The U.S. Supreme Court agreed to clarify the scope of a federal law aimed at protecting homebuyers from being overcharged by companies that provide real estate settlement services.

On Tuesday the justices accepted an appeal from a group of Louisiana consumers seeking to sue Quicken Loans Inc. over fees they paid at their mortgage closings.

The homebuyers say Quicken, a Detroit unit of the closely held Rock Holdings Inc., charged as much as $1,100 in "loan discount fees" without providing the interest rate reduction those fees typically bring.

The fight at the high court centers on a provision in the 1974 Real Estate Settlement Procedures Act that bars settlement providers in at least some cases from collecting money for services they didn't perform.

The question for the justices is whether that provision applies only when two companies split the disputed fee, as in the case of a kickback. A New Orleans federal appeals adopted that reading of the statute in throwing out the suit against Quicken, putting it at odds with other courts around the country.

The Obama administration urged the Supreme Court to accept the homebuyers' appeal and overturn the lower court ruling.

Subscribe Now

Access to authoritative analysis and perspective and our data-driven report series.

14-Day Free Trial

No credit card required. Complete access to articles, breaking news and industry data.