Mortgage ruling could shock U.S. banking industry

Dandelion Salad

By Gina Keating – Analysis
LOS ANGELES (Reuters)
Mon Jun 30, 2008 8:14pm BST

A lawsuit filed by a Wisconsin couple against their mortgage lender could have major implications for banks should a U.S. appeals court agree that borrowers can cancel their loans en masse when their lenders violate a federal lending disclosure law.

The case began like hundreds of others filed since the U.S. housing boom spawned a rise in sales of adjustable rate loans. Susan and Bryan Andrews of Cedarburg, Wisconsin, claimed that lender Chevy Chase Bank FSB (CCX_pc.N: Quote, Profile, Research) had hidden the true terms of what they believed was a good deal on a low-interest loan.

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h/t: ICH

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