Financial Lender Liability
"Better late than never, but never late is better."
- Harvey McKay
Just to be clear, SO&L does NOT defend financial institutions in lender liability matters…….We sue them on behalf of our clients!
Briefly, lender liability law states that lenders must treat their borrowers honestly and fairly. When that’s not the case, lenders can be subject to borrower litigation under a variety of legal claims usually involving breach of contract and/or fraud.
A loan agreement is a contract. As such, if it was fraudulently induced or there was lack of mutual consent, the agreement cannot be enforced. If the loan contract was breached by the lender, the lender can be sued.
A common remedy pursued by borrowers when a breach of a loan agreement has occurred is the recovery of damages. Said recovery can include lost opportunity, lost profits and the difference between the loan amount and the costs for obtaining a new/replacement loan.
Lawsuits involving financial institutions involve complex issues that often include: defining the fiduciary relationship (was the bank acting as a fiduciary or an advisor) and/or was there an arms length creditor – borrower relationship.
Even if there was a default on a loan, the financial institution must act prudently in all actions taken following default. If collateral has been wrongfully repossessed or disposed of, the lender may lose certain rights, forfeit its security interest or be held liable for damages. “Commercial reasonableness” must be exercised by the lender.
Because the area of lender liability law is changing quickly, lenders and borrowers' rights activists are busy lobbying in state legislatures and Congress for changes to benefit their representative sides.
And due to all that lobbying activity, the time to have your case evaluated is NOW. Contact SO&L before changes in applicable law reduce or restrict your rights and remedies.
We invite you to call us at 818-461-8500 or you may prefer to use our Confidential Contact Form.