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Truth in Lending: 11.3.1 General

This section addresses general issues related to the identity of the person raising a TILA claim. This includes issues involving co-obligors and forgery victims. The last subsection describes standing and judicial estoppel issues in bankruptcy court.

Fair Debt Collection: 11.15.2.2.3 When does harm have a close relationship to harm traditionally recognized as a basis for a lawsuit?

Ramirez provides more detail about one of the two alternative tests for Article III standing articulated in Spokeo: that the harms the plaintiff suffered have a close relationship to a harm traditionally recognized as providing a basis for a lawsuit in American courts.1464 Ramirez states that Article III “does not require an exact duplicate in American history and tradition.”1465

Fair Debt Collection: 11.15.2.2.5 Procedural vs. substantive requirements—does it make a difference?

The Spokeo decision dwelt on a characterization of the case’s FCRA violations as merely “procedural.” Although the Spokeo Court did not clearly indicate the role of the distinction between procedural and substantive violations, many decisions have given meaning to this distinction, often by giving greater weight or conclusive weight to Congress’s judgment in enacting a statute that creates substantive protections and grants a private remedy for violations.1495

Truth in Lending: 9.3.3.2.1 General

In general, the TILA rules discussed in this section apply to residential mortgage loans, which are defined to include closed-end, dwelling-secured loans (although timeshares are excluded from many provisions).137 However, the loan affordability and income verification rule has some additional scope applications.

Mortgage Lending: § 3801. Findings and purpose

(a) The Congress hereby finds that—

(1) increasingly volatile and dynamic changes in interest rates have seriously impared1 the ability of housing creditors to provide consumers with fixed-term, fixed-rate credit secured by interests in real property, cooperative housing, manufactured homes, and other dwellings;

Mortgage Lending: 12 U.S.C. § 1715z-20. Insurance of home equity conversion mortgages for elderly homeowners

(a) Purpose. The purpose of this section is to authorize the Secretary to carry out a program of mortgage insurance designed—

(1) to meet the special needs of elderly homeowners by reducing the effect of the economic hardship caused by the increasing costs of meeting health, housing, and subsistence needs at a time of reduced income, through the insurance of home equity conversion mortgages to permit the conversion of a portion of accumulated home equity into liquid assets; and

Mortgage Lending: § 206.3 Definitions.

As used in this part, the following terms shall have the meaning indicated.

Bona fide tenant means a tenant of the property who is not a mortgagor, borrower, a spouse or child of a mortgagor or borrower, or any other member of a mortgagor’s or borrower’s family.

Borrower means a mortgagor who is an original borrower under the HECM Loan Agreement and Note. The term does not include successors or assigns of a borrower.

Mortgage Lending: § 206.45 Eligible properties.

(a) Title. A mortgage must be on real estate held in fee simple; or on a leasehold that is under a lease with a duration lasting until the later of: 99 years, if such lease is renewable; or the actuarial life expectancy of the mortgagor plus a number of years specified by the Commissioner, which shall not be more than 99 years. The mortgagee shall obtain a title insurance policy satisfactory to the Commissioner.

Mortgage Lending: § 206.125 Acquisition and sale of the property.

(a) Initial action by the mortgagee.

(1) The mortgagee shall notify the Commissioner within 60 days of the mortgage becoming due and payable when the conditions stated in the mortgage, as required by § 206.27(c)(1) have occurred or when the Deferral Period ends. The mortgagee shall notify the Commissioner within 30 days when one of the conditions stated in the mortgage, as required by § 206.27(c)(2), has occurred.

Mortgage Lending: § 206.131 Contract rights and obligations for mortgages on individual dwelling units in a condominium.

(a) Additional requirements. The requirements of this subpart shall be applicable to mortgages on individual dwelling units in a condominium, except as modified by this section.

(b) References. The term property as used in this subpart shall be construed to include the individual dwelling unit and the undivided interest in the common areas and facilities as may be designated.

Mortgage Lending: § 206.134 Partial release, addition or substitution of security.

(a) A mortgagee shall not release the security or any part thereof, while the mortgage is insured, without the prior consent of the Commissioner.

(b) A mortgagee may, with the prior consent of the Commissioner, accept an addition to, or substitution of, security for the purpose of removing the dwelling to a new lot or replacing the dwelling with a similar or like kind on the existing lot under the following conditions:

Mortgage Lending: Introduction to State-by-State Summary

The state statutes that govern land contracts (a.k.a. “land installment contracts” or “contracts for deed”) take a variety of approaches and forms. These laws were enacted at various times, and usually without much consideration of the laws on the books in other states. In large part they seem to have been created out of whole cloth, rather than drawing on the legislative language developed in other jurisdictions or lessons learned from those other attempts.

Mortgage Lending: ARIZONA

Arizona’s land contract statute includes several limitations on the forfeiture remedy. First, a forfeiture may be carried out only after waiting a specified amount of time, ranging from thirty days to nine months, depending on the amount of money that has been paid towards the purchase price.3 Second, the forfeiture remedy must be carried out in the manner set forth in the statute.

Mortgage Lending: CALIFORNIA

California’s statute uses the term “real property sales contract,” and defines that term as an agreement in which one party will convey title to another upon the satisfaction of certain conditions, and the contract does not require conveyance of title within one year of contract formation.12

Mortgage Lending: COLORADO

Colorado requires that the seller in a contract for deed transaction fulfill two key obligations: (a) designate the county public trustee (an official responsible for verifying the satisfaction of mortgages and also carrying out foreclosure sales) as the escrow agent for payments made towards the property taxes for the property,19 and (b), within ninety days after execution of the contract, notify the county treasurer and county assessor of the transfer by filing a written notice of transfer by contract for deed.

Mortgage Lending: FLORIDA

Florida’s statute simply and elegantly provides that all conveyances or instruments for the purpose of conveying property with a purpose of securing payment of money “shall be deemed and held mortgages” and “shall be subject to the same rules of foreclosure and to the same regulations, restrains and forms as are prescribed in relation to mortgages.”27 Courts have confirmed that this section applies to contracts for deed, which are deemed mortgages under Florida law.28 The statute further explains th

Mortgage Lending: ILLINOIS

In 2017, Illinois passed the Installment Sales Contract Act29 that expanded protections for buyers in land contracts.

Mortgage Lending: INDIANA

Indiana does not have a statute that comprehensively addresses land installment sales contracts; however, two acts, Indiana’s First Lien Mortgage Law and Home Loan Practices Act do have provisions that impose some rules on land installment sales contracts.

Mortgage Lending: IOWA

Iowa law provides three basic protections for land contract purchasers. First, Iowa law requires all land contract sellers to record the contracts within ninety days and, if the sellers do not do so, they may be subject to a $100/day fine and limited in their ability to obtain forfeiture. Sellers who fail to record cannot pursue a forfeiture until the contract is recorded.41 Second, Iowa’s statute requires that the seller deliver certain written disclosures to the buyer before execution of the land installment contract.

Mortgage Lending: LOUISIANA

Louisiana law imposes minimal requirements on land installment sales contracts, which it labels as bonds for deed. It requires sellers to provide buyers who default on payments with a notice giving the buyers forty-five days to cure the default.44 Buyers make their installment payments through an authorized escrow agent.

Mortgage Lending: MAINE

Maine requires foreclosure, rather than forfeiture, of any land contract for the sale of residential real estate if the buyer is in possession of the real estate at the relevant time.47 If the buyer is not in possession of the home (for example, if the buyer is renting the home to a tenant), the terms of the contract apply, meaning that a forfeiture could be allowed if the contract so provides.