October 23, 2012
MADISON – A lawsuit has been filed in the Circuit Court’s office at the Boone County Courthouse against Whitesville State Bank alleging fraudulent conduct by the bank.
According to the lawsuit filed July 31, 2012, the plantiff Andy L. Kyser of Peytona claims the bank induced him into an unwise mortgage loan in excess of the value of his home. After he fell one month behind on his loan, the bank publicized his apparent indebtedness, refused to apply his payments to his loan and moved to foreclose without providing notice of default or right to cure.
According to the suit, Kyser, along with his recently-deceased wife, purchased the home in 2004 for $35,000, when they also obtained a real estate mortgage from Whitesville State Bank.
Kyser also had two other loans, neither of which was secured by the home, according to the lawsuit.
In early 2006, the bank told Kyser he was behind on his loan payments and would face foreclosure if he did not refinance. Kyser’s complaint says the bank required him to refinance his home-secured loan and one of his personal loans into a new home-secured loan.
Kyser claims to the best of his knowledge and belief he was not behind on his loans in early 2006, but after threats made by the bank to foreclose he did refinance to avoid losing his home.
Kyser’s complaint states that the bank obtained an appraisal valuing the property at $36,500 as of March 2006, but suppressed that information from him and on March 3, 2006, originated a loan for $49,499.45 for him with a term of 20 years and an initial interest rate of 7.25 percent. After an initial fixed rate period, the interest rate adjusts annually by adding 5 percent to the current index. The interest rate may rise to 13.25 percent, but will never fall below 6 percent, the complaint said.
The loan also included settlement charges of approximately $2,145.95.
The lawsuit also claims the husband of one of the bank’s employees came to where Kyser’s wife was working at the time and loudly stated “be sure you leave her a big tip, she’s behind on her house payment.”
Kyser’s complaint also states that he tried to make payments, but the bank refused to account for them and instead moved to foreclose on his home.
The lawsuit says Kyser has an eighth-grade education and is disabled. He has been employed as a truck driver and is unsophisticated in financial matters and was not afforded by the bank the opportunity to understand the details of the transaction.
The lawsuit accuses Whitesville State Bank of using a pattern of predatory lending practices. The lawsuit accuses the bank of unconscionable inducement, breach of contract, illegal return of payments, misrepresentation in debt collection and unreasonable publication.
Kyser has demanded a trial by jury and is being represented by Charleston attorneys Sarah K. Brown, Jennifer S. Wagner and Bren J. Pomponio with Mountain State Justice, Inc.
Whitesville State Bank was chartered in June 1946 in Whitesville, as a state bank and member of FDIC. Big Coal River Bancorp, a one bank holding company, was formed in 1986 and all bank shares were transferred to holding company stock.
Whitesville State Bank has earned a “Superior 5-Star” rating for the last 22 consecutive quarters by BauerFinancial, Inc., the nation’s leading bank rating and research firm.
The bank currently operates through four offices located in Comfort, Crab Orchard, Glen Daniel and Whitesville.