US banks offered exploding-interest-rate mortgages to consumers? US banks didn't properly disclose the exploding-interest-rate portion? US banks are being sued in civil court under the Truth In Lending Act? Hah, karma's a bitch!
Source: http://uk.reuters.com/article/newsOne/idUKN2634924420080630?sp=true
To summarize, a couple got a mortgage in 2005 from the Chevy Chase Bank (yes, really!) with an adjustable interest rate. The interest rate climbed dramatically, from 1.95% in the first month to "well above 5.75 percent" by the second month. Last year the couple successfully transformed their lawsuit into a class action lawsuit, which means thousands of other borrowers in the same position can sue the bank together. And the big part of the story is that if this couple wins they can force the bank to rescind the loan, meaning they can negotiate a much fairer mortgage with another bank.
Quote from: Thorin on July 05, 2008, 03:33:18 PM
To summarize, a couple got a mortgage in 2005 from the Chevy Chase Bank (yes, really!) ...
FYI for clarification: Da Bank* (http://en.wikipedia.org/wiki/Chevy_Chase_Bank#Litigation) vs. Cornelius Crane ?Chevy? Chase (http://en.wikipedia.org/wiki/Chevy_Chase),
thespian!
* "...taking the name from Chevy Chase, Maryland (http://en.wikipedia.org/wiki/Chevy_Chase%2C_Maryland)..."