Banking Law

Colorado Court Upholds Bank Loan Interest Validity in Bankruptcy (1)

Aug. 13, 2020, 7:40 PM; Updated: Aug. 13, 2020, 8:46 PM

A federal court in Colorado ruled that a new federal rule on interest rates on bank-sold loans is valid, but remanded a bankrupt company’s dispute over the “true lender” of a high-interest loan it owed.

Rent-Rite Superkegs West Ltd. deserved an opportunity to conduct discovery on whether the loan came from Wisconsin-based Bank of Lake Mills or its non-bank partner, World Business Lenders, LLC, the U.S. District Court for the District of Colorado ruled Wednesday.

The Office of the Comptroller of the Currency in May issued a “valid-when-made” rule that said an interest rate remains valid when a bank transfers...

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