ALBANY, N.Y. (Legal Newsline)-A New York judge is sending a strong message to mortgage companies: Help struggling homebuyers avoid losing their homes.

Justice Jeffery Spinner of Suffolk County has ordered a couple's $292,500 mortgage "cancelled, voided, avoided, nullified, set aside" because of a failure to act in good faith on the part of IndyMac Mortgage Services, a division of OneWest Bank F.S.B.

In Spinner's decision, he wrote that the homeowner had been reasonable in requests for a loan modification, while IndyMac Bank was unwilling to entertain any outcome short of foreclosure.

The judge referred to IndyMac's conduct as being "inequitable, unconscionable, vexatious and opprobrious" in its dealings with Greg Horoski, 56, and his wife, Diana Yano-Horoski, 55.

"Plaintiff's conduct is wholly unsupportable at law or in equity, greatly egregious and so completely devoid of good faith that equity cannot be permitted to intervene on its behalf," the judge said. "Indeed, Plaintiff's actions toward Defendant in this matter have been harsh, repugnant, shocking and repulsive to the extent that it must be appropriately sanctioned so as to deter it from imposing further mortifying abuse against Defendant."

The Horoskis fell on hard times after experiencing health problems but still every two to three months would call their lender and try and negotiate a payment plan that they could afford. The bank ultimately sent their home into foreclosure.

Five times the couple showed up at a court settlement conference to try and settle the case and five times no one from the bank appeared. The bank finally had to direct the bank to produce an officer and show up in court.

Spinner wrote that at that conference, it was made clear to the court that IndyMac had no intention of resolving the matter in any way but to foreclose on the property.

In a statement from OneWest Bank, the bank said it will appeal the decision.

"In this particular case, we spent nearly four years working with the borrower to resolve the situation and the law does not authorize a judge to cancel a borrower's loan obligation because he did not like the way loan modification discussions were handled. We believe the Yano-Horoski ruling, if allowed to stand, has sweeping and dangerous implications for the entire mortgage lending industry."