Is a lender liable to a borrower for negligence?
The following excerpt is from Duenas v. Ocwen Loan Servicing, LLC, Case No.: 1:14-cv-00406 - JLT (E.D. Cal. 2014):
"[A]s a general rule, a financial institution owes no duty of care to a borrower when the institution's involvement in the loan transaction does not exceed the scope of its conventional role as a mere lender of money." Nymark v. Heart Fed. Sav. & Loan Assoc., 231 Cal. App. 3d 1089, 1096 (1991). A lender's liability to a borrower for negligence arises only under special circumstances, such as "when the lender actively participates in the financed enterprise beyond the domain of the usual
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