Mortgage Lender Asks High Court to Uphold Federal Rules vs. States

By Seiberg, Jaret | American Banker, March 26, 1997 | Go to article overview

Mortgage Lender Asks High Court to Uphold Federal Rules vs. States


Seiberg, Jaret, American Banker


A mortgage company is asking the Supreme Court to decide whether state judges may reinterpret rules issued by federal regulators.

At issue is an Alabama law that limits fees lenders may charge consumers to 5% of a loan's value.

The Alabama statute exempts any lender authorized by the Department of Housing and Urban Development to provide federally insured mortgages. Several other states have similar laws.

United Companies Lending Corp. assumed it was exempt from the Alabama cap because it is a HUD-authorized guaranteed lender.

United was sued after it charged nearly $3,000 in fees to Michael and Joyce McGehee in 1991 on a $32,000 mortgage.

The Alabama Supreme Court sided with the McGehees in October, ruling tht United had broken the state law. The court declared that HUD had only authorized United's corporate headquarters in Louisiana to offer guaranteed mortgages. The McGehees got their loan from United's Mobile, Ala., field office.

The ruling directly contradicted HUD policy, which bestows a single, corporatewide authorization on a lender.

In its petition to the Supreme Court, United argued that the U.S. Constitution requires states to defer to federal agencies unless their rule interpretations are arbitrary or clearly erroneous. According to United's brief, that exception does not apply to HUD in this case.

The lender also argued that state judges must independently evaluate the propriety of regulations before overturning them. That never was done in the Alabama dispute, it said. …

The rest of this article is only available to active members of Questia

Already a member? Log in now.

Notes for this article

Add a new note
If you are trying to select text to create highlights or citations, remember that you must now click or tap on the first word, and then click or tap on the last word.
One moment ...
Default project is now your active project.
Project items

Items saved from this article

This article has been saved
Highlights (0)
Some of your highlights are legacy items.

Highlights saved before July 30, 2012 will not be displayed on their respective source pages.

You can easily re-create the highlights by opening the book page or article, selecting the text, and clicking “Highlight.”

Citations (0)
Some of your citations are legacy items.

Any citation created before July 30, 2012 will labeled as a “Cited page.” New citations will be saved as cited passages, pages or articles.

We also added the ability to view new citations from your projects or the book or article where you created them.

Notes (0)
Bookmarks (0)

You have no saved items from this article

Project items include:
  • Saved book/article
  • Highlights
  • Quotes/citations
  • Notes
  • Bookmarks
Notes
Cite this article

Cited article

Style
Citations are available only to our active members.
Buy instant access to cite pages or passages in MLA, APA and Chicago citation styles.

(Einhorn, 1992, p. 25)

(Einhorn 25)

1. Lois J. Einhorn, Abraham Lincoln, the Orator: Penetrating the Lincoln Legend (Westport, CT: Greenwood Press, 1992), 25, http://www.questia.com/read/27419298.

Cited article

Mortgage Lender Asks High Court to Uphold Federal Rules vs. States
Settings

Settings

Typeface
Text size Smaller Larger Reset View mode
Search within

Search within this article

Look up

Look up a word

  • Dictionary
  • Thesaurus
Please submit a word or phrase above.
Print this page

Print this page

Why can't I print more than one page at a time?

Help
Full screen

matching results for page

    Questia reader help

    How to highlight and cite specific passages

    1. Click or tap the first word you want to select.
    2. Click or tap the last word you want to select, and you’ll see everything in between get selected.
    3. You’ll then get a menu of options like creating a highlight or a citation from that passage of text.

    OK, got it!

    Cited passage

    Style
    Citations are available only to our active members.
    Buy instant access to cite pages or passages in MLA, APA and Chicago citation styles.

    "Portraying himself as an honest, ordinary person helped Lincoln identify with his audiences." (Einhorn, 1992, p. 25).

    "Portraying himself as an honest, ordinary person helped Lincoln identify with his audiences." (Einhorn 25)

    "Portraying himself as an honest, ordinary person helped Lincoln identify with his audiences."1

    1. Lois J. Einhorn, Abraham Lincoln, the Orator: Penetrating the Lincoln Legend (Westport, CT: Greenwood Press, 1992), 25, http://www.questia.com/read/27419298.

    Cited passage

    Thanks for trying Questia!

    Please continue trying out our research tools, but please note, full functionality is available only to our active members.

    Your work will be lost once you leave this Web page.

    Buy instant access to save your work.

    Already a member? Log in now.

    Author Advanced search

    Oops!

    An unknown error has occurred. Please click the button below to reload the page. If the problem persists, please try again in a little while.