Larry L. Jones Janet Jones v. Etrade Mortgage Corporation Etrade Bank

Larry L. Jones (Jones) and Janet Jones appeal the judgment of the district court dismissing their complaint with prejudice for failure to state a cause of action under the Truth In Lending Act (TILA), 15 U.S.C. §§ 1601—1667f, against E-Trade Mortgage Company and E*Trade Bank (collectively E*Trade). Holding that the Joneses have stated a viable complaint, we reverse and remand.

ALLEGATIONS

The Joneses allege, and for the purpose of this appeal we take as true, the following:

In September, 2001, Jones contacted E*Trade to arrange the refinancing of the mortgage on his home. On September 15, 2001, Lisa Arroyo, a loan consultant employed by E*Trade, sent him five documents to complete his loan application. Among the documents was one entitled “40-Day Lock-in Disclosure and Agreement” (Agreement). It identified the Joneses and their property and established a loan amount of $201,000 at an interest rate of 7.25 percent. The Agreement further provided for a “Rate Lock Fee” that would be refunded at the close of escrow.

The Agreement also contained general terms providing that applicants were required to return all documents listed on an enclosed checklist within three calendar days…