Couple sues Bac Home Loans Servicing for predatory lending

By Kyla Asbury | May 20, 2010

CHARLESTON -- A couple is suing Bac Home Loans Servicing after they claim they were the victims of predatory lending and were taken advantage of.

Lori A. Noble and an unknown individual were also named as defendants in the suit.

William F. Stump and Charity A. Stump sough to purchase a home in 2007 and the defendant provided them with a letter that they were approved for a loan up to $45,000, with 8.25 percent interest, according to a complaint filed April 29 in Kanawha Circuit Court.

The Stumps located a house for sale by owner and the owners said they would accept $35,000 for the home, according to the suit.

The plaintiffs claim they contacted the defendants and informed them of the sale price and the defendant informed the Stumps that it would have the home appraised and inspected.

During the course of discussions about the loan, the defendants repeatedly assured the Stumps that the monthly payments on the loan would be lower than the $400 the paid in rent at the time and that the total payments would be approximately $280 per month, according to the suit.

The Stumps claim the defendants arranged for an inflated appraisal by Noble, who stated the market value of the home was $37,000, but in reality it was $29,000 when absent of major defects. They also claim the home contained several major defects that rendered it entirely unsafe to live in.

At the closing, the Stumps first learned that the monthly payments would be $466, rather than approximately $280, as they were told before, which was due to purchase money insurance that had not been disclosed or explained to them, according to the suit.

The Stumps claim they also first learned that the interest on the loan would be 9.5 percent instead of the 8.25 percent they had been pre-approved for.

At the time of the loan, there were numerous major apparent and non-apparent defects with the home that the Stumps began to experience after they moved in, including structural problems with the roof and foundation; rats; termites; mold; a failed roof with active leakage; no gutters; no roof ventilation; numerous leaks throughout the home; holes in the ceiling; dryrot; a hole in the kitchen floor and rot under the kitchen; improper and unsafe gas lines; unsafe and inadequate electrical system; improper water lines; unsafe and inadequate sewer system; active mold throughout the home; rotted floors; non-functional rear bath tub fixtures; unsafe un-vented unitary wall furnaces; and inadequate and damaged windows, according to the suit.

The Stumps claim they informed the defendants of the problems and her told there was nothing they could do to fix the defects.

The Stumps are seeking actual damages and civil penalties. They are being represented by Jennifer S. Wagner and Daniel F. Hedges.

The case has been assigned to Circuit Judge Jennifer Bailey.

Kanawha Circuit Court case number: 10-C-792

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