Sarno v. Wells Fargo Bank
Plaintiff John C. Sarno (Plaintiff) appeals from the judgment entered in favor of Defendant Wells Fargo Bank, N.A. (Wells Fargo) after the trial court sustained Wells Fargo’s demurrer without leave to amend. We affirm.
In November 2010, Wells Fargo provided Plaintiff a Good Faith Estimate (GFE) for a home loan. The GFE quoted an initial interest rate of 4.25 percent. Closing was to occur at the end of November, but it was postponed for two months. Immediately prior to the closing, Wells Fargo allegedly informed Plaintiff that the interest rate had increased to 4.625 percent. Plaintiff accepted the new interest rate and proceeded with the closing.
Over a year later, Plaintiff sued Wells Fargo, claiming the GFE constituted a binding agreement to make a loan at the listed 4.25 percent interest rate and that, under the GFE’s terms, the quoted interest rate was “available indefinitely.†The trial court rejected this contention, as do we.
The federal regulations governing GFEs expressly provide, “[i]f the interest rate has not been locked, . . . loan terms related to the interest rate may change.†(24 C.F.R. § 3500.7(f)(5).) Plaintiff admits he did not lock the 4.25 percent interest rate quoted in the GFE. And, contrary to Plaintiff’s contention, the GFE cannot reasonably be interpreted as a binding agreement to make a loan at the quoted interest rate for an indefinite period of time. The judgment is affirmed.
Because this appeal is from a judgment following the sustaining of a demurrer without leave to amend, we recite the material facts pled in the complaint without passing on the truth of the allegations, but disregard contentions, deductions and legal conclusions. (Blank v. Kirwan (1985) 39 Cal.3d 311, 318.)
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