Bank of America (BoA) moved to dismiss this breach of contract action arising from homeowner Lyo's attempt to secure a loan modification. When Lyo had mortgage difficulties, she contacted BoA who sent her an application for a loan modification, and BoA accepted and mailed Lyo an agreement for a Trial Period Plan (TPP) agreement. Lyo made the trial payments and continued to do so after the trial period was fnished, but BoA never sent her documents for a permanently modified loan. Lyo was notified she was ineligible for a modified loan due to the net present value (NPV) of the premises. In July 2011, for the first time in 23 months since execution of the TPP, BoA rejected Lyo's monthly payment. The court found Lyo's TPP could stand alone as an enforceable contract to grant her a loan modification as described within if conditions were met, rather than being so intertwined with the HAMP program that her claims could be deemed private causes of action under federal law. It found the language of the TPP provided unequivocally that upon Lyo's compliance with all conditions BoA was affirmatively obligated to act in granting her a permanently modified loan. Thus, Lyo was entitled to a trial and any conflicting language within the TPP mitigated against dismissal.
The full decision can be found here: http://www.newyorklawjournal.com
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