Man says mortgage companies misapplying payments

By Kyla Asbury | Feb 4, 2015

CHARLESTON –A man is suing HSBC Mortgage Corporation and PHH Mortgage Corporation after he claims the companies routinely misapplied his mortgage payments.

On Jan. 2, 2008, HSBC originated Leonard L. Wesley's mortgage loan in the amount of $132,000 for a term of 30 years with an interest rate of 8.125 percent and with a monthly payment of $980.10, according to a complaint filed Dec. 22 in Kanawha Circuit Court and removed to federal court on Jan. 29.

Wesley claims after sums for private mortgage insurance, hazard insurance and property taxes are added, his monthly payment was $1,297.24 as of Nov. 1, 2012 and, each year went down a few dollars, and, as of Nov. 1, was $1,290.02.

Wesley regularly sends either $1,300 or $1,350, intending for the extra money to be applied to further paying down his principal balance, however, the defendants routinely apply the extra money to payment of "corporate advances" rather than the principal balance.

The defendants routinely represent that Wesley owes "assessed expenses" in addition to his regular monthly payment and his monthly statements fail to properly account for the payments Wesley has made.

Wesley claims when he called the defendants to ask about the fees it was charging him, he was alternately told that the fees were attorneys fees and that the fees resulted from him filing bankruptcy, despite the fact that he had not filed for bankruptcy.

The defendants are routinely assessing illegal charges that are not authorized by agreement or law, which violates West Virginia code, according to the suit.

Wesley is seeking compensatory and punitive damages. He is being represented by Sarah K. Brown and Bren J. Pomponio of Mountain State Justice.

U.S. District Court for the Southern District of West Virginia case number: 2:15-cv-01282

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