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Court orders more proceedings in foreclosure action

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An Elkhart County man successfully convinced the Indiana Court of Appeals to reverse the denial of his motion to set aside default judgment in a foreclosure action. The man argued he relied on information from the bank that he could proceed with a short sale and the foreclosure proceeding would be put on hold.

Bank of America N.A. attempted to foreclose on Michael H. Kretschmer’s property in Elkhart County in 2012. When Kretschmer didn’t reply to the complaint, the trial court awarded default judgment to the bank. When Kretschmer learned of the judgment, he filed a motion to set it aside, alleging that Bank of America had agreed to a short sale of the real estate. He said he spoke with someone in the bank’s counsel’s office who told him, “not to worry about anything and to continue with the short sale.” Based on that conversation, Kretschmer did not hire an attorney or appear in court.

The matter went to a settlement conference, in which the parties agreed to stay the foreclosure pending Kretschmer’s submission of a possible short sale offer and the bank’s review of the offer. But the bank claimed it never received any offers and the trial court later ruled in favor of the bank on Kretschmer’s motion to set aside the default judgment.

But the trial court erred by denying his motion, the Court of Appeals ruled Thursday in Michael H. Kretschmer v. Bank of America, N.A., 20A05-1312-MF-600. The judges found that his failure to timely answer BANA’s complaint was the result of excusable neglect under Trial Rule 60(B)(1) and (3) due to the information provided by the bank’s counsel’s office.

Kretschmer claimed that he presented two short sale offers to the bank, but the bank failed to consider the offers. If true, these allegations could show that the bank engaged in contractual sabotage or other acts of bad faith, the appeals court held.

“If Kretschmer’s assertions that BANA promised to allow him more time to attempt to obtain an acceptable short sale offer are credited, then it was incumbent upon BANA to give due consideration to any short sale offers Kretschmer submitted for approval. Finally, we observe that Ind. Code § 24-4.4-2-201 provides in part that a creditor who fails to respond to a short sale offer may be liable in an action under 12 U.S.C. 2605(f), and the fact that Kretschmer may be entitled to damages under certain circumstances supports the conclusion that, if the case were tried on the merits, a different result may be reached,” Judge Elaine Brown wrote.

The case is remanded for further proceedings.
 

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  1. Can I get this form on line,if not where can I obtain one. I am eligible.

  2. What a fine example of the best of the Hoosier tradition! How sad that the AP has to include partisan snark in the obit for this great American patriot and adventurer.

  3. Why are all these lawyers yakking to the media about pending matters? Trial by media? What the devil happened to not making extrajudicial statements? The system is falling apart.

  4. It is a sad story indeed as this couple has been only in survival mode, NOT found guilty with Ponzi, shaken down for 5 years and pursued by prosecution that has been ignited by a civil suit with very deep pockets wrenched in their bitterness...It has been said that many of us are breaking an average of 300 federal laws a day without even knowing it. Structuring laws, & civilForfeiture laws are among the scariest that need to be restructured or repealed . These laws were initially created for drug Lords and laundering money and now reach over that line. Here you have a couple that took out their own money, not drug money, not laundering. Yes...Many upset that they lost money...but how much did they make before it all fell apart? No one ask that question? A civil suit against Williams was awarded because he has no more money to fight...they pushed for a break in order...they took all his belongings...even underwear, shoes and clothes? who does that? What allows that? Maybe if you had the picture of him purchasing a jacket at the Goodwill just to go to court the next day...his enemy may be satisfied? But not likely...bitterness is a master. For happy ending lovers, you will be happy to know they have a faith that has changed their world and a solid love that many of us can only dream about. They will spend their time in federal jail for taking their money from their account, but at the end of the day they have loyal friends, a true love and a hope of a new life in time...and none of that can be bought or taken That is the real story.

  5. Could be his email did something especially heinous, really over the top like questioning Ind S.Ct. officials or accusing JLAP of being the political correctness police.

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