WASHINGTON (Dec. 11, 2009) - The Federal Housing Administration (FHA) today announced that it reached a settlement agreement with Equitable Trust Mortgage Corporation (ETM) of Baltimore, Maryland, thereby terminating the suspension imposed on December 7, 2009. FHA suspended ETM's HUD/FHA approval because ETM improperly overcharged 37 borrowers for broker and loan origination fees in excess of what the U.S. Department of Housing and Urban Development currently allows.
"The settlement agreement is a victory for both HUD and the borrowers who were affected by ETM's actions," said Federal Housing Administration Commissioner David H. Stevens. "The settlement agreement imposes a significant penalty on ETM for violating HUD requirements, but also provides the wronged borrowers relief in these tough economic times."
By settling without admitting fault or liability, ETM has paid HUD a civil money penalty in the amount of $277,500. In addition, ETM agreed to refund the broker fee improperly charged to 37 borrowers. ETM will be contacting the 37 borrowers in an effort to refund the fees and these borrowers shall expect to receive refunds in amounts ranging from $500 to $9,135. The total amount repaid to borrowers will be $147,589.81. In the event that ETM is unable to contact the borrowers after using its best efforts, then ETM shall donate these funds to a HUD-approved Housing Counseling Agency.
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