Pittsburgh-based PNC Bank has been hit with a lawsuit accusing its mortgage servicing unit of unfair and deceptive practices involving delinquent loans.
The suit, filed in federal court in Pittsburgh last week, contends PNC employs a scheme to maximize fees when borrowers fall behind in their mortgage payments.
Specifically, the suit claims PNC repeatedly charges delinquent mortgage customers for “unreasonable and inappropriate” drive-by property inspections.
The suit, which seeks class-action status on behalf of “hundreds of thousands or millions of borrowers,” was filed by Rosemary Marsh of Bremerton, Wash.
According to the complaint, Ms. Marsh was charged for six inspections, at $12 each, over a span of 17 months after she fell behind on her mortgage in 2013.
“The inspector drives by the property ostensibly to assess whether the property is occupied, being maintained, and has not been damaged,” the suit said.
But the bank automatically orders the property inspections at regular intervals without regard to whether they are needed or reasonable, according to the suit. “Property inspections are even performed when PNC is aware that a property is not vacant,” the suit said.
As an example, the complaint said, in the case of a borrower who only misses one month’s payment but continues to make regular monthly payments, “PNC’s system will continue to generate work orders for property inspections until the initial default is cured.”
“These computer-generated inspections are unnecessary and unreasonable, confer no benefit to the lender and serve no purpose other than to generate revenue for PNC,” the suit states.
In Ms. Marsh’s case, the bank ordered and assessed inspection fees even after verifying she was occupying the home, and after she had resumed making monthly payments on her loan, according to the suit.
PNC declined comment, saying it doesn’t discuss ongoing litigation.
The lead attorneys in the case — at Finkelstein, Blankinship, Frei-Pearson & Garber of White Plains, N.Y., — did not return phone calls or emails seeking comment.
Patricia Sabatini: PSabatini@post-gazette.com; 412-263-3066.
First Published: November 10, 2017, 6:22 p.m.
Updated: November 10, 2017, 6:26 p.m.
