Baltimore, Md.-based lender Equitable Trust Mortgage Corp. has approval to make FHA-guaranteed loans again after settling charges that it charged borrowers excessive loan origination fees. The Federal Housing Administration suspended ETM’s FHA approval on Dec. 7 for allegedly overcharging 37 borrowers for broker and loan origination fees.
Without admitting fault or liability, ETM has paid the Department of Housing and Urban Development a $277,500 civil penalty, HUD said in a press release. ETM also agreed to refund $147,600 to the 37 borrowers, who will receive refunds ranging from $500 to $9,315, HUD said.
HUD is reportedly planning to lift the 1 percent cap on origination fees for FHA-backed loans, saying new loan disclosure forms lenders are required to begin using on Jan. 1 under the Real Estate Settlement Procedures Act (RESPA) will help borrowers comparison shop, American Banker reported.
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