Eleventh Circuit Holds Certain Improper Disclosures Do Not Trigger TILA Rescission

TILA Mortgage Origination

On January 14, the U.S. Court of Appeals for the Eleventh Circuit affirmed dismissal of a suit seeking rescission of a mortgage loan based on the lender’s alleged failure to disclose the “real lender” and improper disclosure of the interest rate, the yield spread premium, the payments schedule and the processing and administrative fees. Wane v. The Loan Corp., No. 13-11597, 2014 WL 114688 (11th Cir. Jan. 14, 2014). The court held that the allegation that the borrower was not informed of the real lender did not support a right to rescind because (i) it was not a material disclosure under the TILA; and (ii) the borrowers were, in fact, apprised of the party financing the mortgage. Similarly, the court held the allegations that other terms were improperly disclosed did not give rise to a right to rescind because they were either properly disclosed or, in the case of the yield spread premium and the processing and administrative fees, did not constitute material violations of TILA’s disclosure requirements. The court also affirmed the district court’s order denying the borrower’s motion for summary judgment to quiet title, and granting the lender’s motion for summary judgment for breach of contract and money lent.