HELENA – A Meagher County couple has reached a confidential settlement with Bank of America in its lawsuit alleging the bank engaged in fraudulent dealings.
The lawsuit was filed by Abraham and Betty Jean Morrow of White Sulphur Springs.
One of the couple’s attorneys, David K.W. Wilson of Helena, said Tuesday, “We’re happy it’s settled. We’re happy it’s resolved.”
Under the deal, reached earlier this month, the terms of the settlement are to be kept confidential.
“Unfortunately, we cannot comment on the specifics of the settlement but to say we are pleased to have resolved the matter,” Bank of America spokeswoman Jumana Bauwens said.
The case had been set to go to trial in Helena earlier this month, but it was postponed for negotiations between attorneys for the Morrows and the banking company, which produced an a settlement.
The Montana Supreme Court, in a 5-2 decision in May, reversed a summary judgment for Bank of America by District Judge Kathy Seeley of Helena and sent the case back for trial.
Chief Justice Mike McGrath wrote the majority opinion in favor of the Morrows’ “claims of negligence, negligent representations, actual fraud, constructive fraud and violations of the MCPA (Montana Consumer Protection Act)” and remanded it for further proceedings “consistent with this opinion.”
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The Morrows, who were from South Carolina, bought 50 acres in Meagher County in 2003 and built a house there three years later. They had planned to spend their retirement there.
In August 2008, the Morrows entered into a refinance mortgage loan with Quicken Loans. They borrowed $291,200 and agreed to make monthly payments of $2,301 over 15 years at an interest rate of 4.99 percent.
A month later, Countrywide Home Loans bought the loan from Quicken and began serving it.
Two months later, Bank of America acquired Countrywide.
Then the Morrows encountered financial problems. The South Carolina couple who bought two of their businesses there defaulted on one and filed for bankruptcy on the other, depriving the Morrows of anticipated income of $10,000 a month.
The Morrows told Bank of America of their changing financial picture. They said a bank representative told them to deliberately skip a loan payment to qualify for the federal Home Affordable Mortgage Program. The bank said it had no written record of that conversation.
The Morrows then made a reduced mortgage payment of $1,240 a month in December 2009 and for the next 14 months.
Bank of America then tried to foreclose on their home, the Morrows said. They obtained an injunction to block the foreclosure attempt.
Bank employees told the Morrows by mail that their loan was in default. Over the phone, however, Bank of America employees told them to ignore the letter and continue making reduced payments because their loan was in modification status, McGrath wrote.
Morrow, an accountant, said in an interview with the Missoulian State Bureau that he kept boxes of all written documents from Bank of America, along with notes of every conversation he had with 40 different bank employees, many of whom were based overseas. None gave Morrow their full names, Morrow said, but he insisted that they provide him with their employee numbers if they wouldn’t give him their last names.