WASHINGTON, Dec 11 (Reuters) - The Federal Housing Administration on Friday said it reached a settlement with Equitable Trust Mortgage Corp after suspending the lender for charging unauthorized fees to minorities on government-backed home loans.
Under the agreement, Equitable Trust will pay a civil money penalty of $277,500 and will refund $147,590 in brokers’ fees improperly charged to 37 borrowers, the FHA said in a statement. The borrowers will receive amounts ranging from $500 to $9,135.
The agreement ends a suspension imposed on the Baltimore-based lender on Monday. The FHA had said Equitable Trust also had failed to disclose all loan origination fees to borrowers.
The FHA is doing a broad review of mortgage lenders to ensure that all lending meets government requirements as its volume rises and defaults erode its reserves. As of last week, it had suspended seven lenders and withdrawn FHA approval for some 270 others. (Reporting by David Lawder, Editing by Chizu Nomiyama)