Lozo
Pacific Shore Funding v. Lozo
Opinion
Opinion
Aldrich, J.
INTRODUCTION
A year after refinancing a loan they had obtained from Pacific Shore Funding, Zoran and Monika Lozo attempted to rescind the original loan transaction on the ground Pacific Shore had violated various disclosure requirements of the Truth in Lending Act (TILA) ( 15 U.S.C. § 1601 et seq., as amended by the Home Ownership and Equity Protection Act of 1994 (HOEPA), 15 U.S.C. §§ 1602 (aa) & 1639). The trial court granted Pacific Shore’s summary judgment motion following King v. State of Cal. (9th Cir. 1986) 784 F.2d 910 , cert. den. sub nom. King v. California (1987) 484 U.S. 802 [ 98 L.Ed.2d 11 , 108 S.Ct. 47 ], rehg. den. 484 U.S. 971 [ 98 L.Ed.2d 412 , 108 S.Ct. 412 ] (King), ruling that once having refinanced their first loan, the Lozos had nothing left to rescind.
In the published portion of this opinion, we decline to follow King, and are instead persuaded by the reasoning of myriad federal courts from other circuits. We hold that borrowers are not precluded from rescinding a consumer credit transaction that is secured by their residence and subject to TILA merely because they have already refinanced that loan.