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Mutti v. Rushmore Loan Management Services, LLC

United States District Court, W.D. Washington, Seattle

May 2, 2019

RUSHMORE LOAN MANAGEMENT SERVICES LLC, and WILMINGTON SAVINGS FUND SOCIETY, FSB, d/b/a Christiana Trust, not individually but as trustee for Pretium Mortgage Acquisition Trust, Defendants.




         This matter is before the Court on Defendants [sic] Motion for Summary Judgment. Dkt. #21. Plaintiffs have responded in opposition. Dkt. #25. Defendants forego a reply. Neither party requests oral argument and the Court does not find it necessary. Having reviewed the briefing and the record and for the following reasons, the Court denies Defendants' Motion.


         Plaintiffs, Kulwinder Mutti and Kirpal Mutti, borrowed $275, 000 to purchase a home, securing the loan with a Deed of Trust. Dkt. #1 at ¶¶ 2, 4.[1] The loan has been sold several times and Defendant Wilmington Savings Fund Society (“Defendant Wilmington”) is the current owner of the loan[2] and Defendant Rushmore Loan Management Services, LLC (“Defendant Rushmore”) is the current servicer of the loan. Id. at ¶¶ 6-7.

         Plaintiffs provide the relevant history in a declaration (Dkt. #25-1) filed with their opposition to Defendants' Motion:

In 2015, we encountered financial difficulties and fell behind in the payments on the Loan. In order to save our Home and pay the Loan, we sought loss mitigation from the servicer of the Loan at that time, Residential Credit Solutions, Inc. (“RCS”). On or about December 21, 2015, RCS sent a Trial Period Plan (the “TPP”) to us and a true and correct copy of the TTP is attached as Exhibit C to the complaint we filed. Pursuant to the TPP, we were required to make three (3) monthly payments each in the amount of $1, 555.63 for the months of February 2016, March 2016 and April 2016. Pursuant to the terms of the TPP, upon our acceptance of the TPP and timely remittance of such payments, RCS was to calculate and offer us a permanent loan modification. We accepted the TPP and remitted the requisite three (3) payments in a timely manner pursuant to the terms of the TPP. Proof of our payments pursuant to the TPP is attached as Exhibit D to the complaint we have filed. Servicing of the Loan transferred from RCS to Ditech Financial, LLC (“Ditech”) on or about February 22, 2016. While we continued to remit the TPP payments to RCS, RCS forwarded such payments to Ditech and Ditech received such payments in a timely manner. A copy of the transaction history of the Loan from Ditech evidencing such is attached as Exhibit E to our complaint. Rather than apply the payments in accordance with the TPP, however, Ditech applied those payments to the Loan rather than the effective TPP, and then claimed that the Loan was delinquent. A copy of a mortgage statement from Ditech evidencing such is attached as Exhibit F to our complaint. Ditech did not honor the TPP throughout its servicing of the Loan and transferred the Loan to Rushmore in a default status. Despite our complete compliance with and satisfaction of the terms of the TPP, neither RCS, nor any subsequent servicer, including Rushmore, ever abided by the terms of the TPP and offered to us a permanent loan modification consistent with the terms of the TPP.

Dkt. #25-1 at ¶ 3.

         When no permanent loan modification was provided, [3] Plaintiffs sent Defendant Rushmore a Notice of Error (“NOE”)[4] detailing the mistakes they believed had occurred. Dkt. #1 at ¶¶ 33-34. Despite the notice, Defendant Rushmore did not provide a permanent loan modification and Plaintiffs do not believe that Defendant Rushmore adequately investigated the matter. Dkt. #25-1 at ¶ 7.


         A. Legal Standard

         Summary judgment is appropriate where “the movant shows that there is no genuine dispute as to any material fact and the movant is entitled to judgment as a matter of law.” Fed.R.Civ.P. 56(a); Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 247 (1986). Material facts are those which might affect the outcome of the suit under governing law. Anderson, 477 U.S. at 248. In ruling on summary judgment, a court does not weigh evidence to determine the truth of the matter, but “only determine[s] whether there is a genuine issue for trial.” Crane v. Conoco, Inc., 41 F.3d 547, 549 (9th Cir. 1994) (citing Federal Deposit Ins. Corp. v. O'Melveny & Meyers, 969 F.2d 744, 747 (9th Cir. 1992)).

         On a motion for summary judgment, the court views the evidence and draws inferences in the light most favorable to the non-moving party. Anderson, 477 U.S. at 255; Sullivan v. U.S. Dep't of the Navy, 365 F.3d 827, 832 (9th Cir. 2004). However, the non-moving party must present significant and probative evidence to support its claim or defense. Intel Corp. v. Hartford Accident & Indem. Co., 952 F.2d 1551, 1558 (9th Cir. 1991). “The mere existence of a scintilla of evidence in support of the [non-moving party's] position will be insufficient; there must be evidence on which the jury could reasonably find for the [non-moving party].” Anderson, 477 U.S. at 251. Uncorroborated allegations and self-serving testimony will not create a genuine issue of material fact. Villiarimo v. Aloha Island Air, Inc., 281 F.3d 1054, 1061 (9th Cir. 2002); T.W. Elec. Serv. v. Pac. Elec. Contractors Ass'n, 809 F.2d 626, 630 (9th Cir. 1987). Rather, the non-moving party must make a “sufficient showing on [each] essential element of her case with respect to which she has the burden of proof” to survive summary judgment. Celotex Corp. v. Catrett, 477 U.S. 317, 323 (1986).

         B. ...

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