Plaintiffs Move to Re-Certify Class in Non-Borrowing Spouse Lawsuit

In the latest development in ongoing litigation around reverse mortgage non-borrowing spouses, plaintiffs are moving for renewed class certification in a class action lawsuit filed by the AARP Litigation Foundation on their behalf.

Plaintiffs in the case filed against HUD earlier this year include non-borrowing spouses who face foreclosure after their borrowing spouses have passed away. They filed for a renewed motion for class certification in early November, and have provided new evidence toward their case, including the denial of requests for foreclosure extension under HUD’s most recent non-borrowing spouse guidance.

After three years of litigation regarding non-borrowing spouses, HUD this year clarified its guidance around those non-borrowing spouses, offering protection to new borrowers.

HUD also granted the ability for non-borrowing spouses to request new foreclosure extensions under certain circumstances, a protection the plaintiffs argue has not been delivered.

“Plaintiffs have supplied evidence in the proposed motion for class certification that despite the fact that HUD has expressly stated to this Court that requiring lenders to foreclose on surviving spouses is a violation of the law, it continues doing it anyway, and is flatly denying lenders’ requests for extension of the foreclosure deadlines [under HUD guidelines],” the most recent filing states.

The Court earlier ordered HUD to determine relief for the plaintiffs named previously. HUD responded by stating that no such relief would be granted. However, a final determination of Remand is yet to be completed.

“It has now become clear that without bothering to issue a decision on remand, HUD is affirmatively compelling lenders to deny [Trigger Inapplicability Decision] relief to other surviving spouses, and penalizing lenders if they fail to foreclose according to regulations HUD has said do not apply to mortgages that are not due and payable under HUD’s regulations and insurance contract,” the filing states.

Written by Elizabeth Ecker

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