Consumer Finance Insights
April 25, 2019

Maryland AG Announces Settlement with Reverse Mortgage Servicer

On April 16, 2019, the Maryland Attorney General (“Maryland AG”), in cooperation​ with Maryland’s Office of the Commissioner of Financial Regulation, announced it had reached a settlement with a Michigan reverse mortgage servicer resolving allegations that the company charged homeowners for home inspection fees in violation of the Maryland Consumer Protection Act, Md. Code Ann., Com. Law §§ 12-121 and 12-1027.

In 2013, the Commissioner of Financial Regulation put the company on notice that it was imposing prohibited inspection fees on Maryland residential mortgage borrowers.  According to the settlem​ent, the company continued to assess illegal inspection fees until January 1, 2017.  Although the company disputes the illegality of the property inspection fees, the company represented that it has discontinued assessing such inspection fees and that it has refunded approximately $43,904 in property inspection fees that it had charged or collected from Maryland consumers.  The settlement also requires the company to pay a $50,000 penalty and $5,000 in enforcement costs to the Maryland AG.