Law Commons^™

Challenges Under Truth In Lending: Suing For Rescission, Giving Clear And Conspicuous Notice, And Electing Not To Rescind, Elwin Griffith

Akron Law Review

This Article reveals that the uniformity sought by Congress through TILA has challenged the courts to clarify the relationship between a notice of rescission and a suit for rescission, the relevance of the consumer’s ability to tender the loan principal, and the difficulty of recognizing a creditor’s attempt to accommodate a consumer’s premature election not to cancel a transaction.

Avoiding The Nuclear Option: Balancing Borrower And Lender Rights Under The Truth In Lending Act’S Right Of Rescission , Jonathan L. Caulder

Washington and Lee Law Review

No abstract provided.

Rethinking Disclosure In A World Of Risk-Based Pricing, Patricia Mccoy

Patricia A. McCoy

In response to subprime loan abuses, it is common for policymakers to exhort consumers to comparison-shop for residential mortgages. This policy prescription ignores the fact that price revelation works differently in the prime and subprime markets, impeding search in subprime. In the prime market, lenders reveal firm prices for free, without requiring consumers to first submit loan applications. This dynamic, combined with Truth-in-Lending Act (TILA) disclosures that standardize prices, make it easy to comparison-shop for prime mortgages. In contrast, in the subprime market featuring risk-based pricing, consumers must reveal their creditworthiness before lenders can determine loan prices, which allows lenders ...

Behaviorally Informed Regulation, Michael S. Barr, Sendhil Mullainathan, Eldar Shafir

Book Chapters

Policy makers typically approach human behavior from the perspective of the rational agent model, which relics on normativc, a priori analyses. The model assumes people make insightful, well-planned, highly controlled, and calculated decisions guided by considerations of personal utility. This perspective is promoted in the social sciences and in professional schools and has come to dominate much of the formulation and conduct of policy. An alternative view, developed mostly through empirical behavioral research, and the one we will articulate here, provides a substantially difierent perspective on individual behavior and its policy and regulatory implications. According to the empirical perspective, behavior ...

Notice Is Not Enough: Why Tila Requires More Than A Letter Of Intent, Levi Smith

University of Michigan Journal of Law Reform Caveat

The federal Truth in Lending Act (TILA) provides borrowers with protections and remedies against certain actions by lenders. TILA allows, in some circumstances, a borrower to rescind a loan from a lender within a three-year period from when the loan is made. However, a circuit split has developed regarding how the right to rescind must be exercised. Of the circuits that have considered this question, some require a lawsuit to be filed within the three-year period to rescind the loan. Other circuits have held that providing notice of the intent to rescind the loan within the three-year period is sufficient ...

How America's Newest Consumer Credit Statute Fails To Protect Its Oldest Consumers: A Critique Of The Credit Card Act Of 2009, Michael A. Furlong

Oklahoma Law Review

No abstract provided.

Ability To Pay, John A. E. Pottow

Articles

The landmark Dodd-Frank Act of 2010 ("Dodd-Frank") transforms the regulation of consumer credit in the United States. Many of its changes have been high-profile, attracting considerable media and scholarly attention, most notably the establishment of the Consumer Financial Protection Bureau ("CFPB"). Even specific consumer reforms, such as a so-called "plain vanilla" proposal, drew hot debate and lobbying firepower. But when the dust settled, one profoundly transformative innovation that did not garner the same outrage as plain vanilla or the CFPB did get into the law: imposing upon lenders a duty to assure a borrower's ability to repay. Ensuring a ...

The Case For Behaviorally Informed Regulation, Michael S. Barr, Sendhil Mullainathan, Eldar Shafir

Book Chapters

Policymakers approach human behavior largely through the perspective of the “rational agent” model, which relies on normative, a priori analyses of the making of rational decisions. This perspective is promoted in the social sciences and in professional schools, and has come to dominate much of the formulation and conduct of policy. An alternative view, developed mostly through empirical behavioral research, provides a substantially different perspective on individual behavior and its policy implications. Behavior, according to the empirical perspective, is the outcome of perceptions, impulses, and other processes that characterize the impressive machinery that we carry behind the eyes and between ...

