Lawsuit: Bank of America inflated appraisal of Harpers Ferry home

CHARLESTON - A widow is suing Bank of America N.A. after she claims it participated in predatory lending practices and caused her and her late-husband damages.

In March 2006, Joanne M. Herrington and her husband, Curtis E. Herrington, sought to purchase a farmhouse in Harpers Ferry that was built in the late-1800s contingent on financing and appraisal at the proposed sale price, according to a complaint filed April 12 in Kanawha Circuit Court.

Joanne Herrington claims she and her husband were relocating from Florida and were unfamiliar with the local real estate market, and if the home was not worth the offered sale price, they were not going to proceed with the sale at that price and would counteroffer at the true value.

Because they were unfamiliar with the local real estate market, the Herringtons were relying on the appraisal to determine if they would proceed with the sale, according to the suit.

Joanne Herrington claims Bank of America arranged for an inflated appraisal and obtained and relied upon a market appraisal valuing the property at $350,000, when its actual market value at the time was $180,000.

Bank of America valued the property as if it were built in 1993, rather than the late-1800s, according to the suit.

Joanne Herrington claims during closing, the defendant failed to properly disclose the balloon payment and failed to include her in the deed and deed of trust.

In May 2009, Joanne Herrington contacted Bank of America in an effort to refinance and take advantage of lower interest rates and was informed that the value of the property was $177,000 and because of that, it would not refinance her, according to the suit.

Joanne Herrington claims she sent a letter to the defendant on Aug. 10, requesting an account record and notifying the defendant that she was being represented by counsel.

Despite being informed that she was being represented by counsel, Bank of America continued to contact Joanne Herrington directly on at least 10 occasions, according to the suit.

Joanne Herrington claims in September she discovered the home was not work the value represented at the time of purchase.

The defendant intentionally misrepresented to Joanne Herrington and her husband that it was a reputable lending entity that followed commercially acceptable lending practices and/or intentionally suppressed that it failed to follow commercially acceptable lending practices in origination of the loans, according to the suit.

Joanne Herrington is seeking actual and punitive damages and civil penalties. She is being represented by Sarah K. Brown, Bren J. Pomponio and Daniel F. Hedges of Mountain State Justice.

The case has been assigned to Circuit Judge Charles E. King.

Kanawha Circuit Court case number: 13-C-722