             Case: 16-10257     Date Filed: 11/08/2016   Page: 1 of 8


                                                            [DO NOT PUBLISH]



               IN THE UNITED STATES COURT OF APPEALS

                       FOR THE ELEVENTH CIRCUIT
                         ________________________

                                  No. 16-10257
                              Non-Argument Calendar
                            ________________________

                     D.C. Docket No. 1:15-cv-02031-CAP



RHONDA J. CLARK,
a.k.a. Rhonda J. Fulgham,

                                                           Plaintiff-Appellant,

                                     versus

HSBC BANK USA, NATIONAL ASSOCIATION,
as Trustee,
NATIONSTAR MORTGAGE, LLC,

                                                          Defendants-Appellees.

                            ________________________

                  Appeal from the United States District Court
                     for the Northern District of Georgia
                        ________________________

                               (November 8, 2016)

Before HULL, MARCUS, and WILSON, Circuit Judges.

PER CURIAM:
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      Rhonda Clark, appearing pro se, appeals the district court’s dismissal of her

complaint against HSBC Bank USA, N.A. (“HSBC”) and Nationstar Mortgage,

LLC, (“Nationstar”), in which she alleged that the defendants wrongfully

foreclosed on her property, and violated Regulation X of the Real Estate

Settlement Procedures Act (“RESPA”). On appeal, Clark argues that the district

court erred in dismissing her Regulation X claim and in denying her leave to

amend, because at the time of the foreclosure sale, she had not received any

communication from her mortgage servicer as to the status of her request for loan

modification. Further, she contends that HSBC was her mortgage servicer, and

knew or should have known that she was under consideration for a loan

modification with her previous loan servicer, Bank of America, and thus,

Regulation X prevented HSBC from foreclosing on her property. After a careful

review of the records and the parties’ briefs, we affirm.

                               I.    Standard of Review

      We review a district court’s dismissal for failure to state a claim de novo.

See Hunnings v. Texaco, 29 F.3d 1480, 1484 (11th Cir. 1994). Although we

review the denial of a motion to amend a complaint for an abuse of discretion, we

review a denial due to futility de novo “because [the district court] is concluding

that as a matter of law an amended complaint would necessarily fail.” Fla.

Evergreen Foliage v. E.I. DuPont De Nemours & Co., 470 F.3d 1036, 1040 (11th


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Cir. 2006) (internal quotation marks omitted). Lastly, pro se pleadings are liberally

construed and are held to a less stringent standard than pleadings drafted by

attorneys. Bingham v. Thomas, 654 F.3d. 1171, 1175 (11th Cir. 2011). However,

where a pro se litigant fails to challenge an issue on appeal, the issue is deemed

abandoned. Irwin v. Hawk, 40 F.3d 347, 347 n.1 (11th Cir. 1994).

                                   II.   Discussion

      Here, the district court did not err in dismissing Clark’s RESPA claim,

brought pursuant to Regulation X, for failure to state a claim because Clark did not

comply with the regulations to warrant a claim, and HSBC is not a loan servicer

and is therefore not subject to the regulation.

      To survive a motion to dismiss, a plaintiff’s complaint must state a claim

that is plausible on its face and feature more than “unadorned, the-defendant-

unlawfully-harmed-me accusation[s].” Ashcroft v. Iqbal, 556 U.S. 662, 678, 129

S. Ct. 1937, 1949 (2009). To satisfy the plausibility standard, the complaint must

demonstrate more than a sheer possibility that the defendants have acted

unlawfully. Id. We need not accept “legal conclusion[s] couched as a factual

allegation” or “[t]hreadbare recitals of the elements of a cause of action supported

by mere conclusory statements” as true. Id. Determining whether a complaint

survives a motion to dismiss is a “context-specific” task and the allegations must




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permit the court, based on “its judicial experience and common sense . . . to infer

more than the mere possibility of misconduct.” Id. at 679.

          A. Clark Did Not Comply With Regulation’s Requirements

      Although it appears that Clark does not challenge the district court’s

determination regarding her RESPA claim against Nationstar, as she does not

present any arguments against or mention Nationstar in her brief, to the extent that

she has preserved that claim, the district court did not err in its determination

because Clark’s loss mitigation application was untimely.

       Under RESPA, a consumer protection statute that regulates the real estate

settlement process, the Consumer Financial Protection Bureau (“CFPB”) is tasked

with prescribing rules and regulations. See 12 U.S.C.S § 2617(a). RESPA’s

Regulation X, became effective January 10, 2014. See Mortgage Servicing Rules

Under the Real Estate Settlement Procedures Act (Regulation X), 78 Fed. Reg.

10696-01, 10696 (Feb. 14, 2013). This regulation places certain obligations on

mortgage servicers when a borrower submits a loss mitigation application and lays

out distinct procedures and rules for submitting such applications regarding

measures for assessing completeness, timelines and evaluation protocols. See

generally 12 C.F.R. § 1024.41.

