Material Interference in UDAAP Lawsuit

The first full-service mortgage risk management firm in the United States.

November 16, 2023

QUESTION

We are being sued for a violation of UDAAP. The lawsuit is based on the allegation that we materially interfered with the ability of a consumer to understand our terms and conditions. As far as I know, we have never intentionally misled a consumer. Our legal counsel is fighting back, but our reputation is already getting hit with negative press.

I am the Chief Operating Officer, and with permission of our Board, I am writing you to ask for some history involving this kind of allegation. Your response could help us broaden our perspective and assist us in making sure this incident never happens again.

We recently signed up for your UDAAP Tune-up, but it will not start for a few weeks. In the meantime, a word from you about some facets of this allegation would be appreciated.

What is "material interference" involving terms and conditions in the context of UDAAP?

ANSWER

Thank you for your interest in our UDAAP Tune-up. Our UDAAP review is in demand. When it comes to Unfair, Deceptive, or Abusive Acts or Practices (UDAAP), it is essential to be proactive. Don’t wait for a regulatory investigation; certainly, don’t think you can wiggle your way out of a lawsuit, which often metastasizes into class action litigation.

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For information about our

UDAAP Tune-up,

please contact us here.

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There are many litigious access points to allege UDAAP violations, given that many regulatory frameworks are implicated. You mentioned that you never intended to mislead the consumer; however, it is important to recognize that intent is not required to show material interference.