Are you checking your mailbox every day and finding it cluttered with offers for new credit cards? Millions of other consumers are inconveniently dealing with the same dilemma and you can find a solution to reducing credit card junk mail with the help of the Federal Trade Commission (FTC)...
Many consumers have at least one debit card and one credit card. Understanding the liability differences between each and knowing when it is the right time to use them is important...
Some companies make extra money by oppressing consumers with hidden fees. Most of the time hidden fees appear in transactions that include contracts such as charge cards, loans, hotels, student fees, and telecommunication services like internet, television, and phones.
Ohio Gets Rid of Wells Fargo
Ohio decided to cut doing business with Wells Fargo due to the recent, unacceptable behavior of creating millions of fake bank accounts with customer names. So far cities in Illinois, Washington, and the Wells Fargo home state of California have already suspended business with the bank for at least one year.
Between 2011 and 2015 Wells Fargo employees created millions of fake bank accounts to meet targeted sales and collect more money in fees from their customers who were unaware of the unauthorized accounts. Wells Fargo’s actions violated the Truth in Lending Act and threatened to destroy their customers credit score.
This month Ohio announced that Wells Fargo is suspended from doing business with the state for at least one year. Wells Fargo mostly participated in funding state bonds in Ohio and is now forbidden to do so because of the loss of trust between the public and the bank. Ohio will now solicit related services from other companies even though Wells Fargo has contributed over $800 million to state bonds in the last couple years. Whether Wells Fargo will be able to gain business with Ohio again after a year will be determined at a later time.
It was settled in September that Wells Fargo will pay $185 million dollars in penalties for their fraudulent acts. Another $5 million dollars will be distributed to customers who are victims of the unlawful act and fee generating accounts.
Truth In Lending Act
The Truth in Lending Act (TILA) is a federal law legislated on May 29, 1968 under the Consumer Credit Protection Act. The TILA was created to protect consumers involved in contracts with credited purchases with creditors and lenders. Essentially the TILA act enforces loan companies and credit card companies to provide all information regarding interest rates and other fees before a consumer agrees to borrow.
TILA covers open-ended credit and close-ended credit. Open-ended credit includes borrowed funds such as credit cards, debit cards and home equity loans. Examples of close-ended credit include auto loans and home mortgages. Information regarding terms of an Annual Percentage Rate (APR), the total amount offered in a loan and the frequency of due dates to repay the loan is now obligatory for the loaner to provide to the consumer under this act. The dispense of required information now allows consumers to be aware of contracts, costs of credit and so-called hidden fees. Consumers are also able to be more confident and comfortable agreeing to credit related contracts because they can use the provided information to compare a variety of loans or borrowed money.
Failure of cooperation by a loaner or creditor to provide the required information to the consumer can result in rescission in certain instances. The loan or credit transaction would be disentangled and canceled, and all fees and paid money would be returned back to the consumer in a rescission. Lenders and credit companies are more disposed and willing to provide the required information based on TILA due to the amount of loss which could generated during a rescission.
You can find out more information about the Truth in Lending Act (TILA) regarding home owners and foreclosure by reading 23 Legal Defenses to Foreclosure: How to Beat the Bank by Troy Doucet.
Defending Foreclosure: The Basics and How to Use Them
Receiving a court summons for foreclosure is frightening. You find yourself pondering questions you never thought you would encounter. Can you save your home? Will your credit report be affected? Where will your family live?
The bank is telling the court that it has a right under the mortgage to foreclose on you. However, keep in mind that you have rights too, and it is legal, ethical, and smart to assert all of your rights with the help of an attorney when facing foreclosure.
Efficient foreclosure defense can allow you to stay in your home while you litigate your case, and we help many of our clients to save their home. However, if you are looking at other options, we can also help you obtain a deficiency judgment waiver in the situation that you leave your home, such as in a foreclosure sale, short sale, or deed in lieu of foreclosure agreement. We also help many clients to apply for and obtain a loan modification that reduces their principal, interest rate, and monthly payment.
Some of the defenses that experienced foreclosure defense attorneys employ to delay or dismiss foreclosures are:
Failure of Condition Precedent
The terms of the Note, Mortgage, and federal guidelines generally require specific steps the bank has to take before it can begin a foreclosure. If the bank fails to comply with the requirement to serve the homeowner with notice of default or to conduct necessary meetings with the homeowner, the court may dismiss the foreclosure.
Lack of Standing
When foreclosure proceedings begin, a lawsuit must be filed and served against you. You become the defendant, and the bank is the plaintiff. The bank must demonstrate to the courts they are the party legally entitled to foreclose on you. This is the legal concept of “standing”. You can bring the plaintiff’s standing into question as a foreclosure defense, and they must prove that they have the standing to foreclose. As the news has shown over the last several years, ownership of a mortgage can be a complicated thing with most loans being securitized, bought and sold multiple times. The bank’s errors, improper or incomplete documentation, or fraud may cause them to have a hard time proving their standing. If they can’t prove it, the lawsuit may be dismissed.
