In a recent national class action, hundreds of home-mortgage borrowers have accused the Federal National Mortgage Association of unlawfully rigging their interest rates. The lawsuit offers a glimpse into the business practices and mindset of one of the country’s largest government sponsored enterprises. Continue Reading Fannie Mae Finds Itself in Cross-Hairs of Class Action

The infamous marketing arrangement run by Genuine Title, LLC, a now-defunct title company from Maryland, has ended up where we all expected: in a certified class action. All the lender defendants except one settled the lawsuits against them. The lone holdout, West Town Bank & Trust, ignored a few critical defenses and learned its lesson the hard way. Continue Reading Lender Misses Golden Opportunity to Assert Key RESPA Defenses

Many states require lenders to record satisfactions of mortgage soon after the underlying debt is paid off. The failure to do so can result in monetary penalties. In light of a recent decision from the U.S. Supreme Court, judges now disagree about whether those situations can also lead to viable lawsuits. Continue Reading Judicial Feud Erupts Over Recording of Mortgage Releases

The impact of a long-awaited court ruling involving PHH Corporation is still reverberating throughout the real estate industry. The decision could radically change the way the Consumer Financial Protection Bureau (CFPB) enforces the Real Estate Settlement Procedures Act (RESPA). Because the opinion is so potentially far reaching, we will discuss it in two separate posts. In this first one, we will consider what it means for the CFPB to be unconstitutional. Continue Reading The CFPB Is Unconstitutional, So Now What?

No real estate business wants to get sued in a class action or pay the associated legal costs, which can be hefty. The question often arises then: Will my company’s errors-and-omissions insurance protect me if we are hit with a class action? The answer is “maybe,” and, in any event, your insurer will almost certainly fight you over the matter. So prepare yourself for a protracted legal fight against a determined adversary. The good news is that, sometimes, insureds can and do win these battles. Continue Reading Insurance Coverage for Class Actions: A Battle Royale

Class actions involving the Telephone Consumer Protection Act of 1991 (TCPA) are nothing new. What is new is that they recently hit the real estate industry. Worse yet, insurance companies have grown increasingly savvy in excluding coverage for those types of lawsuits. Nonetheless, a smart company might be able to bargain away its questionable insurance rights in exchange for settling a TCPA class action. Continue Reading Insurance Coverage for TCPA Class Actions Remains Uphill Battle

If your company must publically file its service rates, you should consider attacks that plaintiffs’ lawyers have launched against other fee schedules. Also, keep in mind ripple effects that market-conduct examinations can have. A recent decision from a California appellate court highlights these dangers. Continue Reading Class-Action Trolls Covet Weak Spots in Your Filed Rates

The most critical part of any class-action defense is often the narrative. That is because a judge who believes that consumers have been cheated will often permit a class action to go forward, even if the case is otherwise questionable. Nowhere is that tendency more evident than in the wave of lender-placed insurance (“LPI”) lawsuits currently sweeping the country. Continue Reading Companies Face Difficult Narrative with Lender-Placed Insurance