Magazine article Mortgage Banking

FHA Lifts Suspension of Equitable Trust Mortgage

Magazine article Mortgage Banking

FHA Lifts Suspension of Equitable Trust Mortgage

Article excerpt

The Federal Housing Administration (FHA) reached a settlement agreement with a recently suspended lender--Baltimore-based Equitable Trust Mortgage Corporation (ETM). As part of the settlement, the lender paid a civil money penalty of $277,500. Without admitting fault or liability, ETM entered into the agreement with FHA, thereby terminating the suspension that was imposed on Dec. 7.

Equitable Trust Mortgage was suspended from participating in the FHA program after HUD found evidence that the lender "improperly overcharged 37 borrowers for broker and loan origination fees in excess of what [HUD] currently allows," a press release noted.

Part of the settlement agreement requires ETM to refund the broker fees it improperly charged to 37 borrowers, according to HUD. The lender will seek to notify the affected borrowers, and refunds are expected to be in amounts ranging from $500 to $9,135, HUD said. Should the lender be unable to contact any of the affected borrowers after "using its best efforts," then the amount shall be donated to a HUD-approved Housing Counseling Agency, HUD stated. The total amount of the fees to be refunded is $147,589. …

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