Unfair Lending Practices
If your bank has been deceptive about your loan, acted unfairly, or failed to disclose required information, you may be able to challenge foreclosure based on these bad acts. The Truth In Lending Act (TILA) requires lenders to disclose a great deal of information, including the annual percentage rate, payment schedule, and other information about the loan. Lenders who do not give borrowers the correct information TILA requires have broken this law.
There are many other defenses that may be raised, such as unconscionable terms, foreclosing on an active service member, and failure to properly invoke the court’s subject matter jurisdiction. But a homeowner can’t use one of these foreclosure defenses if they don’t know the defense exists or how to properly raise it. There are federal and state laws intended to protect homeowners, and those defenses can delay or dismiss foreclosure proceedings.
If you find yourself facing a bank in a foreclosure lawsuit, you know they have their attorneys working to protect the bank. Your best option is to get an attorney on your side to review everything and protect your interests. Contact Doucet & Associates to help ensure that your rights are protected.
Right of Rescission
A borrower facing foreclosure has a number of defenses to losing his or her home. One such defense is the right of rescission. One can think of rescission as the ending of a contract or agreement. Under the Truth in Lending Act (“TILA”), 15 U.S.C. § 1635, a borrower has the right of rescission as to certain transactions including mortgage refinancing, a home equity line of credit, a home improvement plan, or any other non-purchase credit transaction secured by the borrower’s principal dwelling . However, TILA’s right of rescission does not apply to the purchase of a home.
TILA “requires creditors to provide borrowers with clear and accurate disclosures of terms dealing with things like finance charges, annual percentage rates of interest, and the borrower’s rights[.]” Barrett v. JP Morgan Chase Bank, N.A., 445 F.3d 874, 877 (6th Cir. 2006). See also 12 C.F.R. § 226.1(b) (“The purpose of this regulation is to promote the informed use of consumer credit by requiring disclosures about its terms and cost.”).
Normally, a borrower is allowed until midnight of the third business day after the consummation of the transaction or delivery of the required TILA disclosures to the borrower, whichever is later, to rescind the transaction. But if the lender does not provide the required TILA forms and disclosures to the borrower, the borrower’s right of rescission may extend up to three years. In other words, a borrower has an “unconditional right to rescind for three days,” after which the borrower has three years to rescind if the lender fails to satisfy TILA’s disclosure requirements. Jesinoski v. Countrywide Home Loans, Inc., 135 S. Ct. 790, 792 (2015).
If a lender does not meet its TILA disclosure obligations and the borrower wishes to rescind the transaction within the three year time period, the borrower may do so by giving notice to the lender in accordance certain Federal Reserve Board regulations. For a borrower, a rescission of a transaction means the borrower is refunded all payments, fees, and costs, essentially placing the borrower in a position as if the transaction never occurred.
Wells Fargo Admits to Wrongful Conduct in Mortgage
Wells Fargo, a multinational banking and financial services holding company, admitted wrongdoing by proffering judgment in a federal lawsuit filed by Doucet & Associates on behalf of its client, a Westerville homeowner. Wells Fargo confessed to the lawsuit’s allegations and paid the homeowner money for the wrongful conduct.
In 2009, the homeowner accepted a promissory note and a mortgage in order to create a security interest in his home. During this time Landstar Title, LLC, APR Mortgage Corporation, Century Mortgage Company of Kentucky, and Prominent Title Agency, LLC, allegedly improperly set up an affiliate relationship (sharing profits from the real estate settlement). The homeowner alleged they did not properly inform the homeowner of this profit sharing, meaning he alleged all monies that changed hands were illegal kickbacks.
Later in 2012, the homeowner informed Wells Fargo that he wished to cancel his mortgage loan transaction under the Truth in Lending Act (TILA) on the basis of the non-disclosure of payments between the title company and mortgage company. Wells Fargo failed to honor this request, and in doing so violated the Truth in Lending Act.
The homeowner sought the cancellation of his mortgage loan be honored and that the security interest on his property be terminated. He also sought actual, statutory, and punitive damages in addition to injunctive relief to ensure these actions would not happen again, and wished to ensure these dealings did not affect his credit score.
Wells Fargo, in response, admitted wrongdoing and offered the homeowner cash in damages, which he accepted.
Doucet & Associates is dedicated to fighting for the rights of consumers, protecting their interests and offering legal assistance to those who would otherwise be unable to afford it. If you feel that a company is taking advantage of you, the law firm welcomes your call at (614) 944-5219.
Best Foreclosure Defense Available to Consumers
TILA rescission is one of the best statutory consumer foreclosure defense because it enables homeowners to unwind their entire mortgage transaction and get a refund of nearly all money paid to the lender, including monthly interest and closing costs. A subset of TILA, called HOEPA, offers even greater benefits that can generate substantial damages for the homeowner.
To qualify, the loan must have been used for your primary residence and not be older than 3 years old (HOEPA loans can be longer). Most importantly, the loan must have been used to refinance the home. That is, the loan must be a refinance under three years old. If those things apply, you should have your loan evaluated for TILA rescission based on faulty disclosures.