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Additional Info re:Predatory Loan

Posted on: 07th Dec, 2006 07:41 am
We appealed the summary judgement and won in Florida 3rd district court of appeals. They reversed the summary judgement becuase there was a genuine issue of fact about the loan's purpose (either its business or consumer). The appeals court ruled and said in their opinion, based on case law, that the determination of a loan's purpose, even with the existence of a business purpose affadavit, is the borrower's use of the money and NOT the borrower's subjective motivitation. They also said that the lender knew that over 75% of the hard equity loan was to pay off an existing 2nd mortgage on the borrower's homestead (single family residence). The cash at close has already been documented that all the money was used for personal expenses. They sent the case back to the lower court to determine the use of the money so the loan can be classified as a business or consumer loan based upon the use of loan proceeds. If consumer, then HOEPA, Florida Fair Lending and TILA regulations and disclosure would apply. If business, no protection. You have to understand that all the lender has to do to make these kinds of loans is document them properly and comply with mandated disclosure. Pretty simple when you think about it.
Yeah, if the business lenders don't provide the TILA or HOEPA disclosures, they should be giving some kind of disclosure where the loan terms and conditions are clearly stated.
Posted on: 07th Dec, 2006 09:20 pm
Hi Guest,

Yesterday I came through a similar post in forums and I have given my opinion there. So if you can go through http://www.mortgagefit.com/know-how/hardmoneyequityloan.html , I feel you will be able to get some information there.

Thanks
Posted on: 08th Dec, 2006 12:57 am
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