Remedies under TILA

This post summarizes content of earlier posts, but is intended as a concise statement to end the series of blog posts regarding the Truth in Lending Act. New content regarding TILA will be added as available, however the next series of blog posts will address a new topic, perhaps another consumer protection statute or a new area of law altogether.

Only creditors are subject to the civil penalties of TILA. U.S.C. 1640(a). Civil damages are appropriate when disclosure requirements have been violated, and liability is imposed despite the creditor’s alleged good faith and reasonableness. The damages potentially include actual damages, statutory damages, and attorneys fees.

A consumer is entitled to actual damages where a creditor fails to comply with the requirements imposed by TILA. The amount of these damages is equal to the sum of any actual damages sustained by the consumer as a result of the creditor’s violation. U.S.C. 1640(a)(1). Courts may require the consumer to show actual reliance upon the accuracy of the disclosures in order to claim actual damages.

A consumer is entitled to statutory damages for violations of the general and rescission requirements of TILA. U.S.C. 1640(a). For open-end credit transactions, statutory damages are awarded in an amount equal to twice the finance charge. If the action arises out of a credit transaction secured by a dwelling, the consumer is entitled to a minimum award of $200 but not more than $2,000. U.S.C. 1640(a)(2)(A)(i-iii). Only one statutory recovery is allowed even if there are multiple disclosure violations in a transaction. U.S.C. 1640(g).

Consumers are awarded attorney’s fees in a successful action or when they are “determined to have a right of rescission under Section 1635″ even if the consumer is not obligated to pay his or her attorney. U.S.C. 1640(3). Attorneys fees include the cost of the action and “a reasonable attorney’s fee as determined by the court”. U.S.C. 1640(3).

At Wilson Law Group, we work within these laws to provide you with the appropriate remedies for the violations in your mortgage. As always, our blog does not provide legal advice for a particular situation. Rather it is a series of opinions and references for general information.

For your free consultation, contact us today.

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