Responding To The Subprime Mess: The New Regulatory Landscape, David Schmudde

Fordham Journal of Corporate & Financial Law

No abstract provided.

An Opt-Out Home Mortgage System, Michael S. Barr, Sendhil Mullainathan, Eldar Shafir

Other Publications

The current housing and financial crisis has led to significant congressional and executive action to manage the crisis and stem the harms from it, but the fundamental problems that caused the crisis remain largely unaddressed. The central features of the industrial organization of the mortgage market with its misaligned incentives, and the core psychological and behavioral phenomena that drive household financial decisionmaking remain. While the causes of the mortgage meltdown are myriad and the solutions likely to be multifaceted, a central problem that led to the crisis was that brokers and lenders offered loans that looked much less expensive and ...

Behaviorally Informed Financial Services Regulation, Michael S. Barr, Sendhil Mullainathan, Eldar Shafir

Other Publications

Financial services decisions can have enourmous consequences for household well-being. Households need a range of financial services - to conduct basic transactions, such as receiving their income, storing it, and paying bills; to save for emergency needs and long-term goals; to access credit; and to insure against life's key risks. But the financial services system is exceedingly complicated and often not well-designed to optimize house-hold behavior. In response to the complexity of out financial system, there has been a long running debate about the appropriate role and form of regulation. Regulation is largely stuck in two competing models - disclosure, and ...

Rethinking Disclosure In A World Of Risk-Based Pricing, Patricia A. Mccoy

Boston College Law School Faculty Papers

The residential mortgage market in the United States has changed significantly since the passage of current federal mortgage disclosure laws in the 1960s and 1970s. In this Article, Professor Patricia McCoy advocates for the reform of these traditional disclosure rules. After describing the evolution of the subprime mortgage market and providing a description of current federal disclosure laws, she explores how these new market dynamics cause the traditional disclosure rules to break down in the subprime market. Professor McCoy concludes with proposals to counteract false advertising practices, facilitate "meaningful comparison-shopping, and formulate streamlined disclosures addressing loan applicants' greatest concerns in ...

Rethinking Disclosure In A World Of Risk-Based Pricing

Patricia A. McCoy

The residential mortgage market in the United States has changed significantly since the passage of current federal mortgage disclosure laws in the 1960s and 1970s. In this Article, Professor Patricia McCoy advocates for the reform of these traditional disclosure rules. After describing the evolution of the subprime mortgage market and providing a description of current federal disclosure laws, she explores how these new market dynamics cause the traditional disclosure rules to break down in the subprime market. Professor McCoy concludes with proposals to counteract false advertising practices, facilitate "meaningful comparison-shopping, and formulate streamlined disclosures addressing loan applicants' greatest concerns in ...

Lending A Helping Hand?: A Guide To Kentucky’S New Predatory Lending Law, Kent H. Barnett

Scholarly Works

The purpose of this note is to furnish the consumer advocate with an in-depth analysis of Kentucky's new predatory lending law by examining the basic structure of the statute, and its ambiguities, faults, and remedies. Practitioners will understand the impact the law may have on high-cost home loans, the potential traps that await their clients, and the provisions that require amending.

Part I discusses the applicability of the statute. Part II focuses on Kentucky's limitations that dovetail HOEPA requirements for high-cost home loans. Part III discusses provisions of the Kentucky law that require much more than, or in ...

State Consumer Protection Statutes: An Alternative Approach To Solving The Problem Of Predatory Mortgage Lending, Jessica Fogel

Seattle University Law Review

This article continues in Part II by defining predatory lending practices, identifying borrowers who are likely to face predatory lenders, and discussing the consequences of predatory lending. Next, Part III provides a background for existing federal regulation, again in reference to RESPA and TILA. Part IV discusses state legislative efforts to curb predatory lending and identifies the problems of inconsistency and federal exemptions that undermine these state statutes. Part V examines the elements of state consumer protection acts and unfair and deceptive acts or practices ("UDAP") statutes and their application to predatory practices. Part VI argues that, because consumer protection ...

