High Court Decides in Favor of Quicken Loans in RESPA Case

The ""Supreme Court"":http://www.supremecourt.gov/ ruled unanimously in favor of ""Quicken Loans, Inc."":http://www.quickenloans.com/, Thursday, in a case that bars lenders from splitting settlement fees with third parties.

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The decision upholds an interpretation of the Real Estate Settlement Procedures Act (RESPA) that gives lenders leeway when it comes to charging fees. It rejects a longstanding HUD policy that interpreted the law to include a flat ban on unearned fees.

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Writing for the high court, Justice Antonin Scalia said that plaintiffs ""must demonstrate that a charge for settlement services was divided between two or more persons"" to establish that a lender violated RESPA.

The decision ends a nearly four-year suit against the Detroit-based lender.

The case began in 2008 when three Louisiana families filed separate suits against Quicken Loans. The plaintiffs argued that the lender billed them for origination discount fees without reducing interest rates.

The suits worked their way through three lower courts, including a U.S. Fifth Circuit Court of Appeals, whose disagreement with past decisions helped land the case before the Supreme Court.

Much of the contention surrounded previous guidance issued by ""HUD"":http://portal.hud.gov/hudportal/HUD supporting the view that the legal framework prohibits lenders from charging unearned fees.

The court wrote that the proper interpretation is ""manifestly in├âÔÇÜ├é┬¼consistent with the statute HUD purported to construe,"" arguing that it ""would make no sense if Congress had already resolved"" any issues with the law.