A Boston federal court was expected to rule by today on the fairness of a $10 million settlement of a class action against the mortgage arm of Ford Motor Co. over alleged kickbacks to brokers.

The ruling, which had not been issued by presstime, would end a two-year battle between the unit, Associates First Capital Corp., and Neighborhood Assistance Corporation of America. A ruling in favor of the settlement could pave the way for settlements in dozens of similar suits, which focus on a practice that regulators have yet to address with clear rules.

The lawsuit charged that Ford Consumer Finance, a subsidiary, had paid illegal kickbacks to brokers who convinced borrowers to take higher-rate loans.

Associates, a Dallas-based subsidiary of Ford Motor, originally hammered out the agreement in August 1996. But this January, community activist Bruce Marks, executive director of Neighborhood Assistance Corporation of America, vowed to fight the settlement, which affects about 80,000 borrowers, calling it "a sellout."

Judge George A. O'Toole heard additional evidence Wednesday from both sides in the case. Mr. Marks and his group protested on the steps of U.S. District Court for Massachusetts.

As it stands now, the settlement guarantees a coupon for $50 in cash or $250 off a new loan to any borrower who got a loan from Ford Consumer Finance between Jan. 1, 1991, and June 30, 1996. Borrowers who paid additional points on their loans are entitled to greater reimbursement.

Neighborhood Assistance mailed letters to more than 50,000 borrowers involved in the suit urging them to opt out, but only 300 have responded, Associates said.

Compensating mortgage brokers has been a sticky issue for lenders for years, in part because of the lack of a clear ruling on the issue by the Department of Housing and Urban Development. The agency had been slated to deliver a rewritten rule by Labor Day but missed its deadline.

Lenders have won most of the recent legal battles.

Most recently, a high-profile suit against Crestar Mortgage, an Arlington, Va.-based unit of Crestar Financial Corp., was denied class- action status. Attorneys for lenders applauded the judge's decision.

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