Connecticut General Statutes 36a-760i – Court action based on lender’s failure to comply with statutory requirements
(a) A borrower who has been injured by a violation of sections 36a-760a to 36a-760h, inclusive, may bring a claim in a court of competent jurisdiction by the date three years after the date of the closing for the following: The greater of actual damages or one thousand dollars; and costs and reasonable attorney’s fees, unless:
Terms Used In Connecticut General Statutes 36a-760i
- Counterclaim: A claim that a defendant makes against a plaintiff.
- Damages: Money paid by defendants to successful plaintiffs in civil cases to compensate the plaintiffs for their injuries.
- Equitable: Pertaining to civil suits in "equity" rather than in "law." In English legal history, the courts of "law" could order the payment of damages and could afford no other remedy. See damages. A separate court of "equity" could order someone to do something or to cease to do something. See, e.g., injunction. In American jurisprudence, the federal courts have both legal and equitable power, but the distinction is still an important one. For example, a trial by jury is normally available in "law" cases but not in "equity" cases. Source: U.S. Courts
- Evidence: Information presented in testimony or in documents that is used to persuade the fact finder (judge or jury) to decide the case for one side or the other.
- Foreclosure: A legal process in which property that is collateral or security for a loan may be sold to help repay the loan when the loan is in default. Source: OCC
- Fraud: Intentional deception resulting in injury to another.
- Jurisdiction: (1) The legal authority of a court to hear and decide a case. Concurrent jurisdiction exists when two courts have simultaneous responsibility for the same case. (2) The geographic area over which the court has authority to decide cases.
- Loan: includes any line of credit or other extension of credit. See Connecticut General Statutes 36a-2
- Mortgage: The written agreement pledging property to a creditor as collateral for a loan.
- Mortgage loan: A loan made by a lender to a borrower for the financing of real property. Source: OCC
- Mortgagor: The person who pledges property to a creditor as collateral for a loan and who receives the money.
- Mutual: when used in conjunction with any institution that is a bank or out-of-state bank means any such institution without capital stock. See Connecticut General Statutes 36a-2
- Restitution: The court-ordered payment of money by the defendant to the victim for damages caused by the criminal action.
(1) By the date ninety days after the date of the loan closing and prior to the commencement of any action against a lender under this section, the borrower is notified by the lender of the compliance failure, the lender tenders appropriate restitution and the lender either (A) makes the nonprime home loan comply with the applicable provisions of sections 36a-760a to 36a-760h, inclusive; or (B) changes the terms of the mortgage in a manner beneficial to the borrower so that the mortgage will no longer be considered a nonprime home loan subject to the provisions of sections 36a-760a to 36a-760h, inclusive; or
(2) The lender is able to show by a preponderance of evidence that the compliance failure was not intentional and resulted from a bona fide error notwithstanding the maintenance of procedures reasonably adapted to avoid such errors. For the purposes of this subdivision, the phrase “bona fide error” includes, but is not limited to, a clerical, calculation, printing, computer malfunction or programming error, but does not include an error of legal judgment with respect to a lender’s obligations under the relevant provisions of sections 36a-760a to 36a-760h, inclusive. In actions where the compliance failure has caused material injury to the borrower, the lender shall also be able to show that it cured the compliance failure or otherwise undertook reasonable remedial steps to address or compensate for the injury; or
(3) The lender and borrower otherwise reach a mutual agreement on an appropriate remedy or curative action.
(b) In addition, the court may grant an injured borrower such relief as it deems just and equitable.
(c) A borrower or mortgagor may assert fraud and any violation of sections 36a-760a to 36a-760h, inclusive, which causes material injury to a borrower as a counterclaim or defense to foreclosure by the date six years after the date of the closing.
(d) Nothing in this section shall be construed as creating or permitting a cause of action or defense or counterclaim against an assignee of a nonprime home loan or other mortgage loan with respect to a violation of sections 36a-760a to 36a-760h, inclusive, by the originating lender or mortgage broker.