Opinion ID: 2995397
Heading Depth: 2
Heading Rank: 2

Heading: Loan Splitting

Text: Rendler also argues that the district court erred in granting Corus Bank’s summary judgment motion and denying her motion based on her claim that Corus violated the TILA by splitting Rendler’s loan into two separate transactions. She claims that Corus engaged in loan splitting when it issued her two loans, on its own volition, when she only filled out one application and sought only one loan. Loan splitting may be defined as the situation where the debtor wanted, requested and expected to receive a single loan, consummated in one transaction, but the lender documented and made disclosure for the loan as if it were two separate transactions. In re Buckles, 189 B.R. 752, 760 (D. Minn. 1995). Several district courts have held that loan splitting violates the TILA because the Act mandates that the lender provide a single, comprehensible disclosure of the cost of credit./10 We need not decide however, whether loan splitting, as defined in In re Buckles, violates the TILA because that is not what is claimed by the Rendler class. In this case, the class is defined as those individuals to whom Corus issued two loans and two TILA disclosure statements in connection with the financing of a single piece of residential real estate. The class is not limited by the expectations of the consumers. In fact, three-fourths of potential class members under this definition submitted two applications for and expected to receive two separate loans from Corus Bank. Loan splitting focuses on whether the borrower expected to enter into more than one transaction. See Buckles, 189 B.R. at 760. The key for a loan splitting claim is the breach of the borrower’s expectations by the lender, and because this class definition does not include a limitation based on those expectations, the Rendler class cannot maintain a claim for loan splitting.