The Litigation Financing Industry: The Wild West Of Finance Should Be Tamed Not Outlawed, Susan Lorde Martin

Fordham Journal of Corporate & Financial Law

No abstract provided.

Annual Survey Of Virginia Law: Antitrust And Trade Regulation Law, Michael F. Urbanski, James R. Creekmore, Beth G. Hungate-Noland

University of Richmond Law Review

This year witnessed the advance of a wide variety of antitrust and trade regulation theories, most of which met with little success. Of the antitrust cases, Continental Airlines waged a successful battle to eliminate carry-on baggage restrictions at Dulles Airport. Additionally, Maryland's price-setting scheme for liquor was not accorded state action immunity. On the other side of the ledger, another antitrust litigant failed to overcome the requirement that efforts to petition the government must be objectively baseless in order to meet the sham exception to the Noerr-Pennington doctrine. Difficulties in proving an antitrust injury and the intent element of ...

Predatory Lending: Practices, Remedies And Lack Of Adequate Protection For Ohio Consumers, Anna Beth Ferguson

Cleveland State Law Review

This note focuses on remedies available to borrowers who fall prey to predatory lending practices on their home equity loans where their homes are used as collateral. Part II gives basic background information on predatory lending: what predatory lending is, examples of common predatory lending techniques, and, who benefits and who is hurt by predatory lending practices. Part III discusses and critiques current federal laws that borrowers have used to combat predatory mortgage lending practices. Part IV explains the current forms of relief available in Ohio and the limitations of these remedies. Part V discusses remedies in other states, focusing ...

Time And Money: One State's Regulation Of Check-Based Loans, Deborah A. Schmedemann

Faculty Scholarship

This article, which is part narrative and part essay, describes one professor's experience working on “check cashing” (or “check-based loans”) cases at the Appalachian Research and Defense Fund in eastern Kentucky. Parts I and II describe the typical check-based loan transaction and its effects on low-income consumers. Part III recounts how the law of check-based loans has developed in Kentucky, during the professor’s time there and since. Part IV sets forth some observations about language and legal process, suggested by the preceding narrative.

An Implied Cause Of Action Under The Real Estate Settlement Procedures Act, Christopher L. Sagers

Michigan Law Review

John and Janet lived for most of their early years together in a townhouse in Manhattan. It was a rental, a two-story walk-up on the Upper West Side with barely enough room for the two of them, and it ate up most of their income so that they were barely able to save anything. "Wait a minute," John said one day, "we're paying almost as much for this dump as we'd pay for a mortgage on a nice house!" So the two of them looked over their finances. Not much there. A few thousand and a 401(k ...

Consumer Disclosure In The 1990s, Griffith L. Garwood, Robert J. Hobbs, Fred H. Miller

Georgia State University Law Review

No abstract provided.

Property, E. F. Roberts

Cornell Law Faculty Publications

No abstract provided.

Property, E. F. Roberts

Cornell Law Faculty Publications

No abstract provided.

Acceleration Clause Disclosure: A Truth In Lending Policy Analysis, Patrick E. Hoog

Indiana Law Journal

No abstract provided.

A Comparative Study Of The Truth In Lending Act, Robert R. Riggins

Honors Theses

Consumer credit probably began in the United States early in the nineteenth century, but it has only in recent years acquired such a position of social and economic imminence. Today, credit is an integral part of our life style and the volume of consumer credit sales reaches monumental proportions.

Though credit use has benefits, the unwise use of credit has serious ramifications. Little can be done to protect the consumer from himself, so attention must focus on protecting the consumer-borrower from the lender. The full-disclosure facet of the Act assures consumer-borrowers that they will be informed as to the real ...