      Regarding completeness, the regulation establishes that when a servicer

receives an application 45 days prior to a foreclosure sale, the servicer is required


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to immediately ascertain whether the application is complete and notify the

borrower of this determination in writing within 5 days. § 1024.41(b). Generally,

an application is considered complete when the servicer “has received all the

information that the servicer requires from a borrower in evaluating applications

for the loss mitigation options available to the borrower.” § 1024.41(b)(1). If the

application is deemed incomplete, the servicer must “exercise reasonable diligence

in obtaining documents and information to complete [the] application,” informing

the borrower in the initial notification of “the additional documents and

information the borrower must submit to make the loss mitigation application

complete” and state “a reasonable date by which the borrower should submit the

documents and information.” § 1024.41(b)(1), (b)(2). If the borrower fails to

respond within the reasonable time provided and the application remains

incomplete, the servicer may, at its discretion, evaluate the incomplete application.

See § 1024.41(c)(2). However, if the borrower submits the requested documents or

no additional information is requested, the application is considered complete and

the servicer’s evaluation obligations under subsections (c) are triggered as long as

the application qualifies as complete—either in actuality or facially—more than 37

days before the foreclosure sale. See id. § 1024.41(c).

      Pursuant to subsection (c), within 30 days of receiving the complete

application, the servicer must evaluate the application and determine all loss


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mitigation options available to the borrower and “[p]rovide the borrower with a

notice in writing stating the servicer’s determination of which loss mitigation

options, if any, it will offer to the borrower on behalf of the owner or assignee of

the mortgage.” Id. § 1024.41(c). Additionally, if the borrower submits a complete

application more than 37 days before a scheduled foreclosure sale, the servicer is

prohibited from proceeding with the foreclosure sale until the servicer either (a)

notifies the borrower of its decision regarding loss mitigation options, (b) the

borrower “rejects all loss mitigation options offered”, or (c) the “borrower fails to

perform under an agreement on a loss mitigation option.” See id. § 1024.41(g).

Notwithstanding these mandates, “[n]othing in § 1024.41 imposes a duty on a

servicer to provide any borrower with any specific loss mitigation option.” Id.

§ 1024.41(a).

       Clark submitted loan modification paperwork on March 25, 2015, only 13

days before the foreclosure sale scheduled for April 7, 2015. Thus, Clark’s loan

modification application was submitted outside Regulation X’s prescribed

timelines for both complete and incomplete applications, and therefore, Nationstar

was not required to inform Clark of her mitigation options, if any, or stop the

foreclosure process. See 12 C.F.R. § 1024.41(b)(2)(i), (c)(1), (g).




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                               B. HSBC Is Not A Loan Servicer

      Again, Regulation X’s requirements only apply to mortgage servicers, and

HSBC is not a servicer within the meaning of the regulation, thus the district court

did not err in dismissing her claim.

      Under Regulation X, a “servicer” is the “person responsible for the servicing

of a federally related mortgage loan.” 12 C.F.R. § 1024.2. “Servicing” a loan is

defined as “receiving any scheduled periodic payments from a borrower pursuant

to the terms of any federally related mortgage loan . . . and making payments to the

owner of the loan or other third parties . . . as may be required pursuant to the

terms of the mortgage servicing loan documents or servicing contract.” See 12

C.F.R. § 1024.2; See generally § 1024.41.

      According to Clark’s complaint and the attached exhibits, Nationstar acted

as Clark’s mortgage servicer on behalf of HSBC, who merely owned the security

deed. Nationstar was the party responsible for receiving payments on the

mortgage, informing Clark of her default, arranging her foreclosure solutions, and

taking her loan modification application into consideration. Thus, Regulation X’s

requirements do not apply to HSBC, and the district court properly dismissed

Clark’s Regulation X claim against HSBC.

      Additionally, the district court did not err in concluding that any attempt by

Clark to amend her complaint to add an allegation that she submitted a previous


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loan modification request to Bank of America, who then failed to forward the

paperwork to Nationstar, would be futile. This allegation would still not state a

valid Regulation X claim against Nationstar. Clark’s Bank of America loan

modification application was submitted some time in 2011, before Regulation X

became effective on January 10, 2014. See Mortgage Servicing Rules Under the

Real Estate Settlement Procedures Act (Regulation X), 78 Fed. Reg. at 10696.

Nationstar has been her servicer the whole time Regulation X has been effective

and Clark has never alleged that she submitted a loan modification application to

Nationstar before the March 25, 2015 application referenced in her complaint

(which was submitted outside Regulation X’s 45 day timeframe). Thus, allowing

Clark to amend the complaint to assert her allegation that she submitted a previous

loan modification request to Bank of America, who then failed to forward the

paperwork to Nationstar, would have been futile. Accordingly, the district court

did not err in dismissing Clark’s RESPA claim against Nationstar and HSBC.

      AFFIRMED.




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