Wells Fargo sued over home equity lines of credit
Business Law
The banking unit of Wells Fargo & Co. is facing a lawsuit claiming it illegally reduced the size of customers' home equity lines of credit.
The suit, which was filed in Illinois, claims Wells Fargo failed to accurately assess the value of customers' houses before deciding to cut the size of their credit lines. San Francisco-based Wells Fargo is being accused of using unreliable computer models that wrongly valued home prices too low to justify cutting the size of customers' loans.
Home equity lines of credit are similar to credit cards in that a customer has a credit limit and can continue to borrow money until the limit is reached. Once a portion is paid off, it again becomes accessible to borrow. But, home equity lines of credit are backed by a borrower's property, whereas credit cares are unsecured.
Michael Hickman, who filed the lawsuit on behalf of himself and is seeking class action status for it, claims Wells Fargo also did not provide proper notice that the bank was reducing the size of the credit lines.
The bank's notice for reducing the lines also did not specifically provide a new estimated value for the property or the method used to determine the houses value. Hickman's lawsuit said that information was needed so a customer could challenge the change in the credit limit and try and reinstate the previous limit.
Hickman is being represented by KamberEdelson LLC, a Chicago-based law firm, which is also representing clients that have filed similar suits against JPMorgan Chase & Co. and Citigroup Inc.
Nearly all banks have been hit hard by mounting loan losses tied to residential real estate over the past two years. Reducing lines of credit can limit exposure to the struggling sector.
Related listings
-
SC lawsuit against Nucor Steel can proceed
Business Law 08/18/2009A federal appeals court has revived a discrimination lawsuit brought by black employees who claim they worked in a racially hostile environment at a Nucor Steel mill in South Carolina, attorneys said Tuesday. The 4th U.S. Circuit Court of Appeals sai...
-
Massey drops lawsuit against WVa Supreme Court
Business Law 07/25/2009Coal producer Massey Energy has dropped its lawsuit challenging the West Virginia Supreme Court's recusal procedures. Richmond, Va.-based Massey said in a statement Friday that the retirement of former Justice Larry Starcher last year prompted it to ...
-
Opponents of GM sale face noon deadline
Business Law 07/10/2009Opponents of General Motors Corp.'s plan to sell the bulk of itself to a new government-controlled company face a noon deadline to file appeals and find a way to get the sale halted.But with their options dwindling and time running out, it's increasi...
Grounds for Divorce in Ohio - Sylkatis Law, LLC
A divorce in Ohio is filed when there is typically “fault” by one of the parties and party not at “fault” seeks to end the marriage. A court in Ohio may grant a divorce for the following reasons:
• Willful absence of the adverse party for one year
• Adultery
• Extreme cruelty
• Fraudulent contract
• Any gross neglect of duty
• Habitual drunkenness
• Imprisonment in a correctional institution at the time of filing the complaint
• Procurement of a divorce outside this state by the other party
Additionally, there are two “no-fault” basis for which a court may grant a divorce:
• When the parties have, without interruption for one year, lived separate and apart without cohabitation
• Incompatibility, unless denied by either party
However, whether or not the the court grants the divorce for “fault” or not, in Ohio the party not at “fault” will not get a bigger slice of the marital property.