she would probably qualify for a $420,000 first mortgage, with a monthly payment of $1,385.00, and a $52,000 second mortgage, with a monthly payment of $476.35. (Id. ¶¶ 20--21.)
"[T]he entire [loan] transaction was consummated within ten (10) days from [Plaintiff's] initial contact with Agent." (Id. ¶ 25.) "On or about November 11, 2006, Plaintiff executed the closing loan documents at her home [spending] no more than fifteen (15) minutes with Agent, and was never explained what she was signing or the contents therein." (Id. ¶ 29.) "During the loan application process, Plaintiff was never given the opportunity to review the Application [or] informed of the contents therein." (Id. ¶ 24.) "It was not until June 2010, when she attempted to modify her loan that she discovered that her Application stated that her income was $12,400.00 per month and that she was self-employed for 4 years and 3 months." (Id.) Plaintiff never "discuss[ed] these income figures and employment information with Agent[,] . . . Plaintiff had told Agent that her income was $2,700.00 per month and she was employed as an engineer technician." (Id.)
"On or about June 10, 2010, . . . Plaintiff default[ed] on the Loan." (Id. ¶ 32.) "Plaintiff sent a qualified written request ("QWR") and a validation of debt (VOD) to Defendants on or about September 6, 2011[, to which] Defendants failed to properly respond." (Id. ¶ 114.) "On or about May 16, 2011, without [contacting Plaintiff], BOA, through its alleged trustee, RECON, recorded a Notice of Default on the Subject Property." (Id. ¶ 38.) "On or about August 18, 2011, BOA, through its alleged trustee, RECON, recorded a Notice of Trustee's Sale[, which] stated that the total amount [owed was] $479,677.25. The Trustee's sale was scheduled for September 13, 2011." (Id. ¶ 39.)
Plaintiff's Verified FAC contains both federal and state claims. Plaintiff commenced the instant lawsuit in state court on January 26, 2012; Defendants removed that case to federal court, and Plaintiff subsequently filed her verified FAC. Since Plaintiff's state claims and issues appear to substantially predominate over Plaintiff's federal claims, the portion of the motion challenging the sufficiency of Plaintiff's federal claims will be addressed first. Plaintiff alleges federal claims under TILA (seventh claim) and RESPA (fourth claim).
A. TILA Claim (Seventh Claim)
Defendants argue that Plaintiff's TILA claim "relate[s] to the origination of the Loans [in November 2006] and [is] accordingly time-barred." (Defs.' Mot. 9:2--3 (citing FAC).) Defendants argue that "the statute of limitations on any claims related to the origination began to run in November 2006." (Id. 9:8--9.) Plaintiff rejoins that a claim "does not accrue 'until the discovery, by the aggrieved party, of the facts constituting the fraud or mistake.'" (Pl.'s Opp'n 3:13--14 (quoting Cal. Code Civ. Proc. § 338(d)) (citing Broberg v. Guardian Life Ins. Co. of Am., 171 Cal. App. 4th 912, 920 (2009)).) Plaintiff argues that since she "did not discover the fraudulent facts (inflated income) used by Defendants to qualify her for the loan until [she] reviewed the original loan documents in or around June 2010 while preparing a loan modification application[, her] claims accrued from discovery at this time." (Id. 3:27--4:2 (citation omitted) (citing FAC ¶ 24).)
In pertinent part, 15 U.S.C. § 1635(f) prescribes: "An obligor's right of rescission shall expire three years after the date of consummation of the transaction or upon sale of the property, whichever occurs first." 15 U.S.C. § 1635(f). A TILA action for damages may be brought "within one ...