The term lender liability involves several different causes of action that may potentially be brought against lenders, but as a New Jersey banking attorney can explain, the essence of the claims are that the lender must treat the borrower fairly.
An unprecedented number of loan defaults has created increased scrutiny of lenders in regards to their loan documentation and relationship with borrowers. Borrowers themselves may bring claims against the lender, but an experienced New Jersey banking lawyer reports that recent regulatory concerns have increased pressure to ensure that mortgage lenders are playing on a level field, and recent litigation has seen financial guarantors and bankruptcy trustees bringing claims against lenders as well.
Causes of Action
A primary issue is breach of contract. As a New Jersey banking attorney emphasizes, a mortgage contract, although sophisticated and wide ranging, is in essence merely a contract. Thus, its terms, especially its damage clauses, are enforceable. Other causes of action reported by a New Jersey banking attorney, either brought as an original action or as a counterclaim, include:
• Negligent misrepresentation
• Breach of the covenant of good faith and fair dealing
• Breach of fiduciary duty
• Technical violations of various federal and state statutes
Defending the Financial Institution
The resolution of many lender liability issues will hinge on managing the voluminous discovery attendant with such cases. An experienced New Jersey banking lawyer understands how to handle the pitfalls of e-discovery and has established protocols in place for extensive document review. By continually narrowing the focus of the case with the use of dispositive motions and other pretrial measures, your New Jersey banking attorney can provide opportunities for settlement where possible, while laying the groundwork for a trial if that becomes inevitable.
Contact a New Jersey Banking Lawyer for Legal Advice
If your company is currently facing a lender liability claim or if you would like to learn how to mitigate the risks present in today’s lending climate, call Snellings Law, LLC, a New Jersey banking attorney group, at 973.265.6100.