We found a match
Your institution may have access to this item. Find your institution then sign in to continue.
- Title
Mending Broken Promises: Allowing Homeowners to Pursue Claims of Promissory Estoppel Against Lenders when Denied Loan Modifications.
- Authors
PARKER, AMY B.
- Abstract
Over the past five years, nearly four million families lost their homes to foreclosure. Despite government efforts to overcome this problem, the mortgage crisis continues to plague the United States. Amidst this crisis, lenders inform homeowners seeking a loan modification that they do not qualify and advise them to stop making payments on their mortgage loan. Relying on this advice, homeowners stop making such payments and comply with the lender's requirements, only to find that the lender subsequently initiated foreclosure proceedings against them. A number of homeowners defended such foreclosure proceedings on the basis of promissory estoppel--arguing that they reasonably relied on the lender's promise to negotiate a loan modification. While courts traditionally have not granted relief to homeowners on the basis of promissory estoppel, a trend is developing among many states and an increasing number of courts are allowing homeowners to pursue such claims. This Note argues that the trend favoring homeowners' claims of promissory estoppel against lenders who promised to negotiate loan modifications provides an equitable result. First, this Note examines the government's role in encouraging loan modifications in contrast to mortgage lending industry servicers' disincentives to provide loan modifications. In addition, this Note explains how homeowners' claims meet all the necessary elements of promissory estoppel and why such claims should be allowed.
- Subjects
UNITED States; PROMISSORY estoppel; LEGAL status of homeowners; MORTGAGE modification; FORECLOSURE; LEGAL status of moneylenders; MORTGAGE bank laws
- Publication
New England Law Review, 2013, Vol 47, Issue 4, p985
- ISSN
0028-4823
- Publication type
Article