Mortgage Servicing and Loan Modifications: 5.8.3 Negligence
Borrowers seeking to assert tort claims based in negligence have met with mixed results. Whether actions are styled as claims for negligence or negligent servicing, courts have applied the same traditional four-part test. In order for plaintiffs to prevail in such an action, they must show: (1) a duty of care owed by the defendant to the plaintiff; (2) breach of that duty by the defendant; (3) injury to the plaintiff; and (4) that the defendant’s breach caused the plaintiff’s injury.164