In this case, a California Appellate Panel rendered an opinion favoring creditors who refinance a debt in reliance upon a fraudulent financing statement, even though no new money is advanced. In this case, debtors had an existing loan with the bank and were unable to make the agreed payments. Debtors requested an extension of time to […]

Here, debtor, a former police officer, applied for and was approved for a loan from Hartford Police Federal Credit Union for $150,000. The loan was for the purpose of paying off an existing second mortgage on debtor’s residence and for the purchase of a business. At the closing on the credit union’s new mortgage, debtor executed the closing […]

In this case, a jury awarded the debtor $46,225 plus punitive damages of $100,000. Here, Pioneer Savings loaned $39,000 to Lannigan secured by the debtor’s real estate. The initial interest rate was “8 1/2%”. The loan documentation provided that Pioneer: … may hereafter decrease said interest rate and may also increase the rate upon giving […]

False Credit Union Loan Application results in nondischargeable debt for Credit Union. Here, debtor applied for several loans at the Credit Union, and on all but the last application, the debtor listed a mortgage debt on her residence. Each of the loan applications were denied due to an unacceptable debt to income ratio, except for the […]

In this case, the debtor filed successive Chapter 13 petitions for the apparent purpose of frustrating the debtor’s mortgage company from foreclosing on debtor’s real estate. The Court held that the successive bankruptcy filings were in bad faith and in violation of the Bankruptcy Code requirement that all filings must be in good faith. Costs […]

An Erroneous legal description in a Credit Union mortgage was fatal to enforcement of mortgage. Here, Electric Boat Community Federal Credit Union (EBC), granted a loan to Louis Salerno (Salerno) that was supposed to be secured by a mortgage on the debtor’s real estate. In the mortgage document, however, the credit union inadvertently identified the real estate […]

A Chapter 7 debtor, who was not in default under the obligations of a consumer loan agreement, was not limited to redemption, reaffirmation, or surrender of the collateral. Here, the the court held that a Chapter 7 debtor could keep his vehicle pledged as collateral to the creditor, even though the debt was not reaffirmed, redeemed […]

In this case, the lender’s Truth-in-Lending (TILA) disclosure provided that the borrowers were granting a security interest in the borrowers’ real estate and in all after acquired property as additional security for future advances. The mortgage document did not, however, contain the same language and did not grant a security interest to the lender in […]

In this case, a U.S. Bankruptcy Court ruled that Calumet National Bank’s recorded mortgage was invalid simply because the notary’s acknowledgement did not recite who appeared before the notary and acknowledged execution of the mortgage. Here, debtors borrowed more than $148,000 from Calumet National Bank and signed a mortgage on their real estate securing the debt. […]

The Real Estate Settlement Act (RESPA) parameters have been significantly expanded by recent amendments to both the Act itself, as well as amendments to Regulation X and Regulation Z with the Truth in Lending Act.   Consequently, nearly all mortgages on a member’s one-to-four family residence require additional disclosures be distributed to the applicants.   The regulations expands […]