Issue

Fraudulent denial of mortgage modification—date of discovery—lack of diligence—claims time-barred

Summary

In an action brought by homeowners (plaintiffs) alleging that a bank (defendant) operated a fraudulent scheme to delay plaintiffs' mortgage modification requests–submitted pursuant to a federal mortgage relief program–while continuing to collect trial period payments from them, which eventually resulted in the foreclosure of their homes, the trial court properly dismissed plaintiffs' claims as being time-barred because the claims were filed outside of the applicable statutory time limits from the date plaintiffs knew or should have known of their injuries and of the alleged fraud. At the latest, the statutes of limitations for all of plaintiffs' claims (both non-fraud and fraud) began to run by the date that each plaintiff lost his or her home. Although plaintiffs argued that they could not have discovered defendant's fraud until later, given the nature and frequency of their interactions with defendant without any progress being made on the modification application process, plaintiffs should have known of defendant's misdeeds through the exercise of ordinary diligence.

Summary from the North Carolina Reports digest (official subject index). Read the opinion →