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No. The court noted that the reason for requiring particular wording, type size, and placement immediately above the borrower's signature is to ensure that the borrower sees it, reads it, and follows its instructions. And it could not be denied that Walton violated these requirements. But it does not follow, the court continued, that the note is rendered unenforceable by this violation. Under the law, borrowers are entitled to compensation for the "actual damage suffered, claimed, and proved by them" as a result of the lender's having failed to provide the required cautionary statement. Since Phil could not provide any proof of damages, his claim was dismissed. Got a question on this or another issue?
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Editor's Note: This article originally appeared in the Credit & Collection Manager's Letter.
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