NEW YORK - (09/27/04) -- In a major blow to the mortgageindustry, a federal appeals court ruled Friday that many of the fatfees lenders earn during the settlement process may amount toillegal mark-ups if the lender performs no significant service toearn the additional fees. The ruling found that Wells FargoMortgage Corp., one of the largest mortgage lenders in the country,marked up fees charged to borrowers from third-party vendorswithout adding any additional value or service of their own. Aclass action suit claims that Wells contracted for loan originationservices from third-party vendors at a cost of $20 to $50, thencharged its borrowers $150 to $300 for the same documents. The suitalso challenged fees charged to use of Fannie Mae's and FreddieMac's automated underwriting systems, which cost Wells $20 perapplication, but for which Wells charged the borrowers as much as$300. The ruling comes several months after Congress shot down abid by the Department of Housing and Urban Development to reformthe settlement process and reign in settlement costs, under whichborrowers are charged thousands of dollars for property and floodzone appraisals, title work, document preparation, credit reportfees, and underwriting.
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As AI and digital assets become mainstream, banks are spotting new opportunities to integrate payments with other activities.
July 4 -
House Republicans overcame internal divisions to narrowly pass President Trump's tax and spending package Thursday afternoon. The measure would cut the Consumer Financial Protection Bureau's funding level, among other provisions.
July 3 -
A new partnership with Google Cloud will let the Spanish bank offer Gemini to all staff after a successful ChatGPT deployment.
July 3 -
Atlanta-based CoastalSouth's initial public offering prices at $21.50 a share; Valley National Bancorp announces Lyndsey Sloan will succeed Gary Michael as general counsel; Webster Financial Corporation taps a new chief risk officer and appoints a new board member; and more in this week's banking news roundup.
July 3 -
Capital One closed the deal to buy the credit card provider in May and as part of the review process, decided to exit its home equity lending business.
July 3 -
In a rare move for a credit union, the Seattle institution has snapped up the 13-member team that created EarnUp's AI Advisor product.
July 3