Dismissal Of Predatory Lending Action Reversed.

Plaintiffs initiated an action against a loan broker and various financial institutions, claiming “pursuant to a scheme of predatory lending, [they] made material misrepresentations and fraudulent concealments of circumstances in the appraisal of the residence and in the terms of the loan in order to maximize their profit.” They alleged they applied for a residential home loan, and later discovered they used an appraisal which was based upon outdated sales of homes that were not truly comparable in value, resulting in a significantly inflated appraisal of the property. The trial court sustained demurrers without leave to amend and granted a judgment on the pleadings. The appellate court reversed, agreeing with plaintiffs that they sufficiently alleged delayed discovery of facts that defendants had purposely withheld from them, pursuant to a scheme of predatory lending, in order to induce them to enter into now defaulted loans. Fuller v. First Franklin Financial Corporation  (Cal. App. Third Dist.; May 1, 2013) (As Mod. June 24, 2013) 216 Cal.App.4th 955.