The three cases involved accusations that servicers failed to provide required documentation at mediation or did not have someone present at mediation who had authority to modify the loan.
Because Nevada’s Foreclosure Mediation Rules “expressly require that certain documents be produced during foreclosure mediation and that someone with authority to modify the loan must be present or accessible during the mediation, [the court] conclude[d] that a party’s failure to comply with these requirements is an offense subject to sanctions by the district court,” the Court stated.
In a second case involving Wells Farge, the Court cited its previous ruling in the Pasillas v. HSBC Bank USA that failure to produce required documents prohibits the district court from certifying the mediation so that foreclosure proceedings may continue.
The Court further noted that this is a sanctionable offense.
The Court concluded that Wells Fargo failed to produce all necessary documents. The court, however, did not agree with the homeowner’s accusation that Wells Fargo acted in bad faith.
In a third foreclosure appeal, homeowners requested sanctions be taken against their servicer, HomEq. Servicing Inc on the grounds that the bank’s representative at mediation did not have authority to negotiate the loan and that the bank “acted in bad faith by refusing to consider the Redmons for a loan-modification program.”
Nevada’s Supreme Court sent the case back to the district court for review.
Nevada’s Foreclosure Mediation Rules were enacted July 31, 2009 and were amended September 28, 2009.
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