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PNC Bank, National Association v. Wilson

Court of Appeals of Illinois, Second District

March 2, 2017

JEREMY T. WILSON and MICHELLE M. WILSON, Defendants (Jeremy T. Wilson, Defendant-Appellant).

         Appeal from the Circuit Court of Du Page County No. 12-CH-5282 Honorable Robert G. Gibson, Judge, Presiding.

          McLAREN JUSTICE delivered the judgment of the court, with opinion. Justices Jorgensen and Schostok concurred in the judgment and opinion.



         ¶ 1 Defendant Jeremy T. Wilson appeals from summary judgment rendered against him and in favor of plaintiff, PNC Bank, National Association, in a foreclosure action upon a mortgage loan between the parties. The mortgage is insured by the Federal Housing Administration (FHA), a division of the United States Department of Housing and Urban Development (HUD). Jeremy contends that the trial court erred by rendering summary judgment in PNC Bank's favor, because PNC Bank did not comply with federal regulations prior to instituting its foreclosure action. Jeremy argues that the evidence in the record demonstrates the existence of a genuine issue of material fact with respect to his defense that PNC Bank failed to comply with HUD regulations, specifically, title 24, section 203.604, of the Code of Federal Regulations (24 C.F.R. § 203.604 (2014)), which requires a lender, before bringing a foreclosure action against a defaulting borrower, either to have a face-to-face meeting with the borrower or make "a reasonable effort" to arrange a face-to-face meeting. For the following reasons, we affirm.

         ¶ 2 I. BACKGROUND

         ¶ 3 In June 2003, Jeremy and his wife, Michelle M. Wilson, gave a promissory note to National City Mortgage Company in the amount of $224, 467, secured by a mortgage lien on the Wilsons' real property in Du Page County. Subsequently, PNC Bank succeeded to the interest of National City Mortgage Company. The federally insured mortgage loan that is the subject of this cause of action is subject to HUD regulations.

         ¶ 4 The Wilsons failed to make their monthly payment due on the loan for August 2010. In October 2010, PNC Bank sent the Wilsons a letter establishing the terms of a three-month special forbearance plan. The Wilsons complied with the special forbearance plan, and PNC Bank offered the Wilsons a loan modification to bring their loan current. The parties executed the loan modification agreement on February 10, 2011. On February 28, 2011, the Wilsons filed for Chapter 7 bankruptcy protection in the United States Bankruptcy Court, and they did not reaffirm their mortgage. The bankruptcy court discharged the Wilsons' debt to PNC Bank in May 2011.

         ¶ 5 On October 31, 2012, PNC Bank filed a complaint against the Wilsons for foreclosure, alleging that the Wilsons defaulted on the loan "by failing to pay the monthly installment due May 1, 2012[, ] and thereafter." PNC Bank alleged that both Jeremy and Michelle were the mortgagors of the subject property. PNC Bank attached a copy of the mortgage to the complaint.

         ¶ 6 On September 28, 2013, Jeremy, alone, filed an answer.

         ¶ 7 On November 18, 2014, the Wilsons moved for summary judgment. In their motion, the Wilsons contended that PNC Bank violated HUD regulations because (1) before PNC Bank filed its foreclosure complaint neither Jeremy nor Michelle "received any written information from [PNC Bank] regarding *** counseling programs *** offered by [HUD] [or] any written information from [PNC Bank] regarding a request to have a face to face interview, " and (2) no efforts were "made to arrange such a meeting." The affidavits of Jeremy and Michelle were attached to their motion.

         ¶ 8 In response, PNC Bank filed a cross-motion for summary judgment, arguing that there was no dispute that it sent a certified letter to the Wilsons and that a PNC Bank agent made a trip to the Wilsons' property and met with Michelle. PNC Bank attached the affidavit of Brian Arthur, PNC Bank's vice president for mortgage services-default, wherein Arthur stated the following. He was familiar with PNC Bank's business, its mode of operation, and the manner in which its records were prepared. Arthur reviewed loan files and was familiar with PNC Bank's corporate history and its records, including the Wilsons' loan file. Arthur stated that PNC Bank sent the Wilsons "a letter by certified mail dated February 2, 2012, stating that PNC, through its agent [J.M. Adjustment Services (JMA)], would schedule a face-to-face meeting at their home to discuss solutions to bring their loan current. A true and correct copy of the February 2, 2012 letter is attached." The attached letter is a computer-generated copy of a letter dated February 2, 2012, addressed to Jeremy at the mortgaged property. In the upper-right corner, the letter provides, in the same font as the entire letter, "Certified Mail/Return Receipt Requested."

         ¶ 9 PNC Bank also attached the affidavit of Ryan Kojadulian, an employee of JMA, wherein Kojadulian stated the following. Kojadulian reviewed the business records regarding the attempt by one of JMA's agents to arrange a face-to-face meeting with the Wilsons at the mortgaged property. These business records include a "Field Visit Result Summary Sheet" that was saved to JMA's computer, indicating that on February 12, 2012, an attempt was made to have a face-to-face meeting with the Wilsons, and the agent made contact with Michelle and gave her a letter in a blank, sealed, confidential envelope "with the customer's name on it." Further, a copy of that letter was saved to JMA's computer. "[T]rue and correct" copies of the "Field Visit Result Summary Sheet" and the letter were attached to Kojadulian's affidavit. The "Field Visit Result Summary Sheet" contains the Wilsons' names, the mortgaged address, PNC Bank's name, and a number of checked boxes indicating that the agent "Spoke with Customer" and that the "Address [was] Verified by Customer." Under "Additional Comments, " it states the following:

"A visit was made by the agent on 2-12. The agent made contact with the customer, Michelle, at the time of the visit. The agent left the blank sealed confidential envelope with the customer's name on it containing the letter to the customer and she declined to use the agent's cell phone to contact the lender right then. *** Michelle advised that she would be sure to contact the lender."

         The letter is on PNC Bank's letterhead, is dated February 12, 2012, and is addressed to Jeremy and Michelle at the mortgaged property. The letter states as follows:

         "Please contact PNC Mortgage at 1-(800) *** between the hours listed below.

         Please call PNC Mortgage during the hours listed below:

Monday - Friday

8:00AM - 9:00PM (EST)


8:00AM - 2:00PM (EST)

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