Plaintiff Kimberly Shibles had been having financial difficulties and requested assistance through possible mitigation from Bank of America (BOA), her mortgage holder. Meanwhile, she remained current on her mortgage payments. BOA issued her a Trial Modification Contract in accordance with the Home Affordable Modification Program, a requirement for banks since the mortgage crisis and bailout. A letter explained she could begin a three-month period where her payments would be lowered by approximately 45%. Her understanding was that if she complied with temporary revision for this period that she would qualify for a permanent modification. She consented to the agreement and complied with the revised payments, yet the contract for permanent modification did not arrive; therefore, she continued those payments continuously each month.

Several months later she received a Notice of Intent to Foreclose and soon after a notification stating she was denied the permanent modification. The reason for denial was that she had failed to submit the proper documentation showing her financial hardship. Shibles reviewed her submitted paperwork and saw that she had sent the details of her financial problems as requested and felt the denial was not warranted. BOA continued their foreclosure process over the following year in a New Jersey court and were granted a default judgment after Shibles did not appear for a court date. The property was foreclosed and she was evicted. Shibles brought a claim citing a violation of the Real Estate Settlement Procedures Act. She contended the roughly $12,700 she had paid during the years since the temporary modification had not been credited toward her mortgage.

The claim states that BOA committed common law fraud, breach of contract and a violation of the Consumer Fraud Act. Shibles says her life was “turned upside down”. Jay Patterson, a forensic accountant, says that often the modifications and other resolution efforts in the foreclosure process are hindered by procedural mistakes, misplaced paperwork, or misunderstandings about the arrangements. In recent years, several employees of mortgage lenders have alleged that companies encouraged them to sabotage the process of mortgage modifications. Shibles' attorney suggests that large lenders are often “fleecing Americans” and reiterated that his client did not miss any of the revised mortgage payments throughout the process.

Shibles' case is currently on appeal and her home has since been sold. The defendant contends the claim should be dismissed based on Federal Rules of Civil Procedure 12(b) challenging the validity of the claim. In these motions the defendant cites a lack of sufficient factual support necessary for the court to reasonably infer that the defendant was responsible for misconduct. In many cases, the homeowners were temporarily approved for modification and several months later informed that they did not qualify for a permanent modification. In these situations, it is apparent that retaining assistance from a lawyer with experience in foreclosure defense is critical; and the attorney should be brought into the matter earlier in the process for the best results.